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Post-Sandy Loan, Grant Programs Announced

Gov. Chris Christie wants to focus the first big grant of federal aid to recover from Superstorm Sandy on helping rebuild homes for low- and moderate-income people and small businesses.

Sandy Renters
Mario Tama, Getty Images

His administration on Tuesday announced a plan for allocating the $1.8 billion block grant. All the programs are prioritizing projects in the nine counties with the worst damage from the late October storm, the state’s worst natural disaster.

The programs the Republican governor wants to implement — offering grants to rebuild damaged homes, no-interest loans for small businesses and giving landlords cash incentives to repair homes and rent them — are standard for states receiving federal assistance after natural disasters.

But Christie’s administration is offering one twist: Instead of doling money out to county or municipal governments to hand out through localized programs, his administration plans on running all the programs.

“We are going to be dealing with billions of dollars,” Richard Constable, the state community affairs commissioner, told The Associated Press in an interview Tuesday. “No municipality has the infrastructure” to handle such programs on its own.

He also said that strategy should cut down on waste, fraud and abuse. The plan calls for putting $84 million for planning and oversight, also intended to eliminate abuse.

Last week, advocates for the poor pointed to studies that showed that low-income families and renters were hit particularly hard by Sandy, which killed 40 people in the state, severely damaged thousands of homes, displaced hundreds of thousands more and knocked out power to most of the state.

Constable said helping the most vulnerable is a priority with this round of federal funding.

“We’re going to try to do our darndest not to leave folks behind,” he said.

Under the program, homeowners can get up to $150,000 each for rebuilding projects not covered by insurance or other government programs.

The administration also wants to offer $10,000 for people who agree to continue living for two years in devastated communities.

Only primary homes would be eligible for those and other housing programs, and much of the money would be set aside for low- and moderate-income families.

There also are incentives for property owners to repair and rent homes and grants designed to increase the number of homes available to people with disabilities and other special needs.

Storm-damaged small businesses — those with annual revenue under $5 million — could get interest-free loans with no principal payments due for 18 to 24 months.

Michele Brown, CEO of the New Jersey Economic Development Authority, said that time range was chosen so businesses could get through two summer seasons without major payments.

Other proposals would give grants to business improvement districts and to launch a $25 million ad campaign to push shore tourism.

“There’s a perception out there that the entire shore and coastline is closed,” Brown said.

Unlike a similar plan announced Tuesday in New York, none of the money is designated to buy out homeowners who want to leave the shore.

Two more rounds of block grants are expected later, with a total to New Jersey of between $5 billion and $6 billion. It’s all part of more than $60 billion in Sandy-related aid allocated by Congress. The funds could be scaled back somewhat because of widespread federal budget cuts that took effect March 1.

The initial New Jersey spending plan was to be posted online Tuesday afternoon for a seven-day public comment period. The plan must be approved by the U.S. Department of Housing and Urban Development.

New Jersey officials expect the approvals to be made, and the money to start flowing, next month.

 

(Copyright 2013 by The Associated Press.  All Rights Reserved.)

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