The State of
Sandy Recovery
Two and a Half Years Later,
Over 15,000 Families Still Waiting to Rebuild
Second Annual Report
February 2015
Fair Share Housing Center • Latino Action Network •
NAACP New Jersey State Conference
The State of
Sandy Recovery
Two and a Half Years Later,
Over 15,000 Families Still Waiting to Rebuild
Second Annual Report
February 2015
Fair Share Housing Center • Latino Action Network •
NAACP New Jersey State Conference
Cover Photo: Bill Halbeisin’s cot in his damaged home in Beach Haven West. Bill’s
house has been approved for RREM funding but has not been rebuilt.
© 2015 by Fair Share Housing Center, Latino Action Network, and NAACP New Jersey
State Conference. This document may be freely reproduced, disseminated, or distributed
in full. For permission for reproducing excerpts, contact Adam Gordon at Fair Share
Housing Center, [email protected]. The authors express their thanks to
Yvette Chen for her assistance in data analysis on this report.
Introduction
A few weeks ago, Governor Chris Christie did not mention the still ongoing recovery from
Superstorm Sandy in his State of the State address. This second annual report fills in what
Governor Christie omitted. Two and a half years after Superstorm Sandy, much work remains to
ensure that New Jersey’s rebuilding effort fairly and effectively gets people back home.
In October 2012, Sandy seriously damaged or destroyed more than 55,000 homes. Two
programs, one for homeowners, and one for renters, have provided the State’s primary
permanent recovery strategy to get people back in their homes and communities:
• The Reconstruction, Rehabilitation, Elevation and Mitigation (RREM) program aims to
serve approximately 10,800 families who had serious damage in rebuilding and elevating the
homes they own. Of those 10,800 families, only 328 have completed rebuilding. About half
have not even signed a contract to start.
• The Fund for Restoration of Multi-family Housing (FRM) will result in 5,400 rehabilitated
or replacement rental homes for families who experienced serious damage. Of these 5,400
homes, only 51 are complete. Most will not be available until between late 2015 and 2017.
While some delay is unavoidable in any rebuilding, New Jersey’s deep problems in initial rollout
set the state back significantly. We still need to fully account for these problems – which is hard
when the State refuses to release documents that explain them such as the Cohn Reznick
integrity monitor reports. We also need to evaluate whether, given these issues, the State is doing
everything it can to address the difficult reality of thousands of families whose rebuilding has
been set back. Thousands of people find themselves in the untenable situation of simultaneously
paying the mortgage and taxes on an uninhabitable home and also rent on another home. Many
people, especially lower-income families, have been displaced far from their original
communities. It is critical that the State do everything it can to move the rebuilding process along
– and provide both transparency to people waiting for funds on how to access them, along with
assistance in the interim.
For homeowners, the flawed rollout of RREM included lost applications and ever-changing
instructions. The State fired the contractor running RREM, HGI, in January 2014. For renters,
there was too little money available. And that limited money went to places with little storm
damage such as Belleville, instead of to the hardest hit communities such as those in Monmouth
and Ocean Counties.
Some problems hit African-American and Latino communities especially hard: the lack of funds
for renters, inaccurate information in Spanish, and disproportionate rejection rates from RREM
even though many rejected applicants were actually eligible. As a result of a settlement of a fair
housing complaint filed by Fair Share Housing Center, Latino Action Network, and the NJ
NAACP, the State has begun to address these issues. But much work remains to be done.
Regardless of race, ethnicity, or community, there is still a long way to go for too many New
Jerseyans. This report identifies the work left to do, and suggests a path forward in three key
areas: fairness, getting people back home, and transparency. We hope that this report will help
make New Jersey’s recovery programs more effective so that by the third anniversary of Sandy
in October, far more people will be back home.
1
1. Fair Funding for Both Renters and Homeowners Impacted
by Sandy, with Priority for the Hardest Hit Communities
The problem: The initial rollout of the Sandy recovery did not happen fairly for either
renters or homeowners.
