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Red Cross: Over $100 million in Sandy aid still unspent

The Red Cross raised about $303 million to help those affected by hurricane Sandy, but only two-thirds of it has been spent, prompting criticism that the Red Cross is losing sight of its role in emergency relief.

By David B. Caruso and Jennifer PeltzAssociated Press / May 28, 2013

In this March 2, 2013 photo, rubble surrounds the foundation of a home destroyed by Sandy in the Belle Harbor section of the Queens borough of New York. By many measures, the recovery from the superstorm, which struck Oct. 29, has been slow.

Mark Lennihan / AP

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NEW YORK

Seven months after Superstorm Sandy, the Red Cross still hasn't spent more than a third of the $303 million it raised to assist victims of the storm, a strategy the organization says will help address needs that weren't immediately apparent in the disaster's wake.

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Some disaster relief experts say that's smart planning. But others question whether the Red Cross, an organization best known for rushing into disasters to distribute food and get people into shelter, should have acted with more urgency in the weeks after the storm and left long-haul recovery tasks to someone else.

"The Red Cross has never been a recovery operation. Their responsibility has always been mass care," said Ben Smilowitz, executive director of the Disaster Accountability Project, a nonprofit group that monitors aid groups. "Stick with what you're good at."

Storm victims could have used more help this past winter, said Kathleen McCarthy, director of the Center for the Study of Philanthropy and Civil Society at the City University of New York.

"People were cold. Homes mildewed. There wasn't enough decent housing," she said. "Given the lingering despair, it's hard to understand the argument that 'We are setting that money aside.'"

As Americans open their wallets to assist tornado victims in Oklahoma, the Red Cross is again emerging as one of the most important relief organizations on the ground and also one of the most prodigious fundraisers for victims. As of Thursday, it had raised approximately $15 million in donations and pledges for the tornado response, including a $1 million gift from NBA star Kevin Durant and numerous $10 donations, pledged via text.

The Red Cross was also the No. 1 recipient of donations after Sandy. The organization said it still had $110 million remaining from its pool of storm donations as of mid-April, which were the most recent figures available.

Red Cross officials pledged that all the money in its Sandy fund will eventually be spent on the storm recovery and not diverted to other disasters or used to support general Red Cross operations.

Over the next few months, the Red Cross expects to spend as much as $27 million of its remaining Sandy donations on a program providing "move-in assistance" grants of up to $10,000 to families displaced by the storm. About 2,000 households have been assisted by the program so far, with an additional 4,000 waiting for an eligibility determination.

Part of the delay in spending, officials said, is to wait to see how the hardest-hit states allocate a $60 billion pot of federal relief dollars and address gaps in the government aid package.

"We are waiting to see where the greatest need is going to be over time," said Josh Lockwood, CEO of the Red Cross Greater New York Region. "We are more concerned with spending our resources wisely rather than quickly."

Some disaster relief experts said holding funds in reserve was indeed a smart move.

Much of the toughest and most expensive relief work after a natural disaster comes not during the initial months but during the long-term rebuilding phase after the public's attention has waned and new donations have stopped flowing, said Patrick Rooney, associate dean at the Indiana University Lilly Family School of Philanthropy.

"It would be splashier, perhaps, to spend the money right away while the media is still there and the donors are still looking," he said. "But the important needs, from the cost perspective and the recipient perspective, take place after the headlines are gone and after the cameras are gone."

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