FEMA denies Irma money for three cities. One desperately needs it to pay off a loan
The federal government has rejected millions of dollars in requests by three Miami-Dade County municipalities to pay for debris cleanup after Hurricane Irma, saying substantial parts of their submissions failed to properly document the work and prove it was eligible for reimbursement.
El Portal, Miami Shores and Florida City each used the same consultant, Disaster Program & Operations, to help with the complex reimbursement process after the September 2017 storm. After a lengthy review, the Federal Emergency Management Agency said the cities submitted flawed paperwork — and not just minor errors.
FEMA rejected more than $1.3 million of the over $2 million requested by El Portal, a big blow for a tiny village whose annual budget is around $2.5 million. The village needs the money to pay off a $1.25 million line of credit it took out in 2018 to pay Looks Great Services, the company it utilized to remove debris from its streets.
In Florida City, FEMA denied about $2.1 million of $3.4 million the city sought in reimbursement.
And in Miami Shores, FEMA denied close to $500,000 of about $1.3 million worth of cleanup costs. The agency has yet to make a final ruling on another $2 million requested by the village, and is asking for more documents before making that call.
Officials in all three cities said they plan to appeal the rulings within the required 60 days. Miami Shores received determination letters Oct. 13; El Portal, Nov. 10; and Florida City, Nov. 16.
“I’m gonna fight to the end for what I feel like our village deserves and what I feel like our community needs,” said El Portal Mayor Omarr Nickerson. “I’m planning for whatever comes down the pike, but I’m still not going to wave the white flag until they put that final nail in the coffin.”
Over a year ago, the three cities received mysterious letters from FEMA that said the agency was reviewing “questionable invoices” submitted by consultants who had helped them navigate the aftermath of Irma. Last December, a FEMA spokesman told the Miami Herald the agency had referred the matter to the Department of Homeland Security’s Office of Inspector General.
The inspector general’s office has yet to issue a report. And so far, nothing has come of rumblings — made public in a July wrongful termination lawsuit by El Portal’s former police chief — that the FBI may also be investigating.
But the recent letters from FEMA represent tangible setbacks for cities that have spent three years trying to claw back taxpayer money that was spent after Irma ravaged South Florida as a Category 3 hurricane.
“Given the fact that there is almost $500,000 at stake here, I believe we have no choice but to file an appeal in hopes of recovering all or a substantial portion of the de-obligated funds,” Miami Shores Village Manager Tom Benton wrote in an Oct. 15 memo to the village council.
The council voted unanimously to move forward with an appeal. The village has retained Ernest Abbott, the former general counsel for FEMA who now works for the law firm Baker Donelson, to assist in the appeal process. He will collect up to $45,000 in legal fees.
“If we’re confident we didn’t do anything wrong based on our own review — we didn’t hire shady contractors, everything in our control is solid — then I am absolutely in favor of going after the money that’s really been taken out of the pockets and pocketbooks of our residents by FEMA,” said Miami Shores Councilman Jonathan Meltz.
FEMA finds major problems with submissions
The letters from FEMA outline a host of issues with the three cities’ submissions, which were required to include photos and detailed documentation to prove each piece of debris removed presented a threat to public safety.
“There are numerous photos that show trees, but most of the photos don’t clearly show hazardous branches or sizes of them,” FEMA wrote in a letter to El Portal.
In other cases, photos were missing or seemed to show work done outside village limits. “The village of El Portal failed to adequately document its costs for removing hazardous limbs and branches,” the agency wrote.
El Portal had already made changes to its original submissions in response to requests from FEMA. The village, through its consultant, first claimed over 5,600 hazardous leaning trees and hanging limbs were removed after Irma. That claim was reduced to about 5,500 after an initial request for information, and later cut by more than half to about 2,300, according to FEMA.
It wasn’t immediately clear why the figure changed so dramatically, but at least one village official was skeptical about the original count back in 2018. At a July 2018 council meeting, then-Councilman Werner Dreher repeatedly questioned the figure, which was cited at the time as around 5,500.
“We’re certain and 100% sure that we have 5,500 trees in the village?” Dreher asked. El Portal is less than half a square mile in size and has about 2,400 residents in North Miami-Dade, south and west of Miami Shores.
Gabrielle Benigni, a consultant with Disaster Program & Operations who assisted all three cities, replied: “We have the ticket ledgers and the tickets, yes. I can show you that.”
Benigni did not respond to a request for comment from the Herald.
