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Letter From HUD Inspector General Vows Strict Audit and Enforcement Oversight of NJ Sandy Funds

February 5th, 2014 No comments

Climate Change and Sea Level Rise Not Incorporated in Enforceable State Programs

Christie Seeks To Use Federal Funds As State Match Requirement

Unless the federal rules are enforced, New Jersey will use these funds to recreate the pre-Sandy highly vulnerable development pattern, ensuring that billions of federal dollars will be wasted on projects virtually certain to be destroyed by climate change-driven sea level rise and extreme storm events.  ~~~  Bill Wolfe, Director, NJ PEER

Interesting stuff in the HUD IG letter – the new 2 year “use it or lose it” may relate to the recent firing of HGI contractor and jeopardize millions of dollars of unexpended RREM funds.

[BTW, we predicted this chaos – and why it would occur – 2 weeks after Sandy struck]

From out friends at PEER:

Press Release

For Immediate Release: Wednesday, February 5, 2014

Contact:  Bill Wolfe (609) 397-4861; Leola Webb (202) 265-7337

New Christie Sandy Spending Plan Has Gaping Holes

HUD Beefs up Audits for Jersey Expenditures; 2-Year Use-It-or-Lose-It Deadline

Trenton — New Jersey Governor Chris Christie’s long-awaited plan for spending the bulk of federal funds awarded to the state for post-Super Storm Sandy relief suffers from several gaps and flaws.  At the same time, the U.S. Department of Housing & Urban Development (HUD) Office of Inspector General has signaled that it has expanded its audit and enforcement efforts in New Jersey, including a “spending deadline” for use of funds, according to a letter released today by Public Employees for Environmental Responsibility (PEER) which had asked for this more intensive review.

Earlier this week, the Christie administration unveiled its plan for spending nearly $1.5 billion in federal reconstruction aid.  While more problems will be uncovered during scheduled hearings—which will be the first time public input has been solicited on New Jersey’s plans–several key features jump out on first review:

  • The Christie administration proposes to pay the state match with federal funds, a clear misuse of federal funds for which the state is required to provide a partial match with its own funds;
  • Each state is supposed to have a comprehensive “science-based” risk analysis that it “has or will employ to select, prioritize, implement, and maintain infrastructure projects or activities.” However, New Jersey has no such risk analysis.  Nor does the plan specify any mechanism for ensuring these analyses would be implemented if they were written; and
  • For the largest pot of funds, the Homeowner Reconstruction, Rehabilitation, Elevation and Mitigation (RREM) Program, in Tier One New Jersey found 12,389 homes eligible  but just 5,124 (41%) have “received a grant award” (this may not be actual cash in hand for the homeowner).  In the new Tier Two plan, New Jersey requests $390 million more for RREM, yet fails to explain the delay in disbursement or disclose why the contractor was abruptly fired, or provide a plan for fixing whatever it was that caused the delay in the first place.

“It takes a lot of nerve to use federal funds for the state match to qualify for federal funds,” stated New Jersey PEER Director Bill Wolfe. “This is less a plan than a vague promise to write a plan.”

On January 15, 2014, PEER asked the HUD Inspector General to broaden its current investigation on the “Stronger than the Storm” media contract to include New Jersey’s compliance with a host of federal rules, ranging from incorporating climate change to using a “transparent and inclusive process” to select projects.  In a response dated January 28th, Randy McGinnis, Assistant Inspector General for Audit, wrote that the federal agency is committing “significant audit, evaluation and investigative resources” to oversight and pledged that “we will ensure that HUD is enforcing Federal requirements” cited by PEER.

In addition, the letter indicated that “HUD established a spending deadline for Hurricane Sandy funds which is 2 years from the date of the grantee’s grant agreement.”  For Tier Two funding, that deadline will start to run once HUD accepts New Jersey’s just unveiled funding plan.  For Tier One funds, however, the deadline is already running and, at its current rate, New Jersey may have to forfeit unspent funds.

