Sandy aid programs criticized for initial rejections

Posted: February 07, 2014

The now-fired contractor that oversaw New Jersey's largest Sandy recovery programs improperly rejected 1,900 applications in a "botched" process, a housing advocacy group said Wednesday.

Data reviewed by the Fair Share Housing Center in Cherry Hill showed nearly 80 percent of applicants who appealed initial denials for the state's grants were found on appeal to be eligible for Sandy funding.

The Fair Share Housing analysis "leaves out both significant facts and context," said Lisa Ryan, a spokeswoman for the state Department of Community Affairs (DCA). The department blamed the high rate of incorrect denial on FEMA, saying the federal agency provided faulty damage assessments.

FEMA officials, for their part, defended their data Wednesday night, saying their assistance data is focused on the immediate aftermath of a disaster and "is not intended to be a comprehensive damage assessment for long-term recovery work."

Fair Share, a frequent critic of the Christie administration, said the erroneous rejections occurred with "startling frequency" in a process it called "flawed from start to finish."

An additional 1,700 applicants to the Reconstruction, Rehabilitation, Elevation and Mitigation (RREM) program were rejected but did not appeal.

The contractor, Hammerman & Gainer Inc. (HGI), a Louisiana firm that had been fired post-Katrina, had a three-year contract worth $68 million to administer Sandy housing programs, including resettlement grants, which gave $10,000 to Sandy victims in exchange for staying in their communities, and RREM grants, worth up to $150,000.

The company's contract was terminated Dec. 6, but the dismissal became public only late last month. A termination settlement gave the company $10.5 million.

"We want to know why they fired them," said Kevin Walsh of Fair Share Housing. "Even more importantly, the people who have been harmed because of HGI's incompetence should be given another shot at the money."

The waiting list for the RREM program is 7,000 people, Walsh said. The Christie administration estimates that 3,000 will come off that list and receive grants in the next round of funding.

The Christie administration has never directly explained the contractor's firing, except to say DCA now oversees the programs itself. Privately, officials have said that the company's shortcomings were well-documented by homeowners in testimony and interviews, and that the termination should be viewed as a positive development, not cause for outrage.

Homeowners complained of delays, lost paperwork, redundant requests, and a confusing process with no clear reasons for denials.

The RREM grants are administered at one of nine housing centers in the Sandy-impacted counties. Fair Share said that 1,033 of 3,196 rejected applicants appealed and that 788 were found to be eligible.

Of 3,221 applicants rejected for resettlement grants, 1,391 appealed, and about 79 percent were found qualified.

Ryan said Wednesday that of 40,000 homeowners who collectively applied to both the RREM and resettlement programs, several thousand in each program were initially deemed ineligible because they did not meet such requirements as location or amount of Sandy-impacted damage. "Noting the high number of ineligibility determinations, we investigated and learned FEMA provided the state with inaccurate damage assessment data," Ryan said.

As a result, applicants were allowed to document damage through non-FEMA sources, such as private insurance or the Small Business Administration, Ryan said.

Appearing in Monmouth County on Tuesday, Christie acknowledged an imperfect and frustrating process in which "I haven't made every right decision," but said the requests for documentation were mostly to ensure that the grants were prioritized by need. "The people who don't get it, predominantly I want them to be the people who have means to do it themselves," he said.

DCA personnel now manage the centers, Ryan said Tuesday, and the transition has not interrupted recovery efforts. Her statement added: "The state will continue to enhance and improve programs and their delivery to Sandy-impacted residents on an ongoing basis whenever opportunities for further efficiencies present themselves."

U.S. Rep. Bill Pascrell Jr., a Democrat representing the Ninth District, released a statement saying the Fair Share analysis "shed some light on just how grossly mishandled the largest Sandy housing program really was."

"The startling mismanagement only adds to the reasons why Gov. Christie must reopen the application process for the RREM program so folks can get access to the help they need," he said. "Furthermore, the excuses and lack of transparency need to end."

Fair Share is asking for a full explanation of why HGI was fired, and an independent audit of all applications rejected for Sandy aid. Pascrell called for an independent monitor.

The group also is seeking to modify the proposed Action Plan for the next $1.46 billion in funding "to allow for people who were unfairly left out of the process to get funding."

609-823-0453 @amysrosenberg

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