It has been over five years since the June 2016 floods, but there is still no guarantee that funds will be available for those who need residential and commercial structure demolition — at least not from the RISE WV Clearance and Demolition Program.
Michelle Penaloza, program manager for the Community Development Block Grant Disaster Recovery Program (CDBG-DR) spoke before the Interim Joint Legislative Committee on Flooding during their meeting at the State Capitol on Sunday, Sept. 12.
She explained that the RISE WV Clearance and Demolition program had been allocated $5.875 million through the United States Department of Housing and Urban Development (HUD) CDBG-DR grant. In February 2019, when HUD authorized the program to use this money, new requirements for structure demolition had to be met. In many cases, those who had previously submitted a demolition application have been denied due to HUD criteria.
HUD criteria states that the structure must be damaged beyond rehabilitation, it must be vacant (including properties with non-paying homeless tenants) and have undisputed ownership, which is a problem for many West Virginia families who have inherited property. In addition, property taxes must be up-to-date and the property owner must sign an agreement for future property restrictions, Penaloza noted.
Structures that may be demolished must be located in one of the 12 counties most affected by the flooding, Penaloza said. The four counties considered most impacted and distressed by the flooding, including Clay, Kanawha, Nicholas and Greenbrier, were to receive at least 80% of that funding. Fayette, Jackson, Monroe, Pocahontas, Lincoln, Roane, Summers and Webster counties share the other 20%.
As of Aug. 31, the program has spent $3.5 million of the original $5.875 million budget. $1.6 million has gone towards the actual demolition of 46 structures, while $1.9 million has been spent on administrative costs including title searches, payroll, environmental reviews and fleet management. Thirty-one demolition projects have been completed in Greenbrier County, Penaloza stated.
She added that this program is not an extension of the Federal Emergency Management Agency’s Personal Property Demolition Removal (PPDR) program and it is not a property acquisition program. Instead, it is a program of last resort.
“It was never meant to offer any type of buy-out or financial funding to applicants,” Penaloza said. “This was strictly clearance and demolition of structures beyond repair from the 2016 floods. No payments have been made to homeowners or to property owners.”
She added that this miscommunication occurred when the HUD financed grant began, it was administered by the West Virginia National Guard, just like the PPDR program.
“Most people considered this the same program,” Penaloza said. “There were many people in our communities who believed that their property was scheduled for demolition, but that is not the case.”
To expedite the program, guardsmen went into the communities and collected a list of proposed addresses for demolition, Penaloza explained. The properties were put into the new program, but they were not properly vetted.
Additionally, Penaloza said that a technical amendment has been submitted to HUD, documenting that National Guard administrative services ended in April 2021. As a result, they have requested a reallocation of $1 million in funding from HUD to help with the demolition program.
West Virginia Senate Minority leader and member of the Interim Joint Legislative Committee on Flooding, Stephen Baldwin (D-Greenbrier, 10), stated that the RISE WV program has been beneficial to so many people, but he had questions about the clearance and demolition component of the program.
He said that he believed 262 people were accepted into the program for structure demolition. He pushed for clarification and wanted to know why these property owners were not accepted into the program when they had previously been told they would be.
“At the end of the day, the issue for them is they are not being served,” Baldwin began. “So, at our last meeting, we talked about how we can serve those people who have an expectation that they are going to be served. I understand what you are saying that maybe that was not the most appropriate expectation because of a former sub-recipient who is no longer a sub-recipient, which I believe you are saying is the National Guard. But, those families have an expectation that they are still going to be assisted in some way. It was my understanding at the end of the last meeting that we were going to find a way to assist them.”
Penaloza responded “One of the biggest downfalls of this program, was, again, whether it belongs to the state or to the sub-recipient. People bought up properties after the storm expecting federal funds to tear them down. So, with the million dollars coming in, we are going to focus on residential not commercial. We are not focusing on municipalities or county requests, we are focusing on those families in our most impacted and distressed residential areas that owned property at the time of disaster.”
Penaloza stated that as a result of some property owners submitting multiple applications for multiple structure demolition, they decided to only allow three applications from any one person. This cut down on the number of approved projects.
She further explained that the demolition of commercial structures “ate up a huge part of the budget,” but “that is why, with the new additional million dollars, [the] focus is on residential families.”
The new goal of the program is to demolish 26 additional structures with remaining funds. This will increase total properties demolished to 72. Penaloza said that because Nicholas County has not received any help on clearance and demolition through this grant, the goal is to serve families in that county.
Baldwin noted “If we get to 72, we still have 190 families tied to structures who have an expectation that something is going to happen. It sounds like we don’t have any funds for these 190 families and their structures.”
“At this time, we do not,” Penaloza responded.
“Is there a commitment that we will try to find one?” Baldwin asked.
“I think that at this time, we cannot say that,” Penaloza said. “Again our priority is housing. We have housing to finish, multi-family to finish, rental to finish. When the housing program is finished, and, if there is available funds, then we can take that request to HUD.”
“Okay, I just want to be clear,” Baldwin replied. “When we last met in April, there was a commitment. From April to September, there has been no change, and now there is no commitment.”
Baldwin concluded by stating that he hopes they can find a way for everyone to work together to help these families who need structure demolition.
Jennifer Ferrell, director of the Community Advancement and Development division of the West Virginia Development Office, had previously presented committee members with an update on the RISE WV housing program, which Penaloza mentioned was the main priority of the CDBG-DR grant.
Ferrell noted that since February 2018, 329 housing projects and 42 bridge replacements to primary homes have been completed.
Regarding housing, there are still 61 active cases including 38 reconstructions and 23 mobile home replacements left to be completed, as well as the 26 demolitions, Ferrell said. A total of 74,735,912 out of their $149,875,000 CDBG-DR budget has been spent so far. The original budget allows for community and economic development projects—like infrastructure and park improvement. The $5.875 million allocation for clearance and demolition came from these funds.
Also, on Jan. 13, 2021, the state received $106,494,000 in CDBG-MIT funding approved by HUD for flood mitigation efforts, Ferrell continued. Currently, 39 applications from state and local governments, public service districts and more are being reviewed for the first round of funding. It is anticipated that applications for the second round of funding will be available beginning the last quarter of 2021.
Ferrell stated that RISE WV is moving forward and on target for meeting end-of-year housing goals.