[StBernard] Contractor is owed millions from feds

[Westley Annis]

Contractor is owed millions from feds
Red tape holding up cash in St. Bernard 
Thursday, February 08, 2007
By Karen Turni Bazile
St. Bernard/Plaquemines bureau 

The contractor demolishing homes and hauling sewage in St. Bernard Parish is
owed millions by the federal government and, at some point, might have to
stop working until it is paid, company officials and parish leaders said. 

 
Unified Recovery Group, the contractor hired by the parish to remove storm
debris and demolish homes, has been paid only for the first few hundred of
the more than 4,000 homes it has demolished since May, said J.S. Lawrence
Green, URG's chief operating officer. The company, which also won a contract
to haul the parish's sewage from storm-damaged lift stations to treatment
facilities, has not been paid for that job since the second week in
September. 

The financing has slowed as state and federal officials decide whether to
approve more than $150 million the company has billed the parish for its
services. The Federal Emergency Management Agency reimburses parishes for
storm cleanup and related expenses. 

After meeting Tuesday in Chalmette with URG and parish officials, Col. Tom
Kirkpatrick, the state coordinating officer for the Governor's Office of
Homeland Security and Emergency Preparedness, said he would address the
issue with FEMA officials this week. 

FEMA spokesman Ronnie Simpson said FEMA is reviewing the matter. FEMA didn't
attend because its representatives had the wrong date for the meeting,
Simpson said. 

Kirkpatrick said the biggest problem is the layers of federal approval in
place because of the size of disaster and amount of federal money at stake. 

"The problem is we need to have (federal-level) people here who can make
decisions," Kirkpatrick said, echoing a common refrain among state and local
officials on recovery funding issues. "We have agreed to take on some of the
issues personally with FEMA." 

Kirkpatrick said personnel from the state offices of Homeland Security and
Legislative Auditor will be stationed in St. Bernard Parish to help locals
handle the paperwork needed to get federal reimbursement for hurricane
recovery work. 

Even though FEMA has obligated $137 million for demolition work in St.
Bernard Parish, St. Bernard Parish Finance Director Amy Blanchard said the
parish has been paid only about $6.3 million. Most of that went to the River
Birch landfill, where the debris is being hauled, she said. She said about
$1 million was paid to URG. 

The more immediate problem may be the $24 million owed for hauling sewage
from more than 70 storm-damaged lift stations, a task that requires trucks
to run nearly constantly from the stations to the treatment plants to
prevent sewage from overflowing through manholes into the streets, Blanchard
said. 

"If we don't get some sort of financial relief from FEMA to pay for this
sewer work, the contractor is going to quit working and we will have a
health crisis when the sewer starts backing up into the street," she said. 

One of the paperwork problems, Blanchard said, stems from the fact that FEMA
officials initially estimated that only 15 percent of the homes being
demolished would need costly asbestos abatement work. FEMA approved the
demolition money based on that estimate. But costs have skyrocketed because
more than 85 percent of the structures razed had asbestos, Blanchard said. 

Also, she said, the amount of sewage that needed to be hauled was grossly
underestimated by FEMA and the problem has been exacerbated because of heavy
rains that put more water into damaged underground lines, creating more
wastewater to haul. 

Green said he hopes the matter is resolved quickly. 

"St. Bernard Parish has asked us to continue working and we will do so up to
the point where we can no longer financially afford to do so," Green said. 

Parish President Henry "Junior" Rodriguez and his administrators pushed for
the Tuesday meeting to get FEMA and state officials in one room with parish
and URG officials. 

"If these people (with URG) aren't able to continue their activities, we are
in serious trouble in this parish," Rodriguez said. "Who's going to want to
do the job when the first guy didn't get paid?" 

. . . . . . . 

Karen Turni Bazile can be reached at kturni at timespicayune.com or (504)
826-3321.