Far less of New Jersey’s initial Sandy funding went to renters than their share of damage would
suggest. This underfunding disproportionately affected large numbers of African-American and
Latino families, and lower-income families of all races and ethnicities including many white
working-class families. As a result of the fair housing settlement mentioned above, more funding
will go to both renters and homeowners in proportions that begin to address this disparity:
Percent of Sandy-impacted Renters by
Race, Ethnicity, and Income
White
56%
African-American
23%
Asian-American
8%
Percent of Sandy-impacted Homeowners
by Race, Ethnicity, and Income
White
82%
African-American
8%
Asian-American
7%
Latino
Non-Latino
25%
75%
Latino
Non-Latino
8%
92%
HH Income below $30,000
HH Income $30,000-$60,000
HH Income above $60,000
67%
22%
11%
HH Income below $30,000
HH Income $30,000-$60,000
HH Income above $60,000
28%
23%
49%
2
Funds especially for renters were not initially targeted towards the areas hardest hit by Sandy and
many developments were funded with little or no connection to Sandy. Sandy impacted renters
would have to move long distances instead of returning to their home communities. Part of the
fair housing settlement requires this imbalance to be corrected through the Fund for Restoration
of Multi-Family Housing, the biggest rental program, which will allocate funding based on the
actual damage in the hardest hit counties.1
Homeowner Rebuilding: Damage vs. Funds
Awarded
% Damage
% Funds Awarded
76.3%
64.9%
17.0%
18.1%
6.0%
Bergen to Middlesex
Monmouth-Ocean
17.7%
Atlantic-Cape May
Renter Rebuilding: Damage vs. Funds
Awarded
% Damage
% Funds Awarded
52.5%
39.1%
34.3%
25.2%
22.2%
Bergen to Middlesex
Monmouth-Ocean
1
25.8%
Atlantic-Cape May
In the charts, Bergen to Middlesex includes Bergen, Essex, Hudson, Union, and Middlesex
Counties. Sandy Homebuyer Assistance Program is not included in calculations, as it serves both
homeowners and renters. Geographic allocation of Sandy Homebuyer Assistance funding:
Bergen to Middlesex 21.6%; Monmouth-Ocean 53.7%; Atlantic-Cape May 24.7%.
3
Lavern Burgess, a renter from the Ironbound section of Newark, is still trying to rebuild
from the storm:
Lavern Burgess is a father of three who has lived for the past
eight years in an apartment in the Ironbound section of
Newark. He works as a machine operator in Hackensack.
When Sandy struck his apartment, the water came in through
the first floor balcony, flooding the living room and kitchen.
“For me and having my kids with me, it was a nightmare,”
Burgess said. “We were sleeping in the dark, my kids were
scared, and I was so stressed out. I just had to hold on and pray
that everything would get better.”
Sandy ruined the carpet, leaving behind a putrid odor. The
flooding also damaged the boiler which took the landlord two
months to fix. In the meantime, the Burgess family was left
with no heat or hot water. Lavern was forced to use the gas
stove and space heaters to generate heat. “I stayed up most nights to make sure nothing caught on
fire,” Lavern said, noting that he also felt the impact in his job.
This generated a utility bill that was nearly $2,000. Eventually, Lavern’s power was shut off and
he had to live in the dark for about two weeks. He also fell behind in his rent at this time which
caused him to go to court with the landlord. The funds that the State made available to
homeowners through the Resettlement program for these kinds of short-term needs were not
made available to renters. A local non-profit organization, Ironbound Community Corporation,
has been able to help with his gas, electric, and rent somewhat, but as a result of the shortfall of
funding for renters, Lavern is still today trying to catch up on his back expenses and living in an
apartment that suffered severe damage from Sandy.
