PAHA mismanagement goes to Appropriations Committee

Iowa Sen. Charles E. Grassley

Iowa Sen. Charles E. Grassley cites Port Arthur Housing Authority as an example of a government-funded agency that is in need of more oversight to prevent wasteful spending in an October report presented to the Senate Committee on Appropriations Subcommittee on Transportation, Housing and Urban Development. 

The Republican senator had previously made his assertions about the troubled PAHA in a July 25 letter to U.S. Department of Housing and Urban Development Secretary Shaun Donovan. In the HUD correspondence, Grassley asked for additional information relating to the Office of the Inspector General June audit, which concludes PAHA mismanaged about $6 million of taxpayer money.

“What (Grassley) is really after is making sure HUD is on top of what’s going on at local housing authorities,” Grassley media liaison Jill Gerber said. “HUD’s limited oversight has proven not to be enough.”

In July, Grassley requested information from HUD Secretary Donovan pertaining to PAHA and its related nonprofits including the Port Arthur Affordable Housing Corporation and the Port Arthur Housing Opportunities Corporation. Among the data Grassley asked for was “a copy of the current executive director’s employment contract and all financial statements filed by the PAHA, and/or its instrumentality, to HUD, including any statements made about executive director salary and all benefits,” “copies of all PAHA financial statements, audits and the management representation letters provided by the auditors,” “all legal bills and professional fees paid by PAHA” and “all travel and vehicle usage records for employees at PAHA as well as the PAHA Board members.”

According to Grassley, when PAHA received news of the OIG audit findings of gross questionable spending, “Unfortunately, rather than accepting responsibility, the PAHA submitted a combative 16-page response.” He said, “PAHA responded to all audit requests through an outside law firm and required that outside lawyers were present when OIG auditors interviewed PAHA staff members. I have raised concerns about similar tactics used by law firms at the Philadelphia Public Housing Authority that cost taxpayers over $35 million.”

Donovan has yet to respond to Grassley’s request for information.

Grassley’s recent message to the Committee on Appropriations urged fellow senators to help ensure the appropriate spending of tax dollars after housing authority scandals across the country have revealed wasted funding and abuse of the public trust in a vacuum of oversight.

“The agency has taken a few positive steps, but progress has been too slow,” Grassley said. “The agency seems to get involved in oversight of local housing authorities only after the fact, when the abuse has occurred and local media have documented the problems. For the public benefit, we need to reverse the timeframe.”