“HUD appears to have woken up to the fact that the Christie administration has made a mess of post-Sandy reconstruction,” Wolfe added.  “Unless the federal rules are enforced, New Jersey will use these funds to recreate the pre-Sandy highly vulnerable development pattern, ensuring that billions of federal dollars will be wasted on projects virtually certain to be destroyed by climate change-driven sea level rise and extreme storm events.”

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Read the HUD IG letter

See PEER call for expanded federal audit of Jersey Sandy spending

Look at new Christie $1.5 billion Sandy spending plan

View language on New Jersey using federal funds for state match

New Jersey PEER is a state chapter of a national alliance of state and federal agency resource professionals working to ensure environmental ethics and government accountability

 

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Another Port Authority Deal Buried in The Weeds of Christie’s Sandy Plan

February 4th, 2014 No comments

Port Authority To Pay NJ’s Share of $2 Billion Infrastructure Damage

Yesterday, the Christie Administration released its funding plan for the $1.46 billion second round of federal Sandy recovery money (to read the plan, hit this link).

A careful reader would find this $2 billion gem, buried in the weeds on page 2-30:

The Port Authority has estimated total damages from Superstorm Sandy to exceed approximately $2 billion, which does not include possible future latent damages. The Port Authority has also identified additional resiliency and mitigation projects. It is the State’s understanding that the Port Authority intends to satisfy its Sandy-related damage and resiliency costs through one or more of the following sources of funds: grant proceeds from the Federal Transit Administration and FEMA; proceeds from insurance; and available Port Authority capital funds, including through the issuance of its debt obligations.

At this time, the State anticipates that the Port Authority will meet its local share requirements, but the State will continue to assess and evaluate financial conditions at the agency. The State will also further consider the Port Authority’s unmet needs and cost share requirements if a third tranche of CDBG-DR funds is announced.

What this means is that the Port Authority will pick up NJ’s tab for its State and local match shares of at least $2 billion in Sandy damage – saving NJ hundreds of millions of dollars. More than that in the likely event that even more damages are discovered in the future.

So, it looks like Gov. Christie – and his Pal Port Authority Chairman David Samson – have pulled off another sweetheart deal.

To get the full flavor of those deals, you have to read or listen to this superb piece by WNYC investigative reporter, Andrea Bernstein:  How Christie’s Men Turned the Port Authority into a Political Piggy Bank

According to documents and interviews with more than a dozen top-level sources, the governor made clear from the get-go that the agency would be the source of cash for New Jersey’s hard-up infrastructure budget. And he and his team proceeded to wrangle billions from the bi-state authority to further his political goals — much of that for projects that had never been under the Port Authority’s jurisdiction before.

“It’s politics,” said City College of New York Professor Robert “Buzz” Paaswell of  Christie’s use of the Port Authority’s pot of money. “They’re using it to solve their budget problems.”

The Port deal to cover NJ’s state share for over $2 billion in Sandy damages to Port Authority infrastructure sure seems to be part of the larger pattern documented by the Bernstein story.

What these shortsighted political deals have done is bankrupt the NJ Transportation Trust Fund, increase Port Authority tolls and fees, and deferred necessary infrastructure maintenance and investments. They also divert Port and federal funds from other needed projects in the region – particularly on the NY side of the river.

And all this damage was done solely to advance Chris Christie’s political ambitions.

Think about that next time you’re stuck in traffic.

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Documents Show That Gov. Christie’s Office Was Involved in Distribution of Sandy Hazard Mitigation Grants to Towns

February 3rd, 2014 No comments

Gov.’s Office made phone calls to Towns that received funds a month before the election

Vague grant award criteria and murky review process invite political manipulation

“The Governor’s scoring spreadsheet looks more like a game of bureaucratic bingo than a rational, need-based selection process. Many of these requests were virtually identical, yet a few were accepted while many others rejected.  No wonder our mayors are confused and suspicious.”  ~~~  Bill Wolfe, NJ PEER Director

According to official documents provided to us, Gov. Christie’s Office was involved in the award and distribution of Sandy Hazard Mitigation Grant funds to over 100 NJ towns. This involvement included the Sandy Czar and the “Office of Inter-governmental Affairs”, a place where the NY Times reported the Gov. played “money ball“.

