Yesterday afternoon Hammerman checked in with a Home Elevation grant update highlighting the guilty plea copped by home elevation consultant Rickey Davis, who bribed state officials to get lists of the names of homeowners in the program. Davis is the tip of the iceberg of wrongdoing in the program that appears to have double dealing built into every level of state government with oversight responsibilities and the guilty pleas indicate Team Letten intends to roll up the entire rotten bunch.
Hammerman has the following quote from Jim Letten’s courthouse step presser that is worth highlighting as the same concept was mentioned on these pages well over a month ago:
The program is financed by FEMA as a part of its Hurricane Katrina recovery aid, and U.S. Attorney Jim Letten’s office noted that the profit margins built into the state grants of up to $100,000 were so high that elevation contractors were willing to pay Davis $10,000 a pop for a signed contract.
Does everyone remember in the early days after Hurricane Katrina when FEMA was paying for hotel rooms for the displaced? Remember how artificially high the room rates were, pushed up by the rate FEMA was paying? The same concept is at play here as FEMA capped the number of houses to be raised for the money that was allotted thus effectively and drastically raising the market price to elevate a house. The increase in pricing, based upon the calculations of bureaucrats that evidently have no clue how much it costs to raise a house, greatly increased margins which in turn attracted the dregs of the business world to the program turning it into a cesspool of waste and corruption.
Now speaking of dregs, cesspools and corruption it is only fair Slabbed advances the discussion as I was leaked a few docs that illustrate the point. One of the things certain unscrupulous contractors were doing was forgiving initial “promissory notes” that were executed in advance of the funds flowing to a particular project essentially rebating up to $30,000 of FEMA funding to homeowners in the program as a sweetener to sign up with a particular contractor. I have two examples of this the first being from Goatherder elevation company Coastal Shoring (click the pic to get the 2 page pdf): Continue reading “Rickey Davis cops a plea: A Louisiana Home Elevation boondoggle update.”