FEMA cited various other problems with the submissions by Miami Shores and Florida City. Miami Shores failed to provide work activity logs for police and for some public works employees, the agency said.
In Florida City, which reported the removal of about 3,300 trees and limbs, FEMA said the city improperly sought reimbursement for work to remove debris from private property.
Florida City submitted over 300 pages of additional documentation this summer after a series of meetings with FEMA. But FEMA “determined most of the documentation provided was not acceptable in quality.”
“We’re concerned they ignored all the information we sent,” Mayor Otis Wallace said. “We went to great lengths to justify our position. Somebody didn’t read it.”
FEMA rejected 62% of the city’s $3.4 million request. Florida City, the southernmost city in Miami-Dade, has a budget of over $20 million. But the funds are substantial for a city where 38% of residents live in poverty.
“This is our money,” Wallace said. “The FEMA process is, in a word, unbearable.”
The Herald previously obtained hundreds of photographs and other documents the municipalities submitted and identified several potential problems.
On Oct. 2, 2017, for example, one worker monitoring the cleanup in Miami Shores logged 504 hazardous limbs removed, 10 times the daily average for monitors in El Portal and Miami Shores in the days after the storm. But the monitor submitted only seven photographs for that day — most of which appear to show low-lying brush.
FEMA rules mandate that a photograph be submitted for each hazardous limb, and that municipalities only be reimbursed for limbs greater than two inches in diameter that “pose an immediate threat” to public safety.
El Portal is still in debt
Benigni told El Portal officials at the July 2018 meeting that she expected the village to see its reimbursement money within “90 days, max.” The council later voted to approve the line of credit that has since left it in debt.
This summer, El Portal negotiated with Synovus Bank for a second straight year to renew the line of credit as it continues to make monthly interest payments of about $3,000. The arrangement now expires July 28, 2021.
Nickerson said he is already considering the village’s options if the bank won’t extend the deal, such as a term loan that could be paid off over five to seven years. A village-wide referendum to approve a general obligation bond would be a last resort, he said.
“I’m not counting on Synovus renewing the loan again,” Nickerson said. “I’m preparing for the worst.”
Interim Village Attorney Joe Geller, who is also a state representative, said any money the village receives from FEMA will immediately go toward paying back the bank. Once FEMA approves any reimbursement funds, it is up to the Florida Division of Emergency Management to release them to the village as it sees fit.
A FEMA spokesman, Jim Homstad, said FEMA has approved a total of about $262,000 for El Portal, close to $2 million for Florida City, and no money for Miami Shores.
As of November 2019, the state had released about $146,000 to El Portal, $344,000 to Florida City and no money to Miami Shores. A spokesman for the state agency told the Herald on Wednesday that no additional money has been released, but did not elaborate on the reason.
The initial payments were made after FEMA had begun approving the cities’ submissions, but the state stopped releasing money after FEMA revealed it had found problems with invoices in September 2019 and pulled back money that it previously released to the state.
“FEMA’s role includes being a responsible steward of taxpayer dollars,” Homstad said. “That’s why these reviews and procedures are in place.”
Geller and Nickerson said the village of El Portal could, at some point, consider taking legal action against the debris removal company and the consultant to try to get money back.
El Portal and Miami Shores didn’t have a debris removal contract in place when Irma first made landfall, so they utilized mutual aid agreements with Florida City to “piggyback” on existing contracts with Looks Great Services and Disaster Program & Operations.
‘There was no fraud’
It’s not uncommon for the FEMA reimbursement process to be slow. Florida Democratic Sen. Jason Pizzo, whose district includes El Portal and Miami Shores, said another one of his district’s municipalities, Biscayne Park, is still working with FEMA and the state to get the money it’s owed from Hurricane Irma.
The process has taken more than three years, even with “all things running smoothly,” Pizzo said.
The difference, he said, is that the process for El Portal, Miami Shores and Florida City is taking place amid questions about possible fraud.
“If there was wrongdoing, I would like the federal government to hurry up,” Pizzo said. He said he had expected the Department of Homeland Security’s Office of Inspector General to release its findings this summer but speculated that the process was likely delayed due to the COVID-19 pandemic.
The inspector general’s office did not respond to a request for comment on the status of its probe.
Claudia Cubillos, the outgoing El Portal mayor, insisted at a Nov. 18 meeting that everything was aboveboard.
“There was no fraud,” she said. “There was work that could be better done, but there was no fraud.”
This story was update on Thursday, December 3, to include new comments from a FEMA spokesman,
This story was originally published December 2, 2020 at 6:00 AM.
