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.

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.

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."

Red Cross officials noted that a year after a tornado killed 158 people in Joplin, Mo., it found itself providing a new round of mental health services to survivors. The cholera epidemic that killed thousands of people following a massive earthquake in Haiti, where the Red Cross was also criticized for not spending donations faster, didn't start until nearly a year after the disaster.

The Red Cross says it is planning substantial grants to other nonprofit groups doing Sandy recovery work and is doing much of its current work in conjunction with charitable partners with local ties.

On Wednesday, it plans to announce a $1.25 million grant to the Brooklyn Community Foundation, which has in turn been making donations to neighborhood associations and committees working on a wide array of storm recovery projects, from cleaning mold to repairing sinkholes.

Red Cross volunteers working with the organizing group New York Cares are going out several days a week to muck and clean flooded homes and remove mold. Red Cross staff and caseworkers have been holding "unmet needs roundtables" in hard-hit communities, trying to identify victims not covered by traditional aid programs.

"Our experience shows that as the recovery goes on, the needs of survivors will evolve," said Roger Lowe, Red Cross senior vice president. "It's important to make sure some money is available for those needs no one can predict right now."

Other organizations that raised large sums for the relief effort have also held back money while they evaluated the wisest way to spend it.

The Hurricane Sandy New Jersey Relief Fund, led by Mary Pat Christie, wife of New Jersey Gov. Chris Christie, raised $32 million after the storm but didn't begin awarding grants on a large scale until April. So far, it has given about $11 million, with the biggest grants going to local organizations building or repairing housing.

The United Way, which raised $9.7 million in a Sandy recovery fund for New York, New Jersey, Connecticut, and some parts of Pennsylvania, said it has spent about $4 million of that total to date, though another $2.5 million is set to go out soon.

"We always knew, from the very beginning, that our fund and our resources would be for longer-term strategies," said United Way of New York City President Sheena Wright. "We feel good about the timeframe."

That strategy of holding some cash to spend later contrasts with the approach taken by the Robin Hood Foundation, which was in charge of distributing more than $70 million raised by a Dec. 12 benefit concert by Bruce Springsteen, The Rolling Stones, and other music royalty.

That fund was depleted entirely by April, with grants given to 400 relief organizations ranging from food banks to legal services to volunteer rebuilding groups.

Robin Hood spokeswoman Patty Smith said the foundation moved as fast as it could because it believed that delays in government aid were leaving big gaps in services.

Red Cross officials say they have the ability to meet both long-term and short-term needs, noting the organization has served 17 million meals and snacks, distributed 7 million relief items, mobilized 17,000 workers and volunteers, and provided 81,000 overnight stays.

Its efforts won over early critics like Staten Island Borough President James Molinaro, who assailed the Red Cross response in the days immediately after the storm but now praises it as having provided vital help.

"They've come a long way since Day One," Molinaro said.