City’s house elevation grant program a case study in opaque governance
15th July 2013 · 0 Comments
By Charles Maldonado
A typical New Orleans City Council agenda can include a dozen or more budget transfer requests from Mayor Mitch Landrieu’s office, each with a brief, esoteric summary attached, sometimes totaling tens of millions of dollars. Charged with oversight of a $900 million annual budget, the council can be forgiven for voting many of these items through with little, if any, public discussion or explanation.
Ordinances 29,586 and 29,587 are good examples of how difficult it can be to scrutinize the budget. They appear to be worth nearly $12 million in federal grant money, but they’re arguably worth only about $2.2. million. They appear to allocate nearly $1 million apiece for flood mitigation on a handful of homes. That turns out not to be the case, but the houses are still receiving large grants.
Ultimately, privacy restrictions on the grants make it impossible to determine exactly how the money is being spent, or whether it’s being spent wisely.
Ordinances 29,586 and 29,587 breezed through committee and onto the council’s consent agenda — a group of noncontroversial items usually approved en bloc — with little attention.
As written, the ordinances appropriate federal grant money totaling $11,798,031 “for elevation of second-story conversion and wind retrofit of 12 residential historic structures.”
No more details were provided in the ordinances themselves, and no more from City Budget Director Cary Grant when he presented them to the council’s Budget Committee last month.
“Is there a motion? Second? All in favor? Aye. Ayes have it. Moving right along,” City Councilwoman at-Large Jackie Clarkson said as the committee voted on the item. That was the extent of debate on the two ordinances, which appear to allocate about $980,000 for each of the 12 houses. The ordinances are up for a final vote Thursday.
“City Council is going to vote to allocate $11.8 million to retrofit and elevate 12 historic residential structures,” the New Orleans Citizen Participation Project’s Nick Kindel told The Lens in a June 20 email. “The ordinance does not provide any other information beyond that, such as the location of the buildings, the type of construction, the type of building, or the estimate for each structure.
“I am all for historic preservation, but $1 million per building seems like a huge cost when these hazard mitigation funds could be better used to address flood problems at a neighborhood level.”
As it turns out, the $11.8 million represents an increase, not a new allocation, of a FEMA Hazard Mitigation Grant Program grant previously valued at $9.5 million. And it isn’t just for 12 houses, city officials explained. However, while the work isn’t costing $1 million per house, it’s still pricey, in some cases well in excess of home values.
FEMA project numbers 1603-0073 and 1607-0107 were approved in January 2009 to fund the elevation and wind retrofitting for a group of homes, most in or near Broadmoor, according to a 2010 memorandum of agreement between FEMA, the state, city and the Advisory Council on Historic Preservation. The original agreement covered 55 properties in historic districts, though it was significantly altered last year when a number of the original property owners opted out of the program, forcing the city to provide alternates.
Now 48 houses are part of the program, according to Bradford Case, the city’s director of hazard mitigation. FEMA released an additional $2.2 million for the project last year.
The homes will be raised to or above the preliminary “base flood elevation” of one foot below sea level. Depending on the area of Broadmoor, that means elevating them several feet and perhaps more.
Houses in historic districts first require additional scrutiny, including architectural and archeological review. Grants are handed out in two phases, first for design and then construction. Yet there’s no way to tell which properties are receiving grants or how much each will receive.
The city declined to provide the current list of properties because an individual homeowner’s participation in the Hazard Mitigation Grant Program is subject to the federal Privacy Act, according to city spokesman Tyler Gamble. He did, however, provide a list of unidentified properties with current grant amounts.
That’s not to say the city has never shared the information. The Lens found a number of Hazard Mitigation Grant agreements on the city’s online contract database. Gamble said that was an unintended consequence of the city’s decision to put them all online.
Based on 48 homes in the program, the federal government will spend an average of nearly $250,000 on each house. Most of the fully funded renovations run well over that number — up to $771,000.
That is in part because many are raised-basement homes, which require more extensive work in order to be raised, Case told The Lens.
“Raised basement houses tend to require virtually the entire bottom floor (the ‘basement’) to be demolished and then reconstructed atop a new foundation resulting in the lowest floor being at or above the BFE.”
The city shared a number of hazard mitigation grant contracts with the Bureau of Governmental Research for its 2010 report on city contracts, “Inside Outsourcing.” The watchdog group reviewed grant agreements for 28 elevation projects and found that the median cost of the grants was $276,000.
“The largest grants to elevate homes exceeded, by large amounts in some cases, the appraised value of the properties as recorded on the 2010 tax roll. The awards also exceeded the values on the pre-Katrina tax roll,” the report reads. The Bureau of Governmental Research shared 18 grant agreements with The Lens, including four covered by the FEMA project funding the current home elevations. The grants were valued between $445,000 and $622,000, among the most expensive the group found, and all well above the homes’ current assessed values. As the report noted, FEMA doesn’t place a cap on home elevation grants.
Barbara Tumulty’s 2009 approval for $445,000 was the fifth-largest that BGR found in its review. Tumulty’s raised-basement home is worth $350,000, according to city assessor records.
“The bottom floor — the basement, I guess they would call it — it does flood because it’s so low. It floods several times per year,” said Tumulty in a phone interview. “There’s a good rationale for what they’re doing if they get it done.”
She hasn’t actually received the full grant, she said.
“I’m still in that program. We had quite a lapse of time because of a lot of the regulations they require,” she said, adding that she has been told recently that she may soon be cleared to begin hiring contractors. “A lot of this is based on assumptions. I’ve been in the program such a long time, I don’t want to say it’s for sure. I hope to get going within a month.”
This article originally published in the July 15, 2013 print edition of The Louisiana Weekly newspaper.