By Reaghan Waites, Civitas Intern
“It’s hard, you know. My little girl goes to Princeville school and when I told her that the school actually got flooded, the reaction on her face totally broke my heart” said Latasha Wilkins, Princeville resident. The town of Princeville sits adjacent to the Tar River. Nearly 75 percent of housing in the town was damaged or destroyed by Hurricane Matthew.
The flooding forced Wilkins and her three children out of their rental home and into a Red Cross shelter in a high school gym. Although living in a gym wasn’t ideal, Wilkins made the most of her time by serving other victims by passing out food, clothes and water.
Wilkins is one of the thousands of North Carolina residents affected by Hurricane Matthew. Judy Locklear, a Lumberton resident, had to evacuate her home after four feet of water damaged the interior. Locklear and her daughter sought refuge in their truck, where they lived for three days. Locklear had no other option but to stay in a motel while waiting for federal funds to trickle into the state and provide relief.
These are just a few of the countless stories told by national and local media outlets highlighting the victims left homeless after Matthew made landfall in 2016.
For 12 days in September and October of 2016, Hurricane Matthew hammered North Carolina with wind and rain killing 28 people and leaving catastrophic flooding particularly in the eastern regions of the state. More than 20,000 North Carolina residents were displaced and sought refuge in shelters.
In October of 2018, two years after Matthew, more than 600 victims were still living in Red Cross shelters in the state’s southeastern corner.
At a legislative hearing regarding the pace of the recovery effort, Rep. Brenden Jones (R-Columbus) noted, “It’s like a third-world country, something that I never thought that I would see.”
To aid in disaster relief efforts, the federal Department of Housing and Urban Development (HUD) awarded the state a $236 million grant. Additional federal funds for disaster relief brought total federal funds to $400 million.
On the state front, the North Carolina General Assembly passed the 2016 and 2017 Disaster Recovery Acts, giving the Department of Public Safety (DPS) a total of $300.9 million for hurricane recovery efforts. This legislation apportioned the federal grants received and allotted these additional state funds towards relief efforts.
While federal and state officials were quick in developing plans to address the aftermath of Matthew, plans don’t always mean action. As of December 2018, the state had only spent 1 percent ($3.4 million) of the HUD grant, compelling HUD to classify North Carolina as a slow spender. Even worse, the state’s delay in providing disaster relief for Matthew victims constitutes the slowest spending rate of any state or federal funds, as noted in the New York Times.
These developments beg the question: where did state and federal disaster funds go? How have the needs of so many North Carolina residents been ignored for so long?
The Program Evaluation Division (PED) of the General Assembly launched an investigation in May to discover the cause of ineffective recovery efforts.
The report shed light on administrative issues and inefficiencies within DPS’ dispersal of disaster funds. This raised additional concerns regarding the state’s failure to provide hurricane relief to those affected by Matthew.
The PED found that the contracts necessary for distributing funds caused unnecessary spending. In order to develop plans, write reports, and evaluate unmet needs, the state must contract with companies within North Carolina. Contracts between the state and partnering companies did not meet HUD requirements and the work was rebid as a result. This cost North Carolina $3.7 million in state money, which the PED report classifies as “unnecessary.”
In addition, limited institutional knowledge, program design issues, and changes in implementation strategies led to inefficient spending efforts. The PED report notes that North Carolina’s decision to shift away from using federal Community Development Block Grant money on housing, and instead spending the money on economic development and infrastructure, left a void of experienced staff capable of properly distributing HUD grants.
These issues resulted in the perfect storm, leaving Matthew victims without aid —years after the fact.
The PED report prompted the state legislature to conduct further research. In a follow-up report, the PED identified a funding stream that did not meet state requirements. Specifically, DPS allotted a portion of the $9 million appropriated to the emergency sheltering and short-term housing fund to the NC Community Development Initiative, hereafter referred to as the Initiative.
The second report includes several key findings:
DPS established an agreement with the Initiative to spend state funds for purposes that do not align with the legislative directive of the disaster recovery legislation.
The Initiative focuses on expanding affordable housing in the community, which does not align with the purpose of providing “emergency sheltering and short-term housing” as set forth in the Disaster Recovery Acts. Creating “affordable housing and services,” a mission of the Initiative, is not specific enough to match this requirement. The funds were distributed to private developers and landlords for “flexible low-cost financing to expand affordable housing.” See page five of the report.
