HUD Delays Disaster Preparation Money for Puerto Rico

WASHINGTON — The Trump administration said on Friday that it would delay about $9 billion in disaster prevention funds to Puerto Rico and the United States Virgin Islands, distributing the money separately from funds for nine states, citing concerns over corruption and fiscal management.

The funds are part of $16 billion that the Department of Housing and Urban Development awarded in 2018 to help states and territories prepare for future disasters. It was the first time that it had issued funds specifically for mitigation efforts, which it described as “actions taken to protect communities from the predictable damage from future events.”

Puerto Rico was awarded $8.3 billion, and the Virgin Islands $770 million. The rest went to the nine states: Texas, Louisiana, Florida, North Carolina, South Carolina, West Virginia, California, Missouri and Georgia.

An announcement by Ben Carson, the housing secretary, said that the money would be released in two batches, with the second including only Puerto Rico and the Virgin Islands.

The department did not provide a specific time frame for when the money would be distributed, but officials said that the states would soon be able to apply for it, but that stricter oversight and financial controls are still being developed for Puerto Rico and the Virgin Islands.

“Recovery efforts in jurisdictions prepared to do their part should not be held back due to alleged corruption, fiscal irregularities and financial mismanagement occurring in Puerto Rico and capacity issues in the U.S. Virgin Islands,” Mr. Carson said in a statement.

The housing agency also announced on Friday that it would appoint a federal financial monitor to oversee the disbursement of disaster relief money in Puerto Rico and to “ensure recovery funds get to the people who need them most and protect taxpayers who are footing the bill.”

The action comes a week after Gov. Ricardo A. Rosselló of Puerto Rico resigned following a series of protests that demonstrated widespread frustration with government corruption, the economy and a poor response to Hurricane Maria in 2017.

[Read more about the governor’s resignation.]

On a phone call with reporters, housing department officials said they would issue rules in the coming weeks that would allow the states to apply for the money, but they could not say when similar rules for Puerto Rico and the Virgin Islands would be released.

“Today’s announcement that HUD will soon release rules for Texas’ long-awaited mitigation funds is welcome news,” George P. Bush, Texas’ general land office commissioner, said in a statement. “These rules will determine how we can use our funds to better protect Texans living along our coast.”

Critics questioned the department’s delay in issuing the requirements for Puerto Rico and the Virgin Islands.

“The notice could go out simply saying that there will be additional requirements for Puerto Rico and the U.S. Virgin Islands, and probably additional assistance to address the capacity issue, instead of putting them in this limbo,” said Harriet Tregoning, the former principal deputy assistant secretary of HUD’s Office of Community Planning and Development under President Barack Obama.

After Hurricane Sandy in 2012, the Obama administration formed a task force across the federal government “to make sure that there was a coordinated response to the disaster commensurate with its impact,” Ms. Tregoning said. “What I don’t quite understand is why there hasn’t been a similar effort to address these issues with Puerto Rico and the U.S. Virgin Islands, and other jurisdictions that might have capacity issues as well.”