The Hazard Mitigation Grant program is the discretionary pot of Sandy money at issue in the Hoboken situation, where Mayor Zimmer claimed that Sandy funds were linked to her support for the Rockefeller development project.

This latest disclosure comes at at time when there are several criminal and administrative investigations underway regarding how the Christie administration spent Sandy funds, leading the Star Ledger editorial board to suggest that Sandy funds were used as the Gov.’s  “political slush fund”.

Documents show that:

  • the Gov.’s Office called towns that received grants early in October 2013, less than a month before the election
  • efforts were made to restrict “bad news”, i.e. information from towns that did not receive grants and the public until after the election
  • a private non-profit corporate funded group was used for “outreach” to the towns regarding the grants program
  • the allocation of funds was not based on need and did not follow any rational plan or transparent planning process

My practice at Wolfenotes is to post links to all documents that provide the factual basis for the claims I make. However, in this case, I can not do that because it would jeopardize my sources.

However, I am willing to meet personally and share the documents with any reporters that want to verify and authenticate the documents, but agree to protect the confidentiality of my sources.

In the below press release from our friends at PEER, we do disclose the winners and losers and the grant allocation criteria. See if you can figure them out:

For Immediate Release:  Monday, February 3, 2014

Contact:  Bill Wolfe (609) 397-4861; Kirsten Stade (202) 265-7337

Jersey Sandy Energy Grant Awards Raise More Questions

Hazard Mitigation Funding Criteria Ignores Municipal Need and Hazard Severity

Trenton — New Jersey grants to municipalities struggling to rebuild power infrastructure devastated by Super Storm Sandy were unevenly distributed under an opaque criteria administered by a private group operating under the direction of the office of Governor Chris Christie, according to documents posted today by Public Employees for Environmental Responsibility (PEER).  The end result left big winners and many losers as only a tiny fraction of municipal applications to buy or fix generators serving critical facilities, such as shelters, emergency operations, police and fire stations, got funding.

Just a month before last November’s election, Gov. Christie’s office verbally notified the mayors awarded coveted energy grants from the state Hazard Mitigation Program – the program at the heart of allegations from the Mayor Dawn Zimmer of Hoboken.  From the 779 local public agency applications totaling more than $340 million in requests, Gov. Christie’s office selected only 144 applicants, fewer than one in five, and funded only $25 million, around 7% of total expenses.

Projects had to score at least 80 points derived from 12 factors to be eligible for funding but –

  • The program was administered by a corporate-funded private nonprofit, called Sustainable Jersey, which is subject to scant external review;
  • The funding criteria included grades from several state agencies, such as the Board of Public Utilities and the Department of Environmental Protection, under standards not spelled out, raising questions about their transparency and integrity; and
  • Public notice was limited so as to not attract any uninvited participation.

Perhaps most significantly, the point system did not explicitly consider the need of the municipality or extent of the hazard to be mitigated.  Nor does the state have a system for identifying emergency priorities.

“The Governor’s scoring spreadsheet looks more like a game of bureaucratic bingo than a rational, need-based selection process,” stated New Jersey PEER Director Bill Wolfe, noting the abrupt termination of the state’s main contractor and the growing uncertainty over distribution of Sandy money. “Many of these requests were virtually identical, yet a few were accepted while many others rejected.  No wonder our mayors are confused and suspicious.”

