On October 29, 2012, Hurricane Sandy came aground in the New York City area and did billions of dollars worth of
damage in all five New York City boroughs. It did not take an expert to see that the storm damage was extensive, and the talk of relief funds to help start rebuilding homes began almost immediately after the storm had ended.
The city was not ready for a storm like that, but Mayor Michael Bloomberg vowed that the city would rebuild. With the help of the federal government, Mayor Bloomberg created the Build It Back program that would be used to take care of an estimated 15,345 homes. The program sounded like a great idea, but it wasn’t long before the people of New York City would lose faith in the federal, state, and city governments.
Build It Back: A Different Kind Of Program
When the federal government gives grants to homeowners after a disaster, the expectation is for the grants to be used to rebuild homes. However, the government learned a tough lesson after Hurricane Katrina when grants were being given out, but homes were not being rebuilt. Instead of giving out grants, the feds and city officials decided to use Build It Back to pay contractors directly for their work on rebuilding homes.
The idea of paying contractors directly was used to eliminate the possibility of fraud, but the idea has not found success. Contractors in New York City are cheating residents and, in some cases, causing residents thousands of extra dollars to get their homes rebuilt. The fraud from contractors has inflated the costs of Build It Back. Those costs went up in October 2015 following an announcement from new New York City mayor Bill de Blasio.
Costs Are Getting Out Of Hand
In October 2015, Mayor de Blasio announced that he wanted all Build It Back work to be completed by December 31, 2016. The federal government was shocked at the announcement, but de Blasio showed he was serious by hiring three of the largest contractors in the country to accomplish the work.
New York City hired SLSCO out of Houston, Texas, LiRo Group, and New York City skyscraper builder Tishman Construction. Each firm was chosen because they could absorb the costs of the work and allow the federal government time to make payments. Only SLSCO had any experience in building residential homes, and the lack of experience on the part of the big contractors has pushed costs from $120,000 per home up to around $200,000 per home.
The three contractors have raised concerns about the tight deadline, despite the fact that there was no deadline in place prior to de Blasio’s announcement. The other issue with costs comes from the fact that de Blasio insisted on larger contractors because he wanted all union labor to be used in the building projects. With the deadline being confirmed and union labor being insisted upon, costs have greatly increased.
Will Build It Back Reach Its Goal?
None of the contractors are publicly saying whether or not they can meet Mayor de Blasio’s December 31, 2016, deadline. Expert observers indicate that the project will run out of money before the deadline, however, the mayor’s office is denying those claims.
By October 2015, it was estimated that 63 percent of all homeowners who had applied to Build It Back had either had their home’s rebuilt, or were getting financial assistance to find new places to live. But, this took three years to complete. With only five months left to go, it is going to be a race to see if the clock runs out before the last home is fixed.
The Build It Back program was instituted only months after Hurricane Sandy to help New York residents rebuild their neighborhoods. While thousands of people applied to the program, many dropped out after months of inactivity. The Build It Back program has plenty of success stories to its credit, but now it is faced with whether or not the government can meet its own goals, or if the program will run out of money and momentum before the last nail is struck.