U.S. VIRGIN ISLANDS – The Office of Disaster Recovery announces that $76.5M in payments for direct construction activities is being released to prime contractors for the Emergency Home Repair of the Virgin Islands (EHRVI)/Sheltering and Temporary Essential Power (STEP) Program.
FEMA halted contractor payments in June 2020 after citing cost reasonableness concerns about the EHRVI/STEP program administered by the VI Housing Finance Authority. In a meeting in October 2020 with Governor Bryan and former FEMA Administrator Peter Gaynor, FEMA committed to making a determination by December 31 on the reasonableness of construction-related costs.
FEMA made good on that commitment and issued its decision that $233M of hard construction costs were determined eligible. A total of $165M was previously paid and $76.5M is now approved for release. A difference of $18M has been deemed ineligible. The Territory intends to appeal this amount and work expeditiously to drawdown and pay funds.
“Today’s announcement is welcomed news for many of our local subcontractors who participated in the emergency home repair program and a testament to the close coordination of our administration with our federal partners and their commitment to our recovery and rebuilding efforts,” Governor Bryan said.
Funds will be released to the VI Housing Finance Authority, who will, in turn, pay prime contractors AECOM and APTIM.
“The VIHFA is committed to ensuring that both local and stateside contractors are made whole for the tremendous amount of work done by the STEP program,” said Executive Director Daryl Griffith. “The VIHFA’s Cost Reasonableness Report shared with FEMA showed that the detailed accounting system that was done by the VIHFA, Witt O’Brien and prime contractors AECOM and APTIM was thorough and indeed reasonable. This is a great milestone and we look forward to completely closing out this program.”
The EHRVI/STEP program provided temporary repairs to 6,560 homes and permanent roofing repairs to 1,648 homes.
“This accomplishment required a significant amount of coordination,” said Office of Disaster Recovery Director Adrienne L. Williams-Octalien. “The Office of Disaster Recovery thanks FEMA, Delegate Stacey Plaskett and Ernst & Young, for their assistance and efforts in securing these funds for the Territory. We will continue to work with local and federal stakeholders to obtain the final determinations necessary to make these long-awaited payments to contractors.”
FEMA has committed to making a determination on soft costs, which includes contractor costs associated with housing, travel, oversight and administration, by March 31, 2021. The Territory has submitted the requested documentation and pertinent project information to FEMA to conduct their review and create a final accounting based on actual, eligible costs incurred in the performance of the projects.
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