LITTLE ROCK, AR, March 7, 2007 -- Associated Press: A year and a half after Hurricanes Katrina and Rita, the government is auctioning off at sharply discounted prices thousands of trailers used by storm victims, raising fears among mobile-home dealers that the government will flood the market and depress prices.

 

Mobile home dealers are finding that some potential customers would rather wait to make a deal on a used Federal Emergency Management Agency trailer than pay $25,000 to $40,000 for a brand-new one.

 

"People think they're just going to get to buy them for nothing," said Gale Crews, owner of Diamond State Mobile Home Sales in Hope, where FEMA is storing 20,000 trailers at the city's airport. Some of the FEMA trailers, which are being auctioned through a government Web site (www.gsaauctions.gov), will sell for less than half of what they cost new.

Some critics of the Federal Emergency Management Agency said the sale is emblematic of the way FEMA botched its handling of Katrina: FEMA ordered more trailers than it needed, it let many of them sit out in the open, exposed to the elements, and now, some fear, it is about to double-cross the trailer dealers.

 

FEMA spokeswoman Debbie Wing defended the agency, saying it "wanted to be prepared to house as many victims as possible" when it bought the trailers. She said the agency is now trying to lower its storage costs by reducing the number it is holding in reserve for the next disaster.

 

"We're being cautious not to flood the market," she said. "We appreciate the fact that these manufacturers sold us these units during the height of it."

 

FEMA spent $2.7 billion to buy 145,000 mobile homes and trailers after Katrina and Rita hit the Gulf Coast in August and September 2005, paying a bulk-rate price of about $19,000 per trailer, on average. FEMA now has 60,000 trailers in storage nationwide; several thousand of them — exactly how many is not clear — were never used.

 

The agency said it plans to sell the ones that suffered a lot of wear and tear from being used by storm victims. As for the never-used trailers, Wing said FEMA has no plans for the time being to sell those.