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Gov. Chris Christie announces the second round of Sandy recovery funding in Keansburg earlier this month.

(Saed Hindash/The Star-Ledger)

Millions of dollars in federal housing aid meant for victims of Hurricane Sandy went to projects in counties far removed from those areas most impacted by the storm, an analysis of state data shows.

Nearly a third of the money — $47.6 million, earmarked for new affordable housing projects — landed in Essex and Middlesex counties, while many hard-hit Jersey Shore communities in Ocean saw relatively little of it.

The affordable housing program has come under sharp focus in recent weeks after questions were raised over the awarding of more than $10 million in grants involving at least two projects that appeared to have political overtones. In both cases, Gov. Chris Christie gained endorsements after the money was allocated in two communities barely brushed by the storm.

State officials say the goal of the program was to get new housing in place as quickly as possible in the nine counties most severely affected by Sandy — and that they followed federal mandated criteria in making those awards.

“Our first goal was to get housing up as soon as possible,” said Anthony Marchetta, executive director of the New Jersey Housing and Mortgage Finance Agency. “Based on what I know, I think we did a pretty good job.”

And even critics of the state’s Sandy recovery efforts say the program in question has worked far better than most of the state’s much-maligned initiatives, coming out of $1.8 million in federal relief aid being distributed across a wide range of different programs meant to help homeowners, renters and small businesses get back on their feet.

“It probably is the best run and most effective of all the Sandy programs,” conceded Adam Gordon, a staff attorney at the Fair Share Housing Center, a Cherry Hill-based organization that litigates for affordable housing in New Jersey and has been particularly critical of how much of the storm aid has been spent to date — and in some cases, not spent.

Despite much fanfare about the state’s Sandy comeback, holes continue to be poked into boasts of its success.

There has been growing frustration over the past year by many victims over the slow pace of storm aid. The state’s recovery plan includes the Resettlement Program, which offers $10,000 to primary homeowners whose houses had more than $8,000 in damage from the storm; the Reconstruction, Rehabilitation, Elevation and Mitigation Program, which provides grants of up to $150,000 to help primary homeowners rebuild and elevate their homes; and the Incentives for Landlords Program, which subsidizes rental rates over a two-year period to provide more affordable rental housing.

The Fair Share Housing Center, in a review of recovery fund awards, found hundreds of homeowners have been wrongly denied assistance, and 79 percent of residents who appealed denials of funds for housing recovery were successful.

Last month, after months of complaints from homeowners about inept management, poor communication and long delays, the state severed ties with Hammerman & Gainer, the Louisiana firm hired to handle New Jersey’s Hurricane Sandy housing recovery programs. The state says it is now taking a larger role in the recovery effort.

$160M in relief

The affordable housing financing program came out of nearly $160 million in disaster relief awarded to date through the U.S. Housing and Urban Development’s Community Development Block Grant program. The money was meant to help finance multifamily apartment complexes, public housing projects and special-needs housing in the nine counties hit hardest by the storm: Atlantic, Bergen, Cape May, Essex, Hudson, Middlesex, Monmouth, Ocean and Union counties. All but Union received funds.

In addition, Marchetta said the state leveraged the use of tax credits to bring additional resources to the funding effort.

“We received 51 applications for projects in the nine counties,” he said. At the same time, projects in any of 65 municipalities listed as so-called “priority areas” were to be put at the top of the list.

They ultimately funded 36 projects, representing more than 2,600 units. Of that total, 19 were located in the priority areas — nearly all that applied to the state for funding.

All of the approved projects had been in the works long before Sandy hit the coast in October 2012.

“We were looking for shovel-ready projects,” explained Marchetta, noting that it takes time to develop new housing — not only for design and planning, but to obtain permits and gain other municipal approvals. Starting from scratch would take years, so they sought projects in the impacted areas that already had everything but the financing ready to go. The strategy, officials said, would get families into new affordable housing within a year to 15 months.

Gordon said the program itself works.

“This stuff will get built,” he said. “They will build in Jersey City and in Toms River, and it will help people who were impacted. It’s a real program.”

But he believes the state is still not doing enough to focus the program on the areas most affected.

“There is just far more money going to Essex than the impact warrants, and far too little going to Ocean,” Gordon noted. “People displaced from their homes in Toms River are not going to move 75 miles to find affordable housing in Newark.”

According to state data, out of the initial round of nearly $160 million in funding, Atlantic County, where Sandy hit, received 20 percent of the funding. But 16.1 percent of the money went to Essex County and another 13.7 percent went to Middlesex. Ocean County, which was particularly devastated, received just 7.7 percent.

Marchetta said the state can only pick and choose from projects proposed by developers.

“I don’t generate the proposals. I don’t acquire the land. The developer or a nonprofit or a housing authority has to do that,” said Marchetta.

Last spring, for example, the state earmarked $3 million, along with another $7.4 million in tax credits, to help finance a public housing project in Hoboken, which was hard hit by

the storm.

Hoboken Mayor Dawn Zimmer, long at war with the city’s housing authority and its director ­­— Carmelo Garcia — killed the development over what she called serious design flaws and a failure to include backup generators, while especially critical of the authority’s failure to discuss the project with her administration beforehand.

The rejection caught state officials by surprise.

“Sandy created a lot of damage in Hoboken, and it was clear this was an opportunity to provide some money that could have ultimately generated 100 units or more in affordable housing,” said Marchetta. “There was a need there in my mind, but for whatever reason, they decided to go against it.”

Without Zimmer’s support, the state was forced to pull the plug.

The other major criticism of the program has focused on at least two cases in which projects appear to have been selected because of political considerations.

In one, a senior center and housing complex in Belleville called Franklin Manor was awarded millions of dollars, in a deal announced less than two weeks before the town’s Democratic mayor backed the governor for re-election.

Christie administration officials said the complex was approved because it would help those displaced by the storm from other towns. But at the project’s unveiling, town officials focused almost exclusively on how the 137-unit housing project would help Belleville’s senior citizens.

In another, records show the state awarded $4.8 million to help build a high-rise building in New Brunswick.

Both were approved almost immediately by the Housing Mortgage Finance Agency.

Marchetta insisted politics did not a play role in the selection process.

“Look at our list. Jersey City probably got more money and more projects than any other community, and clearly they were not fans of this administration,” he said.

Editor's note: A story published earlier today on this website about the awarding of Hurricane Sandy recovery funds incorrectly reported that a $4.8 million state grant to a project in New Brunswick was backed by Shaquille O'Neal. While O'Neal is a partner with Boraie Development in an unrelated development project in Newark, a spokesman for the developer said he had nothing to do with the New Brunswick development.

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