Investigation suppressed by Trump administration reveals obstacles to hurricane aid for Puerto Rico

Access to HUD information was delayed or denied on several occasions. Several former senior administration officials in the Office of Management and Budget refused to provide requested information about decision-making related to the Puerto Rico relief funds.

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“Delays and denials of access and refusals to cooperate negatively affected the ability of the [Office of Inspector General] to conduct this review,” the report said.

The 46-page report presents an incomplete picture of the political influence of the Trump White House on delaying disaster relief for the struggling island.

Still, Inspector General Rae Oliver Davis, appointed by Trump as top HUD watchdog, found unprecedented procedural hurdles set by the White House budget office — in addition to an extended partial federal government shutdown that also produced delays.

The OMB required HUD’s notice of grant funds to go through an interagency review process before approval, preventing HUD from publishing its draft notice of funding by its target date. The OMB had never before required such a review process for a notice allocating disaster-recovery funds, according to the inspector general’s report, and there had been no previous discussion about requiring the extra step.

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“This is about life and death issues,” said Rep. Nydia M. Velázquez (D-N.Y.), who led the call for the inspector general’s investigation. She characterized the Trump administration’s actions as “a way to prevent the people of Puerto Rico from access to so much needed money to prevent people from dying.”

She said Congress must now find ways to ensure that when lawmakers appropriate money to federal agencies as they did to HUD for hurricane relief, “that the administration must comply with the will of Congress.”

One senior HUD official, Stan Gimont, then the deputy assistant secretary for grant programs, bemoaned the tedious review process imposed by the White House budget office as “kind of like Groundhog Day, just keeps coming back. And that’s … where your frustration will set in. … It’s almost like we’re going to keep bringing this back to you until you just eat it,” the report said.

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While investigators interviewed 20 current and former HUD officials and two Puerto Rico housing officials, they had no access to Carson. Several senior political appointees at HUD withheld answers to questions, and White House budget office officials involved in delaying the timing of the aid also refused to cooperate.

The report said Carson and then-HUD Deputy Secretary Brian Montgomery had expressed “mounting concerns and frustrations” to then-acting OMB director Russell Vought about “HUD’s inability to make progress” on disbursing the funds. At one point, Montgomery told Vought that the White House’s actions were tantamount to holding disaster-relief funds “hostage,” the report said.

But the inspector general said given the lack of cooperation, investigators were unable to determine why the extra layer of review was required.

HUD had initially intended to publish a funding notice that would have applied to all 16 jurisdictions receiving hurricane relief, but OMB urged the agency to issue separate notices for Puerto Rico and the U.S. Virgin Islands, the report said. Carson reluctantly agreed on the grounds that the agency was concerned over alleged corruption and fiscal mismanagement on the island.

Protesters called for the resignation of Gov. Wanda Vázquez Garced (D) in San Juan, Puerto Rico, in January 2020 after untouched disaster aid was discovered. (Adriana Usero/The Washington Post)

The Post had previously reported that President Donald Trump repeatedly told aides that disaster relief allocated for Puerto Rico must be closely monitored because he believed the territory’s government was corrupt and the economy in poor shape before the hurricanes devastated the island. Trump had also told then-White House Chief of Staff John F. Kelly and then-OMB Director Mick Mulvaney that he did not want a single dollar going to Puerto Rico, and instead, he wanted more of the money to go to Texas and Florida.

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The White House budget office also insisted on overhauls to Puerto Rico’s property-management records, suspension of its minimum wage on federal contracts, and other prerequisites to access relief funds, prompting Montgomery to question whether HUD had the legal authority to enforce such requirements, the report said.

“How many poison pills are in here?” Montgomery wrote in an email to other senior HUD officials, according to the report.

“Montgomery said he did not believe that HUD could coerce Puerto Rico to fix its property-tax system to receive mitigation funding because the property-tax system was not related to mitigation activities,” the report said. “He also indicated that HUD did not put these types of conditions on other disaster-recovery grantees.”

The report, released publicly on Thursday, comes five months after Trump’s reelection defeat.

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Damaging disclosures about former transportation secretary Elaine Chao, former White House physician Ronny Jackson, former secretary of state Mike Pompeo and other Trump officials were made public months after they left office.

At least a dozen other investigations have yet to be completed, in part because of unprecedented delays to inquiries by inspectors general.

Other overdue reports include an inquiry by the Commerce Department watchdog into the administration’s controversial decision to add a question on citizenship to the U.S. Census; two long-running ethics probes of Ryan Zinke, Trump’s first Interior secretary; and an audit of a $400 million contract to build the border wall that was awarded at Trump’s urging to a North Dakota construction firm whose top executive was a prominent GOP donor.

Davis took the unusual step of laying out the administration’s obstruction at the top of the HUD report. The report also notes that Trump administration officials delayed investigators’ access to emails and other electronic documents, invoking the privilege claimed by the president, known as executive privilege, of withholding information in the public interest.

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HUD demanded that agency attorneys sit in on investigators’ interviews with Carson and other political appointees, the report said, a tactic widely used during the Trump administration that watchdogs worried could unduly shape testimony. Davis had previously expressed concern to congressional staffers about HUD attorneys’ desire to be present for witness testimonies.

While Carson was never interviewed, other former political appointees eventually agreed to be interviewed without an agency lawyer, but then refused to answer certain questions, the report said.

Carson, as well as HUD, declined to comment on the inspector general’s findings.

Puerto Rico Governor Pedro R. Pierluisi said in a statement that the inspector general’s findings show “clearly there were onerous and discriminatory restrictions on the funding appropriated by Congress to help Puerto Rico recover from recent natural disasters.”

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Pierluisi, who assumed office in January just before President Biden’s inauguration, said he has established “a great working relationship” with the new administration. Now that “those restrictions have been lifted and most of the funding has been released,” he said, “Puerto Rico’s reconstruction will see the boost it needs to fully recover and prosper.”

The Biden administration this week removed what it called “onerous restrictions unique to Puerto Rico that limited the island’s access” to disaster recovery funds and announced the obligation of $8.2 billion in federal mitigation funds.

Among the eliminated restrictions are the incremental grant obligations and review by a federal financial monitor to oversee the aid, as well as additional oversight by the U.S. territory’s federally mandated fiscal control board beyond what is already required by law, HUD said in its announcement.

“Since its first days, the Biden-Harris Administration has prioritized action to enable stronger recovery for Puerto Rico,” said HUD Secretary Marcia L. Fudge in a statement, adding that the new administration’s actions would “unlock access to funds Puerto Rico needs to recover from past disasters and build resilience to future storms, while ensuring transparency and accountability.”