Two South Texas counties allege mishandling of Hurricane Harvey claims

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Officials in Refugio and Victoria counties are displeased with how the Texas Association of Counties has handled insurance claims in the aftermath of Hurricane Harvey, with one suggesting the Texas Rangers should investigate.

Victoria County Commissioner Gary Burns told the Victoria Advocate newspaper that the Texas Rangers need to investigate the poor handling of restoration efforts. Refugio County, meanwhile, is asking for $1 million in damages from TAC in a state-court lawsuit.

The Texas Association of Counties was formed in 1969 to represent Texas counties in discussions with state officials. The organization offers a risk management pool, including insurance coverage for counties whose facilities are damaged by storms, fires and other causes.

After Hurricane Harvey hit in August 2017, both Refugio and Victoria counties, at the recommendation of TAC, hired the Virtus Group (now the Commercial Restoration Company) to handle remediation and repairs of county facilities.

Refugio County’s lawsuit argues that after the association filed a claim on its insurance policy, adjusters for CRC conducted “a substandard investigation and inspection of the properties, prepared reports that failed to include all of the damages that were observed during the inspections, and undervalued the damages observed during the inspections.” The suit claims breach of contract by TAC.

Representatives of Commercial Restoration Company didn’t respond to the Advocate’s requests for comment.

Cary Roberts, spokesman for TAC, told The Texas Monitor the association doesn’t comment on pending litigation. He said the insurance risk pool operated by TAC has more than 400 members and 32 of them filed claims related to Hurricane Harvey. 

Refugio County Judge Robert Blaschke referred The Texas Monitor to attorneys handling the case against TAC, but law firm representatives did not return calls seeking comment.

Critics in Victoria County contend that their local leaders squandered taxpayer money in paying Kansas-based CRC nearly $900,000 for repair and restoration work after bypassing bidding laws, the Advocate reported. The contract between the company and Refugio County is virtually identical to the Victoria County contract.

Burns, the county commissioner, has questioned why Victoria County hasn’t been more transparent in providing public progress reports.

“We have a bigger situation than Refugio does, and we don’t want to be dragging our feet,” he told the Advocate.

Burns didn’t return requests for comment from The Texas Monitor.

Dennis Patillo, a member of the Victoria Regional Airport Commission, has raised questions about repairs to county-owned airport properties damaged by Harvey, including why a second firm recommended by TAC, Gerloff Construction, was never asked to bid.

During a July meeting, airport commissioners questioned the management of $2.6 million in insurance payments designated for county-owned property repairs after Harvey.

Patillo said that CRC, acting as an agent for TAC, was the only party determining the extent of the damages.

“It is more common than not that the insured is in an adversarial position with the insurer,” he wrote in an op-ed in the Advocate. “As such, hiring an independent adjuster might have been a more reasoned approach. Without independent eyes, we can never be assured that our claims were treated fairly. 

Patillo wrote that transparency has been an issue, with no details provided as to how CRC was vetted, the scope of the repairs covered by the contract, documentation of work performed or how much work remains to be done.

“To this day, the answers to those questions have not been made public,” he wrote. “Taxpayers have a right to know how their dollars are spent. 

Luis Garcia, national project coordinator for CRC, is scheduled to visit Victoria County soon to provide updates, County Commissioner Kevin Janak said recently. 

He said at a recent commissioners court meeting that Victoria County departments are now gathering information about what work on county property is left to be performed. A group has been inspecting the restoration work done by CRC.

“I think that we need to have buy-in from all departments on this to see exactly. We don’t want to miss anything on this,” he said.

Johnny Kampis can be reached at [email protected].

1 COMMENT

  1. Thank you Johnny. For the Victoria county story. Some of the county officials are trying very hard to keep all this out of the public eye

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