Christie’s Ending of Sandy Contract Draws Call for Probe

Photographer: Spencer Platt/Getty Images

New Jersey Governor Chris Christie speaks to the media at the scene of a massive fire that destroyed dozens of businesses along an iconic Jersey shore boardwalk on September 13, 2013 in Seaside Heights, New Jersey. Close

New Jersey Governor Chris Christie speaks to the media at the scene of a massive fire... Read More

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Photographer: Spencer Platt/Getty Images

New Jersey Governor Chris Christie speaks to the media at the scene of a massive fire that destroyed dozens of businesses along an iconic Jersey shore boardwalk on September 13, 2013 in Seaside Heights, New Jersey.

Republican Governor Chris Christie’s termination of a Hurricane Sandy contract led two Democratic U.S. congressmen from New Jersey to request a federal investigation.

Representatives Frank Pallone and Bill Pascrell Jr. today asked U.S. Housing and Urban Development Secretary Shaun Donovan to review the “sudden cancellation” of a $68 million deal with Hammerman & Gainer Inc. The New Orleans-based company was hired in May to oversee the distribution of $600 million in federal homeowner relief after Hurricane Sandy devastated parts of New Jersey’s coast in 2012.

“Neither HGI nor the state of New Jersey have provided any details as to the reason for termination or the plans for administering the impacted recovery programs,” the congressmen said in a letter to Donovan.

Pallone, of Long Branch, and Pascrell, of Paterson, asked Donovan to appoint an official to monitor New Jersey’s use of Sandy funds. The agency’s inspector general already is auditing Christie’s expenditure of $25 million in federal disaster aid on an election-year ad campaign featuring him and his family urging tourists to return to the New Jersey shore as rebuilding was under way.

Sandy Spending

Pallone requested that review. David Montoya, HUD’s inspector general, said in a Jan. 14 statement that audits, such as that of Christie’s tourism spending, are routine and shouldn’t be construed as an investigation. Donovan has said the expenditure was appropriate because tourism is crucial to New Jersey’s economy.

Though the state ended the three-year HGI contract in December, it didn’t disclose the termination until last week. The cancellation “comes amid months of delays in the distribution of Sandy rebuilding funds,” according to a statement from Pallone and Pascrell.

A phone message for Cherie Pinac, chief operating officer for Hammerman & Gainer, wasn’t immediately returned. Brian Sullivan, a HUD spokesman, didn’t respond to an e-mail today for comment on the request for an investigation.

Christie’s office referred questions to the state’s Community Affairs department. Lisa Ryan, a spokeswoman, said the department will cooperate with HUD and “is confident any review will show the state continues to manage Sandy recovery funds in the best interests of the people of New Jersey.”

“The conclusion of our relationship with HGI was coordinated and efficient, with no interruption in services, following a mutual agreement between the parties as the state transitions into the next phase of the housing recovery programs,” Ryan said in an e-mail.

Christie, a 51-year-old potential 2016 presidential candidate, soared to record approval on his handling of the storm. His rating is now at its lowest since May 2011 amid investigations of his administration’s ties to unannounced lane closings at the George Washington Bridge that were meant as political punishment, according to a Fairleigh Dickinson University survey released yesterday.

To contact the reporter on this story: Elise Young in Trenton at eyoung30@bloomberg.net

To contact the editor responsible for this story: Stephen Merelman at smerelman@bloomberg.net

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