In addition, the agreement between DPS and the Initiative did not specify that projects must exist for the benefit of hurricane survivors. Therefore, individuals unaffected by Hurricane Matthew have the same priority in benefitting from the disaster fund. There is no distinction present to determine who may receive help from the Initiative.
Eastern regions of the state were particularly affected by Hurricane Matthew’s aftermath. The Island Packet,one of Beaufort County’s local news outlets, recently published an article highlighting the inefficiency of Gov. Roy Cooper’s administration in providing funds to hurricane victims, many of whom reside within Beaufort County. The article quoted Rep. Julia Howard (R-Mocksville), who noted, “Just to rebuild communities with new development, that was never the intent of the legislature or the directive.” A problem arose when the DPS, she remarked, “took liberties where liberties should not have been taken.”
The Department of Public Safety (DPS) ignored grant-making best practices when it selected the North Carolina Community Development Initiative as a recipient and did not follow state law when it distributed grant funds to the Initiative.
Specifically, the typical scoring system and systematic criteria required for fund disbursal was not implemented. As a result, the process failed to consider other deserving recipients and alternative applicants.
The PED report notes that the selection process for determining a grant recipient should be formal, meaning it should be “competitively bid, systematic, and based on the proven track record of implementation demonstrated by applicants.” This ensures that the DPS identifies the most qualified recipient, equipped to efficiently utilize state expenses. This formal process was not observed while administering funds to the Initiative.
From a logistical standpoint, the report also found that DPS did not obey state laws regarding the dispersal of the grant fund. Instead of paying in quarterly or monthly installments, it disbursed a lump-sum payment of $5.35 million.
The funds intended for emergency sheltering and short-term housing for hurricane survivors appear to financially benefit the Initiative, real estate developers, and private property owners providing rental housing.
This is a clear failure to meet the expectation set forth by the Disaster Recovery Acts. Hurricane survivors are the intended beneficiary of state funding under the Disaster Acts, but DPS failed to aid victims and instead provided funds to private developers.
Figure: Allotment of emergency management funds Page 9 of the PED report: https://www.ncleg.net/PED/Reports/documents/Disaster/Disaster_Memo.pdf
State-supported loan principal may not be returnedto the State and it is unclear if interest accrued has been used in accordance with state law.
The agreement between DPS and the Initiative did not address whether the $732,450 in state funds used for loans will remain with the Initiative or go to the state. It also did not address if interest accrued by the Initiative is being used in compliance with state law.
It doesn’t look like the investigations are over. “As serious questions remain unanswered regarding the slow pace of the Cooper administration’s recovery effort, it’s critical that we continue our committee’s oversight to ensure folks get the help they need,” said Rep. John Bell (R-Wayne), chairman of the legislative oversight committee tasked with studying the recovery funds, told committee members in 2018.
Where do we go from here?
While public outrage regarding recovery efforts seems muted, former Gov. Pat McCrory has weighed in and was quoted in the News and Observer during April of last year for criticizing Gov. Cooper’s “leadership void” in providing efficient hurricane relief.
The same News and Observer article included a quote from the editorial board of the Virginian-Pilot, Virginia’s largest paper, remarking that “Cooper should do better” regarding North Carolina’s lack of progress as compared to Virginia and South Carolina, whose disaster relief efforts were well underway shortly after Hurricane Matthew struck.
The Cooper administration continues to blame the delay on red tape and bureaucracy. Spokesman Ford Porter said the state has already distributed millions in state and federal recovery funds and getting funds to people who qualify “is a top priority.” However, millions of dollars do nothing if they are not used properly —a fact that the Cooper administration seems to have forgotten.
Hurricanes can be life changing events. While programs were in place to handle the aftermath, relief efforts have been ineffective. “It takes us so long to help folks that are in immediate need. It’s a crying shame,” Rep. Craig Horn (R-Union) said in May of this year.
Failure of the DPS to properly allot this money is a misuse of state and federal funds and a violation of the public trust. Although the issue merits further investigation, it is unlikely that any additional action will be taken to hold the Cooper administration accountable. This is an unfortunate reality for those left suffering from the devastation of Hurricane Matthew.
“I don’t know what’s next, because we literally have nowhere to go,” said Toshica Medley, who stayed in the Nash Central High School shelter after floods devastated her home. “You just don’t plan for stuff like this. You don’t plan on not having your house. You don’t plan on being homeless. I’ve never been homeless in my life. What do you do when you’re homeless?”
The Cooper administration’s failure to provide aid to the neediest residents in our state adds yet another disaster for those who are faced with cleaning up the aftermath of Hurricane Matthew.
