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Christie’s Biggest Sandy Contractor Fired

WNYC, Jan. 23, 2014

Homeowners, Legislators Had Bitter Complaints About Firm

By Matt Katz, New Jersey Public Radio

The Christie administration has quietly cut its ties to an embattled company that had New Jersey’s biggest contract for getting Sandy victims back in their homes. Homeowners and legislators had widely criticized the company’s performance, taking some of the gloss off Governor Chris Christie’s signature project: Sandy recovery.

Christie officials — who as recently as two weeks ago gave legislators in Trenton no hint that the contract had been cancelled — wouldn’t say on Thursday why the deal with Hammerman and Gainer, or HGI, was terminated more than two years before completion. Last week, Gov. Christie touted the successes of the Sandy recovery at an event on the Jersey Shore.

HGI won its contract last May shortly after its New Jersey law firm, Capehart Scatchard, made a $25,000 donation to the Republican Governors Association, which is now headed by Christie. The RGA contributed $1.7 million to Christie’s re-election campaign.

The state was to pay HGI $68 million in fees to administer a $780 million Sandy program. But the Christie administration terminated that contract in December, and the termination took effect — unannounced — on Monday. Documents posted on a state website say the company was to be paid $10.5 million as an "unpaid balance" — and for work performing during a "transition period" following termination.

Among the various programs implemented after Sandy, HGI’s Reconstruction, Rehabilitation, Elevation and Mitigation (RREM) grant program, which provided up to $150,000 per home for reconstruction, was widely panned. Homeowners complained of long wait-lists, lack of transparency, stonewalling, and lost paperwork. Much of this criticism surfaced during legislative hearings over the last several months.

HGI was also criticized for how it implemented a home reconstruction program in Louisiana after Katrina, according to the Wall Street Journal. Company officials have said they were improving operations.

At a hearing in Trenton earlier this month, Department of Community Affairs Commissioner Richard Constable III was asked about the performance of HGI in New Jersey. But his answers did not indicate that the company was no longer operating in the state.

On Thursday, Lisa M. Ryan, a spokeswoman for Constable, said: "We’ve recently concluded our relationship with HGI as New Jersey transitions to the next phase of disaster recovery." Ryan did not answer a question about what company, if any, is now running HGI’s programs for Sandy victims. Nor did she say why the contract was terminated.

Likewise, Cherie A. Pinac, the chief of operating officer of HGI, would not disclose the reasons for the termination of the contract, but said it was by mutual agreement. "Under the terms of the contract, I’m not authorized to make a statement," Pinac said in a phone interview from her office in Louisiana.

Christie made an announcement about a new after-school program at an elementary school in Camden on Thursday afternoon, but he did not take questions from reporters.

The termination of the state’s biggest Sandy contract comes as two major scandals loom over Christie’s political career: the charge that Christie officials threatened to cut Sandy relief funds to the town of Hoboken unless its mayor supported a redevelopment deal — a charge the administration adamantly denies; and investigations into Christie’s aides ordering George Washington Bridge lane closures to exact political revenge — something the governor says he knew nothing about.

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