After the storm: Will Stein follow Cooper or forge his own path?

The Helene recovery is possibly the most formidable challenge facing Gov. Josh Stein. To be successful, he must distinguish himself from former Gov. Roy Cooper’s failures in the Matthew and Florence recoveries. To do so, proper management of the $1.43 billion the state is set to receive in disaster recovery funds from the federal Department of Housing and Urban Development (HUD) will be paramount.

Fiscal overview

In addition to the $1.43 billion allocated to the state, the city of Asheville will receive a separate $225 million grant from HUD. Beyond the HUD funding, additional allocations from various federal agencies have also been announced for North Carolina. Altogether, these commitments bring the total federal investment to the state of North Carolina for the Helene recovery to more than $2.7 billion.

Moreover, the North Carolina General Assembly has allocated $1.6 billion in state funds across four disaster recovery acts to support the Helene recovery effort, demonstrating policymakers’ commitment to rebuilding the western part of the state.

Additionally, in their respective 2025 biennial budget proposals, both chambers recommended transferring $700 million to the Hurricane Helene Disaster Recovery Fund (Helene Fund). For comparison, Stein recently proposed a $891 million spending package for the Helene recovery.

Prudent policy adjustments

Since taking office, Stein has introduced some prudent policy adjustments that should help to distance him from Cooper’s poor track record in disaster recovery:

• Created the Division of Community Revitalization (DCR) within the Department of Commerce and the Governor’s Recovery Office of Western North Carolina (GROW NC) to oversee the Helene recovery, replacing the North Carolina Office of Recovery and Resiliency (NCORR). Cooper created NCORR in 2018 to manage the Matthew and Florence recoveries, producing tragic results. Despite receiving $981.8 million from HUD, by 2024, NCORR generated an estimated budget shortfall of $319 million while completing homes for only 70 percent of the victims of Matthew and Florence.
• Established a disaster recovery website through GROW NC with a dashboard that tracks disaster recovery funding and progress toward program outcomes. This appears to be a significant improvement from NCORR, which has been riddled with reporting errors and transparency issues.

Areas of concern

While Stein has made some sound policy changes, unfortunately, several other policies are reminiscent of Cooper’s failed approach:

• An effective long-term disaster recovery plan begins with optimal resource allocation. That said, DCR’s plan for the $1.43 billion HUD grant does not maximize benefits for direct victims. The $807.3 million allotment to the Reconstruction and Rehabilitation (R&R) Program, which is designed to help direct victims whose homes suffered major damage, will likely be short hundreds of millions of dollars. Despite this, DCR plans to spend $191.3 million on affordable rental housing units available to anyone below a certain income threshold, not just those directly impacted by the hurricane, and another $53.4 million on workforce housing, which is affordable housing for purchase. This mirrors Cooper’s NCORR, which spent $54.3 million on affordable housing units, while thousands of direct victims of Matthew and Florence lived in motels for years.
• Although NCORR was superseded by GROW NC and the DCR for the Helene recovery, Stein decided to keep NCORR in charge of completing the Matthew and Florence recoveries. This decision could prove to be a grave mistake. In March, the General Assembly appropriated funds to NCORR to complete the reconstruction of the remaining houses for the victims of Matthew and Florence. If NCORR fails to complete the homes with this funding, this will not only be a blow to Stein but also weaken Cooper’s prospects of pursuing a seat in the U.S. Senate.
• Despite the city of Asheville receiving its own $225 million HUD grant, the state is allowing Asheville residents to apply for the state’s Homeowner R&R Program and Workforce Housing for Ownership Program. The plan is for Asheville to contribute only $3 million to the Homeowner R&R Program and nothing to the Workforce Housing for Ownership Program. Meanwhile, Asheville will spend $28 million on rental affordable housing units. Allowing Asheville residents to apply for the state’s Homeowner R&R Program, while the city plans to contribute only $3 million, will drastically increase the likelihood that the program will run out of money like NCORR’s Homeowner Recovery Program.

Also, of interest

In early May, the DCR awarded Horne LLP a contract worth $81.5 million over three years for program management. Interestingly, from 2019 to 2022, Horne was contracted by NCORR to provide case management for the Matthew and Helene recoveries. The results were poor, and notably, no one is willing to take the blame. Horne blames NCORR, and NCORR blames Horne.

Another wrinkle is that Stein’s Western North Carolina Recovery Advisor worked for Horne until April last year and contributed $19,200 to Stein’s gubernatorial campaign and $29,000 to the N.C. Democratic Leadership Committee in 2024 while living in Mississippi.

Closing thoughts

The Helene recovery effort is a pivotal test of leadership for Stein, who inherits the burdens of Cooper’s past missteps. Unfortunately, the current allocation strategy risks repeating Cooper-era mistakes by under-prioritizing the direct needs of displaced homeowners.

Moreover, Stein’s decision to allow NCORR to continue managing the Matthew and Florence recoveries created an unnecessary political liability and opened the door for more damage to Cooper’s legacy. At the same time, Asheville’s limited financial commitment to the Homeowner R&R Program adds another strain to an already precarious budgeting plan.

How Stein navigates these challenges will shape the future of North Carolina and may also define his governorship.

The post After the storm: Will Stein follow Cooper or forge his own path? first appeared on John Locke Foundation.