Newsday
(11/6/2013 8:17 PM, Tom Brune)

Washington -- Don’t blame federal law if you took out a Small Business Administration disaster loan and now can’t get a federal Community Development Block Grant to pay for superstorm Sandy damage, Housing and Urban Development Secretary Shaun Donovan said Wednesday.

Donovan said it’s up to local governments to set rules for awarding CDBG funds for Sandy recovery, though he conceded that his agency advises them not to award grant money to those who can afford loans.

Donovan, who serves as the president’s point man on Sandy recovery, made the comments in response to a question by Sen. Kirsten Gillibrand (D-N.Y.) at a Senate hearing on Sandy one year after the storm.

Prompted by complaints to her office -- and recent rallies on Long Island -- Gillibrand questioned Donovan.

"A number of my constituents were dismayed to learn that because they accepted a Small Business Loan, they are now ineligible for CDBG funding," she said. "What are the options for families that accepted SBA loans?"

Donovan said, "Our guidance to communities is that if somebody can afford a loan, then grant money is precious, and you ought to direct it to the people who really can’t pay."

He added, "But that’s not a federal law. It’s up to the community that they assess the need and determine that. What’s clearly not flexible is you can’t get paid twice for the same thing."