WWL-TV

BATON ROUGE, La. -- State investigators have received allegations of wrongdoing in the post-hurricane "Katrina cottage" housing program but haven't yet determined if they have merit, Legislative Auditor Steve Theriot told state lawmakers on Tuesday.

Theriot declined to give details of the allegations, which triggered his office's investigation of the program now run by the Louisiana Recovery Authority. The program, run by another arm of government until seven months ago, has been the target of criticism because none of the planned 500 cottages has been built, three years after Hurricane Katrina created housing problems in south Louisiana.

"We are looking into the veracity of those allegations," Theriot told the Legislative Audit Advisory Council.

About $2 million has been spent on the cottage program, out of $74.5 million set aside by the Federal Emergency Management Agency, according to Dan Daigle, one of Theriot's top assistants.

The cottages are planned for New Orleans, Baton Rouge and Lake Charles.

Wil Jacobs, the LRA's housing policy director, said construction will begin this month on the first cottages at the National Guard's Jackson Barracks in New Orleans.

The Louisiana Housing Finance Association was given oversight of the program in January, 2007, and was dogged by conflicts with its contractor. Gov. Bobby Jindal gave the program to the LRA in March, 2008.

Louisiana lawmakers have complained steadily about the lack of construction. Meanwhile, roughly 2,800 Mississippi families, whose homes were ruined by Katrina in 2005, have been living in state-built cottages.

While acknowledging a time lag, Jacobs said there's at least one good reason for the difference: Mississippi's cottages are cheap -- essentially, glorified FEMA trailers. Louisiana's Katrina cottages are planned as modular single-family homes that should withstand hurricanes and last a century, he said.

The Mississippi Emergency Management Agency has condemned more than 230 of the cottages because of damage from Hurricane Gustav last month.

Jacobs said the LRA expects to meet its September, 2009, deadline for completing construction of the cottages.

"At this point, we are confident that we have a path forward to start building and to start moving these projects forward to meet our deadlines," Jacobs told the committee.

Lawmakers have been mainly complimentary of the LRA's takeover, but still complained about the delays.

"To me this whole program has been a complete disaster," said Rep. Neil Abramson, D-New Orleans.

(Copyright 2008 by The Associated Press. All Rights Reserved.)