Hurricane aid squandered on condos for rich

The New Orleans region still hasn't recovered from Hurricane Katrina 2 years ago. Federal tax incentives were supposed to help rebuild the shattered city. But these tax breaks have been snatched up by greedy developers of luxury condos hundreds of miles away.

As Tom Brokaw might have said: Sounds to us like...a fleecing of America!

These federal tax dollars are financing about 10 new condominium projects for the very rich around Tuscaloosa, Alabama - a city that is nearly 300 miles from New Orleans and is well inland, so it received relatively little damage from the hurricane. These condos cost as much as $1,000,000 per unit. Many of the condos cater to wealthy University of Alabama alumni and feature Bear Bryant-themed decor. Other buyers are rich investors (who live as far away as California) who plan to rent them out to other wealthy individuals.

This was allowed to happen because Republican Sen. Richard Shelby of Alabama got the Gulf Opportunity Zone Act of 2005 to expand the area eligible for hurricane funds into Tuscaloosa to help developers there. This despite the fact that Tuscaloosa sustained only some rain and wind damage and not the full force of the storm. (In our area, that amount of damage is common even without a hurricane.) The funds aren't just being used on condos but also retail complexes, luxury hotels, and fancy restaurants (where most hurricane survivors will never be able to afford to go).

This abuse of these tax breaks bogs things down for the folks around New Orleans who apply for the tax breaks to be used in their own hurricane-ravaged area, which actually needs the tax incentives. Communities that needed the tax breaks still have yet to see any progress. Some people there have never even heard of the tax breaks.

Lo! And get this! The tax break isn't even available to people who buy a home to use as their own residence. It's only for developers or investors who own property that they rent out.

The scam being pulled in Tuscaloosa may cost American taxpayers billions. They call that the "free market."

According to locals, some of the new condos are replacing affordable apartments in historic districts. And some of the "residents" of these new condos are actually people who live out of town and are using the condos fewer than 10 times a year.

Must be great to be rich and be able to displace working-class families just to have an extra place to host parties for your rich college buddies 10 times a year.

It's just like how taxpayer dollars in Minnesota went to new stadiums instead of bridge repairs, and how the same in New York went to stadiums instead of caring for injured 9/11 firefighters.

(Source: http://www.newsday.com/news/nationworld/wire/sns-ap-katrina-luxury-condos,0,1213580.story)