Xavier University of Louisiana: Repair Estimates, Replacement Money

Xavier University of Louisiana agreed to pay $12 million to resolve allegations involving false facility-damage certifications to the Federal Emergency Management Agency and misleading repair estimates prepared by AECOM. The government alleged that Xavier obtained excessive Hurricane Katrina assistance for its gymnasium, student center and electrical grid. For someone who knew those facilities, the question was concrete: did the damage described in the funding request match the campus the storm actually hit?

The Justice Department announced Xavier’s settlement on June 3, 2020, alongside its decision to join part of a whistleblower’s False Claims Act case. An AECOM project specialist had brought the case. Xavier settled its own alleged role as a funding recipient.

Why the FEMA Repair Estimate Changed the Funding

FEMA repair and replacement funding depended on the relationship between the cost to fix a facility and the cost to replace it. For the Katrina assistance at issue, funding was limited to repair costs unless those costs exceeded 50% of replacement cost. Above that threshold, full replacement funding was available, as the Justice Department explained in its later AECOM settlement announcement.

That made the estimate more than a proposed construction bill. Its size could change the kind of assistance the applicant received. The government alleged that AECOM submitted requests that secured excess funding, including replacement money for facilities entitled only to repair funding. Descriptions of a building’s original design and storm damage fed directly into that decision.

The court’s account of the whistleblower’s allegations adds a detail that matters to anyone who works with estimates. The project specialist alleged that his assignment to AECOM’s New Orleans response unit exposed inflated repair costs and deflated replacement costs. He had arrived after the termination of an employee who worked on those projects, according to his account. Both sides of the comparison could move. Raising the repair estimate and lowering the replacement estimate each made replacement eligibility easier to show on paper.

Money intended to restore a damaged facility depended on an account of the facility that a project specialist said was wrong. The claim could turn on how much building existed before the storm, what the storm damaged and what it would cost to restore that damage.

What Are False FEMA Facility-Damage Certifications?

A false certification tells the government that information supporting a claim for money is accurate when the person certifying it knows otherwise. In this case, the Justice Department alleged that AECOM submitted false requests between 2007 and 2013, and that certain applicants falsely certified the information in requests it prepared on their behalf.

AECOM was the technical-assistance contractor. Its work included site evaluations and preparing and reviewing damage and repair estimates used to determine funding eligibility. The requests included damage descriptions, repair estimates and replacement estimates. Xavier was an institutional applicant seeking money for its facilities.

This sits within federal assistance fraud: the university sought public-assistance funding for disaster recovery. AECOM’s contract paid for technical-assistance work supporting that program.

The government’s allegations reached the review process, too. According to the AECOM settlement announcement, supervisors reviewed applications containing materially false design, damage and replacement-eligibility descriptions and did not correct them. The earlier announcement said the government alleged that AECOM management knew by 2011 of systemic problems with false and inaccurate information reaching FEMA but failed to notify the government.

For an insider, the review history connects an inaccurate description to the people who saw it and the decisions they made afterward.

The Alleged Storm Damage to a Nonexistent Air Conditioner

The Roman Catholic Archdiocese of New Orleans faced a separate applicant-side allegation involving damage to a central air-conditioning unit that did not exist. The Justice Department’s Archdiocese announcement also described misstated facility square footage. It alleged that the Archdiocese knowingly signed certifications containing false damage descriptions and repair estimates prepared by AECOM.

Those allegations concerned the Archdiocese’s facilities. The later AECOM announcement identified the cafeteria at St. Raphael the Archangel School among the educational facilities involved in the contractor’s settlement.

A nonexistent air conditioner makes the issue unusually plain. The alleged square-footage error raises the same question about the building itself. A polished estimate cannot repair a false description of what was there.

Xavier’s electrical grid supplies its own concrete example. In describing the government’s allegations, the court said AECOM allegedly misrepresented that the university’s underground electrical grid had been substantially damaged by Katrina. Knowledge of the actual system and its damage goes to the heart of that allegation. The campus facilities and the Archdiocese’s equipment were different, but both accounts turn on whether the physical property matched the description used to obtain assistance.

Separate Settlements for the Applicants and the Contractor

The case reached both ends of the funding request: the institutions seeking assistance and the contractor preparing the estimates. Xavier’s settlement addressed the university’s alleged role as an applicant. The Archdiocese and AECOM subsequently resolved their own alleged roles.

The Archdiocese agreed to pay more than $1 million in a resolution announced November 15, 2021. The Justice Department said the amount reflected the Archdiocese’s financial condition.

The Justice Department reported that FEMA paid AECOM more than $300 million between 2005 and 2019 for technical assistance on the Katrina recovery. Against that scale of work, AECOM agreed to pay $11.8 million in the settlement announced October 24, 2023. That resolved allegations about the contractor’s submission of false disaster-assistance requests for the educational facilities, including Xavier’s facilities and the Archdiocese cafeteria.

We see an odd result here: the university agreed to pay more than the contractor accused of preparing the misleading estimates.

With that resolution, the Justice Department reported nearly $25 million recovered in connection with applications prepared by AECOM.

The Justice Department handled the case with investigative support from the Department of Homeland Security’s Office of Inspector General.

How Much Money Can a Whistleblower Get From a Qui Tam Lawsuit?

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. Here, the Justice Department said the AECOM project specialist received approximately $2.3 million as part of Xavier’s resolution.

The later AECOM announcement said the whistleblower would receive more than $2.4 million from that company’s settlement. These were separate whistleblower rewards tied to separate recoveries.

What a Facilities or Disaster-Recovery Insider Can See

The useful connection is between the facility, the estimate and the certification that reached FEMA. Someone familiar with the building before Katrina may know its design, size and equipment. Someone who worked on the assessment may know how the damage description became repair and replacement estimates. Someone who reviewed the application may know which discrepancies were raised and whether the submitted request changed.

As the court described the project specialist’s allegations, he raised concerns internally and AECOM failed to inform the government or address the resulting overpayments. The review history matters because it can show what happened after someone questioned the estimates.

For a university facilities employee, the electrical-grid allegation is a question about the system the employee knows. For an estimator, the repair-versus-replacement comparison is a question about the inputs and assumptions in the estimate. For an administrator, the certification is a question about what the institution approved. Each perspective can explain a different part of the same request for public money.

Our work with you connects that firsthand knowledge to the funding claim and the decisions behind it. The facility description, cost estimates, certification and review history give us specific places to test the account you bring.

You Know the Facility Behind the Estimate

If you know where a FEMA damage description departed from the building, equipment or electrical system you worked with, speak to one of our Whistleblower Experts about that discrepancy. We build your case with you and bring in FEMA disaster-assistance whistleblower lawyers who understand facility estimates and applicant certifications. We stay beside you through the process, working to build your strongest disaster-assistance whistleblower case.