Taxpayer Shock – City Forgoes Tens of Millions in Federal Home Buyout Funds

By Bill Oakey – January 11, 2016

About a month ago, I suddenly became curious about the money being spent on home buyouts in the Onion Creek area related to the 2013 and 2015 floods. It occurred to me that none of the news reports addressed the question of where all of the money was to come from. How much of it, I wondered, was coming from local dollars, and how much of it was being matched by Federal grants? The local funding for these flood-related projects comes from the monthly drainage fees that we pay on our utility bills.

After doing some research on the topic and submitting questions to City officials, I received a detailed and disturbing response. The City’s Watershed Protection Department replied to my questions with a partially complete summary of the flood mitigation spending that actually goes back to 1999. So, here’s the bottom line. For the projects included in the response, the total cost is $170.17 million. Out of that total, only $55.77 million will ultimately come from Federal matching funds.

The chart below, provided by the Watershed Protection Dept. shows the breakdown of the Federal and local spending on these projects:

Lower Onion Creek Flood Mitigation Project

Lower Onion Creek Buyout   Total Project Local Funding  Federal Funding  Pending Federal
Project                                       Cost                Share                Share                    Reimbursements

Corps Project Area*                $73.2M          $18.9M             $54.3M                  $22.9M
25-Year Project Area               $35.5M          $35.5M                     0                             0
100-Year Project Area           $61.47M          $60.0M             $1.47M                  $1.47M
Totals                                     $170.17M        $114.4M           $55.77M                $24.37M

*Note: Values are for the overall Corps project since 1999 for all phases: buyouts, ecosystem restoration and recreation.

In an email from Stephanie Lott, Public Information Specialist from Watershed Protection, she states that the above chart does not include all of the flood mitigation projects since 2013. Most disturbing for local taxpayers is the additional comment, “From asking some of our managers, it doesn’t sound like there are any other flood mitigation projects since 2013 that included federal funding.”

The response leaves a number of critical unanswered questions:

  1. Why did Austin receive such a tiny share of Federal reimbursements for these projects?
  2. Did the City take advantage of every possible opportunity to apply for Federal funding?
  3. Should the City be eligible for any State matching funds for the home buyouts?
  4. Did the City work with the State to submit a flood mitigation plan to FEMA that included all of the anticipated Onion Creek home buyouts? (See “The Federal Grant Application Process” below).
  5. Why does the City assume that none of the remaining home flood buyouts since 2013 will  receive any Federal funding?
  6. Has the City Council been fully informed about the limited, and in many cases nonexistent Federal funding for the large number of previous and pending home buyouts?
  7. What plans, if any, does the City have for applying for Federal funds for future buyouts of flooded homes?

 The Federal Grant Application Process

It was not difficult to track down the Federal guidelines for assistance in home buyouts in flood prone areas. See this link entitled, For Communities Plagued by Repeated Flooding, Property Acquisition May Be the Answer.” Below are some excerpts from the document:

For eligible communities, FEMA typically funds 75 percent of the cost of property acquisition with the municipality and state contributing the remaining twenty-five percent. FEMA does not buy houses directly from homeowners. Buyout projects are initiated and administered by local and state governments with grant funding support from FEMA. “Additional federal funding may also be provided by the Community Development Block Grant program administered by HUD.”

“To qualify for federal funding for the acquisition of flood-prone properties, a state must create a flood mitigation plan, which is then submitted to FEMA for review and approval. In its mitigation plan, the state identifies communities that have experienced losses due to repetitive flooding and, once the plan is approved by FEMA, notifies those communities that funding for property acquisition may be available.”

Also, see how the Harris County Flood Control District handles the grant application process. Note the sections entitled, “Federal Funds for Voluntary Buyout,” and “Federal Eligibility Requirements.”

Mayor Adler and the City Council should review these guidelines and pose some hard questions to the Watershed Protection Dept. If FEMA and HUD funding is available to cover “typically 75%” of flooded property acquisitions, then why has the City been relying on local drainage fee funds to cover the entire cost? If, in fact, the City Manager and his staff have dropped the ball to the tune of tens of millions of dollars, then who will be held accountable? And how soon can the City set about correcting these deficiencies to the future benefit of Austin utility ratepayers?

Stay tuned for an update on this issue as soon as any response from the City becomes available.

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4 thoughts on “Taxpayer Shock – City Forgoes Tens of Millions in Federal Home Buyout Funds

  1. Kathryn Anderson

    And is it coincidental that citizen’ water bills have skyrocketed in the last year, even though most of us are using MUCH less water , due to the drought??? hmmmm

    >

    Reply
  2. Clint Smith

    National Gray Panthers have urged support for an outside, independent forensic-type Audit {specifically by DoJ/USAttorney/IRS into the use of Federal funds] for some time now. Instead the Public gets City Staff-selected hires like Zucker (@ a cost of $260 Mil) – whose report finds mismanagement in CoA’s Plans Division but ignores a grand jury’s 3 count bribery indictment & urges more funds for 2 new components to expedite approval of building permits for Developers!.

    Reply

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