FEMA offers refunds for Katrina trailers

updated 10:10 p.m. ET Jan. 17, 2008

NEW ORLEANS - The Federal Emergency Management Agency, responding to concerns about formaldehyde in trailers issued to hurricane survivors, said Thursday that it would offer refunds to people who bought them after their initial use.

The federal government began selling trailers in 2006 through online auctions and to victims of the intense 2005 hurricane season. Sales were suspended in July last year because of the fears about formaldehyde, which can cause respiratory problems.

Hundreds of people in Louisiana and Mississippi are suing manufacturers, accusing them of providing FEMA with trailers that contained high levels of the toxin after hurricanes Katrina and Rita, which devastated much of the Gulf Coast.

FEMA said that 10,839 travel trailers and park models were sold by the federal General Services Administration at an average price of $6,936, and that 864 trailers were sold directly to hurricane victims.

The agency said it would e-mail buyers to notify them of the refund option. Buyers have 60 days to request a refund, FEMA said.

U.S. District Judge Kurt Engelhardt, who is presiding over formaldehyde cases filed on behalf of 723 people, met with attorneys on both sides Thursday in New Orleans.

Henry Miller, a lawyer for FEMA, said the agency has received only 20 formaldehyde-related claims that it considers "legally sufficient."

FEMA says the trailers won't be used as temporary shelters for disaster victims until safety concerns are addressed.

In late December, government scientists began measuring formaldehyde levels in hundreds of FEMA trailers. Preliminary results are due next month, and a final report is expected to be released in May.

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