RALEIGH — North Carolina Office of Recovery and Resiliency’s Director Laura Hogshead is no longer with the agency, according to an announcement by Department of Public Safety Communications Director Jody Donaldson on Nov. 20.
The announcement is apparently tied to a memo issued by Eddie Buffaloe Jr., secretary of the Department of Public Safety.
Her departure follows a legislative oversight hearing on Nov. 18, where lawmakers grilled Hogshead about the North Carolina Office of Recovery and Resiliency (NCORR). It was revealed during the hearing that the agency has a much larger budget deficit than previously reported.
Also testifying before the Joint Legislative Commission on Governmental Operations’ subcommittee was Pryor Gibson, Gov. Roy Cooper’s legislative counsel, who Cooper sent in to keep tabs on the agency. Per Buffaloe’s memo, Gibson will be taking over for Hogshead.
Last month, lawmakers were surprised to learn NCORR had a budget gap of $175 million when Cooper released his hurricane relief proposal. Testimony given during the hearing by both Pryor and Hogshead now puts the total at $221 million. NCORR has a budget of more than $1 billion.
“Mr. Chairman, right now NCORR’s too far over its skis. It does not have enough money to finish the projects in its queue or the affordable housing,” Gibson told Sen. Brent Jackson (R-Sampson), who was chairing the hearing. “I mean, that is pretty straightforward. That’s the reason we went to you and your staff before the last session and said we need $175 million.”
Gibson explained that an operational accounting showed $175 million should be able to finish all the homes, but the actual accounting review showed it was “clear that it’s going to be about $221” million to get Matthew and Florence hurricane victims back in their homes.
Around $50 million for immediate needs in NCORR’s budget gap are included in Senate Bill 382, which includes the third round of legislative-issued Hurricane Helene aid. The funds will be monitored by both the N.C. Office of State Budget and Management and the Office of the State Auditor.
NCORR, created by Cooper in his first term, has struggled with disaster recovery efforts following Hurricanes Matthew and Florence. As of now, 1,400 homes are still pending construction and 766 families are in the rebuilding process.
Hogshead’s presentation to the subcommittee shows that 4,323 families are in some stage of the process. Of those, 2,869 are in the “close out” stage of getting back into a home, 635 are still in the contract bid stage, and 771 are in the construction phase.
At a hearing in March 2023, Hogshead told lawmakers that 1,067 projects had been completed out of 4,466 families seeking assistance. This was an increase from the 889 completed projects she reported during a December 2022 hearing.
Hogshead had previously indicated that before the COVID-19 pandemic hit, the monthly average completion rate was 31 homes. During 2020, that average fell to 23. By 2021, the average completion rate dropped to just eight a month, and the first six months of 2020 only saw an average of five homes completed.
During her testimony, Hogshead acknowledged financial mismanagement.
When Rep. Sarah Stevens (R-Surry) asked about how NCORR had overspent its funding on encumbrances, Hogshead said they were “not watching it carefully enough.”
“We were going fast and not watching carefully enough on the encumbrances,” Hogshead said. “But we do have money that we can move within our own envelope. What we’re saying to you all is that we can move money, but we’d have to break commitments.”
Hogshead also indicated NCORR is currently spending $2.1 million monthly on temporary relocation assistance and owes $37.6 million in outstanding contractor invoices.
Several legislators expressed deep distrust in the agency and doubt in its ability to handle Hurricane Helene efforts as well as criticizing its prolonged application process and slow recovery efforts.
During one tense exchange, Jackson pressed Hogshead on taking responsibility for the budget gaps and lengthy delays. Hogshead accepted blame for the issues but told Jackson she would not resign.
Hogshead also told lawmakers she was instructed to keep its application window open much longer than typical disaster recovery programs, with an additional 700 applications submitted in the last two months.
