On Tuesday, January 29, 2013, President Obama signed the Disaster Relief Appropriations Act (HR152) providing $16 billion in funding to the Department of Housing and Urban Development (HUD) Community Development Block Grant Disaster Recovery (CDBG-DR) program in order to help affected States respond to and recover from the severe damage caused by Superstorm Sandy. On Tuesday, March 5, a Notice was published in the Federal Register (Docket FR-5696-N-01) allocating $1,829,520,000 of those funds to New Jersey. The Secretary of HUD made this the initial funding award based on data from FEMA and SBA, used to determine the areas of greatest need in the region impacted by Superstorm Sandy. It is expected that there will be additional allocations of CDBG-DR funds to New Jersey in the coming months and programs will be developed accordingly.

To obtain the funds from the initial funding award, New Jersey is required to submit an Action Plan to HUD detailing the proposed use of funds, including criteria for eligibility and how the use of these funds will address disaster relief, long-term recovery, restoration of infrastructure and housing and economic revitalization in the most impacted and distressed areas.

The State has been in constant communication with its residents, local leaders and other stakeholders prior to and following Superstorm Sandy’s landfall. This continuous outreach has helped to identify the needs and priorities of the many communities affected throughout the state and was used in the development of the programs set forth in the Action Plan.

Although the deadline to submit the Plan is not until April 9th, the State worked diligently to craft the most effective Action Plan and released it publically on March 12th so that the State’s impacted residents can get the assistance they need as soon as possible.

HUD has 45 days from the day it receives the Action Plan from the State to make its decision.

Per the Appropriations Act and Federal Register, the Secretary of HUD must approve an Action Plan. If the Secretary fails to approve the Plan, the State of New Jersey would review the requested changes and develop an amended Action Plan for resubmittal to HUD.

A seven-day public comment period ended March 19, 2013. Public comment are now being responded to and incorporated into the Action Plan. The Plan will be submitted to HUD in the near future. HUD has up to 45 days to approve the Plan. While HUD is reviewing the Plan, the State is moving diligently to finalize all program designs and hire the contractors needed to implement the programs in order to enable funds to reach residents as quickly as possible.

The State is working diligently to put in place the program infrastructure needed so that programs can begin operating as soon as possible after the Plan is approved. However, this does not mean people will receive financial assistance right away. For example, information will have to be reviewed to determine a person’s eligibility for funding, federally mandated environmental reviews will be needed. The State is taking every step to be prepared to begin the process of applying for and distributing aid as quickly as possible.

If approved by HUD, utilizing monies from just the initial federal allocation, the Action Plan would assist more than 26,000 homeowners, more than 5,000 renters and more than 10,000 businesses, as well as local governments.

The Appropriations Act requires that 50% of CDBG-DR funds must be used for activities that benefit persons of low- and moderate-income. The provision can only be waived by the Secretary of HUD, and even then, only when a compelling need is specifically identified.

The State is required to prioritize serving low and moderate income households in its housing recovery programs. However, in order for the State to serve those whose income is above 80% of the area median income, there are funds available in the Rehabilitation, Reconstruction, Elevation and Mitigation (RREM) and Housing Resettlement programs for those who fall outside of the HUD definition of low-to-moderate income.

As part of the Christie Administration’s continued commitment to the most vulnerable, a direct allocation of funds will be made to the NJ Housing and Mortgage Finance Agency to operate a fund, similar to the NJ Special Needs Housing Trust Fund, dedicated to the construction of permanent supportive housing across New Jersey for special needs populations. The Action Plan also has an array of rental programs that will benefit people with special needs. It is anticipated these programs will add more than 1,000 housing units over the next two years for special needs households.

HUD requires that the state develop a needs assessment to identify the unmet needs in housing, infrastructure and the economy. Programs are designed to demonstrate a proportionate allocation of resources to areas and categories of greatest needs. These determinations take into account factors such as income, extent of damage, and location of property (in or out of a flood zone).

HUD does not allow CDBG-DR funds to be utilized for second homes or vacation homes.

Yes, funding in the Rehabilitation, Reconstruction, Elevation and Mitigation (RREM) Program will provide eligible homeowners up to $150,000 for reconstruction, rehabilitation, elevation and/or mitigation of damaged homes. Priority will be given to homes in the nine most impacted counties that are deemed “substantially damaged” (damages exceed 50% of a home’s assessed value) by a municipality’s floodplain manager.

The State has designed several programs aimed at assisting in the replacement of rental units including those for low and moderate income renters. It is expected that approximately 5,000 affordable rental units will be created as a result of programs in the Action Plan.

The State has proposed a $25 million program for a Tourism Marketing Campaign that will promote storm-impacted businesses and shore communities by letting the nation know that New Jersey is recovering and open for business. The campaign would also encourage New Jerseyans and tourists to shop locally. The Administration has requested, and HUD has approved, a special waiver to allow this program which will provide much needed assistance to the vital tourism industry that is critical to our shore communities.

Many direct jobs will be sustained and/or created in the implementation of local rehabilitation, reconstruction and elevation of homes and rental units. Additionally, businesses that are recipients of grant and loan funds administered by the New Jersey Economic Development Authority will be able to retain and hire employees, particularly in the shore-impacted communities striving to re-open and be fully operational for the summer season. Currently we have no definite estimaties, but thousands of jobs should result from the programs being funded in the Action Plan.

Yes. There are several controls in the Action Plan’s policy and procedures to control waste, fraud and abuse. This includes the requirements for detailed procedures to detect and prevent waste, fraud and abuse and avoid duplication of benefits. In addition, Executive Order 125 signed by Governor Christie, establishes several additional safeguards, including an Accountability Officer within each department. The New Jersey Sandy Transparency Portal was created to provide public access to all State contracts for the allocation and expenditure of federal disaster relief funds, including contract vendor information. In addition, the portal lists the available federal funding streams and funding criteria and tracks the federal funding allotment of disaster relief funds in New Jersey. There will be staff at all levels, including at HUD and the State, to ensure transparency throughout the Sandy recovery.