(CN) – The Louisiana Recovery Authority can continue spending hurricane relief funds, despite a lawsuit challenging how the money is disbursed, a federal judge in Washington, D.C., ruled.
In the wake of Hurricane Katrina, more than $13.4 billion in relief funds were appropriated to Louisiana. Nearly $11 billion of that money was designated for the Road Home Program, which distributes grants to repair homes damaged by hurricanes Katrina and Rita.
Each grant is equal to the value of the individual’s home before the storm or the cost of repairing the home, whichever is less.
The Greater New Orleans Fair Housing Action Center, the National Fair Housing Alliance and five New Orleans homeowners sued, claiming the formula used to dispense repair grants marginalizes black residents, whose homes are generally worth less than the homes of white residents.
They claimed the disparity in home values resulted in lower average grants for minorities.
The plaintiffs sought to block the Louisiana Recovery Authority from spending the program’s remaining $554.5 million budget until the case is decided.
U.S. District Judge Henry Kennedy Jr. denied the motion, explaining that the 11th Amendment prevents it from ordering monetary relief.
Kennedy acknowledged that discrimination may have occurred, but said that repairing the devastated area is a priority that would be impeded by withholding the money.