Federal Audit Finds New Jersey Failed to Control Sandy Funds

NJTV News | October 5, 2016 | Sandy
HUD audit concludes Garden State should return money if it cannot justify certain expenditures

Four years after Hurricane Sandy, a federal audit of money allotted to repair and rebuild in the hurricane’s aftermath has found that New Jersey “… did not have adequate controls in place to administer its contract and monitor contract performance and was not fully aware of federal procurement and cost principle requirements.”

Hammerman and Gainer Inc., a Louisiana company that New Jersey paid $43 million to handle applications for aid and to disburse funds, has been a principal target of homeowners entangled in post-Sandy red tape. Now, an audit conducted by the Department of Housing and Urban Development notes “…HUD did not have assurance that the $43.1 million disbursed under the contract was for costs that were eligible, supported, reasonable and necessary.”

The audit calls on New Jersey to justify certain questionable expenses or to pay the money back.

Congressman Bill Pascrell, who had asked HUD to conduct the audit, said, “The state fumbled the ball. The governor fumbled the ball… There was no real track record and there was no real follow-up on many things that should’ve been followed up. And you’re dealing with people who were the most vulnerable. They’re out of their homes.”

The governor’s office declined comment. In a rebuttal to the HUD audit, it blamed “HGI’s sloppy invoicing” for inaccurate records.

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