Agencies have 'clawed back' more than $5 million in Sandy aid from New Jerseyans - By Joe Hernandez, NewsWorks
When Fran Baronowitz returned to her Ventnor, New Jersey, home four days after Superstorm Sandy, the front door was jammed. Floodwaters inside her house caused the floorboards to buckle, pushing the carpet up against the doorway. She entered through the back to find all her furniture saturated, ruined.
A prized piano was reduced to a heavy piece of garbage.
Baronowitz used federal and state aid to repair her home and reinforce it against future storms. She got new flooring in the kitchen, new front and back porches, new walls. A crew raised her house 6 feet off the ground. Finally, after two years, Baronowitz had recovered from Sandy.
"I thought I was through with it," she said, "until I got that letter."
Last August, two years after Baronowitz had moved back home, she received a notice in the mail demanding she pay back $35,174.34 in state aid. The letter said Baronowitz had "duplicated" her benefits by accepting overlapping federal and state aid. Contractors also repaired her house in ways that lacked state approval, such as using vinyl composite for the porches instead of wood.
"I'm on a small income," said Baronowitz, a retired medical secretary. "I don't want to go into my savings if I can help it. But if I have to, I will."
Since Sandy battered the Jersey Shore nearly five years ago, hundreds of residents who received government funds to rebuild their homes have had to pay some of it back, what the government calls a "recoupment."
So far, almost 1,000 New Jersey homeowners have paid back more than $5 million in federal and state aid meant for Sandy rebuilding, WHYY has learned. Many more have yet to reimburse the agencies for overpayments.
Officials at the Federal Emergency Management Agency and the New Jersey Department of Community Affairs, which disbursed storm-relief funds, say the recoupments happen because of ineligible expenses or duplicated benefits.
Homeowners are warned of those risks ahead of time, the officials say.
But state and federal lawmakers are now proposing changes to how disaster relief agencies recover their money, citing a recoupment process that can send struggling homeowners back into financial ruin.
By the numbers
The DCA-administered Reconstruction, Rehabilitation, Elevation, and Mitigation program — known as RREM — is New Jersey's largest pot of state money for Sandy victims, funded by block grants from the federal Department of Housing and Urban Development.
Affected homeowners could also receive aid directly from federal sources. FEMA approved more than $1.4 billion in aid to Sandy victims, often in individual assistance paid through the National Flood Insurance Program. Other agencies, such as the Small Business Administration, also gave out financial assistance after Sandy.
All told, billions of dollars flowed into New Jersey after the storm. A DCA spokesperson said more than 6,000 participants in the RREM program have returned home. A thousand more are expected to wrap up repairs this year.
But moving back home is not always the end of the recovery process. In fact, for some, it means the beginning of a new nightmare.
When work on a Sandy-damaged home is finished, agencies conduct a final review of the homeowner's grant. That's when the agency determines whether it needs to recoup any of the money it gave out.
A recoupment could arise for a variety of reasons: The homeowner simultaneously took state and federal aid that could be considered a duplication of benefits; the contractor spent money in ways that were not approved by the agency; or the overall cost of construction was less than expected.
So far, FEMA has recouped $2,786,706 from 760 Sandy victims, an average of $3,667 per person.
In New Jersey, DCA has recouped $2.25 million from 171 aid recipients, averaging more than $13,000 per person.
Agencies say they have no choice. They're legally required to recover overpayments. The entire process is subject to the federal Stafford Act, which mandates that homeowners cannot "receive funds from multiple sources for the same purpose or in excess of what is allowable to repair or rebuild their home," said DCA spokeswoman Lisa Ryan in an email.
Agencies also say they inform aid recipients multiple times in advance and in writing about what constitutes a "duplication of benefits" and the possibility of recoupments.
Yet while the recovered funds are only a tiny fraction of the total aid given out to Sandy victims, they often loom large for the homeowners who have to repay them.
And as more Sandy victims have moved back home after construction, the recoupment process has been receiving increased attention.
Move for changes underway
Homeowners who spoke to WHYY acknowledged that agencies informed them about the risks of later recoupment. But the application process for disaster relief aid was confusing, many said, and rife with complex documents written in confounding legalese.
That confusion often caused what advocates call "clawbacks" of relief aid reaching into the tens of thousands of dollars, they said.
"People have the impression that every step of the way they've done what RREM asked," said Amanda Devecka-Rinear, director of the New Jersey Organizing Project, a nonprofit that formed after Sandy. "They've signed the papers, they went through this thing ... And then they get the letter, and it doesn't make any sense."
Federal and state lawmakers now aim to improve the recoupment process, so homeowners are better informed about the rules and have more leeway in paying back what they might owe.
"If you made a payment, and a supervisor later decided, 'I wouldn't have made that payment,' they can't go back and claim the money back from somebody," said U.S. Rep. Tom MacArthur, the Republican representing New Jersey's 3rd District and a former insurance executive. "It's not something that I experienced in my insurance life."
MacArthur introduced a bill last month that would force FEMA to recoup any disaster aid within three years after the money is awarded. "This idea that years later they can do audits and change their minds is what I've tried to put an end to," he said. The bill passed a House committee last week.
Legislation at the state level would overhaul the DCA recoupment process even more comprehensively, incorporating some procedures already in place at FEMA.
Sponsored by four New Jersey Assembly Democrats, the bill would outline a step-by-step process for DCA to follow when recouping disaster aid, including sending a notice to the homeowner with information about how to repay.
The bill would lay out a few payment plan options; force DCA to take into account homeowners' income and hardship conditions when setting payment amounts; and create a formal appeals process, something FEMA already has. The legislation passed the Assembly unanimously.
Although DCA has no formal appeals process for recoupments, homeowners have said that discussions with DCA representatives can often lead to lowering how much is owed. Baronowitz, the Ventnor retiree, was able to reduce her repayment number by about $19,000.
