N.J. terminates Sandy recovery contractor

Posted: January 26, 2014

A Louisiana-based firm that last year won a $68 million contract to oversee New Jersey's post-Sandy homeowner assistance program has been terminated from its role by the state.

Officials aren't saying why they ended their three-year contract with Hammerman & Gainer Inc. (HGI). The contract was due to expire in May 2016, but the state reached a settlement agreement with the company last month, and the contract was revised to end Monday, according to documents.

"We've recently concluded our relationship with HGI as New Jersey transitions to the next phase of disaster recovery," Lisa Ryan, a spokeswoman for the Department of Community Affairs, said Friday. The news of the contract's termination was first reported Thursday by WNYC radio.

A message left with a HGI representative was not returned Friday.

In terminating the contract, the state agreed to pay the company $10.5 million - $9 million in unpaid balance and $1.5 million in compensation for work done during the transition period, according to the documents.

Hammerman & Gainer administered the federally funded, $600 million Rehabilitation, Reconstruction, Elevation and Mitigation (RREM) program, which gives grants of up to $150,000 to residents to repair and rebuild homes damaged by Sandy.

The company, which starting in 2009 was the lead contractor in charge of the housing assistance program for Hurricane Katrina victims, also was overseeing New Jersey's $180 million Homeowner Resettlement program and was in charge of the housing recovery centers set up in the nine counties most affected by Sandy.

The process to attain Sandy grants has frustrated residents, who have complained in interviews and at legislative hearings about the pace of the release of the funds and say they have gotten few answers from officials.

Gov. Christie has called the RREM program "the poster child of the post-Katrina hangover." He has said the state's ability to administer the aid is hampered by federal requirements.

On Friday, Christie aides directed questions about the termination of HGI to the Department of Community Affairs (DCA).

In a statement provided by Ryan, DCA Commissioner Richard Constable said the terminated contract had not affected the housing recovery centers, call center, or reNew Jersey Stronger website.

"The daily work of helping Sandy-impacted New Jersey families get back in their homes and communities as quickly as possible is occurring as normal," Constable said. "DCA staff remains available to answer questions about application status and our various recovery programs for Sandy-impacted residents."

Democrats questioned why the termination had not been disclosed earlier, demanding that Christie's administration provide an explanation and a plan for administering the Sandy programs.

"It's simply unacceptable that it took seven weeks for us to learn that the contract with the firm handling the largest Sandy recovery program had been terminated," U.S. Reps. Bill Pascrell Jr. and Frank Pallone (D., N.J.) said in a statement.

State Senate President Stephen Sweeney (D., Gloucester) - who noted that administration officials had testified at recent legislative hearings on the subject - said in a statement that it was "troubling that the administration was silent on the move."

"I can only hope that the wave of news that is plaguing this administration does not adversely affect the needs of New Jersey's residents," Sweeney said.

Christie's administration faces investigation into allegations of political retribution exacted by aides and appointees involved in an apparent plot to jam traffic last September at the George Washington Bridge. The governor has said he knew nothing of a scheme.

Administration officials are also the subject of claims they tied the release of Sandy relief money to the approval of a redevelopment deal in Hoboken. Christie aides deny the accusations, made by Mayor Dawn Zimmer.


mhanna@phillynews.com

609-989-8990

@maddiehanna

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