Bad News for Condo Owners on Quake Aid : Rebuilding: Disaster funds won’t cover temporary housing costs for those about to start repairs, FEMA rules.

Condominium owners who are only now starting to repair buildings damaged in the Northridge earthquake should brace themselves for an unexpected aftershock: They probably aren’t eligible for federal disaster aid to pay for temporary housing while their homes are being fixed.

Officials of the Federal Emergency Management Agency, which has already paid quake victims nearly $1.2 billion for temporary housing and repairs, have decided that condominium owners who have been living in their units during the last year cannot collect federal housing assistance because their homes--while in need of repair--are “not uninhabitable.”

“What we provide is emergency housing assistance for damage to living quarters,” said Len DeCarlo, a FEMA spokesman. “We do not provide assistance for repairs to common areas or for upgrading areas.”

That decision could prompt thousands of condominium owners--some already deeply in debt--to abandon their properties rather than try to pay rent for as long as one year. They are among a large group of property owners who have postponed work on quake-damaged homes while waiting for insurance claims to be paid and loans to be approved.

In the San Fernando Valley, as many as 75% of the condominium associations have yet to begin large-scale repairs, according to Gordon Scott of the Greenspan Co., a company representing about 150 condominium associations engaged in negotiations with insurance companies.

And after a year of wrangling over such claims, the latest news from FEMA seems to many like the last straw.

“I’m scared and stressed-out,” said Lillia Callen, 37, who lives in a three-bedroom condominium in Sherman Oaks with her 78-year-old mother and 7-year-old son. “I feel like FEMA is being totally unresponsive.”

FEMA officials are referring owners such as Callen to its Earthquake Service Centers but warn that most will probably have to pay their own temporary housing bills.

Adrienne Krikorian, an attorney who has had to rent an apartment while her Sherman Oaks condo is being repaired, represents three condominium associations trying to persuade federal officials to change the current FEMA policy.

Condo owners will meet today with Rep. Anthony Beilenson (D-Woodland Hills), who is holding one of his regularly scheduled community forums at Encino Elementary School.

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Kaye Edwards Davis, a spokeswoman for Beilenson, said the congressman sent a letter to FEMA officials earlier this week asking them to review the policy.

“We want to make sure no one is being denied unjustly,” she said.

Krikorian argues that the policy unfairly penalizes condo owners because repairs to common areas in such complexes typically involve walls that are also part of residents’ homes. She said FEMA considers some of the repairs as “mitigation or upgrades,” but Krikorian argues that the work is required by city officials to make living quarters safe.

“People may have been able to live in their units during the past year, but it will not be safe for them to live in them during construction,” she said. “Walls will be knocked down, insulation will be coming off and there will be no fire protection. It’s not like we’re saying that since we’re making earthquake repairs we might as well upgrade. The city is making us do it.”

Krikorian said it is unfair that homeowners able to begin repairs soon after the Jan. 17, 1994, earthquake were eligible for federal emergency housing money, but others, who had to delay repairs because of disputes with insurance companies, are being denied the help.

“We don’t expect FEMA to give a 100% handout, but they need to be fair,” Krikorian said. Linda Libertucci, who owns a condo in a 27-unit North Hollywood complex, said more than half of the owners in her building do not have insurance, and some do not have the money to pay for temporary housing while the building is being repaired.

“Not only would that delay construction, but it would mean the rest of us would have to pay more for the repairs,” Libertucci said.