Despite the steps toward revamping the recoupment process, homeowners with debt letters in hand remain on edge.
"I have so much anxiety. I have so much stress every time a storm comes through," said Julie Suarez of Little Egg Harbor. "It doesn't even have to be here. I watch flooding on the news, and I'm like breaking down crying for people in Louisiana that I've never met." (Suarez and Baronowitz are both members of the New Jersey Organizing Project.)
The road to recovery has taken a toll on Suarez, a public school teacher with a daughter in college. Her house was uninhabitable after Sandy, so DCA helped her build a new one on the same site. Despite hiccups during the rebuilding process, Suarez and her family moved into their new home less than two years after Sandy.
Then she got a recoupment letter.
At first, Suarez was asked to pay back around $51,000, a fifth of the total government aid she received. But the DCA cut the debt roughly in half after negotiating with her. Still, paying it would not be easy.
"My car has 317,000 miles on it. I do not live high on the hog. My other car has 168,000 miles on it. I mean, this is not a joke. I shop at, like, T.J. Maxx in the clearance section," she said.
Suarez said she's willing to pay back what she owes. DCA claimed she duplicated benefits when she received aid from SBA and NFIP, though the reasons for that are still unclear to Suarez. But she knows that she cannot pay back the full amount in three years, the time limit set forth in the letter. And she worries that paying small amounts toward the debt now may be for naught if the state imposes a higher interest rate or puts a lien on her house at the end of the three-year period. (DCA says it can send the unpaid debt to the Department of Treasury for collections.)
Suarez says the recoupment process feels a lot like the rebuilding process — the long phone calls to DCA, the reams of paperwork, the stress. Victims, she said, are being victimized again.
"You put all these people who have been through literally emotional, physical, financial hell for the past however many years it's taken us to get back home," she said, "and throwing this on top of it. Here's your big, fat cherry on the cake."
Sandy fraud payments top $5 million, hundreds of victims - By Jean Mikle, Asbury Park Press
LITTLE EGG HARBOR -- Millions of taxpayer dollars intended to help superstorm Sandy victims repair and elevate their homes has instead gone missing in a wave of contractor fraud.
Sandy victims whose properties were destroyed or badly damaged were often easy marks for scammers, who preyed on people desperate to return home, consumer advocates say.
A frequent complaint by Sandy homeowners and advocates: they did not receive enough guidance to help them make smart decisions during the rebuilding process. And the state did not move quickly enough to stop the flow of funds to contractors who had repeatedly done shoddy work or failed to complete storm-damaged homes.
So far, the state Division of Consumer Affairs has filed civil actions against eight home improvement contractors, claiming they defrauded Sandy victims of more than $5 million in federal rebuilding aid.
And New Jersey has paid out about $5.4 million to homeowners in the state's biggest Sandy rebuilding programs whose grant money was taken by contractors who failed to complete home repair or elevation projects.
Stiffer penalties are needed for builders who deliberately defrauded Sandy victims, advocates say.
The civil actions filed by Consumer Affairs typically seek restitution as well as fines from the home improvement contractors, but Sue Marticek, executive director of the Ocean County Long-Term Recovery Group in Toms River, says the builders often have declared bankruptcy or have little money available by the time they are charged.
"Somewhere along the line, they should make the penalties really heavy," Marticek said. "If you speed in a construction zone, you get double or triple the fines. If you defraud someone in a disaster zone, you should face tougher penalties."
Marticek and others who work closely with Sandy victims say contractor fraud is one of the main reasons hundreds of storm survivors remain displaced.
“Most people that are still struggling to get home going on five years have hit a significant challenge during or with the with the recovery process,” said Amanda Devecka-Rinear, director of the New Jersey Organizing Project, a Sandy advocacy group based in Ocean County. “For many who aren’t home yet that challenge is contractor fraud.”
Little Egg Harbor resident Edwin Byk, 61, is one victim.
For a year, Byk’s three-bedroom home on a lagoon in the township’s Mystic Island section has been perched precariously on weathered wooden cribbing.
Eight feet in the air, the house has been exposed to the elements for a year. Part of a front brick facade has cracked off; battered insulation hangs from interior walls.
Byk said he first hired contractor J&N Construction after noticing work the firm's owner, Jamie Lynn Lawson, was doing on a neighbor's Sandy-damaged home. Byk's house had been flooded with three feet of water while he and his daughter stayed dry on the second floor during the storm's surge.
He repaired the 1,800-square-foot home himself, using about $50,000 in flood insurance proceeds. But when he heard that he could get money to elevate the house through the state's largest rebuilding program for homeowners, the Reconstruction, Rehabilitation, Elevation and Mitigation program, he jumped at the chance.
"I didn't want to go through that again," Byk said of the Sandy damage, "and I wanted to get lower flood insurance rates."
After talking to Lawson, whose firm was in Brick, Byk signed a contract with him. He eventually gave Lawson $97,000 in RREM funds to lift the house, but it took more than a year for the contractor to start the actual elevation.
Lawson lifted the house on cribbing over a weekend in July. But that was the last Byk said he saw of him.
Two days after Lawson elevated the house, the township slapped a stop-work order on the property. Lawson had never applied for township permits to do the elevation, Byk said.
The Ocean County Prosecutor's Office has accused Lawson of taking $1.5 million from 34 homeowners and failing to properly complete, or even start work on their Sandy-damaged homes.
“If DCA would do a background check, this would never have happened,” Byk said, referring to the state Department of Community Affairs. In December 2016, he said he was contacted by DCA and told not to use Lawson for his job.
That was the same month that Lawson was indicted by the Ocean County Prosecutor's Office on charges of money laundering, six counts of second-degree theft by failure to make required disposition, third-degree tampering with public records — referring to omissions made in his contracting application with the state — and one count of fourth-degree unregistered home improvement contracting. Lawson has not entered a plea yet.
