Legislative leadership wants committee to look into West Virginia Rise delays

May 25--Legislative leaders are asking lawmakers to look into delays in getting aid from the West Virginia Rise program to victims of the 2016 flood..

House Speaker Tim Armstead and Senate President Mitch Carmichael have sent a letter to the Joint Legislative Committee on Flooding, asking members to hold public meetings outside of previously scheduled legislative interim committee dates to look into management of the Rise program, which has funds available for repair or reconstruction single-family housing and single-family rental properties damaged in the June 2016 flood.

Part of the delay has been attributed to Gov. Jim Justice "pushing the pause button" on the program after finding irregularities in the West Virginia Department of Commerce's management of the program and $17 million in contracts, according to a report from the West Virginia Press Association.

Commerce manages the RISE West Virginia disaster recovery program through the West Virginia Development Office and West Virginia Community Advancement and Development Office.

"Many questions and concerns have arisen regarding the management of the West Virginia Rise program, contracts awarded by the program and use of funding the program is charged with administering," said the letter sent by leadership. "I am sure you will agree that the flood survivors who are awaiting assistance, as well as the taxpayers, want to ensure that we obtain answers to these questions."

Brian Abraham, general counsel for the governor's office, said former U.S. Attorney Mike Carey was brought in as outside counsel to handle the review, according to the WVPA report. He found a $17 million payment to Horne LLP to be "problematic." The payment did not go through the purchasing agency and was not reviewed by the Attorney General's office -- required steps in payment distribution.

Horne LLP, described as an accounting and law firm based in Mississippi, was selected by the Tomblin administration in a consulting position because of its prior experience working with HUD, including the Hurricane Katrina disaster.

"There were portions of a contract that were awarded after the original contract, in the amount of $17 million," Abraham said. "We were concerned about that, because it did not go through our purchasing agency at the department of administration and that contract was not reviewed by the Attorney General's office, required in West Virginia in a legally binding contract."

Meetings about WV Rise have been on-going since November.

Abraham said one red flag was a "continuing management agreement" that resulted Horne's portion of the contract increasing from $900,000 to $17 million.

Abraham said Commerce officials allowed the Horne contract to be expanded over time.

"Purchasing denied that in writing," Abraham said. "The person that received that in Commerce did not communicate that to the staff responsible for contracting with outside vendors. So, not knowing that, they went ahead and ran what I'll call an internal RFP (request for proposal), and bid it out and had multiple bids on what would later become phases 3 through 8. Horne again was the successful bidder, and that project was $17 million.

"We determined that was not lawful," Abraham said. "Commerce may have believed that they did it right by bidding it out, but procedurally, they didn't."

Because of those findings, the Commerce Department was told to "stop what they were doing in respect to the RISE program," Abraham said.

Earlier this week, an analyst for the flood committee cited media reports, saying the subject would be a topic of study during future interim meetings. The goal is to hear from state Department of Commerce and Rise officials to find out more.

The state previously announced receiving a $104 million Community Development Block Grant from the U.S. Department of Housing and Urban Development for the project.

Commerce Secretary Woody Thrasher previously said the grant would be used to build 1,500 homes in the 12 flood-affected counties, as well as elevate other houses above the floodplain and pay for a year of flood insurance for qualifying property owners, according to previous reports.

Sen. Stephen Baldwin, D-Greenbrier, who serves as a member of the committee, previously said some people in his district still aren't in homes. He mentioned a couple living at a Greenbrier County church who are Rise clients. He said he also knows of residents living in campers.

"The potential of millions of dollars being pulled back (from the federal government) has been stopped because we are doing things right," Abraham said.

"Gov. Justice has made it known from day one," Abraham added, "He insists on transparency and accountability."

Commenting earlier this week, Justice said, "There's a new sheriff in town and people need to realize that Jim Justice will see to it that West Virginia is not going to be on the short end of the stick. We found things that could save West Virginia millions in federal funding. Our flood victims are going to continue to be served. Those people that weren't doing their jobs have been held accountable."

The West Virginia Press Association contributed to this report.

Email: [email protected]; follow on Twitter @AndreaLannom

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