For homeowners, a major problem with RREM was incorrect rejections. Data from the State
showed that nearly 80 percent of applications that were rejected and were then reviewed on
appeal were actually eligible for funding. African-Americans and Latinos were rejected at higher
rates than white non-Latino applicants. Adding insult to injury, the information available on the
RREM program in Spanish had incorrect information such as the wrong deadlines for applying. .
As of November 2014, significant disparities between African-American and Latino applicants
and white non-Latino applicants remained, with African-Americans having been rejected at over
two times the rate of white non-Latino applicants and Latino applicants at 20% higher rates.
These disparities will likely decrease slightly as a result of a review of all rejections mandated by
the fair housing settlement, which was provided by DCA right before this report went to press.
Based on an initial analysis, 253 people who were rejected from RREM were actually eligible for
funding. These applications would never have been reviewed absent the settlement. The
settlement also provides an additional $40 million for low and moderate income homeowners
who were missed in the initial process of all races and ethnicities. Between the review of
rejections and the new program, it is likely that 500 or more additional homeowners will qualify
for assistance.
4
Percent of RREM Applicants Funded, Rejected,
and Waitlisted by Race/Ethnicity
Funded
Waitlisted
Rejected
Withdrawn
7%
12%
32%
18%
8%
12%
15%
14%
61%
59%
Latino
White Non-Latino
11%
50%
African-American
How to Make Recovery Work: Implementing the Voluntary Compliance Agreement
The Voluntary Compliance Agreement reached in May 2014 between the Latino Action
Network, NJ NAACP, Fair Share Housing Center, the State of New Jersey, and the U.S.
Department of Housing and Urban Development requires the State to take numerous steps to
address fairness throughout the rest of federally-funded recovery.
The State should implement the agreement, which:
• Sets firm targets for
prioritizing most
Requirements for Targeting
impacted areas first,
especially the hardest hit
FRM Program to Hardest Hit
counties – Ocean,
Counties
Monmouth, and Atlantic.
Funds for replacing rental
52%
homes through the FRM
28%
20%
program will be allocated
geographically to reflect
Monmouth and Ocean Counties Atlantic County
Everywhere Else
the amount of damage
experienced in each county – within a total of $594 million in FRM funding. As these
homes become available, they will be listed at http://nj.gov/njhrc/ and preference will be
given to applicants who were displaced by and/or experienced major and severe damage
from Sandy.
5
•
•
•
•
•
Requires equal access for non-English speakers to all programs funded with HUD’s
disaster recovery funds and the creation of a Spanish bilingual website for all programs,
now available at http://www.renewjerseystronger.org/?lang=es (with 10 other languages
also available at the menu in the upper right).
Establishes $15 million in available funding for renters still displaced from Sandy, which
can be used for up to two years while replacement homes are being built, which funds are
now available by applying by March 4 at
http://www.renewjerseystronger.org/renters/sandy-tenant-based-rental-assistanceprogram/.
Targets $40 million to low- and moderate-income homeowners missed in the initial
RREM outreach, including at least $10 million to owners of manufactured housing,
which funds are now available by applying by March 4 at
http://www.renewjerseystronger.org/homeowners/lmi-homeowners-rebuilding-program/.
Provides an opportunity for funding for those wrongly found ineligible, through a rereview of all applications rejected from the RREM program, as part of a broader plan to
clear the RREM wait list. Notifications about the re-review of applications have been sent
out to individual applicants over the last month.
Provides enhanced outreach to low- and moderate-income communities that have been
underserved by the recovery to date, including enhanced partnerships with community
groups and housing counseling to help people who are facing financial distress in
recovering from Sandy, with housing counseling information available here:
http://www.renewjerseystronger.org/homeowners/sandy-recovery-housing-counselingprogram/
As the above information shows, the Voluntary Compliance Agreement’s implementation is
starting to actually lead to changes in the State’s programs. Still, much work remains to be done
over the next year to make sure the Voluntary Compliance Agreement is implemented fully and
effectively. For example, our organizations are concerned that the initial rollout of the new
programs for renters and homeowners mentioned above may not be reaching many of the people
eligible due to a lack of advertising in both the English and Spanish language media. Our
organizations are currently seeking more information through an Open Public Records Act
request about what, if any, paid marketing has been done and believe it is critical to have
sufficient marketing of all programs to make sure that people who are eligible actually apply.