Lawson had moved to New Jersey shortly after Sandy and registered his business in November 2012. At the time the state was awash with contractors who had come to New Jersey to help with the rebuilding effort.
The Division of Consumer Affairs, the agency that licenses numerous types of contractors, authorized Lawson's application to become a home improvement contractor, reportedly unaware he had criminal convictions in other states, according to the prosecutor's office.
Authorities said Lawson moved to various states following natural disasters. Records show Lawson lived in North Carolina, Texas and Oklahoma, among other places, and then moved to New Jersey shortly after Sandy decimated much of the shore.
Authorities said Lawson became a fugitive shortly after he was indicted in Ocean County. Arrested by U.S. Marshals in South Carolina in mid-June, Lawson is being held in the Ocean County Jail after a first appearance in court earlier this month.
The prosecutor's office said Lawson, 42, used the money homeowners gave him for his personal expenses and to buy cars.
The Lawson case is one of more than 25 Sandy fraud cases currently being investigated by the Ocean County Prosecutor's Office, according to Sgt. Mark Malinowski, who heads the economic crimes unit.
"They range from one victim to 34, 35 victims," Malinowski said of the cases, adding the fraud cost runs into the millions of dollars. "A lot of these guys bounce from town to town, and we were able, through our networks and our police departments, to find where they had been operating."
Malinowski noted that his office only looks into fraud cases of more than $75,000, or are multi-jurisdictional, so there are many more contractor investigations being handled by local police departments.
Malinowski estimated that Sandy fraud cases still represent about a third of his unit's caseload.
In 2014, two years after the superstorm struck, and the same year that Edwin Byk decided to raise his house, the state fundamentally changed how contractors were hired in the RREM program.
That summer, the state turned over the rebuilding reins to individual homeowners. Instead of the state picking contractors for property owners, which it had done in the first phase of RREM, property owners were allowed to pick their own companies.
Department of Community Affairs spokeswoman Lisa Ryan has said homeowners were urged to call Consumer Affairs before hiring a contractor to learn if there were any complaints against the company.
DCA revised the RREM program after homeowners overwhelmingly told department officials that they wanted to be able to pick their own contractors, Ryan has said.
But most homeowners had never had to oversee such a large rebuilding project, or ever had as much cash to manage. RREM awarded a maximum of $150,000 for rebuilding and elevation projects. Overwhelmed, most just wanted to get back into their houses quickly.
Byk admits he shouldn't have given Lawson so much money up front.
"I didn't want to do it myself," Byk said of selecting a contractor. "I've never done anything like this before. I think the state should have kept doing it."
Ryan has said that RREM has worked well for the majority of homeowners who participated in the program, allowing thousands to replace, repair and elevate their homes.
Of the approximately 7,600 homeowners in RREM, 5,333 have completed construction, while about 700 more have returned home while they finish building, she said.
"Nearly all of the remaining homeowners have started construction, with many of them anticipated to finish rebuilding by the end of the year," Ryan said.
But Byk is one of many fraud victims still caught in limbo.
New Jersey has created a process by which homeowners who were defrauded can receive an additional RREM award, up to as much as their original grant, if a government agency files a criminal or civil action against their contractor.
The award is meant to pay for the work that still must be done to complete the initial project, Ryan said.
But Byk has not yet been able to apply for a revised grant award. He is still awaiting notice from the prosecutor's office that indicates Lawson has been charged in his case. It's needed for him to seek funds from DCA to complete his project.
Even after he receives the document, it may take awhile for him to get more money.
"The length of time it takes for us to disburse RREM funds to a defrauded homeowner varies, as each project is unique and depends on the complexity of the case," DCA's Ryan said.
In the meantime, Byk has paid $7,000 for new architectural and engineering plans and to get all permits needed to complete the home elevation "and make it safe," he said.
Byk is renting a room in his next-door neighbor's house and is receiving rental assistance from the state.
"That's the only way I've been able to afford to stay here," said Byk, who works part-time for the Tall Timbers Homeowners Association in Little Egg Harbor.
State Sen. Jennifer Beck said she believes the state should do more for homeowners in the RREM and Low and Moderate Income Homeowners Rebuilding program who are victims of fraud.
In 2015, Beck, R-Monmouth, first introduced the "Superstorm Sandy Homeowners Protection Act," which would allow DCA to bar contractors who commit fraud from working in New Jersey and strip them of their licenses.
It also would allow the state Attorney General to sue on behalf of homeowners for contractor negligence. The law limits the attorney general's office to sue in criminal cases only.
"It is the State of New Jersey's responsibility to defend our homeowners," Beck said. "It's our responsibility to take this to the mat for them."
Beck's bill is awaiting action in the Senate Budget and Appropriations Committee but has not come up for a vote there.
"The travesty is, there were project managers assigned (by the state)," in RREM, Beck said. "Most homeowners assumed they were going to manage the project. But they didn't. The project managers were just there to make sure the money was spent according to HUD guidelines."
Byk, who once planned to spend his retirement years in Mystic Island, is so frustrated with his experiences that he's now thinking of moving away after he finally completes his elevation project.
"For a year the house has been up," Byk said. "I never should have raised it. I should have left it like it was."
MacArthur moves to limit FEMA recovery of grants made in error - By Phil Gregory, NewsWorks
A New Jersey congressman wants to place a three-year limit on allowing the Federal Emergency Management Agency to force homeowners to repay disaster recovery money.
The bill he has sponsored would prevent FEMA from trying to recoup grant money indefinitely after it was awarded, said U.S. Rep. Tom MacArthur.
"What brought it to my attention initially was a single mom of a disabled child who had gotten a $40,000 grant from FEMA," MacArthur said. "About two years later, FEMA came back and said they make a mistake, and they were demanding the money back. She had used the money to repair her home."
