Mystery lingers over why WV just asked to use flood relief money early this year

CHARLESTON, W.Va. — As lawmakers continue examining why so many West Virginians haven’t received long-term help with housing two years after a devastating flood, one issue likely to catch their focus is lag time.

Why it took so long for West Virginia to begin drawing down federal dollars is among the questions likely to be asked at 9 a.m. Tuesday when the Legislature’s flood committee meets.

The U.S. Department of Housing and Urban Development, source of $149 million in long-term flood relief grants, approved an Action Plan to address long-term relief June 1, 2017.

Contracts for construction companies to work on long-term housing were let a month after that, and Rise West Virginia began taking grant applications last August 7.

But West Virginia didn’t apply to actually start using the HUD money until just this Jan. 29. Housing and Urban Development authorized used of the funds Feb. 20.

So what happened during all those months?

Ed Gaunch

“Why did it take us until January to request spending authority?” Senator Ed Gaunch, R-Kanawha, asked during a Sunday evening review of work by Rise West Virginia.

Gaunch is the co-chairman of the Joint Legislative Committee on Flooding, and, to him, this question is one of the keys to the mystery of why long-term flood relief has gone so badly.

Adam Fridley of the Legislature’s Post Audit Division acknowledged the puzzle.

“That’s a terrific question, and unfortunately it’s one that still remains outstanding even with our office,” Fridley said.

“What you’re looking at is, HUD approves the state’s Action Plan around June 1. We don’t request authority to use the funding until January of this year. That is a significant time lapse, and unfortunately I do not have an answer as to why.”

The audit does hone in on what happened, though.

After the state received HUD approval of its Action Plan last June, West Virginia was required under federal law to conduct a comprehensive environmental review. The state had to demonstrate that its housing reconstruction and rehabilitation would not significantly affect the environment.

“The Rise West Virginia Policies and Procedures make it clear that the environmental review process must be completed prior to any work beginning,” the audit observed.

The audit noted the state’s Jan. 29 submission date for its request to use the federal funds.

“Based on this submission date, the Legislative Auditor concludes that the State did not complete its Tier I Broad Environmental Review until January 2018 when it sent the request to HUD for approval.”

So, was that bureaucratic drift, or was it someone’s fault?

Tim Armstead

House Speaker Tim Armstead, speaking after the audit was presented, took note of this gap.

Armstead asked about waivers that Rise, operating under the state Department of Commerce, could have used to expedite the program.

“I understand there were some waivers that were provided that perhaps Commerce was not aware of were provided,” asked Armstead, R-Kanawha.

Armstead wanted to know if such waivers related to the crucial environmental review.

“I have heard very briefly of those and not in great detail,” Fridley responded, “but it is my understanding from the Governor’s Office that there was a waiver that was granted and misfiled and held up some of the environmental review processes.

“My understanding of the environmental review process is that there is a laundry list of federal environmental requirements the state is required to certify compliance with. My understanding that was a waiver of one of those requirements.”

W.Va. Adjutant General James Hoyer

West Virginia Adjutant General James Hoyer, recently named the point man for West Virginia flood relief, described a similar scenario during a June 7 press conference.

“One of the things we found in looking was that there were 300 authorizations for homes that were stuck in the process step related to the environmental review,” Hoyer said. “As we looked at that to understand what was causing that delay in the environmental review, there were a couple of things that we found.

One related to a requirement for archaeological and other requirements under HUD, Hoyer said.. Another required sign off with U.S. Fish and Wildlife Service.

“As we broke that down and looked, we had some approval with the U.S. Fish and Wildlife Service for their piece of it that didn’t get communicated across the staff process to allow those to be put in the process for actual homes to start moving into replacement.

“There were some things related to documents and approvals from the contractor that didn’t get communicated back effectively. So once we were able to break those things loose, we were able to sign off on the first six to get those out and moving.”

Hoyer then said, “It delayed the ability to draw down the approved HUD dollars because you have to complete all the steps in the process before you can start to draw down the dollars. Until we can start to draw down the dollars we can’t release to a contractor the ability to bring a mobile home or to start building a home.”

By this spring, Housing and Urban Development had already labeled West Virginia a slow spender.

That designation means spending less than 10 percent of monthly pace required to fully use the grant by target closeout date.

Of the $149,875,000 that West Virginia was authorized to spend, it still had $148,428,791 in its pocket.

Gov. Jim Justice

Asked during a June 4 press conference whether normal bureaucratic process or extraordinary events led to the delay in the money being released, Governor Justice wasn’t specific.

He made no reference to environmental approvals that languished. He also simply said the money couldn’t be spent until it was approved by Housing and Urban Development.

He said, though, that people had gained the impression that money would be available last summer.

The money, of course, wasn’t available until months and months later.

“The HUD dollars — again the truth is — the HUD dollars did not arrive. We could not have spent the HUD dollars until after February the 23rd,” he said.

“But, nevertheless, what was being told to these people last summer was ‘We’re going to be doing this tomorrow; we’re going to be building houses tomorrow.’ And the reality is, there was no hope it could be done tomorrow last summer because the monies didn’t even come until this February.”

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