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A company whose earlier disaster recovery contract in North Carolina was marked with serious communications problems will return to run North Carolina’s disaster recovery program in western counties flattened by Hurricane Helene.
The N.C. Department of Commerce on May 9 awarded a project management contract to Horne LLP, worth $81.5 million over the next three years, according to the terms. Four other companies bid on the project.
Horne was the prime contractor for the N.C. Office of Recovery and Resiliency, also known as ReBuild NC, providing case management and other services from 2019 to 2022, when the firm’s contract was not renewed after many disaster victims complained about poor case management.
Last month, in West Virginia, Horne agreed to pay $1.2 million as part of a settlement agreement with the federal government over alleged improper billing for services related to disaster recovery in the state.
Meg Annison, a Horne spokesperson, said the company did not admit any wrongdoing as part of the agreement. She added that the company is “reviewing our options” regarding a statement made by the U.S. Attorney’s Office for the Southern District of West Virginia, “which we believe misrepresents the facts of the case.”
Horne has other connections to North Carolina, and the governor’s office. Jonathan Krebs, the western North Carolina disaster recovery advisor to Gov. Josh Stein, worked for Horne until April 2024.
A spokesperson for Stein said Krebs received his last compensation from Horne on Dec. 10, 2024, which was 2023 deferred compensation, and before the governor took office.
Krebs was on a team of six people who wrote the Request for Proposals for the contract, according to state Commerce Department officials.
But he was not involved in the review committee, according to a governor’s spokesperson and “will not financially benefit from it,” the spokesperson said. “We are farther along in our recovery process due to Jonathan’s expert knowledge and experience, and North Carolinians have been well served by his work to accelerate recovery in western North Carolina.”
North Carolina received a $1.4 billion grant from the U.S. Department of Housing and Urban Development last month for disaster recovery—including the repair or reconstruction of single-family homes, rental housing and infrastructure—as well as economic revitalization and mitigation.
Horne will be in charge of implementing the HUD grant, with oversight by the state Division of Community Revitalization, which is under the N.C. Commerce Department.
State Rep. Mark Pless, a Republican who represents Haywood and Madison counties in western North Carolina, told Inside Climate News the Horne award “causes me great concern.”
“It would appear the executive branch has not learned from the massive failures of NCCORR,” Pless said, referring to ReBuild NC by its acronym. “With the funding appropriated to date, the legislature has given the new administration a great opportunity to move western North Carolina in a positive direction. I can assure the victims of Helene I will not sit idle watching the same mistakes being repeated.”
State officials scored each bidder based on qualifications, price and technical approach to determine which company provided the best value, according to the request for proposals. The state noted in the RFP that this ranking method “may result in an award other than the lowest price or highest technically qualified offer.”
Horne is a well-known accounting and professional services firm based in Ridgeland, Mississippi, that works in several business sectors. Among them: disaster recovery programs across the United States, including Texas, Georgia, New York, South Carolina, Florida, Puerto Rico and the Virgin Islands.
Krebs was a partner in Horne’s Government Services Division, a position he held for nearly nine years, according to his LinkedIn profile. In that role Krebs oversaw multiple disaster recovery projects, including hurricanes, floods and pandemic response.
After Krebs left Horne, he contributed $12,800 to Stein’s gubernatorial campaign and $29,000 to the N.C. Democratic Leadership Committee in in-kind donations for the 2024 general election, state campaign finance records show.
'Applicants Did Not Know Who to Contact'
Horne won the ReBuild NC contract in 2019, worth $34 million. The following year, Horne and ReBuild NC agreed on an amended contract with an expanded scope of work totalling $48 million. In 2021, the parties amended the contract again, bringing the total to $88 million.
Horne had separate agreements with the city of Fayetteville and Robeson County for disaster recovery.
As ReBuild NC’s prime contractor, Horne had many responsibilities, including communicating with hurricane survivors and guiding them through the early steps of the application process. It also hired subcontractors to do further work.
Yet while Horne was in charge of case management, dozens of hurricane survivors complained they could not reach their case managers for weeks or months at a time. Those problems continued even after ReBuild NC did not renew Horne’s contract in 2022 and hired its own case managers.
In December 2022, Legal Aid of North Carolina sent a letter to a state legislative oversight committee describing the consistent communication breakdowns, both under Horne and ReBuild NC.
Applicants sent emails to unmonitored addresses or left messages on voicemails that apparently were not checked. When applicants did finally reach a case manager, they often received “different, even contradictory information.”
As case managers churned through the program, Legal Aid wrote, “the applicants did not know who to contact but were withdrawn for failure to communicate.”
In testimony submitted to a state legislative oversight committee, Horne attributed program failures to ReBuild NC; the agency blamed the company.
Scrutiny in Other States
Over the past decade, Horne’s performance has been scrutinized by several state auditors and federal inspectors.
In Louisiana, the state auditor investigated Horne in November 2022 after several company employees allegedly received COVID-related relief funds they were administering, The Advocate in Baton Rouge reported. Horne “removed” the employees, according to The Advocate, and the state continued to work with the firm.
Earlier that year the state of Alabama had to return more than $42 million in pandemic aid to the U.S. Department of Treasury after Horne failed to distribute emergency rental funds on time, according to AL.com.
Annison, the Horne spokesperson, said the company is “aware of comments surrounding a few of the projects we have overseen. All programs are unique, and we address any client concerns quickly, fairly, and empathetically as they arise.”
Horne has successfully managed, distributed, provided compliance and overseen more than $122 billion in funds related to natural disasters and COVID-19, Annison said. “We are proud of our record of helping and supporting communities in their recovery from these disasters.”
The more recent scrutiny of Horne in West Virginia dates to historic flooding in 2016, when the state’s mountainous terrain damaged or destroyed thousands of homes, businesses, bridges and other infrastructure. The storm left thousands of people homeless and killed at least 23. West Virginia officials hired Horne to manage its $150 million disaster relief program.
In the years that followed, West Virginia investigators discovered that many of Horne’s services provided to the state were “problematic,” according to an April 2025 press release from the U.S. Attorney’s Office for the Southern District of West Virginia in Charleston.
Many of the “personal consultations,” billed by Horne at $950 each, were for cold calls in which homeowners replied they did not need services, according to the U.S. Attorney’s Office.
Horne created an applicant file for each person, complete with fictitious birthdates, Social Security numbers and fake signatures on legal documents, according to the U.S. Attorney’s Office.
Investigators also found that in some cases these personal consultations were actually performed by staff for Voluntary Organizations Active in Disaster, not Horne, the U.S. Attorney’s Office said.
Further investigation revealed that 48 of the physical property inspections, costing the government $1,850 each, “were for vacant lots where an inspection was not required. Similarly, Horne billed $1,650 for each of 72 repair estimates where there was nothing to repair,” the U.S. Attorney’s Office wrote.
Over the course of the contract, Horne’s payment increased from $900,000 to more than $18 million without competitive bidding, the U.S. attorney said. The state eventually paid Horne just $6.7 million and did not extend the contract, according to MetroNews, a West Virginia media outlet.
In a press release, Horne CEO and Managing Partner Rusty Butcher said the company “stands by the value delivered and the appropriateness of the data invoice approved by all parties in 2018. After reviewing the cost of litigation, we determined settling this dispute is the right business decision.”