Amanda Deveca-Rinear, who leads the New Jersey Organizing Project that supports Superstorm Sandy victims, said the legislation could prevent homeowners from suffering financial ruin.
"The FEMA clawbacks can range from $3,000 or $4,000 to much higher than that, $20,000 or $30,000 or $40,000," she said. The bill will prevent the agency from "yanking their financial stability out from under them."
MacArthur said he wanted to put a time limit on FEMA for demanding repayment rather than banning the practice altogether.
"I might have been inclined to eliminate it completely —,except there are times when there's enough question as to whether a payment should have been made," the South Jersey Republican said. "There can be cases where maybe somebody didn't share all of the information. I want to protect the U.S. taxpayer as well."
Healthcare Rally Held In Downtown Toms River - By Bob Vosseller, Jersey Shore Online
TOMS RIVER – The sounds of protest songs with slightly altered lyrics served as the rallying cry against proposed healthcare repeal legislation in front of Toms River Town Hall on June 29.
Priscilla Robinson of the New Jersey Organizing Project and speakers from Ocean County Family Planning, National Organization of Women, Citizens Action of NJ and the New Jersey State Industrial Union Council came out, along with members of the Solidarity Singers to get their message across.
Their message: opposition to current plans to modify the Affordable Care Act.
Priscilla Robinson of the New Jersey Organizing Project, left, speaks about concerns regarding current pending legislation that would modify healthcare coverage, while Waretown resident Karla Ivarson, a member of the Solidarity Singers, holds a banner during a rally in front of Toms River Town Hall.
Part of the afternoon protest took aim at 3rd District Republican Congressman Tom MacArthur, who they urged to vote no when the bill gets back to the House of Representatives. Robinson and each of the speakers present asked constituents of Rep. MacArthur to contact him and request he cast a negative vote.
In April, Rep. MacArthur revived the Healthcare Repeal bill by introducing a series of amendments. Since then, the bill was introduced in the Senate and the Senate Majority Leader hoped to vote on it prior to the July 4 recess. That vote was postponed and opponents of the Republican plan have expressed concerns about the impact of what is being proposed.
“Forty percent of Ocean County residents are working poor. In Atlantic County it is nearly 50 percent and Monmouth County it is 30 percent. We need to protect essential health benefits and community health ratings. We need to protect Medicaid expansion because everyone deserves access to health care and the services we need to stay healthy,” Robinson said.
“I want to speak about the negative aspect of this on women and girls and their families. Even the President described the House version as mean. I’d describe it as mean and sneaky. In this legislation there is a provision that denies any federal funding to Planned Parenthood for one year. Now you know that if they can get away with it for one year it will become an annual event,” Lynda Fote of Ocean County NOW said.
Kathy Fisher from Family Planning said, “Many women in Ocean County who receive health care at a Family Planning Center is the only care they receive.” She added that Family Planning provides educational services aimed at youth concerning reproductive health. “The whole purpose of a Family Planning program is to keep women healthy, offer preventative health care and to make sure that when a woman becomes pregnant it is an intended pregnancy not an unintended pregnancy.”
Lynda Fote of Ocean County NOW speaks during a healthcare rally in downtown Toms River. (Photo by Bob Vosseller)“We are here to take a stand for healthcare not wealth care. Unfortunately, Congress has a different idea. They are not voting in the Senate this week but we know that the fight is not over,” Carol Gay of the NJ State Industrial Union Council said.
A statement from Congressman MacArthur’s office on June 29 noted that, “Obamacare is failing and if Congress does not act, millions of people will suffer. Congressman MacArthur supports a fiscally responsible bill which lowers premiums, increases Medicaid spending, and provides a safety net for the most vulnerable. He believes the status quo is unacceptable since it does not address how to adequately insure the 28 million Americans, who currently receive no health insurance. While others continue to engage in smear tactics and fear-mongering, Congressman MacArthur will continue to focus on solutions to the big issues facing our nation.”
Menendez, Booker Part of Bipartisan Effort to Reform National Flood Insurance Program - by Juliet Kazhas-Hoch
Eight U.S. senators from coastal states – including Sens. Bob Menendez and Cory Booker (both D-N.J.) – have laid out a framework for sweeping reforms to the National Flood Insurance Program. Last week the lawmakers introduced comprehensive, bipartisan legislation to extend the NFIP for six years while instituting modifications to address the system’s faults.
“Americans deserve a National Flood Insurance Program that is sustainable for taxpayers, affordable for homeowners, and accountable to everyone,” Menendez stated. “If we want a more sustainable system, the answer isn’t to slam homeowners with even higher premiums. This legislation puts the lessons we learned after Superstorm Sandy into action, levels the playing field for policyholders, and attacks the NFIP’s rampant waste and abuse to create real savings and greater investment in mitigation and resiliency efforts to make our residents and communities safer.”
The bill is also cosponsored by Sens. John Kennedy (R-La.), Chris Van Hollen (D-Md.), Marco Rubio (R-Fla.), Elizabeth Warren (D-Mass.), Thad Cochran (R-Miss.) and Bill Nelson (D-Fla.).
Menendez, chair of the Sandy Task Force and a senior member of the Senate Banking Committee that oversees the NFIP, pointed out that many property owners are forgoing flood insurance because of rising premiums coupled with the headache, or nightmare, of dealing with the federal program following a natural disaster.
The new proposal, the senators say, would reduce costs for policyholders, while upping the amount spent to prevent damage from future storms. Menendez’s press secretary, Steven Sandberg, explained, “The Sustainable, Affordable, Fair, and Efficient (SAFE) National Flood Insurance Program Reauthorization Act of 2017 tackles systemic problems with flood insurance, puts it back on solid fiscal ground, and reframes our nation’s entire disaster paradigm to one that focuses more on prevention and mitigation to spare the high cost of rebuilding after flood disasters.
