Pryor to hold Treasury nominees over aid repayment

LITTLE ROCK, Ark. (AP) - Sen. Mark Pryor said Wednesday he will block votes on Treasury Department nominees over efforts to collect money from an Arkansas couple who were among thousands nationwide to receive disaster aid the Federal Emergency Management Agency now calls improper.

Pryor announced the move to prevent the U.S. Senate from voting on Treasury Department nominees until the department stops trying to collect the money from Gary and Dorothy Guglielmana of Mountain View. Pryor said the couple, who received more than $27,000 after a 2008 flood was referred by FEMA to the Treasury Department for collection. Pryor said the couple now owes $37,000 after penalties and interest.

The Associated Press reported in May that FEMA is asking to get back about $22 million paid to more than 5,500 people since 2005. FEMA admits the mistaken payments were largely its own fault because employees gave money to ineligible individuals, approved duplicate payments for costs already covered by insurance and made other errors.

FEMA says the Guglielmanas shouldn't have received the money because their county doesn't participate in the flood insurance program. The Guglielmanas claim FEMA knew that when they approved the aid, and they should not be penalized three years later.

"This has just gone too far," Pryor told reporters on a conference call Wednesday morning. "It appears that FEMA's not listening, and now the Treasury is involved. This is not going well ... I am going to hold all of the Treasury nomination until we get this resolved in some fair way."

Pryor's office said the move would block votes on three Treasury nominees: two assistant secretaries and the comptroller of currency.

A Treasury Department spokeswoman did not immediately return a phone call or email seeking comment.

Pryor spokesman Michael Teague said he did not know of any other repayment cases where FEMA has referred the collection to the Treasury Department.

The Senate Appropriations Committee in September agreed to a Pryor measure that would allow FEMA to waive payments that were erroneously made over the past six years. Pryor's office says that 122 other Arkansas households received debt notice letters similar to the Guglielmanas'.

FEMA says current law obligates them to pursue the repayment of improperly-awarded aid event in cases of human error.

"FEMA has been working closely with Senator Pryor and other lawmakers on this issue and has been in constant contact and coordination this entire year to explain how the recoupment process works and why we are required by law to collect improperly dispensed taxpayer dollars," said Rachel Racusen, a FEMA spokeswoman. "Under this legally required recoupment process, an individual who has been notified of a potential improper payment is given several options for settling their case, including the ability to appeal."

(Copyright 2011 by The Associated Press. All Rights Reserved.)