HUD Clouds Future of Flood-Mitigation Funding in Texas

The U.S. Department of Housing and Urban Development (HUD) has clouded the future of dozens of Texas flood-mitigation projects worth billions of dollars.

HUD has alleged racial discrimination by the Texas General Land Office (GLO), which distributes HUD money in Texas. HUD based its finding of discrimination on complaints by two advocacy groups. The complaints stem from a statewide competition – the first of several rounds of HUD awards relating to Hurricane Harvey.

Now, deadlines for actually spending the money are fast approaching. But the uncertainty created by the racial discrimination allegations is causing entities that won HUD grants to question whether HUD will revoke funding and leave half-completed projects in limbo.

The GLO vehemently denies all allegations of discrimination and points out that:

  • HUD imposed the key rule governing competition for grants now in dispute
  • HUD approved the competition’s scoring criteria
  • More than two thirds of the beneficiaries of the funds are Black and Hispanic
  • 100% of the mitigation projects benefitted communities with a majority of low-to-moderate income (LMI) residents, when only 50% was required
  • GLO and HUD ultimately awarded Houston-area entities about $1.5 billion.

Allegations by Texas Housers and Northeast Action Collective

According to the Houston Chronicle, two advocacy groups (Texas Housers and the Northeast Action Collective) filed charges of racial discrimination after the first round of Harvey grant awards in 2021. They allege that the Houston area got zero dollars and are standing by their accusations, despite all the money the area received at the time and since then. (See amounts in timeline below.)

When developing the competition for Harvey grants, HUD insisted that the GLO could not base awards on actual flood damage. Regardless, Texas Housers and the Northeast Action Collective complained that rural areas received the majority of funding even though Houston and Harris County had the majority of flood damage.

After results of the competition became apparent, GLO attempted to remedy the rural/urban disparity by recommending to HUD that $750 million in remaining Harvey competition funds should go to Harris County – without a second competition. HUD approved.

GLO also recommended increasing the amount going to the Houston-Galveston Area Council (H-GAC) from the Regional Mitigation Program. H-GAC’s allocation more than doubled from $209 million to $488 million – again without a second competition. And again, HUD approved.

Regardless, HUD’s “finding” of discrimination based on allegations by the two advocacy groups still stands. Moreover, HUD issued administrative subpoenas to depose GLO executives, even though the Department of Justice (DOJ) already reviewed the racial discrimination complaints and declined to pursue them.

This mess is like throwing trip wires in front of exhausted marathon contestants.

While GLO defended its actions with more than 1,000 pages of documentation, HUD has reportedly produced only a four-page letter laying out vague generalizations.

HUD has not responded to requests from the GLO or for specifics regarding the allegations.

Uncertainty, Fear of Clawbacks Slow Progress

After spending years and millions of dollars to win HUD grants, the award winners now face the specter of not having enough money to finish their projects should Texas Housers and the Northeast Action Collective succeed.

Imagine your bank rescinding a mortgage commitment after you bought a lot and began building a new home.

Worse, HUD could try to claw back the money that grantees have already spent. According to GLO, many of the smaller communities awarded grants don’t have the funds to pay back HUD should that happen.

Faced with that kind of uncertainty, some awardees are reluctant to start construction on their projects – even though they face two looming “use it or lose it” deadlines. The first is only three years away – barely enough time to complete many projects.

As a result, the GLO issued a scathing press release last week, accusing HUD of “destabilizing vital funding.”

Timeline: Who Got What, When?

Is all that chaos necessary? Not if you look at the final score as opposed to the first inning. Houston and Harris County received far more than “zero dollars.” See below.

2017: Harvey

Hurricane Harvey strikes Texas. Presidential disaster declaration.

2018: Congressional Action

On February 9, 2018, Congress approves mitigation funds for 2015 and 2016 floods as well as Harvey-eligible areas. Two months later, HUD allocated money to Texas.

2019: Federal Register Notice

On August 30, 2019, HUD finally published the Federal Register notice enabling the State of Texas to proceed in drafting an action plan for the CDBG-MIT funds. GLO then conducted a public outreach campaign and collected thousands of comments from 117 meetings and 936 individuals. 

2020: HUD Approves Action Plan

HUD finally approved the GLO action plan which called for conducting a statewide competition for funding. The scoring criterion included in the state action plan for distribution of the funds was approved by HUD on March 27, 2020.

May 21, 2021: First Awards

The first $1.1 billion was awarded in the statewide competition:

  • Harris County municipalities received $117 million, not “zero” as the Chronicle article and certain local politicians claimed.
  • More than two thirds of the funding went to Black and Hispanic communities, according to the GLO.
  • 100% of the mitigation projects benefitted communities with a majority of low-to-moderate income (LMI) residents.
May 26, 2021: Second Awards

A mere five days later, GLO requested a direct allocation of $1.2 billion without a competition for Harris County and H-GAC. That included:

  • $488 million for H-GAC to distribute to municipalities throughout the region
  • $750 million for Harris County.
March 18, 2022

HUD approves GLO request for second batch of awards. From its $750 million, Harris County will spend:

  • $97.5 million for administration and planning
  • $502.5 million for 2018 Flood Control Bond Projects
  • $100 million for Partnership Projects, i.e., with City of Houston
  • $50 million for Other County Flood Mitigation Projects.
June 6, 2023: Third Award

GLO recently reallocated $322.5 million in unspent disaster relief funds from Harvey to Harris County Flood Control for mitigation projects. This is in addition to $222,519,672 Harris County received in infrastructure funding from the initial CDBG-DR allocation. 

Still, the Chronicle article alleges that the GLO somehow ran afoul of of the Civil Rights Act and Fair Housing laws by giving the Houston area “zero.”

The DOJ took less than 48 hours to review and dismiss the claim. But the continued legal harassment by HUD is distracting the GLO from its vital mission as deadlines loom.

Could this be politically inspired? Two Houston-based politicians running for election next year have close ties to the groups making the claims. More on that in a future post.

Baseless Racial Discrimination Accusations Have Backfired

Despite the vast majority of Harris County flood-control spending since 2000 already going to LMI areas, the baseless charges of racial discrimination seem to have backfired on Texas Housers and Northeast Action Collective.

In one notable instance, the Northeast Action Collective brought more than a hundred members to a Commissioners Court meeting. They pushed the meeting into the wee hours of the next day, repeatedly demanding the resignations of key Harris County Flood Control executives. Since their resignations in 2021 and January 2022, flood control spending has steadily declined – exposing the constituents that the groups represent to more flood risk.

HCFCD Spending by Year since 2000
Data obtained from HCFCD via FOIA request. Covers 1/1/2000 through 3/31/2023.

And the effects are across Harris County. For instance, in the first quarter of this year compared to the fourth quarter of last year, spending was down in two thirds of the county’s 23 watersheds.

watershed spending increases/decreases between 4Q22 and 1Q23
Data obtained from HCFCD via FOIA Request. Only significant increase was in Greens Bayou watershed.

The HUD/Houser/Collective accusations could produce a similar outcome across Texas – backfiring again.

HUD refuses to discuss its allegations of racial discrimination. HUD did not respond to a ReduceFlooding request for an interview, nor would it meet with GLO Commissioner Dawn Buckingham MD.

Posted by Bob Rehak on 7/8/23

2139 Days since Hurricane Harvey

The thoughts expressed in this post represent opinions on matters of public concern and safety. They are protected by the First Amendment of the US Constitution and the Anti-SLAPP Statute of the Great State of Texas.