“Congress must reauthorize the NFIP, which expires on Sept. 30, 2017.”
As Booker noted, “This legislation takes common sense steps toward making coverage more affordable, extending coverage to those who need it most, and investing in pre-disaster flood control and mitigation efforts that will help protect New Jersey families.”
SAFE NFIP addresses critical problems with the program – administered by the Federal Emergency Management Agency – following Sandy and other disasters, including: unsustainability, low participation rates, inaccurate flood maps, an indifference to the benefits of flood control infrastructure, agency mismanagement, unsustainable debt service costs and contractor profiteering.
In addition to reauthorizing the NFIP for six years, the act would cap annual premium increases at 10 percent, fundamentally revamp the claims process, provide for increased training and certification of agents and adjusters, expand Increased Cost of Compliance coverage, authorize funding for technology for more-accurate flood risk mapping, and ensure investment in mitigation efforts, among other reform measures.
The act has the support of several experts and flood victim advocates, including Susan Marticek, executive director of the Ocean County Long-Term Recovery Group, who believes the legislation “takes into account all of the hard-learned lessons from Sandy, and implements changes that will directly benefit policyholders in the aftermath of a disaster and expedite recovery for the individual as well as the community at large.”
“The pre-disaster aspects of this bill will go a long way to make our communities more resilient and save a tremendous amount of tax dollars in disaster recovery aid,” Marticek added. “The post-disaster reforms show the admirable degree to which Sen. Menendez truly listened to the advocates and Sandy victims on the ground, carrying those lessons into his bill to ensure that disaster victims are at the center of FEMA’s response, and that the failures of the NFIP claims process following Sandy are not replicated in the future. We fully endorse this bill and need it now more than ever.”
Amanda Devecka-Rinear, director of the New Jersey Organizing Project, said the measure is “forward-looking and invests in mitigation and prevention to safeguard families from losing everything, to ensure protection from flood disasters isn’t out of reach, and to make rates more affordable.”
“Flood insurance works only when policyholders’ claims are paid fully and promptly in case of loss,” noted Jay M. Feinman, distinguished professor of law at Rutgers Law School. “This bill gives insurance consumers a fair claims process and effective remedies to guarantee them the protection they have purchased. The reforms in this bill are essential to restore the integrity of the program and keep its promises.”
“This is what bold legislation looks like,” stated George Kasimos, president and founder of StopFEMANow. “Sen. Menendez never forgot the Sandy victims and those along the shore in need of relief. This proposed bill covers all the reforms needed to the NFIP. It is the most policyholder-friendly bill being proposed yet it is fiscally responsible to the budget. This is evident by the widespread support on both sides of the aisle.”
Menendez, who chaired the Sandy Task Force with Booker and Sens. Charles E. Schumer and Kirsten Gillibrand (both D-N.Y.), first exposed the widespread lowballing of flood insurance claims during congressional hearings in 2014, and last year successfully pushed FEMA to reopen every Sandy flood insurance claim for review. The claims review has since compensated Sandy victims more than $230 million in additional payments they were initially denied, Sandberg pointed out.
Menendez authored the Superstorm Sandy Relief and Disaster Loan Program Improvement Act, signed into law last November, which extended and expanded access to federal disaster loans through the U.S. Small Business Administration. The senator’s Homeowner’s Flood Insurance Affordability Act, meanwhile, was signed into law in 2014 to address the skyrocketing rates many Sandy survivors encountered. In 2013, Menendez shepherded the original $60 billion federal Sandy aid package through Congress.
Now, as Warren wrote in an op-ed she, Menendez, Kennedy, Van Hollen, Rubio and Cochran penned for the Wall Street Journal, “It’s time to come together to pass a long-term, bipartisan NFIP reauthorization that makes much-needed reforms to the flood insurance program. Our bill will make changes that extend affordable flood insurance protection to everyone who needs it and that places more emphasis on better flood mapping, prevention, and resiliency.”
-- Juliet Kaszas-Hoch
Menendez, Other Senators Call for Major Reforms in Flood Insurance Program - by John Reitmeyer, NJ Spotlight
Sandy victims pleased as proposed changes include capping homeowners’ premiums and limiting insurance company profits
The National Flood Insurance Program, which underwrites policies for thousands of New Jersey homeowners, is up for renewal later this year, and a bipartisan group of federal lawmakers is calling for major reforms that incorporate lessons learned in the wake of Superstorm Sandy. The program faced a barrage of criticism after Sandy, including for questionable claims’ denials and delayed payments.
The sweeping changes proposed by New Jersey Democrat Robert Menendez and other U.S. senators are aimed at making the flood insurance program more responsive to homeowners and taxpayers instead of to private-sector insurance companies and agency contractors.
They include capping annual premium increases that homeowners can face; freezing interest payments that the program owes the federal government for funds that have been borrowed to pay out claims; and limiting profits that private-sector insurance companies can make while underwriting program policies.
The proposed reauthorization also seeks to give the flood insurance program a more preventive approach by offering incentives like low-interests loans for homeowner flood-mitigation projects. It would also encourage the use of more modern flood-mapping technologies.
Learning lessons from Superstorm Sandy
The reform effort won praise yesterday from advocates for New Jersey’s Sandy victims after it was announced during a news conference held in Washington, D.C. The current law authorizing the flood insurance program will expire after a September 30 deadline unless a reauthorization bill is adopted.
“We have to turn the lessons we learned after Sandy into action, and that’s exactly what the (reauthorization) does,” Menendez said during the news conference.
