In a brief but contentious May 22 Hurricane Response and Recovery Subcommittee hearing, members pressed administration officials about the contracting process and potential conflicts of interest.

At issue during the 70-minute session with Division of Community Revitalization (DCR) Deputy Secretary Stephanie McGarrah, Western North Carolina Recovery Advisor Jonathan Krebs, and GROW NC Director Matt Calabria was how Horne won the $81.5 million housing recovery program contract. Further questions are likely when the subcommittee plans to meet again. Emergency Management Director Will Ray, who was also invited to testify, will address the subcommittee at the next meeting.

Krebs was a managing partner with Horne until April 2024 and made cash contributions to Josh Stein’s gubernatorial campaign. Members raised concerns about a $29,000 in-kind contribution from Krebs to the NC Democratic Leadership Committee reported in October, less than a month after Hurricane Helene. An invoice provided by the governor’s office showed the contribution was in March 2024. Krebs acknowledged that the fundraiser where he made that donation led to his further involvement with Stein and his current role.

McGarrah was very confident in the decision to select Horne and said, “It wasn’t even close—Horne was by far the best vendor selection.” She and Krebs gave conflicting answers about the timing and extent of his participation in the Request for Proposal (RFP) process.

Members asked how IEM was excluded for offering to provide financial information upon request. McGarrah said the 2024 court decision eDealer Servs., LLC. v. N.C. Dep’t of Transp. meant the agency could not ask for the information once the bids were opened.

DCR will ensure accountability on its own and with another vendor that will be hired to monitor Horne’s progress. “We’re not just going to take their word for it,” she said. “And that is another mistake I think NCORR made.”

The procurement process itself took “more than 1,000 hours” from 11 people just at the Department of Commerce, where DCR is housed. McGarrah complained, “There is a lot of red tape. It is one of the most tedious, difficult processes I’ve ever been through. I think we can make improvements to it.”