WRAL Investigates

State ends crisis housing program: 'Some mistakes were made'

Posted January 31, 2013

WRAL Investigates
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— North Carolina taxpayers spent nearly $200,000 over eight years to help a Robeson County woman with a leaky roof. Dianne Galbreath says she applied for hurricane assistance and ended up with a brand new house.

Galbreath’s story was one of several questionable cases the WRAL Investigates team found related to the Hurricane Redevelopment Center, a crisis housing program that was created after Hurricane Floyd hit North Carolina in 1999.

The program was intended to provide housing assistance to thousands of low income people who didn't qualify for federal help.

The center got another dose of state funding after hurricanes struck in 2004. State lawmakers passed the Hurricane Recovery Act of 2005, promising more than $200 million in immediate assistance, $27 million of which went to the crisis housing fund.

While her Robeson County neighbors saw no damage, Galbreath says rain caused a leak in the roof on her 1930s Maxton home. When FEMA rejected her application, she turned to the Lumber River Council of Governments, which handled the state housing money.

“It took forever (to get help),” Galbreath said. She continued living in the home through more than five years of reviews and personal credit problems. Then, a wall caved in.

The agency moved her to a rental home around the corner and paid $625 a month for two years. The state eventually took back the project from Lumber River, and tax dollars paid to demolish the original home and build Galbreath a brand new, two-story house in its place.

“I think the rental, staying in there two years, was a bit much,” Galbreath said.

State ends crisis housing program: 'Some mistakes were made' State ends crisis housing program: 'Some mistakes were made'

According to state records obtained by the WRAL Investigates team, the state spent more than $192,000 and about eight years on Galbreath. If the state had reacted sooner, Galbreath said, she might have been able to keep her original house.

Doug Hoell, director of North Carolina’s State Emergency Management, says he began taking a closer look at the housing assistance program last year. He says he understands if the public thinks the state wasted money.

“Frankly, that's why I'm closing the program,” Hoell said, adding that the program will officially shut down after Thursday. “It was managed at the county level. It was, in a lot of cases, managed by contractors who did the work, and there was a lot of latitude.”

Hoell says block grant funding designation gave counties leeway to exceed typical emergency management assistance. Instead of getting storm damage repairs, applicants and contractors often got more.

Tax dollars paid to replace damaged single-wide mobile homes in Robeson County with more expensive double-wides. Lumber River Executive Director Jan Maynor claimed local leaders called for the bigger homes to make them more storm-worthy and to increase the county tax base. The state never received proof commissioners voted on the decision.

Either way, the move violated state guidelines that storm victims only get comparable replacements.

“Again, I think if this program is ever implemented again it needs to be managed at the state level,” Hoell said.

Preston Locklear says he was thankful to get a double-wide for his family in Rowland. Although, he says, the original house was not actually damaged in 2004 hurricanes, but rather by years of previous water damage.

The WRAL Investigates team also found problems in Haywood County, hit hard by storms in 2004. A couple who lost their mobile home took out a personal loan and bought a new one. Months later, a contractor showed up and said the couple should qualify for assistance.

Tax dollars paid off the couple's $26,000 personal loan, they received $7,000 in cash and then moved the mobile home to a newly prepared lot for an added cost of $54,000. The funds were improperly expended and are subject to recapture, according to the state.

“There are some issues here. Some mistakes were made,” Hoell said.

Hoell has called on the State Bureau of Investigation and state auditor to investigate if fraud was committed in some cases. He won't specify which ones. Still, Hoell argues, on the whole, the housing program did a lot of good.

“I just think that the program was not clearly defined for what it was intended to do,” he said.

The Housing Redevelopment Program assisted 5,100 people after Hurricane Floyd, according to Hoell. More than 2,000 families applied for help after the 2004 storms, but only 209 were accepted. Hoell says they’ve identified 16 instances of potential fraud.

Even some of those with new homes question the process.

“I appreciated it, (but I saw) money being wasted. I really did,” Galbreath said.

The North Carolina Department of Public Safety’s new secretary, Kieran Shanahan, says the program helped thousands of struggling families. "But it was a program that needed a more defined system of checks and balances," he said in a statement. He added that future assistance programs will include a centralized and improved system.

Hoell announced Thursday that he will retire on Feb. 1 after three decades of state service. He announced his retirement plans before WRAL began asking questions about the crisis housing program. Emergency Management Deputy Mike Sprayberry has been named acting director.

25 Comments

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  • queendivadee1963 Feb 1, 2013

    Dianne was not looking for a handout she was looking for help. What was she suppose to do live in the street or in a shelter. Don't judge unless you walked in her shoes. All she wanted was her roof fixed, they took their time and the damage got worse. Was she suppose to say NO to a new home. Would you!!

  • Nancy Feb 1, 2013

    "Is there a single NC state governement agency, office or section that is competent?" - yankee

    Apparently not, every audit Beth Wood has done has shown major financial mismanagement. And to date, no one has been fired.

  • mep Feb 1, 2013

    Mistakes were made.... hundreds of thousands of taxpayer dollars wasted. Same story... different day... different circumstance. And folks wonder why some people dont like paying taxes.

  • yankee1 Feb 1, 2013

    Is there a single NC state governement agency, office or section that is competent?

  • b4reelnow Feb 1, 2013

    be carefull of what you say, the very leaf that gets turned over may very well be your own!

  • novacrazy2000 Feb 1, 2013

    if Galbreath had just put a roof on her house( which the storm probly had nothing to do with) it would have saved the tax payer some money. Some people just look for hand outs any where they can get it.

  • Relic Feb 1, 2013

    "Mistakes were made..." That sounds familiar, doesn't it?

  • bubbba Feb 1, 2013

    And we expect these people to pass more laws to protect us from ourselves. Honestly folks, I think the Mayans may have been right.

  • freedomrings Feb 1, 2013

    “I appreciated it, (but I saw) money being wasted. I really did,” Galbreath said

    Then why didn't she do something about it? A couple of years after I stopped using unemployment, I received a letter in the mail from the department of unemployment saying I had $6,000.00 more coming to me. All I had to do was start electronic filing and enter my PIN. It was tempting, we needed the money, but I knew it had to be a mistake. I tore the letter up. The following year we learned unemployment made a tremendous mistake and overpaid in hundreds of thousands of dollars, and my letter was indeed an error.

    If you smell something fishy, you need to step up and not take advantage.

  • Come On_Seriously Feb 1, 2013

    "Every agency in the state that has been audited or 'looked at closely' is being exposed for waste, graft, corruption.
    McCrory has a lot of work to do."

    True- and he'd best look at reigning in the R general assembly instead of going on athe wild joyride they seem to expect:

    "Problems identified by Medicaid audit largely result of NC Republican’s own budget."

    "the major finding in the audit, that NC’s Medicaid program wasn’t able to meet the budget set for it by the Republican majority in the General Assembly (and passed over former Democratic Governor Perdue’s veto)..."

    http://pulse.ncpolicywatch.org/2013/02/01/problems-identified-by-medicaid-audit-largely-result-of-nc-republicans-own-budget/

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