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NJ Spotlight, Jan. 28, 2014


Sweeney: Secret dismissal of $780M Sandy contractor shows need for governor to use oversight law he signed last March

In the wake of the secret firing of a controversial contractor hired to administer $780 million in Sandy aid, the Christie administration has issued a new request for proposals to a list of preapproved firms to perform additional work as integrity monitors in Sandy programs, Senate President Stephen Sweeney (D-Gloucester) reported yesterday.

“Integrity monitors have an established track record of preventing waste, fraud and abuse,” Sweeney said. “Their efforts in protecting taxpayer dollars are why I pushed so hard to ensure this legislation became law. I am glad the administration is taking the necessary steps to ensure these monitors get to New Jersey as quickly as possible."

“As we saw recently with the midnight firing of Hammerman and Gainer, clearly there are issues with how Sandy funding was being maintained,” he said, suggesting that better use of the integrity-monitoring program might have caught the problems sooner. “Hundreds of millions of taxpayer dollars are flowing through our state right now in relief funding. Integrity monitors will ensure that money is not squandered, so let’s get them here as soon as possible.”

Sweeney and Assembly Speaker Sheila Oliver (D-Essex) were the prime sponsors of the legislation that called for special integrity monitors to audit major Sandy projects and report suspected waste, fraud, and abuse to the New Jersey Attorney General or the independent Office of the State Comptroller. The program was modeled after a similar initiative that New York City Mayor Rudy Giuliani had used to ensure the integrity of the reconstruction of the World Trade Center site after 9/11.

Christie, who was initially noncommittal, signed the bill last March 27, requiring the Treasury Department to choose a pool of firms as integrity monitors through a competitive bidding process and assign them to all Sandy projects whose prices exceeded $5 million. The integrity monitors were to paid through federal Sandy funds, and the Treasury Department had the option of assigning them to lower-cost projects if they felt additional oversight was necessary.

Sweeney’s office learned of the issuance of the new request for proposals for Sandy integrity monitors on Sunday.

Treasury Department Communications Director William Quinn confirmed early this morning that the Treasury Department recently issued a solicitation “seeking interest from a group of preapproved vendors in providing integrity monitoring services for the Department of Community Affairs on their administration of Sandy recovery funds in excess of $5 million.”

“On January 17, we contacted a pool of 26 firms that were approved last year to provide these services under two previous procurements,” Quinn wrote in response to an email, referring to the Group III Integrity Monitoring/Anti-Fraud list on Treasury’s Sandy Information Page. “Their responses are due back on February 7.”

The Christie administration confirmed last Thursday that the Department of Community Affairs had fired Hammerman and Gainer (HGI) in December — a fact that state Community Affairs Commissioner Richard Constable neglected to mention in his testimony at a legislative committee hearing focused on the problems with Sandy relief programs earlier this month.

Last May, HGI won a $68 million contract to administer a $780 million program designed to get Sandy victims back in their homes, a contract that was awarded soon after HGI’s law firm, Cape and Scatchard, made a $25,000 contribution to the Republican Governors Association, which contributed $1.7 million to Christie’s reelection campaign. The company’s work was the subject of constant complaints by New Jersey homeowners displaced by Sandy.

“Whenever you try to find out anything out about Sandy programs, you end up groping in the dark,” complained Jeff Tittel, director of the New Jersey chapter of the Sierra Club. “People have been complaining about HGI for a year now, but nobody knew until a month later that they were gone. Why did it take so long for this administration to find out how bad they were when everybody they dealt with knew they weren’t doing the job? The reason you can’t find out about any of this is because the Christie administration doesn’t want people to know what’s going on.”

Marc Ferzan, executive director of the governor’s office of Recovery and Rebuilding, had not made a public appearance since last April, refusing reporter interviews and skipping four legislative hearings, before finally emerging last week. Ferzan broke his months of silence to do a conference call defending the share of Sandy aid awarded to Hoboken after Mayor Dawn Zimmer charged that Lt. Gov. Kim Guadagno passed along a threat from Christie to withhold Sandy aid from her city if she did not approve a development project represented by David Samson, a close political ally of Christie.

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