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An IBTS trained disaster inspector records storm damage to the outside of a home, while explaining his findings to the homeowner.

Although home inspections and building code enforcement aren’t often top-of-mind for residents and community stakeholders rebuilding from a disaster, construction contractors should be well-informed on how they differ from the regular inspection process. Using building inspectors trained in disaster recovery is a must, and in HUD‘s Community Development Block Grant Disaster Recovery (CDBG-DR) program, successful inspections will determine when you can get paid.

“What can really go wrong here is hiring an inspection company that’s not familiar with disaster recovery inspections,” says Erica Bueno, IBTS Economic Development and Disaster Recovery (EDDR) coordinator.

“There’s a huge difference between regular home inspections and disaster damage assessments, which can come years after the disaster hits,” she explains. “IBTS inspectors are trained to differentiate between damage caused by the storm and damage from not maintaining the home before the storm.” IBTS conducted thousands of inspections in Galveston and Harris County, Texas, for applicants enrolled in the CDBG-DR program after Hurricane Ike.”

When it comes to disaster recovery, there are three main types of inspections: damage assessments, which come after a homeowner is assigned a case manager and before construction begins, interim inspections throughout the construction process, and final inspections at the completion of construction. For communities enrolled in HUD’s CDBG-DR program, damage assessments and interim inspections are required for contractors to request a draw on the contract, while final inspections are universally required in disaster recovery programs. Any home or structure built under a disaster recovery program using federal funds must be inspected by a licensed inspector.

Damage Assessments

An IBTS inspector photographs and documents water damage to the ceiling of a home during a damage assessment with the homeowner.

Damage assessments happen at the start of the recovery process to determine what damage was incurred as a result of the storm. IBTS’s inspectors, for example, are trained to spot flood damage in damage assessments that often don’t occur until two or three years after the disaster. An accurate assessment is critical for determining the scope of work to be performed on the home and ensuring program compliance — CDBG-DR funding cannot be used to repair damages that weren’t caused by the storm.

Damage assessments can also prevent a duplication of benefits, which can occur under several circumstances. If a homeowner spends FEMA, insurance or other federal grant money incorrectly, or if they claim to have made repairs with the money but fail to do so, it is considered a duplication of benefits. Inspectors help prevent this from happening before construction begins by determining if grant-funded homeowner repairs were made, and if the cost of repair amounted to the grant total.

“Homeowners will tell us they used their FEMA money on a new roof, but then our inspectors will find that the roof is still leaking and that no repairs have been made,” explains Bueno. She also recalls another instance when a homeowner received homeowner’s insurance money for landscaping, yet inspectors found that no landscaping had been done, nor had there ever been any landscaping at the home.

“Our inspectors make sure there isn’t a duplication of benefits,” Bueno says. “If a homeowner tells me they spent their insurance or FEMA money on specific repairs, I send out our inspectors to make sure those repairs have been completed. They can also put a number on the amount and cost of material required to complete the job, such as how much sheetrock is required based on the size of the home.”

Once the damage assessment is complete, homeowner applicants can proceed into the benefit selection process, in which they approve the floorplan of the house and select construction materials – cabinets, flooring, wall colors, etc. – to be used in their home. It’s important that homeowners have a clear understanding of what they’re approving in this process, or else homeowner dissatisfaction with cosmetic components can delay the sign-off on the final inspection at the completion of construction, or create more work for contractors.

Interim Inspections

During construction, the construction manager is in charge of ensuring interim inspections are implemented properly and that all construction is built to code. Interim inspections in the CDBG-DR program typically include site, plumbing underground, foundation (makeup), dry-in and framing MEP (mechanical, electrical, plumbing). Construction cannot continue, and contractors cannot get paid, until work passes inspection. Not only does this safeguard the quality and safety of the home, but it prevents issues from delaying the process further on down the road.

“If there’s something wrong with the construction of the home that won’t pass inspection, our inspectors won’t let it go to the next stage so that problems are avoided when it comes to final inspection,” explains Bueno. If there is a delayed or failed inspection, construction contractors should notify the case manager, who can then explain the situation to the homeowner.

Likewise, during interim inspections, and throughout the entire construction process, construction contractors should defer all homeowner questions to the case manager or grant administrator. Make sure that you and all of your subcontractors have a copy of the scope of work and are well-versed in what is and isn’t included in the scope. Unlike normal projects, under the CDBG-DR program you can’t just add requests to the plan under. Avoiding direct contact with the homeowner prevents contractors from getting talked into work for free, or work they thought they would be compensated for but can’t under the recovery program.

“Contractors should never be the ones who have to say ‘no’ to the homeowner,” explains Bueno. “The contractors are there to do what’s on the scope, and if they start doing extra work, it slows the entire process because they can’t move on to the next job.”

Construction contractors’ pay is also contingent on the success of interim inspections. Contractors in the CDBG-DR program have the option to request a draw on the contract after each successful interim inspection, meaning the program manager can draw a portion of the contractor’s compensation from the contract. Contractors don’t get paid in full until after the final inspection passes, when all construction is completed.

Final Inspection

An IBTS inspector completes the final inspection of a home after completing reconstruction under the CDBG-DR program.

The contractor, homeowner, inspector and grant administering agency must all sign-off on the final inspection checklist, which is provided by HUD. Final inspection checklists vary by disaster recovery program, but for CDBG-DR typically include all invoices, change orders, after photos, final inspections forms and other required data. HUD can request to conduct an audit or check on progress at any time — not just at the completion of the project — so it’s important that construction contractors provide accurate, consistent and organized updates to case managers and program managers in a timely fashion.

Ideally, all four parties sign off on the final inspection without issue, however Bueno notes that homeowners can refuse to sign-off at the completion of construction. Typically this occurs because of cosmetic reasons; if the homeowner doesn’t like the color of their walls, or where the front door is placed, for instance, they can decide not to sign-off on the final inspection.

When this happens, Bueno recommends asking the case or program manager to go over the entire scope of work with the homeowner, and shoe them what they have already signed-off on. “You have to make the distinction that this is not a remodeling program,” says Bueno. “We’re trying to get you into a safe environment with running water and electricity.” It also costs contractors money to make cosmetic changes during construction, and delays the entire CDBG-DR program by preventing contractors from moving on to the next home.

Bueno stresses the importance of preventing these issues from arising in the first place by ensuring that the contractor, grant administrator and inspectors are all on the same page. As in all phases of disaster planning, response and recovery, communication is key. When all parties are in-sync, Bueno notes there are “no surprises” when final inspection comes around. If there’s a delay in inspection, for example, Bueno, who serves as a case manager, immediately notifies the homeowner so they’re aware of the delay.

“IBTS streamlines the final inspection process,” says Bueno. “We’re normally on the same page as the contractor, and because we’re often the administrator and the inspector, we’re all in-sync throughout the entire CDBG-DR process. We communicate status updates, delays and issues among stakeholders and with the homeowner to ensure there are no surprises for anyone.”

Although construction contractors are typically experienced with the inspection process, it’s important to recognize the differences with disaster inspections and the the rules and regulations associated with the CDBG-DR program. Careful and detailed disaster inspections performed by trained disaster inspectors help ensure homes – and the entire community – are not just built back, but built back better.