The Agreement does not make all of the funding perfectly fair. And it is not possible to undo all
of the damage from the problems with the initial rollout of Sandy funds. That said, if the
Agreement is implemented successfully it will help a lot of people impacted by Sandy who up to
this point have been left behind.
6
2. Getting People Back Home
The problem: while a lot of money has been committed, very little of it has actually gotten
people to the finish line of the rebuilding process.
According to the most recent Quarterly Performance Report submitted by New Jersey to HUD,
$3.3 billion has been provided to the state, yet less than ¼ of that money – $768.4 million – has
actually been spent.
The slow disbursement of available funding has severe consequences, with repairs and
rebuilding lagging behind. In the case of RREM, the most recent quarterly report shows that the
state has only spent 1/5 ($219 million out of $1.1 billion) of the money allocated for the RREM
program, the largest homeowner program for Sandy relief. Only 328 homes have been completed
as of January 2015, a tiny fraction compared to over 40,000 owner-occupied homes in the state
that were severely damaged or destroyed by Sandy, and the 15,000 families who applied for
RREM. Of those 15,000 families who applied, about 12,500 were found eligible, but nearly
2,000 have withdrawn from the program, in many cases due to giving up on the process, leaving
about 10,800 families still waiting for money today. Even when people have received money,
they have often had problems with their contractors; a recent integrity monitoring report found
that 12 out of 74 contractors reviewed for a RREM program had red flags such as allegations of
bribery, unpaid taxes, and labor law violations, which the State had inadequately screened.
For FRM, progress is also slow. The State projects that FRM will result in 5,400 rehabilitated or
replacement rental homes for families who had serious damage. Of these 5,400 homes, only 51
are complete. Most of the rest will not be available until between late 2015 and 2017.
RREM Progress
FRM Progress
10831
5400
5701
2700
3700
328
Total Eligible Signed Grant In Active
Applicants Agreements Construction
2000
51
Completed
Homes
7
Total
Affordable
Rental Units
Projected
Funding
In Active
Completed
Committed Construction
Units
Not surprisingly given this lack of progress, in a Monmouth University survey of a sample of
displaced families, only a small number of residents sampled have returned to their homes.
Among survey participants in the previous year that reported waiting to return to their homes,
only 28% were able to move back, 67% are still displaced, and 6% say they will never return to
their damaged homes.
Bill Halbeisen, homeowner in Beach Haven West, is still waiting to rebuild:
Bill Halbeisin has owned his home in Beach Haven West since
September 22nd 1989. He retired from being a school
psychologist in 2006. He had four and a half feet of water in
his house during Superstorm Sandy. The entire structure was
damaged. He's lived in nine different places since the storm
and says he feels like he makes camp to break camp and then
make camp again. Bill got a suitable settlement from insurance,
has been working part time to save up, and combined with the
RREM grant, will be able to rebuild.
Bill applied for RREM the first week it was announced. Three
or four months later he was rejected. He was told that he
needed to have more than one foot of water, and more than
$8,000 in damage. He had four feet of water, and pretty much
lost everything, so he appealed. The appeal also took three or
four months. He heard back that he was on the waiting list for approximately five months and
then he was put on the funded list. He didn't actually sign his RREM contract until December
2014.
Before funds are released, Bill needs to have a contract signed with a builder, which should
happen this month. According to his builder's estimate, it is likely another 10 or 11 months until
the work is done and Bill can go home. This winter, he's got help from a non-profit to pay for
his winter rental. In the summer, he lives on a boat that he bought to have a place to stay, and he
stays on a cot in his damaged house when it gets too rough or stormy. Since the SHRAP
program ended, Bill is grateful to have assistance, but wonders where he'll stay next winter as it's
likely the project will continue into the cold months this year as well. Bill is now working with
the New Jersey Organizing Project (NJOP) along with fellow Sandy survivors to try to speed up
the rebuilding process and ensure there is help along the way.
