Discrimination Case Over Katrina Housing Settled

To date, Louisiana's Road Home program has disbursed nearly $11 billion to people whose houses were destroyed during Hurricane Katrina. In 2008, two housing groups representing some 20,000 African-American homeowners filed a lawsuit, claiming that the program was discriminatory against people with low income.

Campbell Robertson of The New York Times reports:

"The program paid out grants to people based on either the pre-hurricane value of their homes or the estimated cost of rebuilding, whichever was less. Under that formula, the plaintiffs argued, a person who lived in a poorer area was likely to receive far less than someone with virtually the same house in a wealthier neighborhood, even though the cost of rebuilding would be the same."

The plaintiffs agreed to drop the lawsuit after the state announced a new "blight reduction grant adjustment" that provides $62 million in supplement grants to 1,400 eligible homeowners.