RALEIGH, N.C. — Discussions swirled at the North Carolina legislative building on Monday, all trying to get to the bottom of what caused a $175 million gap in disaster recovery funding.
State leaders who are overseeing disaster relief efforts testified before lawmakers Monday. House and Senate Republicans are worried about the gap, especially now that recovery efforts after Hurricane Helene hit western North Carolina have started.
Senate Appropriations/Base Budget Committee Co-Chairman Brent Jackson said the point of the discussion was to get "these poor people, our citizens of North Carolina, back in their homes."
Jackson asked Deputy Legislative Counsel of the North Carolina Governor's Office Pryor Gibson and the COO of Rebuild NC, Laura Hogshead, about the budget deficit how the state got to this final number.
"The operational accounting showed in the first pass that $175 million should be able to finish all the homes," Gibson stated. "When we did the actual accounting ... it's clear that it's going to be about $221 million to return all the homes in the queue and get those families back. Remember that $175 [million] was an operational review ... whereas the accounting review revealed that it wasn't fair to use attrition."
Gibson went on to explain that the North Carolina Office of Recovery and Resiliency is "too much over its skis" on this project.
"It does not have enough money to finish the projects in its queue or the affordable housing," Gibson clarified. "It's pretty straight forward. That's the reason we went to you and your staff before the last session and said 'We need $175 million.'"
The last session Gibson referred to was in late October. Gibson went on to insist if the state doesn't have the money, the projects will need to be paused.
Hogshead added that her department has an amendment that could move $44 million of unobligated funding to cover some of the shortfall, but that amendment has not been proposed yet.
House Deputy Majority Leader Rep. Brenden H. Jones (R-46) asked Hogshead about potential fraud in these cases of people asking for money.
"In every instance where an allegation of fraud is made, we send that to our third-party investigators," Hogshead explained. "If that allegation is substantiated, we send that forward to the SBI."
"So we're $221 million in the hole, you notify us two days before the last time we came in, it's hard to believe your accounting is that bad," Jones said.
Jones also accused Hogshead's department of not verifying the claims of filers. He pointed to finding addresses near his own that were on the department's claim list and said there wasn't flooding near his home.
"Did you guys do any due diligence at all with these homes, or did you just sign them up and push them out?" Jones asked Hogshead and Gibson.
"I think any of the families who participate would say we did a lot of due diligence, we do a lot of checking," Hogshead responded. "We check the FEMA databases to make sure that they had a FEMA claim, because it's not just flooding damage, it's any storm damage, so that could include wind damage, roof damage, etc. If there are allegations you would like us to follow up on, we are very happy to do that."
Hogshead explained all claimants have to prove they own the home, they lived in the home at the time and that they received damage from the home.