8
While people are still waiting to move
back home permanently, resources
Residents Needing
available for short-term assistance have
Assistance Making
dried up. The funds to help people meet
short term housing needs, from FEMA
Payments
and the SHRAP program, were based on
the idea that after two years people
Sept 2013 - Jan 2014
July 2014 - October 2014
should be able to move back home.
People are not back home, and the funds
28%
25%
25%
23%
have run out to pay rents, taxes, and
mortgages. There is a critical need for
Assistance with Mortgage
Assistance with Rent
more assistance for these families.
According to the Monmouth University
survey, as the chart to the right shows, there has been little change in the number of residents
impacted by Sandy needing short-term assistance over the past year.
This same survey finds the majority of respondents are still dissatisfied with the recovery effort
and feel forgotten.
Satisfaction with NJ Sandy Recovery Effort
Sept 2013 - Jan 2014
28%
8%
July 2014 - October 2014
30%
27%
35%
28%
38%
6%
Very Satisfied
Somewhat Satisfied
Somewhat Dissatisfied
Very Dissatisfied
Feeling About NJ's Recovery Effort
Sept 2013 - Jan 2014
July 2014 - October 2014
78%
22%
71%
29%
Focused on helping people like me
People like me have largely been forgotten
9
How to Make Recovery Work: Get money out efficiently and effectively so that people can
finish the job of recovery and get back home.
The state should:
• Set benchmarks for when it expects to have money out the door and homes under
construction and fully and safely completed for the RREM and FRM programs and
explain their justification for those benchmarks.
• By the third year anniversary of the storm have all RREM grants awarded and under
construction.
• Publicly provide monthly progress reports towards those benchmarks.
o For RREM those reports should include how many grantees have pulled building
permits, begun construction, and finished construction and back in their homes,
and for those grantees elevating their home where they are in the elevation
process (elevation has not yet begun, elevation underway, elevation completed).
o For FRM those should include how many grantees have pulled building permits,
begun construction, and completed homes and made them available for rent.
• Report the above objectives and performance data by census tract and municipality, and for
elevation by FEMA zone, so that the public can tell that all communities are being fairly
treated
• Help homeowners with problems with contractors, especially contractors who may have been
insufficiently screened by the State before being recommended to homeowners
• Provide short-term assistance to homeowners and tenants who are still displaced and
waiting for permanent housing, through reallocation of unused Community Development
Block Grant-Disaster Recovery funds or other funds.
• Implement a moratorium on foreclosures for people who are waiting for Sandy funding to
rebuild their homes, as a bill with bipartisan support currently pending in the New Jersey
Legislature proposes.
3. A Fully Transparent Recovery
The problem: Too often, it has been incredibly difficult to get transparent information on
the recovery. People can’t get answers on either the small questions – why their grant
agreement is not moving forward – or the big ones – such as publicly-funded integrity
monitor reports.
In March 2013, Governor Christie signed legislation establishing integrity monitors that review
the Sandy rebuilding process – including how billions of dollars in federal aid is spent – and
release periodical reports. Despite spending nearly $10 million in public funds in June 2013 to
hire an integrity monitor, Cohn Reznick, to oversee the main grant process, none of those
integrity monitor reports have ever been released. Instead, the Christie Administration set up a
second integrity monitor to monitor the integrity monitor, and release short summaries of their
activity. People who have been waiting for funds for two and a half years are still in the dark as
to what has caused delays and problems.