The process created distinct losers and winners among applicant cities.  For example –

  • Hoboken applied for the projects totaling less than $1.8 million but was only funded for the smallest one at $136,000;
  • Newark did even worse, asking for $13.4 million for 9 projects but got only five partially funded for a total award of $822,000; and
  • By contrast, Rahway asked for approximately $930,000 for eight projects and received more than half $520,000 for four of them, curiously each with an identical $130,150 price tag.

“With hundreds of vulnerable water supply and sewage systems left unaided, it is not clear how much safer New Jersey will be after all the ‘Hazard Mitigation’ funds are spent,” Wolfe added.  “Ironically, the Christie administration put out press releases touting this as a model program but a closer look suggests there is little to brag about here.” 

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Look at winners – municipalities which got funded  

Compare losers – projects not funded and their scores 

Examine Sustainable Jersey backing 

See PEER call for federal audit of Jersey Sandy money

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New Jersey PEER is a state chapter of a national alliance of state and federal agency resource professionals working to ensure environmental ethics and government accountability

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End of Christie’s First Term – Gov. Signs Bill To Extend Cleanup Deadline For Toxic Polluters

January 22nd, 2014 No comments

Gov. Pocket Veto’s Bill To Require Public Notification of Raw Sewage Discharges

Why Would Gov. Christie Want to Keep Raw Sewage A Secret?

[Important updates below]

Governor Christie ended his first term as the first  NJ Governor ever to complete a 4 year term with virtually no environmental legislative accomplishments, serious legislative rollbacks, and nothing but rollbacks on the regulatory front.

Christie ends his first term attacking environmental protections, just where he started, when in the first hour of his first day in office, he issued a series of sweeping Executive Orders: establishing a moratorium on regulations (EO #1); regulatory relief, federal standards rollback, and cost benefit analysis (EO #2); a new Red Tape  Czar and Red Tape commission (EO #3); and restrictions on unfunded state mandates (EO #4).

Going out with a bang, Christie also ended the 215th Legislative Session (2012-2013) with more evidence of his hostility to environmental protection – evidenced in the bills he signed and the long list of bills he refused to sign and let expire (a “pocket veto”).

But the Governor did so quietly, under cover of his scandal, Inauguration, and a major snow storm that triggered an emergency declaration (view Gov. press release and the massive legislative dump here).

In fact, the Gov.’s action on two bills in particular provide a stunning example of that hostility.

First, the Governor signed a bill that would provide a two year extension of toxic site cleanup deadlines and allow private consultants for the polluters to self certify that the delay is justified.

The bill was rammed through the lame duck session, got no press, and is a poster child for abuse.

The bill guts the only enforceable deadline in the new DEP privatized toxic cleanup program and is a stunning contradiction of the corporate polluters’ promises to expedite cleanup in exchange for privatizing the cleanup program.

The law will only result in more pollution of our soil, groundwater, drinking water, rivers and streams and wildlife –  while allowing the cleanup of  toxic hazards in our communities to fester for two more years.

The only beneficiaries of the law are corporate polluters, who dodge costly cleanup requirements.

I wrote about that bill here:

Second, the Gov. “pocket vetoed” a bill that would have required public notifications and warnings about raw sewage discharges to our rivers, streams, and bays.

Jim O’Neill at the  Bergen Record gets it:

Governor Christie declined to sign a bill that would have required public notification whenever sewer-outfall pipes dump raw sewage into local rivers and bays, legislation that had received overwhelming support by both parties in the state legislature.

The bill also would have required outfall pipes to be clearly marked with signs for swimmers, fishermen, kayakers and other who use the water.

“I’m extremely disappointed,” said Debbie Mans, head of the NY/NJ Baykeeper, which supported the bill. “This is a significant public health issue. Unfortunately the governor didn’t think important that the public be informed that they are swimming in raw sewage.”`

Killing that bill makes an absolute mockery of the Governor’s promise made at his first Inaugural address that:

Today, a new era of accountability and transparency is here.

