City’s missteps leave Columbia homeowners struggling years after 2015 flood
In October 2015, more than 20 inches of rain fell on the Columbia area in just five days, spawning a so-called 1,000-year flood that swamped neighborhoods and devastated hundreds of homes.
To help low-income homeowners recover, Columbia city officials sought and received $13.5 million as part of a federal disaster relief grant. But nearly 6.5 years later, that money — administered by the city — has repaired just 21 homes. Another 50 homeowners with waterlogged floors, leaky roofs, mold or other problems have been told their homes will be fixed, but they’re still waiting.
What’s more, several people who applied for assistance weren’t told until last year that they wouldn’t get any help from the program.
An investigation by The State revealed a litany of missteps by city officials and a private contractor charged with administering the grant. This delayed homeowners getting assistance and forced the city to use local tax dollars to correct mistakes.
City officials acknowledge that getting help to struggling homeowners has taken too long. Some of the officials say complicated federal guidelines have contributed to the delays.
The State’s investigation, which included a review of three years of emails and other documents, shows the program encountered several problems.
Federal auditors repeatedly raised concerns that the city was taking too long to distribute aid and was at risk of missing an initial 2023 deadline to spend the money. As of January this year, the city had spent just a third of the $13.5 million allocated for homeowners.
The city spent all of the $1.3 million set aside for administrative costs a year ahead of schedule.
The city spent upwards of $160,000 repairing properties that were ineligible under the grant.
City employees expressed frustrations with a contractor hired to help lead the program. The city replaced the company last year, a move one city council member said “probably” should have happened sooner.
“Because of (the city’s) negligence, people are still getting hurt in this process,” said James T. McLawhorn, president of the Columbia Urban League. His organization has received complaints from several program applicants. “It’s just unthinkable that these elderly residents who have been devastated by the flood are suffering.”
Columbia Mayor Daniel Rickenmann, who took office in January, said he was first alerted to issues with the program by The State Media Co. “If accurate, these numbers are very alarming. We are going to open up the books at the city and take corrective action,” he said.
Homeowners left waiting
When José Duvall found out he’d have the opportunity to restore his beloved family home through the city’s flood relief program, he was grateful. Duvall, who is blind, has spent the majority of his 65 years in that home off Monticello Road. He has memorized every nook and cranny and cannot imagine living anywhere else.
“This home has been in the family for generations,” he said. “We want to keep it that way.”
The 2015 flood left him with abysmal living conditions like mold, crumbling plaster and a leaky roof.
He applied for the program in 2017 and was told shortly after that work would begin in April 2018. That didn’t happen.
Instead, Duvall spent years waiting for the city to nail down a definite start date.
Duvall temporarily moved out in early February and construction on his home is currently underway, according to the city’s Community Development Director, Gloria Saeed. The estimated completion date is June 15.
Despite missed deadlines and shoddy communications over the years, Duvall said he remains hopeful that the city will make good on its promise. Still, he admitted “we don’t have another choice but to trust in them.”
Shifting Expectations
The city applied for the HUD grant in 2016 with the help of Landmark LLC, a Louisiana-based consulting firm hired to oversee Columbia’s flood relief initiatives.
The federal Department of Housing and Urban Development approved the first round of funding in January 2017 and the city began accepting applications later that year.
A total of 238 homeowners applied.
In July 2019, the city projected in an internal report that it would repair 196 homes by April 2021. But in January 2022, Saeed said 161 applicants were deemed eligible and the city only had enough funds to help 53 of them. Since then, the city has proposed a plan to reallocate around $4 million in federal grant funds to home repairs, enough to help 71 total applicants, Saeed said.
So far, 21 applicants have had their homes fixed, and 15 more have homes under construction. Dozens more are still waiting.
Other qualified applicants, including 59-year-old Deborah Watts, waited up to four years only to find out their homes wouldn’t be repaired after all.
Since the flood, Watts said a storm drain at the edge of her property overflows when it rains, turning her lawn into a swamp and causing water to seep under the house.
When she applied for the program in 2017, Watts said her case manger assured her she met all the qualifications and that help was on the way. Then in June 2021, she received a letter from the city explaining that it did not have enough money to help everyone and her case “does not fall within the group we have funds to serve.”
According to the letter, priority was given to applicants who were elderly, disabled, female heads of household with minor children, and those facing an immediate threat to their health and safety. Those who fell into multiple categories were given additional priority.
“It was very, very disappointing,” Watts said. “It feels like we were misled.”
Meanwhile, the anticipated average cost of each project has risen in less than three years from $69,000 per home to $246,876 per home.
The city said the average cost per home is misleading because the projects incur several expenses not associated with construction. For example, the projects must undergo environmental reviews, asbestos and lead-based paint surveys, the temporary storage of goods, lodging for homeowners, and other costs.
The average cost per project also has risen because of “cascading” damage dating back to the 2015 flood, deferred maintenance of the homes, supply chain issues, labor shortages and an increase in the cost of materials.
The city says the construction costs of new homes have increased 38% in the last two years.
Warning Signs
The first sign of trouble with Columbia’s flood relief program appeared in May 2018 when HUD published a report citing the city for taking too long to spend the money. HUD auditors said the city had a duty to carry out the program as quickly as possible because residents affected by the flood would be “further harmed by a delay in receiving assistance in a program designed for their benefit.”
There were also mounting frustrations with Landmark, the contractor tasked with maintaining records, reviewing construction bids and contracts and writing regular status reports.
As early as 2019, city employees began raising concerns about Landmark in emails and other internal communications. Invoices were a particular point of contention.
In emails, city officials complained that Landmark was not providing detailed descriptions of the work it had completed. This made it impossible for the city to confirm whether the charges Landmark was making were justified, they said.
