FEMA gives away $85 million of supplies for Katrina victims

NEW ORLEANS, Louisiana (CNN) -- FEMA gave away about $85 million in household goods meant for Hurricane Katrina victims, a CNN investigation has found.

The material, from basic kitchen goods to sleeping necessities, sat in warehouses for two years before the Federal Emergency Management Agency's giveaway to federal and state agencies this year.

James McIntyre, FEMA's acting press secretary, said that FEMA was spending more than $1 million a year to store the material and that another agency wanted the warehouses torn down, so "we needed to vacate them."

"Upon review of our assets and our need to continue to store them, we determined that they were excess to FEMA's needs; therefore, they are being excessed from FEMA's inventory," McIntyre wrote in an e-mail.

He declined a request for an on-camera interview, telling CNN the giveaway was "not news."

Photos from one of the facilities in Fort Worth, Texas, show pallet after pallet of cots, cleansers, first-aid kits, coffee makers, camp stoves and other items stacked to the ceiling. Watch dismay over "out of touch" FEMA »

FEMA said some of the items were donations from companies after Katrina, but most were purchased in the field as "starter kits" for people living in trailers provided by the agency. And even though the stocks were offered to state agencies after FEMA decided to get rid of them, one of the states that passed was Louisiana.

Martha Kegel, the head of a New Orleans nonprofit agency that helps find homes for those still displaced by the storm, said she was shocked to learn about the existence of the goods and the government giveaway.

"These are exactly the items that we are desperately seeking donations of right now: basic kitchen household supplies," said Kegel, executive director of Unity of Greater New Orleans. "These are the very things that we are seeking right now. FEMA, in fact, refers homeless clients to us to house them. How can we house them if we don't have basic supplies?" Watch the great FEMA giveaway »

Kegel's group works with FEMA and other local organizations to rehouse victims of Katrina, the 2005 hurricane that flooded New Orleans and killed more than 1,800 people along the Gulf Coast. Community groups say thousands of people are still living in abandoned buildings in the city, though fewer than 100 people remain housed in tents.

Kegel said FEMA was told in regular meetings that Unity was desperate for household supplies and that the group has been forced to beg for donations. But she said FEMA never told Unity and other community groups that it had tens of millions of dollars worth of brand-new items meant for storm victims.

She said she learned of it from CNN, which found that those items never made it to people such as Debra Reed.

"An honest person like me didn't get nothing," said Reed, 54, who recently moved from a tent beneath a New Orleans bridge to a home with the help of Kegel's group. "I'm gonna turn, 'cause I'm gonna cry. I didn't get nothing. I fought to get my money, but they wouldn't give it to me. So I ended up going under the bridge."

FEMA confirmed that it had kept the merchandise in storage for the past two years and then gave it away to cities, schools, fire departments and nonprofit agencies such as food banks. In all, General Services Administration records show, FEMA gave away 121 truckloads of material.