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ZURIK: Residents wait years for payments from Sewerage & Water Board

Updated: May. 18, 2022 at 10:10 PM CDT
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NEW ORLEANS (WVUE) - Hundreds of people have sued the New Orleans Sewerage and Water Board, blaming the agency for a range of issues including damage to homes and even broken bones.

But a FOX 8 investigation finds that just because a judge has ordered the agency to pay up, doesn’t mean it pays what it owes. In fact, some have been waiting for their money for decades.

Dorothy White, 88, has lived in her Claiborne Avenue home for more than 50 years. When she and her husband Donald moved in, she wanted to make some changes, and she knew just the man for the job.

“He wanted to make me happy,” said Dorothy. “So, when he asked me did I want it, and I said, ‘yes.’ He started fixing it up.”

Donald began renovating their home room by room. He started in the back den, moved to the kitchen, then to the front living area. He laid flooring and hung the sheetrock, eventually remodeling the entire place, all to Dorothy’s specifications.

However, in 2010, a Sewerage and Water Board drainage construction project began to damage the home the Donald had worked so hard on. Now, the fireplace has cracks, the tile has buckled, some bricks are cracked, and others are coming loose from the house.

During construction, Dorothy said the house shook violently, and the noise was constant and so loud that it kept her from sleeping.

“Everything was cracking. There were things falling off the walls. So, it made me feel really bad because he had worked so hard to try to get it like I wanted it,” said Dorothy.

Donald died in 2017. About a year later, a judge awarded Dorothy $94,000 to fix the damage that the five years of construction caused. But Dorothy has not seen a penny of that money.

She says she pays her water bill every month, adding, “it’s high,” while she waits for the Sewerage and Water Board to pay the money it owes her.

But Dorothy isn’t alone. According to Sewerage and Water Board documents, the city agency has nearly $19 million in unpaid settlements. One dates back to 1999. The agency has been ordered to pay plaintiffs through the 2000s but has refused to hand over the money.

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Pamela Wauters is a runner. She has competed in marathons around the United States, and even in other countries. In 2002, she had just finished a 5K race in New Orleans, placing first in her age group. She and her husband, Arnaud, decided to walk her medal back to the car, so they could enjoy the after-party.

However, on the way, she stepped on a small pile of debris that covered a Sewerage and Water Board drain. She didn’t realize the drain was missing its cover and fell.

“It was bad,” said Pamela. “My husband called the ambulance. I was transported to the hospital and I ended up breaking my foot.”

To cover medical expenses, the Wauters sued.

In 2007, the Sewerage and Water Board agreed to a settlement, promising to pay $25,000. The Wauters have not seen any of that money.

“I’m disappointed that the city isn’t necessarily interested in taking care of its obligations,” said Arnaud. “We understand it may take a little time, and we were warned it might take a little time. We’re open to that, of course. But never in our dreams would we think it could be this long.”

Pamela’s attorney has since died, and the settlement remains unpaid. With interest, FOX 8 calculates they’re owed nearly $48,000 today.

“I think they count on people either not being around or giving up,” said Arnaud.

Attorney Joe Bruno, Sr., who represents hundreds of clients who are owed money, says the Sewerage and Water Board is ignoring judges’ orders because they can. A state judge can’t force a local government to pay.

“What I don’t understand, is why it has to be the case where the Sewerage and Water Board has decided to treat these people, these customers, these citizens of New Orleans, as the enemy,” said Bruno.

Dorothy is among Bruno’s clients on Claiborne Avenue. That drainage project was mostly funded with federal dollars. He says the Sewerage and Water Board needs to repay the federal government some of the money for the project. However, as part of a cost-sharing agreement, the U.S. Army Corps of Engineers allows the Sewerage and Water Board to use money paid out for damages as a credit against what it owes.

For example, if the Sewerage and Water Board owed the federal government $10 million but paid $6 million to residents whose properties were damaged by construction, instead of owing $10 million to the federal government, the Sewerage and Water Board would only have to repay $4 million.

FOX 8 wanted to ask the Sewerage and Water Board why it won’t pay since in some cases, it wouldn’t cost ratepayers or the agency any money. However, getting answers proved to be difficult. The Sewerage and Water Board missed two deadlines to respond to a few questions from FOX 8.

One of those questions was to clarify how much the Sewerage and Water Board owes. That’s because the $19 million amount provided by the Sewerage and Water board doesn’t appear to be accurate.

Bruno says his clients on Claiborne Avenue are owed about $7.5 million, not the $2.8 million indicated by the agency.

Sewerage and Water Board Executive Director Ghassan Korban didn’t agree to an on-camera interview. He recently received a 9.5% pay raise, and his salary now sits at $322,000.

“I’m sure that Mr. Ghassan is a nice fellow, but he just got a raise,” said Bruno “I’m happy for him, but what do you say to these people? I mean, come on, talk to them. Don’t just say, ‘nana, nana boo, boo, you can’t collect from me.’ Our people deserve more than that.”

Bruno says in his clients’ cases, the Sewerage and Water Board knew the project would likely cause damage. An internal document shows pictures of properties near different Sewerage and Water Board projects and includes red outlines around homes where damage was expected to occur, including Brenda Lackings’ daycare on Claiborne Avenue. She says the shaking in her home was so bad during construction, that she was knocked out of the chair she was sitting on, on more than one occasion.

“My home has been completely knocked from the slab. I have often done band-aid repairs to just keep going, but of course, it’s not effective. The chain wall that’s around my house is on a slant and it’s broken,” said Lackings.

She also said she has had severe plumbing issues and calls the damage “a major catastrophe.”

Lackings thinks she has paid over $125,000 out of pocket to fix some of the issues caused by the construction and to keep her daycare open.

“I’ve had to take out loans because of construction. And you know, we had just done all of this from Katrina,” said Lackings.

Along with paying off those loans, Lackings also pays her monthly bill to the Sewerage and Water Board while she waits for the agency to pay its own bill.

“We’re victimized at this point,” said Lackings. “We’re totally victimized. It’s like highway robbery. And we keep starting over and over, just to survive.”

State law allows unpaid judgments to accrue interest. That interest rate is set annually. FOX 8 calculated the judicial interest rate for each year for all of the unpaid claims provided by the Sewerage and Water Board.

With interest, instead of owing $18.7 million, the board owes over $21.6 million, about $3 million more than it would have owed if it paid the settlements earlier. However, that number is likely higher, as FOX 8 believes the base unpaid claim number the board handed over is lower than what the agency actually owes.

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