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Debris is removed from a main road in Guanica, Puerto Rico, after the quakes. RICARDO ARDUENGO / AFP via Getty Images
Debris is removed from a main road in Guanica, Puerto Rico, after the quakes. Photo: Ricardo Arduengo/AFP via Getty Images

Rep. Nydia Velázquez was right as new watchdog report shows Trump admin withheld aid from Puerto Rico

“They should be ashamed and need to be held accountable for this massive and deliberate cruelty,” Rep. Nydia Velázquez wrote.

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Hidden in the jungle

May 26th, 2022

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A HUD Inspector General report, obtained and first reported by the Washington Post reveals the barriers former President Donald Trump’s administration put in place so that Puerto Rico wouldn’t receive — or at least, seriously hinder — $20 billion in aid after catastrophic hurricanes Maria and Irma. 

The Post reports it paints an “incomplete picture” of Trump’s political influence at the time, yet Inspector General Rae Oliver Davis, appointed by Trump, found several hurdles put in place by his administration that resulted in continued delays. 

The report confirms Rep. Nydia Velázquez’s interrogation of former HUD secretary Ben Carson in 2019, when she pressed him on the Trump administration going out of its way to stall the aid for Puerto Rico. 

“I will ask for your administration, HUD, to send to Congress and to this committee every communication related to Puerto Rico. And you know what sir, we’re going to find out what motivated for you to withhold this money for the people of Puerto Rico,” Velazquez told Carson at a House Committee on Financial Services hearing in 2019. 

The watchdog report says access to HUD information, as Velázquez suspected at the time, was delayed or denied on several occasions, with several officials on the Office of Management and Budget (OMB) refusing to provide requested information, and Trump administration officials delaying access to emails and other documents. 

In 2019, it was reported that former OMB director Mick Mulvaney was told by former President Trump that he did not want “a single dollar” going into Puerto Rico for fear of the island’s government issuing the money. Instead, Trump told Mulvaney he wanted more funds to go to Texas and Florida.

The report examined the effect that the government shutdown in late 2018 and early 2019 had on the release on funds, HUD’s  process for making the second and third tranches of funding available to Puerto Rico, and whether former HUD Deputy secretary Pamela Patenaude resigned because of her part in the release of disaster funds to Puerto Rico. 

According to the report, former HUD Secretary Ben Carson declined to be interviewed by the Inspector General’s office unless an attorney from the Department  “agency counsel” was present.

The report goes through the timeline. 

In 2018, Congress appropriated funds to be released through HUD’s disaster recovery and mitigation programs, creating four “tranches” of funds for Puerto Rico. Two for unmet needs for recovery efforts ($1.5 billion and $8.2 billion), a third for mitigation efforts ($8.3 billion), and a fourth for improving Puerto Rico’s electrical grid ($1.9 billion). 

The report found that the government shutdown at the end of 2018, continuing into 2019, delayed the ability of funds to be delivered to the Puerto Rico Department of Housing (PRDOH), the grantee designated by Puerto Rico. 

With the already approved first tranche, the shutdown caused staffing shortages and “miscommunications” between HUD and PRDOH, as it delayed access until several days after the shutdown ended. 

As for the second, much more substantial tranche, HUD stopped work on all disaster-recovery action plans after direction from OMB under Mick Mulvaney. It concluded this because HUD had not yet executed a grant agreement to make the second tranche of funds accessible to PRDOH by the time the shutdown began.

“As a consequence of HUD’s decision to suspend work on disaster -recovery action plans during the shutdown, the Department stalled and then waived certain deadlines by which it was required to approve or disapprove Puerto Rico’s amended action plan for the second tance of funding,” the report reads. 

The first round of stalls lasted until March 1, 2019, after HUD completed its review of Puerto Rico’s action plan. This delay of several weeks left millions of people in Puerto Rico trying to rebuild on just the first tranche of $1.5 billion. 

A large chunk of the report found that the Community Development Block Grant Mitigation (CDBG-MIT) funds notice for Puerto Rico was delayed because of deliberations that continued between HUD and OMB under the Trump administration, causing  HUD to miss several deadlines.

Delays were caused by a myriad of requests by OMB, such as extensive overdrafting, and requesting to review the Federal Register Notice. The report makes it clear OMB had never requested such a review until then. Five days before HUD’s target date, OMB presented additional comments to the draft notice, which the report says HUD officials described as “extensive.”

The report found such negotiations, “delayed the finalization of the grant-agreement revisions significantly, and eventually resulted in OMB approving HUD to move ahead with grant agreements for jurisdictions other than Puerto Rico on June 27, 2019.”

It greatly impacted the timeframe for the second tranche in funding for Puerto Rico, and took “considerably longer” than the agreement of the first tranche due to the deliberations.

In the end, the OIG also did not find evidence that the former HUD Deputy Secretary resigned because of improper handling of grant funds intended for Puerto Rico. 

The report sheds new light on the years of withholding of funds by the Trump administration, and that a back-and-forth between its officials led to a drawn-out spectacle where, even at the end of his administration, the entirety of funds had yet to be released. 

This week, the Biden administration removed restrictions to Puerto Rico that limited its recovery efforts, and announced an obligation to deliver the $8.2 billion in federal mitigation funds. 

Before that, Education Secretary Miguel Cardona awarded over $900 million in retained education funds under the Trump administration to Puerto Rico.

“The actions taken by HUD today will unlock access to funds Puerto Rico needs to recover from past disasters and build resilience to future storms, while ensuring transparency and accountability,” said HUD Secretary Marcia Fudge at the time of Biden’s announcement. 

The report, while it offers some clarity, merely recommends the current departments — now under a new administration — to “clarify and streamline” the process for administering funds to grantees in the programs in question. 

But as Velázquez wrote today,  there needs to be accountability for the previous directors as well. 

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