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Reasons explained for delay in flood recovery money

CHARLESTON — West Virginia Gov. Jim Justice’s administration is being criticized for its slow pace in spending nearly $150 million in federal flood recovery money — and the governor admits to “pushing the pause button” on the initiative.

But Justice said he has excellent reasons for delays in getting help to victims of June 2016 flash floods that devastated some communities in several areas of West Virginia.

Concern about how some of the money was being spent, specifically involving a Mississippi firm, Horne LLP, has been cited. The company was hired as a consultant for flood recovery work during former Gov. Earl Ray Tomblin’s administration.

But, apparently during a meeting last November involving state and federal officials, issues about how the program was being run were discussed. At the state level, recovery efforts using the federal money are under the RISE West Virginia program, overseen by the state Department of Commerce.

A review of how the money was being managed was ordered by the Justice administration. An outside counsel looking into the matter termed a $17 million payment to Horne “problematic.” It was not subjected to required safeguards, including review by Attorney General Patrick Morrisey’s office.

One concern was a “continuing management agreement” through which the amount of the contract with Horne, initially $900,000, was increased to $17 million.

A commerce agency employee was fired as a result of the investigation.

In addition, a delay of several weeks in proceding with the flood recovery campaign resulted.

In a written statement on the situation, Justice said the investigation “found things that could save West Virginia millions in federal funding. … Those people that weren’t doing their jobs have been held accountable.”

“Our flood victims are going to continue being served,” the governor insisted in his statement.

Details of precisely what happened have not been provided, despite reporters’ attempts to get them from the governor’s office and the Department of Commerce.

Some legislators are not happy about the delay in getting money to flood victims.

State House of Delegates Speaker Tim Armstead and state Senate President Mitch Carmichael are among those who want to know more about the situation. In a letter to lawmakers on the Joint Legislative Committee on Flooding, Carmichael and Armstead wrote that, “Many questions and concerns have arisen regarding the management of the West Virginia RISE program …”

They asked that the committee meet “to examine management (of the program) at the earliest opportunity.”

Meanwhile, officials at the U.S. Department of Housing and Urban Development are concerned. That agency allotted the $149.8 million in federal Community Development Block Grant funding for flood relief work in West Virginia.

HUD has listed the state as a “slow spender” of the money in a report. Of the $149.8 million available to the state since last year, only about $1.1 million has been spent.

“You don’t pick up the pace of expenditures by suspending the program,” as the Justice administration has done, said HUD spokesman Brian Sullivan.

And HUD officials were not happy about communication involving the recovery project. They were “a bit surprised when we learned, and not from the state but through other parties, that the state had suspended the program, at least temporarily,” Sullivan said.

“There’s always going to be tension between doing things quickly and doing things properly,” Sullivan said, adding, “All of this comes in the backdrop of so many people in West Virginia still needing help.”

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