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Chattanooga: HUD investigators expected at housing authority today

By: Yolanda Putman
(Contact)

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Bill Lord

U.S. Department of Housing and Urban Development representatives are scheduled to be at the Chattanooga Housing Authority today to start an investigation of the authority’s financial situation and its causes, said Mark Brezina, HUD’s field office director in Knoxville.

“We’re looking at the whole scope of management,” Mr. Brezina said. “Specifically, the finances (issue) and how it occurred. Management is the reason why you have the financial difficulties.”

Bill Lord, the housing authority’s chief public information officer, said Mr. Brezina’s assessment of the agency’s management is “a reasonable statement.”

The housing authority earlier this month announced a $4.5 million shortfall and that it was laying off 30 people and reducing employee benefits and outside contracts to compensate for the loss. The resignation of Bob Dull, the agency’s executive director, was one of the layoffs.

HUD officials stated that CHA no longer could spend federal dollars without HUD approval.

Housing authority residents also are concerned about the layoffs, said Bobby Paris, president of the Dogwood Manor resident council.

“Residents are worried because of the maintenance,” said Mr. Paris, one of nearly 7,500 residents of public housing or housing managed by the housing authority.

Dogwood Manor has about 125 residents and 18 floors, but it has only two people on its maintenance staff, records show.

“There just isn’t enough maintenance staff, and the staff here is overburdened,” Mr. Paris said.

Residents have been mopping the lobby and hallways, pressure washing the sidewalk and gazebo and raking grass trying to fill in the gaps, he said.

About a dozen REACT (Real Estate Assessment Center Team) investigators from HUD are scheduled to arrive at the housing agency today and to stay for about four to five days, Mr. Brezina said.

The team will review files, audits and financial statements, he said. Representatives also will interview some CHA employees, he said.

Mr. Lord said HUD officials should not be surprised by their findings.

“They’ll find the same thing that we’ve found and come to the same conclusions,” Mr. Lord said.

Betsy McCright, CHA’s chief operating officer and interim executive director, investigated CHA’s problems and developed a draft recovery plan that included the layoffs and restrictions on employee benefits and contracts.

Her draft report states that CHA’s problem traces back to 2001 when the agency went to a private form of management hoping to become more efficient while cutting costs. But by 2004, housing officials saw that they didn’t get the results they expected and some HUD reviews resulted in substandard evaluation scores, according to the report.

The housing agency hired people and took on more resources to correct the problem. However, after the problem was corrected, the housing agency never reduced its staff until February of this year when housing officials laid off 24 people, or about 10 percent of the CHA work force.

Chattanooga Housing Authority board members thought the problem was solved until an April board meeting when vice chairman James Sattler noted that the authority’s expenses were exceeding its assets.

HUD officials said they will consider Mrs. McCrights’ plan for recovery as a draft, and HUD will continue to oversee the housing authority’s federal spending until HUD representatives complete their review.

“We need to understand it and look at it from our own perspective,” Mr. Brezina said.