More than two years after Hurricane Harvey hit Houston, the first HUD funds began making their way to a limited number of citizens. To this day, only 185 homes have been rebuilt using federal funds with an additional 56 in active construction. SBP, a national disaster resilience and recovery organization, has rebuilt more than 200 homes.
Some people can afford to self-fund their recovery while waiting for their HUD funding (using savings or traditional loans). Many will be eligible for reimbursement. But others, particularly the most vulnerable, cannot. We need innovative ideas that facilitate investment into at-risk populations made more vulnerable by disasters.
The Recovery Acceleration Fund (RAF) is just such an idea. For eligible homeowners, this HUD-compliant mechanism would give homeowners access to private capital (via a structured equity instrument capitalized with ESG/impact investment funds, secured by a charitable loan-loss reserve) via loans to support rebuilding costs. Eligible participants would receive support to apply for reimbursement and would repay the loans when HUD funding became available. More families and communities could begin their recovery processes sooner, bringing economic and personal stability back.