Landmark declined to comment for this story.
Problems persist
In 2020, the city was dinged yet again for its slow rate of spending and lack of accomplishments. In a report from June of that year, HUD auditors said the city “may not meet the 6-year expenditure deadline,” based on its current rate of spending.
HUD auditors also raised concerns over the city’s “higher than normal” administrative spending. The report warned that the city may run out of administrative funds before the grant deadline.
Meanwhile, problems with Landmark persisted.
One city official said the city had worked with Landmark to try to improve its invoices – to no avail. “There has been a tremendous amount of effort and no positive accomplishments,” Community Development Administrator Dollie Bristow wrote in an August 2020 email to Saeed.
HUD’s 2020 audit acknowledged problems with one contractor in the program and cited the city for failing to properly verify the contractor’s work. Saeed confirmed that Landmark was the contractor.
The report noted that the contractor was responsible for developing administrative policies and procedures for the flood relief program. Still, that contractor was “not keeping complete and accurate records in the system they themselves designed and implemented,” HUD auditors wrote.
Money wasted
This failure to properly verify and maintain records caused the city to pour time and money into fixing properties that were not actually eligible under the grant.
As part of its 2020 report, HUD performed an in-depth review of files for seven projects that had been approved for funding. These projects included repairs for single family homes as well as rental units and small businesses.
HUD found all seven projects failed to meet federal guidelines and ordered the city to return $169,107.02 in grant funds. The city was able to recapture $20,000 from the applicant of one of these projects, but the rest of the money came from the city’s general fund, Saeed said.
Each project HUD reviewed had missing, incomplete or inaccurate documentation including verification of applicants’ incomes, background checks for contractors, insurance statements, property inspection records and cost estimates.
Two rental properties the city paid to repair had not been damaged in the 2015 flood, according to the report. HUD also found that a city employee was selected to have their home repaired through the program, yet no conflict of interest was documented in their file.
According to notes from a June 2020 meeting where HUD officials and city employees discussed the report’s findings, “One of the HUD monitors stated that in all of his experience with monitoring grantee programs, these files were in the worst shape he has ever seen.”
HUD ordered the city to conduct a full audit of its files and return any grant funds spent on projects that did not meet federal guidelines.
Saeed said the city reviewed a total of 219 files, both for projects that had been accepted into the program and those that had not moved forward for various reasons. All 163 “active” files were deemed eligible, and the city was not required to return any additional funds, she said.
Changing contractors
By September 2020, the city decided to find a new contractor to take over the grant. In November of that year, Virginia-based ICF Incorporated was awarded a contract to replace Landmark as program manager.
At that point, the city had paid more than $6 million to Landmark for its work on the grant.
The city notified applicants in a February 2021 letter, but did not give a reason for the switch.
In a letter to HUD the following month, Saeed wrote: “The prior Program Manager left the files in a state of disarray.”
City Council members Howard Duvall and Will Brennan both said they believed Landmark was to blame for the long delays program applicants faced. Duvall noted that in retrospect, the city “probably waited too long” to replace the contractor.
Though Saeed acknowledged that Landmark employees were responsible for some of the problems cited in HUD’s various reports, she did not say whether that contributed to the city’s decision to replace the contractor.
“Landmark took the program as far as they could take it,” Saeed said. “We are at a different phase of the program now that requires a different skill set and focus on construction management and rehabilitation.”
Remaining challenges
Even with the new contractor in place, the fate of the program is still uncertain.
Despite the multiple warnings the city received about its slow rate of spending, as of January 2022 the city had spent just a third of the $13.5 million allocated to help homeowners and just half of the total $26.15 million federal grant.
Just as HUD had predicted in 2020, the city spent the full $1.3 million set aside for administrative activities by the third quarter of last year.
“The complexity of managing the grant programs resulted in higher than normal administrative costs,” Saeed said.
In a previous interview with The State, the city said it was on track to complete the program by December 2022. Now, the city expects to have all projects completed by the first quarter of 2024, Saeed said.
Over the summer of 2021, HUD granted an automatic extension for certain grant recipients, including Columbia, because of COVID. The city now has until January 26, 2024, to complete the program, according to a HUD spokesperson. If the grant is not closed out by that time, the city will have to return any remaining funds.
City Manager Teresa Wilson “said she understood residents’ frustration with the pace of the program but noted that the City had to be extraordinarily careful in order to comply with the rules put in place by the federal Department of Housing and Urban Development,” Saeed added.
Even so, other governments have successfully carried out the same grant program.
The South Carolina state Office of Resilience received $126.7 million from HUD for statewide disaster relief following the 2015 floods. By the third quarter of last year, all those funds had been spent, according to an agency spokesperson. Richland County received $30.7 million for the same purpose and has distributed about 76% of its grant, according to a county spokesperson.
What’s next?
Last month, the city released an updated action plan for the program which proposed diverting more than $4 million from other grant initiatives — including a project to repair the Columbia canal — and using those funds to help more homeowners. That plan must be approved by HUD before the city can finalize the changes.
Saeed said the city will tap into the general fund to pay for administrative activities not covered by the grant. The projected administrative costs through the closeout of the grant total $458,536.91; However, Saeed said that figure may change and city taxpayers may not have to foot the entire bill.
Going forward, McLawhorn from the Urban League said the city should be transparent about what went wrong and what steps it is taking to rehabilitate the program.
“There should have been an intervention as soon as the problems started,” he said “What we want now for all these family members who have been waiting ever since 2015 is a definitive plan of action from the mayor and city council.”
This story was originally published March 30, 2022 at 10:06 AM.