Created nearly 50 years ago, the flood insurance program is administered by the Federal Emergency Management Agency, but it is not permanently authorized and is instead subject to periodic renewals. More than 230,000 New Jerseyans currently hold flood insurance policies through the agency, and over the past four decades residents here have received almost $6 billion in payments from the agency to help rebuild after devastating storms like 2012’s Sandy.
But the program came under fire in New Jersey in the wake of Sandy as storm victims accused the agency and its contractors of underestimating claims, delaying payments, and wrongly denying policyholders. FEMA eventually agreed in 2015 to reopen the claims of nearly 150,000 Sandy victims to ensure they were treated fairly.
10% cap on annual rise in premiums
Menendez said the proposed reauthorization seeks to ensure that future flooding victims don’t have to face a “manmade disaster” after facing down a natural one like Sandy. “Americans deserve a flood insurance program that is sustainable for taxpayers, affordable for homeowners and accountable to everyone,” he said.
Right now, flood insurance premiums cannot rise by more than 25 percent annually, but the reauthorization would cap the annual increases at 10 percent. That change is designed to help keep the cost of the insurance affordable and keep homeowners from dropping it.
Compensation for private insurance companies participating in FEMA’s “Write Your Own Policy” program would also be capped at 22 percent of premiums instead of the 31 percent that the agency currently allows. The reauthorization would also hold FEMA to strict payment deadlines when claims are filed, and ban outside contractors from using legal tactics to prevent or delay the paying out of legitimate claims.
Funding would also be provided to help encourage the use of more advanced mapping technologies to improve flood maps in communities across the country.
To help strengthen the flood insurance program’s overall finances, the reauthorization would also freeze interest payments the program has been paying to the federal Treasury. In all, the program is an estimated $23 billion in debt, according to a recent U.S. Government Accountability Office report. It has paid about $4 billion in interest to the Treasury over the last decade, consuming roughly 10 percent of the revenue collected through premiums, the senators said.
Freezing those payments would free up funds that could be used to help focus the agency more on preventive efforts, including low-interest loans to homeowners for elevation projects and aid to communities for large-scale flood-mitigation projects. The senators yesterday cited national statistics that indicate such projects generate a $4 return for every $1 spent.
“Our bill shifts our entire flood-response paradigm from one that solely focuses on rebuilding in the aftermath of storms and floods to one that actively works to prevent them,” Menendez said. “These investments in resiliency will be worth every penny, and then some.”
“It’s a lot cheaper to pay on the front end than on the back end,” said U.S. Sen. John Kennedy, a Republican who represents Louisiana, a state that was hit hard by 2005’s Hurricane Katrina. Kennedy, one of three Republicans to sign onto the bill as a primary sponsor along with Menendez and other Democrats, called the reauthorization proposal “incredibly important,” citing the September 30 deadline for renewal.
“It is urgent that we act,” he said.
Krista Sperber, a co-founder of the New Jersey Organizing Project, a group that has been advocating for years for Sandy victims, credited the proposed reauthorization for incorporating “hard lessons” that were learned through New Jersey’s experience with FEMA and the flood insurance program.
“It reins in the private insurance companies who have made record profits at our expense, stops them from being reimbursed by (taxpayers) when we fight their abuses in court, and creates penalties for underpayment, which were rampant after Sandy,” Sperber said. “This legislation creates pathways to allow families to prevent a flood disaster and get out of harm’s way, saving us incredible loss and emotional distress, and saving taxpayers money,” she said.
Kevin Walsh, executive director of the Fair Share Housing Center, another agency that has worked on behalf of Sandy victims, said by limiting the annual increases in insurance premiums the proposal would also help “keep the Jersey Shore affordable to working families.”
'Laugh Instead of Cry' comedy show benefits Sandy group - By Jean Mikle, Asbury Park Press
BELMAR - A comedy show here Saturday will raise money for a superstorm Sandy victims' advocacy group.
The "Laugh Instead of Cry" fundraiser will feature comedians John Poveromo, Angelo Gingerelli and Joann Filan, performing at 8 p.m. at the Beach Haus Brewery, 801 Main St.
Proceeds benefit the New Jersey Organizing Project, a local Sandy advocacy group. Tickets are $25 in advance and $30 at the door, and include two drinks from the Beach Haus. Food will be available from 10th Avenue Burrito.
You can purchase tickets at https://actionnetwork.org/ticketed_events/comedy-night-fundraiser-2.
Born in Brooklyn but raised in New Jersey, Poveromo has a personal connection to Sandy: his parents lost their Toms River home in the storm.
He said working with New Jersey Organizing Project is a way for him to help Sandy victims who are still struggling, nearly five years after the storm. The organizing project was one of several advocacy groups that was instrumental in getting legislation passed to protect Sandy families from foreclosure.
"The stress and heartache I saw my parents endure after Sandy hit is not something I'd wish on anyone," Poveromo said.
"Losing your home is a heavy weight to bear and one they still deal with today both financially and emotionally."
The goal of the fundraiser is to raise $8,780, the same amount the organizing project received last year from Belmar storm victim Krista Sperber.
Belmar residents Mike Irwin, Krista Sperber and her two children, Jack and Maisie, were helped to get home after superstorm Sandy by a borough-wide fundraising effort.
The Sperber family, along with the family of Teresa Keefe were part of Belmar's "Home by Summer" campaign, which raised more than $200,000 to get the two families home. Watch the video above of Belmar Mayor Matt Doherty talking about the campaign.
Before receiving support from the Belmar campaign, Sperber had started a GoFundMe effort as her family struggled to stay afloat while paying rent, storage fees, and a mortgage on a house that could not be lived in.
After receiving help from "Home by Summer" and finally settling with her flood insurance, Krista Sperber asked those who had contributed to the GoFundMe campaign if they wanted their donations returned, or if she should donate it to help other Sandy families.
"They all told me to pay it forward because that's the kind of community we are," Sperber said.
