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SINCE THE FEDERAL Emergency Management Agency (FEMA) came up short in its response to Hurricane Katrina in 2005, the agency has done much to restore its reputation with state and local emergency managers. State emergency management leaders, asked by Congress to critique FEMA’s performance during Hurricanes Gustav and Ike in 2008 and other responses, offered largely glowing assessments of an accessible, effective agency.

“Put simply: If this is the new FEMA, we want more of it,” said Stephen Sellers, of the California Governor’s Office of Emergency Services, testifying before a Senate homeland security panel.

Yet Sellers and peers from other states said one black eye from Katrina has yet to heal: the question of temporary housing for homeless victims and recovery workers. The main problem is FEMA’s fleet of up to 60,000 stored travel trailers, which states won’t accept amid concern over dangerous levels of formaldehyde, a carcinogen.

While formaldehyde is used legitimately and is present in glues that bind particleboard and plywood in such trailers, many of the trailers bought by FEMA in Katrina’s aftermath had unacceptably high levels, first brought to light by occupants’ complaints of symptoms like coughing, nosebleeds, and headaches.

The U.S. Department of Housing and Urban Development (HUD) sets an environmental limit on formaldehyde in housing it funds at 16 parts per billion (ppb), while the Environmental Protection Agency recommends a workplace limit of 100 ppb. The Sierra Club tested 31 Katrina trailers in 2006 and found levels over 100 ppb in all but two of them. Factors blamed for the high levels included hurried procurement and use of sub-par materials.

FEMA acknowledged 206 complaints from occupants of 120,000 trailers, and in 2007 told occupants to better ventilate the units. But during California wildfires, state officials told FEMA they would not accept travel trailers because of formaldehyde concerns. Many of the victims who could have used trailers weren’t given that option.

In February 2008’s “Super Tuesday” tornado outbreak that killed at least 57 and caused more than $500 million in damages, Tennessee’s Macon County was among the most severely affected areas, but the heavily rural area did not have temporary housing options, such as hotel rooms. FEMA was prepared to fund or provide temporary housing, but first asked Tennessee officials to set a limit for trace formaldehyde in housing units, said James Bassham, director of the Tennessee Emergency Management Agency, in testimony before Congress.

State officials were unwilling to set limits because the temporary housing was a federal program, and the issue “became a contest of wills” between state and federal officials, Bassham said.

Tennessee eventually acted on its own and selected higher quality, and thus cleaner, mobile homes from a state supplier at FEMA’s expense, a state official tells Security Management.

That same month FEMA released results of tests conducted on Katrina trailers by the U.S. Centers for Disease Control and Prevention that found levels averaging 77 ppb and as high as 590 ppb.

Since then, Tennessee, Arkansas, and Texas each set a limit of 40 ppb in temporary housing, restricting use of stockpiled Katrina trailers in the federal response to Gustav and Ike. Texas Lt. Gov. David Dewhurst told a congressional committee soon after Ike that his state had “a critical shortage of housing for workers near the heavily impacted areas.”

“Some have recommended the state use stockpiled FEMA trailers, but Texas leadership won’t accept tainted trailers, and I doubt our friends at FEMA would offer us tainted trailers,” Dewhurst testified at the hearing.

Going forward, FEMA has announced that it will restrict purchases of manufactured housing to units that meet the HUD limit of 16 ppb. Sellers, meanwhile, told the congressional committee that state and federal officials need to establish more temporary housing options for disaster victims, which FEMA officials say they will do.