10
Lisa Stevens, homeowner in Little Egg Harbor, has had problems getting clear answers as
to what she needs to do to rebuild:
Lisa Stevens has owned her home in Little Egg Harbor's Mystic Island since 2002. Ten months
before Sandy hit, she retired from a career of service to the state at the Division of Youth and
Family Services. When she bought her house she was told 'it never flooded'. During Superstorm
Sandy, Lisa had about two feet of water in her house. It took weeks for both the full impact of
the destruction to set in, and for Lisa and her neighbors to salvage what they could, and begin to
clean up the rest. Though she says she probably shouldn't have, she stayed in her home even for
the eight weeks where she was without heat and hot water. After a fight with the insurance
company, she was able to reach a settlement. She invested nearly all of that settlement in getting
her home livable again.
When the RREM program came out, Lisa applied. Her application got lost, and she was initially
told there was no record of her application. She had evidence that she applied and was able to
appeal. In a move characteristic of the confusion of the RREM program, Lisa received a letter
denying her appeal the same day she received a letter accepting her in the program. She initially
chose pathway C - where the state's contractors handle all aspects of the program - to avoid the
hassles, complications and potential fraud she'd faced
trying to rebuild her home.
Initial estimates came in at $368,000 (the RREM grant
covers a maximum of $150,000) to completely rebuild
and raise. Deciding to only raise her house, estimates
came it at $173,000, then another quote came in at
$263,000 just to lift the house. Lisa was told she would
need to pay out of pocket $90,000 and to just take out a
loan for that amount. She already has a mortgage. She
decided to try and leave Pathway C to move to Pathway
B where she may have more control over design costs
and choices. She's hoping this will be a more
affordable path forward. She was notified last week of
the pathway switch after applying to switch in the
fall. She's starting this leg of her journey now, and has
joined the New Jersey Organizing Project to help her
and others get back home.
People also have problems figuring out what the issues are causing their own individual delays.
Often, people can’t get answers as to what documents they still need to submit to get funding,
can’t get calls returned, or are told different things by different people. The Sandy Bill of Rights,
bipartisan legislation that would have provided remedies to these issues, passed unanimously in
the Senate and Assembly. However, Governor Christie vetoed the legislation and members of his
own party refused to override his veto. Today, there is no clear and comprehensive checklist or
timetable for getting funding.
11
How to Make Recovery Work: Ensure transparency at every step of the process.
The state should:
• Release all periodic reports from integrity oversight monitors with full detail, including
all past Cohn Reznick reports
• Provide info for people still waiting for money from the RREM program including a clear
and detailed list of any remaining documents needed and a timetable for providing
funding
• Provide a customer service standard of returning all calls and emails regarding questions
on accessing Sandy funding within two business days of contact
Data Sources
Fairness section:
• Share of homes impacted by Sandy: NYU Furman Center for Real Estate and Urban
Policy analysis of FEMA data, April 2013
• Race/ethnicity and income data: Enterprise Community Partners, “FEMA Assistance
Analysis,” March 2013.
• Share of NJ Sandy housing funding: Action Plan Amendment #11, December 2014
• Monmouth University Survey: “NJ Sandy Panel: Recovery Stuck in the Sand,” released
October 30, 2014.
• Rejected RREM applicants found to be eligible: DCA data as reported pursuant to
Voluntary Compliance Agreement, January 2015.
• Percent of RREM applicants funded: DCA data as reported pursuant to Voluntary
Compliance Agreement, November 2014.
• Requirements for targeting FRM: Voluntary Compliance Agreement, May 2014.
Getting People Back Home section:
•
•
•
•
RREM Rebuilding Numbers: Star-Ledger, “'We need help desperately,' residents tell
state officials at Sandy hearing,” January 7, 2015; DCA data as reported pursuant to
Voluntary Compliance Agreement, November 2014.
FRM Rebuilding Numbers: Action Plan Amendment #11, December 2014
Contractor issues: Navigant integrity monitor report, January 2015
Monmouth University Survey: “NJ Sandy Panel: Impacted Residents’ Needs Have Not
Diminished in Past Year,” released October 28, 2014.
12