Christie is the “worst environmental governor ever” (sorry, I stole that phrase from Jeff Tittel, who used it to describe Gov. Corzine).

Here are other pro- environmental and public health related bills the Gov. pocket vetoed – without explanation.

The legislation would have improved a myriad of protections and programs for: coastal dunes; transportation infrastructure financing; coastal rebuilding and home elevation; fire prevention; health risks from mold; clean energy; green buildings; water conservation; and hurricane flood protections – take a look:

S-2602/A-3893 (Smith/Spencer, Rudder) – Repeals law providing CAFRA permit exemption for certain grading or excavation of dune

CC SCS for S-2143/ACS for A-3177 (Gordon, Norcross/Wisniewski, Singleton, Stender, Caride) – Establishes State Transportation Infrastructure Bank and Energy Bank within New Jersey Environmental Infrastructure Trust

S-2976/A-4394 (B. Smith, Bateman/Wisniewski, Amodeo) – Provides standards for, and requires registration of, home elevation contractors

A-1570/S-2273 (Wisniewski, Green, Jasey/Norcross) – Requires fire suppression systems in new single and two family homes

A-1588/S-2081 (Benson, Riley, Ramos/Singer, Greenstein) – Requires DCA to establish procedures for inspection and abatement of mold hazards in residential buildings and school facilities, certification programs for mold inspectors and mold hazard abatement workers

A-2888/SCS for S-2733 (Chivukula, McKeon, Eustace/Smith, Greenstein, Whelan, Bateman, Beck) –Creates Office of Clean Energy in BPU

A-3103/SCS for S-2732 (Ramos, Spencer, Gusciora, DeAngelo, Benson/Gordon, Greenstein) – Provides for priority consideration, by DCA, DEP, DOT, and municipalities, of permit applications for green building projects

A-3898/S-2632 (Ramos, Spencer, Eustace, Vainieri Huttle, Sumter/Smith, Greenstein) – Authorizes municipalities to finance water conservation, storm shelter construction, and flood and hurricane resistance projects

[Update #1: 1/23/13 – Gov. Christie’s signing the 2 year delay in toxic site cleanup got no press. Compare that silence to the ton of coverage given a similar 2 year delay in a water quality rule – could that be because Jeff Tittel curiously testified in support of the cleanup bill delay and then left that bill out of his press release? Why would Tittel support delay of a bad privatization law he opposed and used as his primary example of why Jon Corzine was “the worst environmenntal governor ever”?  Don’t believe he supported it? Listen to the testimony (hit link for Senate Env. 12/5/13). The media stenographers tend  to defer to Tittel for determining what’s newsworthy and lord knows, he works the phone).

But, the raw sewage bill got a good followup story in the Bergen Record, see: Backers of sewage spill bill are baffled –

But oops! reporter Jim O’Neill forgot to ask Sen Smith about his toxic cleanup delay bill! That might muddy the narrative of Smith as environmental champion.   end update #1].

[Update #2– Kirk Moore does a good story on pocket veto of home elevation safety bill, see:  Christie’s pocket veto:No boost for house-lifting safety measure – but again, Sen. Smith is a hero and not asked about his toxic delay bill. – end update #2]

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Complaint Filed to HUD Inspector General on Christie Administration’s Sandy Recovery Program

January 15th, 2014 No comments

Christie Selects Political Insiders to Audit Federal Funds

Recovery Fails to Consider Climate Change & Resilience

We are not naive about political patronage, pay to play, political insiders, and revolving door abuses, but the Christie Administration has managed to shock us again.

According to the NJ Comptroller’s database, the Christie Administration selected the politically powerful law firm of Christie Port Authority Crony David Samson as an auditor of federal Sandy funds!

