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Alberta government asks some Fort McMurray flood victims to repay disaster funding

Christian Hansen got an emergency cheque for $5,000 to help him start fixing his home. He later learned he would have to repay the money.

'I was losing my mind,' says flood victim asked to repay $5,000 in grant money

Repairs to Gary Laine's basement are on hold because he can't afford to hire someone to do the work. (Submitted by Gary Laine)

The Alberta government is asking some flood victims to return thousands of dollars given out through the Disaster Recovery Program. 

Christian Hansen of Fort McMurray said he faces about $60,000 in damages after four feet of water filled his basement in April. The flood caused more than $400 million in damage in the community. 

Forced to evacuate his home during the April flood, Hansen called his insurance company to see what he would be covered for. 

He said his insurance company wouldn't cover any of the damage because it was caused by a flood, something he was not covered for under his policy. 

He then decided to fill out an application for the DRP, a provincial grant program used to help people who have suffered uninsurable losses and damage after a disaster. 

Hansen was sent an emergency cheque for $5,000 to help him start fixing his home. He said he received the cheque on July 6 and deposited it on July 11. 

He was upset when a representative from the DRP called him on July 17 to say his application was being cancelled because he was not eligible for funding and would have to repay the $5,000 he had been sent. 

Christian Hansen says his insurance won't cover any of the damage, and the Disaster Relief Program is asking for its $5,000 back. (Christian Hansen)

"It was already long gone," Hansen said. "I already spent probably close to $10,000 on clean up."

In an email, a DRP representative said the damage to Hansen's home was caused by a sewer backup and he therefore doesn't qualify for DRP funding, because sewer backup insurance is available in Alberta. 

"I was losing my mind," said Hansen. 

He said it's inconceivable that he doesn't qualify for DRP coverage, because though his house was never touched by river water, the only reason the sewer backed up was due to the flooding.

Hansen said he has been in touch with Mayor Don Scott about the issue.

In an email to CBC News, Scott said he was "strongly advocating that the province's Disaster Recovery Program and private insurance is available to its fullest extent for those that need it."

Scott said he is "committed to doing what I can to ensure residents, business owners and the community have as much financial and other supports as possible."

Timothy Gerwing, press secretary for Municipal Affairs Minister Kaycee Madu, said in an email the department has been alerted to the issue and is working on it with local MLA Laila Goodridge.

"We know this is a stressful situation for residents," Gerwing said. "We are doing everything in our power to ensure the people of northern Alberta can recover and rebuild."

Everything in Christian Hansen's basement was destroyed. (Christian Hansen)

Gary Laine has owned his house in downtown Fort McMurray for 14 years. His fully furnished basement flooded with four feet of water during the flood. 

Laine got $10,000 from his insurance company to cover some of damage, and initially DRP sent him a $5,000 cheque to help cover other costs. 

But he was later called and told not to cash the cheque. 

"The big lump in my throat got bigger, because we don't have any money to repair anything," said Laine. "I got a quote just to do the framing and insulation and drywall. It was about $20,000." 

He said the insurance money is gone. It paid to replace the washer and dryer, furnace and hot water tank. 

Laine said DRP told he could get insurance coverage for sewer backup and was therefore not eligible for program funding. 

Gary Laine's basement flooded with four feet of sewer water. (Submitted by Gary Laine)

He said that while he has coverage for sewer backup, it's not enough to cover the damage. 

"The wife cried for a while and I almost did too," he said.

He estimates fixing his entire basement will cost between $50,000 and $60,000. 

Laine said the cost to have someone fix his basement is prohibitive, so he plans to do the work himself to save money. 

"It's devastating. We don't have the money," he said.

He said his wife is retired and his hours have been cut because of COVID-19. 

"Now we probably won't be able to fix it."

Laine was thinking about retiring within the next few years, but now that may not be an option.

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