“I have heard the overwhelming concerns of Harris County regarding the mitigation funding competition,” Bush said in a statement. “The federal government’s red tape requirements and regulations are a hallmark of President Biden’s administration. I am no stranger to standing with the people of Texas as we fight against the federal government. As such, I have directed the GLO to work around the federal government’s regulations and allocate $750 million for mitigation efforts in Harris County.”

The GLO is submitting an amendment to the state’s plan for administering the HUD mitigation grants in Texas to implement the changes and will hold a final funding competition at a later date for the 48 other counties eligible for funding.

Harris County and Houston challenged the GLO’s process for awarding federal Hurricane Harvey relief funding after neither local government was named as a recipient of relief funding awards the GLO announced May 21; both governments contented they bore the brunt of the 2017 storm. Some local officials criticized the GLO’s federally mandated scoring process, which was developed under the Trump administration, for determining the awards.

In an address streamed online on May 24, Harris County Commissioner Tom Ramsey argued that Congress’ intent was for the GLO to ensure that local governments would use the U.S. Dept. of Housing and Urban Development funds to mitigate Harvey’s damages, an estimated 50% of which occurred in Harris County.

“That is not GLO money. … That is money that Congress set aside to address damage in Harris County,” Ramsey said.

The setback comes just weeks after Harris County announced it is facing a $1.4 billion funding gap to pay for its nearly $5 billion in planned flood control projects. The HUD funding was key to the county’s strategy to plug that gap. 

County voters in 2018 had approved a $2.5-billion bond program to cover half of those projects. The other $2.5 billion would come from federal, state and local funding, but so far the county has only secured $1.2 billion.

HUD charged the GLO with developing a formula for selecting which local governments would receive a share of the first round of Community Development Block Grant for Mitigation (CDBG-MIT) funds through the Hurricane Harvey State Mitigation Competition.

Houston and Harris County requested $1.3 billion in funding, but the state instead awarded the funding to 46 other local governments in southeast Texas. Four cities within Harris County—Baytown, Galena Park, Jacinto City and Pasadena—received a combined $90.4 million in funding.

“The way the criteria was put together makes it difficult for communities with large populations to be competitive,” said Harris County Flood Control District executive director Russ Poppe in the May 24 online address.

Brittany Eck, spokeswoman for Land Commissioner George P. Bush, told ENR that the Land Office was bound by HUD’s guidelines in developing its selection matrix.

“We were as surprised as any entity at the results,” Eck says. “We had actually hired staff to help with projects related to Houston and Harris County for mitigation.”

One reason why it was harder for Houston and Harris County to obtain the funding was because HUD decided not to provide direct aid to any one county, which meant that governments would instead have to compete for the funding under the federal agency’s rules.

“We have encouraged Harris County to go back to HUD and have this discussion again,” Eck says, referring to a second round of HUD funding becomes available later this year.

In 2018, Congress approved $66 billion in disaster relief funding to go to HUD, the U.S. Army Corps of Engineers and the Federal Emergency Management Agency. From that funding, the state gave $1 billion in HUD recovery funds directly to the city of Houston and another $1 billion to Harris County after Hurricane Harvey.

Eck says a direct allocation would have been the “cleanest, easiest way” to direct funding to a specific government entity, and that’s what Houston and Harris County expected would happen when it came time to distribute additional mitigation funds.

“We supported in asking for a direct set-aside for those funds so they wouldn’t have to compete with other eligible counties. However HUD did not do that,” Eck says.

In setting the requirements for the funding competition, the state limited each entity to three applications and capped each request at $100 million. Harris County agencies requested the maximum of $900 million.

HUD spokesperson Mike Burns said in a prepared statement that his department did not prevent Texas from awarding the HUD funds to Houston or Harris County. “The formula for allocation was created by the state of Texas. They have full responsibility and jurisdiction over who gets the money that was allocated to the state for flood mitigation, if HUD approves the action plan amendment, which has not been submitted or approved by the agency,” Burns said. “We believe all areas of the state, including Houston and Harris County, should receive the resources they need to recover from Hurricane Harvey.”

Eck says the 81 projects that received funding were awarded in order of highest score until funds ran out. “HUD does not allow grading on a curve, nor could we show favoritism to certain applicants over others,” she says. “In the Harvey-eligible counties competition, we received $5.5 billion in requests from 220 applicants for $1 billion in funds.”

Harris County may now need to explore other funding strategies, including the use of toll roads or raising property taxes in the flood control district. Another $1 billion is available for Community Development Block Grant Mitigation (CDBG-MIT) allocations, and the GLO plans to take applications later this year.

“GLO said they’d be open to a direct allocation. So we’re going to take them at their word and pursue that avenue, both in Washington and in Austin,” Ramsey says.