On top of that, the lead attorney and project manager for the audits is former Christie Cabinet member and DCA Commissioner, Lori Grifa. [and Ms. Grifa just met the technical minimum – but not the spirit – of State Department of Treasury contractor ethics law post-employment restrictions, which include this ban:

There is also a one-year ban prohibiting certain high ranking officials from involvement with any matter involving the former State agency in which he/she served. For more information, see “Post-Employment Restrictions for State Employees,” at http://www.state.nj.us/ethics/faqs/#12.

Now that’s an unbelievable combination of political patronage and revolving door.

On top of that, we see no evidence that the Christie Administration is complying with new HUD requirements to consider science based climate change, sea level rise, and “resilience” policies in the Sandy recovery effort.

So, we filed a complaint to the HUD Inspector General, requesting a broader or new investigation of the Christie performance.

Read the whole story, including our complaint to HUG Inspector General, from our friends at PEER

PROBE OF CHRISTIE SANDY SPENDING SHOULD EXTEND BEYOND TV ADS

Jersey Rebuilding Effort Studded with Sketchy and Costly Federal Rule Deviations

Posted on Jan 15, 2014  | Tags: New Jersey

Trenton — New Jersey Governor Chris Christie’s role in doling out reconstruction monies after Super Storm Sandy needs a thorough independent audit, according to a request filed today by Public Employees for Environmental Responsibility (PEER) with the U.S. Department of Housing & Urban Development (HUD) Office of Inspector General. The organization cites state departures from federal requirements in the $10.5 billion program that have wasted funds or diverted relief from those entitled to it.

Currently, there are at least two federal investigations into New Jersey’s post-storm efforts:

  • The no-bid award of an improper piggy-back debris removal master contract to Florida-based AshBritt Inc., at the urging of its lobbyist and Christie supporter former Mississippi Gov. Haley Barbour, is under review by the U.S. Homeland Security Office of Inspector General; and
  • The $4.7 million media contract which produced the “Stronger Than the Storm” TV ad campaign featuring Gov. Christie and his family is being probed by the HUD Inspector General, at the request of U.S. Representative Frank Pallone (D-NJ).

Citing the fact that a key state auditing-oversight contract of post-Sandy funds was awarded to the law firm headed by David Samson, Christie’s campaign counsel, head of his gubernatorial transition and his appointee to the Board of Commissioners of the Port Authority of New York and New Jersey, PEER is asking for federal review of how these funds are being spent. Adding to the incestuous nature of these arrangements, the principal in Samson’s firm overseeing audit management of the state Department of Community Affairs is Lori Grifa, Christie’s director of that same agency from 2010 to 2012.

“The people profiting from Sandy’s devastation appear to be Christie insiders,” stated New Jersey PEER Director Bill Wolfe, noting that most of the relief funds have yet to be released to stricken home-owners. “The Christie TV ads are small potatoes compared to the rest of this mega-pork pie.”

The PEER request to the HUD Inspector General asks that it broaden its current investigation to include –

  • State non-compliance with federal rules requiring that infrastructure projects increase “resilience” to the effects of climate change, elements utterly absent from the New Jersey post-storm strategy;
  • Absence of the required “transparent and inclusive process” leading to project selection; and
  • Waiver of standards for replacing critical public infrastructure, such as roads, bridges, and bulkheads, designed to prevent them from being damaged again. A prime example was the fire burning down the Seaside Park boardwalk re-built with damaged materials, draining away $15 million in reconstruction funds.

“Little of what has happened in New Jersey can withstand outside scrutiny,” Wolfe added. “It is important that these reviews take place now so that folks who actually deserve the funds still have a chance of obtaining them.”

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Read the PEER letter to HUD IG

Look at the Samson firm audit contract, featuring Ms. Grifa

View Rep. Pallone call for investigation of post-Sandy media marketing contract

See state jettisoning resilience and transparency requirements

Examine how state is making Jersey more vulnerable to the next storm

View latest example of Christie scapegoating

New Jersey PEER is a state chapter of a national alliance of state and federal agency resource professionals working to ensure environmental ethics and government accountability

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