When people think about the impact of a superstorm or a hurricane they typically think about the damage inflicted upon people’s homes as well as their communities. They think about rebuilding and creating a new hope. What they don’t consider is all of the rubble (left behind by the storm) that must be cleared away before contractors can even think about setting foundations and paving new roads. It’s not a particularly fun job but it’s a necessary one if the community is ever to regain some semblance of normalcy.
After major tragedies there are plenty of stories of contractors doing the right thing (and sometimes going above and beyond that) to help those in need yet (like every profession), there are those who will abuse their position in order to gain either political leverage or some form of illicit cash flow. That’s exactly what happened in Belmar, New Jersey as federal auditors have recently questioned over $500,000 in Hurricane Sandy debris removal costs, which apparently stem from a suspicious relationship between two firms and a local politician.
Matthew Doherty, the mayor of Belmar, has recently come under increased scrutiny from the federal government. Auditors from the Department of Homeland Security’s Office of Inspector General found that both J.H. Reid of South Plainfield and Ferreira Construction of Branchburg (who both have relations to Mr. Doherty’s wife) accounted for over half of the town’s debris removal costs (roughly $1.6 million dollars in all).
Doherty claims that the costs were substantially higher than they should have been as they were awarded on an emergency basis. Though the costs may have been higher it is not immediately apparent why the federal government has become involved. But, look a little closer at the report and it becomes much clearer. The town of Belmar wants the Federal Emergency Management Agency (FEMA) to cover $285,000 in markups. A price Inspector General has refused to accept on the condition that the firms used a cost-plus-percentage-of-cost method of billing which does not adhere to federal regulations.
Using that method of billing and the relationship to Mr. Doherty’s wife both firms were able to charge a sum that was substantially higher than the norm. With superstorms and hurricanes frequenting the East coast more often towns and local governments should take care to come up with a reasonable plan of action for debris removal that will increase the incentive for contractors to control costs and hopefully result in a much smoother phase of redevelopment. With debris still littered across the tri-state area keep your eyes open for those who may be misusing their power when it comes to clean-up. We would much rather have good contractors such as yourself rebuilding neighborhoods instead of those who may do more harm than good. Happy building!