Jean Mikle: 732-643-4050, firstname.lastname@example.org
NJ comic who lost childhood home, raising money for Sandy victims - By Steve Trevelise, New Jersey 101.5
John Poveromo is a Toms River comedian who lost the home he grew up in to Sandy. As we approach the fifth anniversary of the super storm, there are still many people who continue to deal with the effects and need your help.
On Saturday, John is hosting a fundraiser to benefit the New Jersey Organizing Project, launched by nine Sandy survivors. The group connects and trains community members to “participate in the decision-making processes that affect their daily lives and take action for real solutions.”
Recently, the organization helped create a Rental Assistance Program, and then led a coalition of communities and elected officials to provide rental assistance to families still out of their homes. That resulted in an additional investment of $15 million to helped affected communities.
Here’s John’s story, in his own words:
“After Hurricane sandy in 2012 my parents lost their home to the storm. I can’t even begin to tell you, 5 years later, how that has affected them. I can only tell you the stress and heartache I saw my parents endure after Sandy hit is not something I’d wish on anyone. Losing your home is a heavy weight to bear and one they still deal with today both financially and emotionally.
“In January I began working with and supporting NJOP’s efforts to ensure that the victims still suffering find the help they need and assurance that if this should happen again, they won’t be going through it alone.”
“As I said above, I can’t even begin to tell you. But what I can do is provide you with a first hand account of what it was like from my mother.”
Here’s the account of what life was like following the storm from John’s mom, Laura Hanebury, also in her own words:
“It’s hard to describe how I felt after Sandy hit. I remember being in the hotel room on my iPad seeing the roller coaster in the ocean, the gas explosions at Camp Osborn in Mantoloking — all the homes on fire and no way to get help there so they had to just let them burn.
We tried to get to our house the next day but Fischer Boulevard was flooded. There was actually a 40-foot yacht in the middle of the street. That night my neighbor text me and said he had taken a kayak down our street. He had 3 feet of water in his house and since my house sat a little lower than his, I probably had the same or worse. I remember texting a friend and telling him about the water – but I didn’t fully understand what that was going to mean. I still remember repeating ‘3 feet of water in my house,’ but I realize now they were just words. They had no meaning to me. I could not comprehend what was happened. That is still one of the most disturbing things I remember, that I didn’t understand it in my mind.
The next day, Oct. 31 we finally got there. We had to park on the street behind our house because our road was still flooded. The front door wouldn’t open because the carpet was so swelled from the water. We pushed the door and saw the wet furniture in the living room first. I was still numb. I finally cried when I saw all the boxes of our Christmas decorations turned upside down and the contents in water. Then my 45 record collection. Those are the things I can’t forget about and still get me very upset.
“Even seeing all the destruction in the house, and with my son’s friends coming to help pack things that weren’t damaged, I did not fully understand the impact this was going to have on my life. It was three days later when someone asked where I was going to live that I lost it. I actually felt on the verge of hysteria. That’s when I realized I couldn’t just ‘clean up’ the mess 3 feet of water made. I had to pack to move. Immediately. No time for thinking or planning. Just time for making what turned into life changing decisions. I’ve spent my whole life planning and organizing. It’s what’s kept me sane through some hard times in the past and now I had to change everything – including my way of coping with bad situations.
Another huge hit came a few days later when I found out I couldn’t go to my office, which I’d been at for 18 years at the time, because it’s located on the barrier island that was hit the hardest. More change, happening way too quickly, and people just didn’t understand why I couldn’t cope.
I was speaking with someone today that I just met who also lost her home. She not only understood but she is still impacted mentally like I am. The only people I’ve ever spoken to that “get” it are the people who were affected.”
I consider myself to be a compassionate and empathetic person. Whenever I would see stories about people losing homes hurricanes or fires, I felt like I knew exactly how I would feel. I was wrong. There is no way to know unless you’ve been there.”
Clock running out on Sandy victims seeking mortgage help - By Jean Mikle and Russ Zimmmer, Asbury Park Press
Time is running out for Sandy victims seeking a break from paying their mortgage.
Homeowners have until 5 p.m. Wednesday to request a mortgage forbearance certification from the state, under a program that aims to give Sandy victims a measure of financial relief.
Hundreds, perhaps thousands, of families on the Shore discovered that their finances could not support both their mortgage and the rent they owed on a temporary home as they waited — and continue to wait — for their homes to be rebuilt nearly five years after the superstorm struck.
More than 300 homes in Sandy-affected zones in Monmouth and Ocean counties slipped into foreclosure in 2014 alone, according to an Asbury Park Press analysis.
Now, the state is offering affected homeowners the chance to delay mortgage payments until they're back on their feet. But the window to apply is closing.
To qualify, a homeowner must:
So far, 537 homeowners have submitted applications to the DCA, according to department spokeswoman Lisa Ryan.
The DCA certifies that the homeowner meets the criteria and then provides proof so the homeowner and their lender can arrange for the mortgage payments to be delayed, until July 2019 at the latest.
As of this week, 295 homeowners have been certified, Ryan told the Press.
Amanda Devecka-Rinear, of the New Jersey Organizing Project, a Sandy advocacy group, said her organization has seen several problems with the foreclosure bill.
The DCA sent a letter to homeowners who could be eligible for the program, telling them they could seek a mortgage forbearance to prevent foreclosure if they are having difficulty making their mortgage payments.
But Devecka-Rinear said homeowners who are already in the foreclosure process may not know that they can seek a stay of foreclosure by going to court.
Legal Services of New Jersey is encouraging homeowners who are already in foreclosure to seek legal help with the process by calling them at 1-888-LSNJ-LAW (1-888-576-5529).
Devecka-Rinear said that some banks seem unaware of the Sandy foreclosure law, and have been unwilling to allow a mortgage forbearance, even after the homeowner has completed the required paperwork.
Democratic gubernatorial candidate visits post-Sandy sites - By Steve Moran, Asbury Park Press
STAFFORD – A Democratic hopeful for his party’s nomination for Governor of New Jersey in 2017 took a bus tour Saturday with a group of impacted homeowners to sections of Manahawkin still recovering from Superstorm Sandy.
State Assemblyman John Wisniewski’s (D-19) office contacted the New Jersey Operating Project (NJOP), a local grassroots advocacy and lobbying group, after meeting two members at a Town Hall-style meeting at Stockton University last month, said NJOP co-founder, Joe Mangino.
He and co-founder Amanda Devecka-Rinear set up the meeting at Mangino’s house, followed by the bus tour.
The NJOP is a regional network of people standing up for South Jersey and the Shore after Sandy by working together to pass policies that make life better, change institutions, hold corporations accountable and ensure elected officials stand with their constituents, according to its Website.
Wisniewski sat in Mangino’s living room in Beach Haven West with about a dozen other NJOP members discussing health care, pensions and the local economy.
But most importantly, Wisniewski he wanted to hear about their post-Sandy experiences and ideas for moving forward.
The candidate listened as people told him their stories of trying to, or finally, getting back home while dealing with all the financial, physical and mental hardships, let alone the infinite levels of state and federal bureaucracy after the storm.
On the top of their list was that many had recently received “clawback” letters from the state’s Department of Consumers Affairs (DCA) demanding the return of grant money they were awarded through the federally funded Reconstruction, Rehabilitation, Elevation and Mitigation (RREM) program.
According to the DCA, when a homeowner prepares to close out of the RREM program, DCA completes a final review of their grant to make sure all work eligible for grant funds has been documented and included in the grant award calculation.
If not, the unused or unaccounted for funds must be returned.
The NJOP and other advocates feel in many cases the clawback happens because paperwork is missing from the audits or guidelines have not been followed properly by the state.
“I spent the last four years fighting to get my life back to normal. And when I finally did, this letter shows up,” said one Little Egg Harbor resident who asked not to be identified.
Julie Suarez, also of Little Egg Harbor said she initially was told her family needed to return $52,000 to the state. But the detailed spreadsheet that came with the letter did not come close her family’s actual costs.
After an appeal, the amount was cut in about half and she was offered a payment plan. “I’m struggling to make my mortgage and they want $715 a month. I don’t have it,” she said.
Wisniewski was given a folder with copies of several of the letters the group’s members had received.
Before boarding the shuttle bus, Wisniewski said the clawbacks should be eliminated. “They cause more hardship and misery than the money they are worth. People shouldn’t be punished for trying to get back home,” he said.
The shuttle bus, provided by the owners of Old Causeway and Mud City Crab House restaurants in Manahawkin, drove out to East Point, on to Cedar Bonnet Island and then past Mud City (Mallard Island).
Wisniewski sat up front with Mangino and Dan Quinn, who he met with Suarez at Stockton, acting as tour guides.
Quinn said while many of the homes in Beach Haven West that were damaged or destroyed have been raised or new ones built up on pilings, there were still many sitting on ground level slabs.
With climate change and rising sea levels, those homes will just be caught up in the same cycle next time, he said.
There needs to be resiliency planning and infrastructure changes to mitigate the damage caused by future storms, Quinn told Wisniewski.
Several of those ground level homes are also still empty, Quinn said. “There were lots of elderly people who retired here and blue-collar workers,” he said.
After Sandy, their insurance did not cover the cost of the damage. Plus, they did not have the money to rebuild or wait out the long process of getting RREM money, so they “walked away,” he said.
That has had a direct impact on the local small business owners as the area changes from a year-round community to summer homes, said Mangino.
Suarez said the same is true in her Mystic Island neighborhood in Little Egg Harbor Township. “There are at least eight empty houses within a two-minute walk of my house,” she said.
She also advocated for strong mitigation and resiliency programs.
Suarez said she read a study by the Rutgers Jacques Cousteau Coastal Research Center in Tuckerton that has predicted Mystic Island will be underwater by 2030, under current conditions.
“Then what am I supposed to do?” she asked.
At Devecka-Rinear’s home on Cedar Bonnet Island, Wisniewski saw first-hand how bad the situation could easily and quickly become much worse.
It was high tide and the bay water was only about a foot below the top of her bulkhead.
“This is only after a day of heavy rain, you can imagine what could happen with the next major storm,” she said.
Using a depth marker in front of her house for a reference, she pointed out the water came to about 6.5 feet above the street during Sandy.
Circling back to Mangino’s house via Bay Avenue, Wisniewski saw that most of the “Mud City” coastal marsh was submerged and the residential streets beyond were flooded at the high tide.
At the end of the tour, Wisniewski said in addition to eliminating the clawbacks, what he learned was there needs to be the development of comprehensive mitigation plans, including the buyouts of homes in flood-prone areas and affordable ways to raise homes.
Also, resiliency actions for the infrastructure such as power and roads. We can’t just have a patchwork of ideas, we need an overall plan, he said.
Most importantly, the state needs to recognize climate change is real, said Wisniewski. “It has been ignored or denied for the past seven years and that can’t go on,” he said.
Most of those on the bus signed Wisniewski's petition to get on the June Democratic primary ballot, but Mangino said the NJOP was not making a formal endorsement at this time based on a single meeting with only a few of the hundreds of NJOP members present.
“I personally liked his ideas for health care and fixing the state’s pension fund,” he said.
Mangino also believes the Assemblyman realizes that there needs to be a statewide plan of resiliency and mitigation to address climate change and future storms.
The NJOP website is at www.newjerseyop.org.
Wisniewski's campaign site is at wiz2017.com.
Both have Facebook and Twitter pages.
We're South Jersey and the Shore standing together for community solutions.