Sen. Chuck Grassley (R-Iowa) said he plans to object to a key nominee to the Department of Housing and Urban Development (HUD) because of the agency’s rush to negotiate contracts for its Moving to Work (MTW) program.
President Obama has nominated Lourdes Castro Ramirez, president and CEO of the San Antonio Housing Authority, to be HUD’s assistant secretary for public and Indian housing.
Grassley’s objection to her nomination would take place if and when it reaches the full Senate for confirmation. The issues he raises could also delay other legislative action involving HUD.
“Over the last four years, I’ve been raising concerns about serious problems at public housing authorities and HUD’s failure to address them,” Grassley said in a statement. “The Office of Public and Indian Housing is responsible for overseeing the public housing authority program. I recently learned that HUD is negotiating new 10-year contracts with the 39 housing authorities participating in the Moving to Work demonstration program. The Office of Public and Indian Housing is also responsible for administering this program but has failed to conduct proper oversight for years.”
MTW provides participating housing authorities an opportunity to design and test new strategies that aim to use federal money more efficiently and help residents become more self-sufficient. The program, which was implemented in 1999, gives the local agencies exemptions from many existing public housing and voucher rules and more flexibility with how they spend their federal funds.
“The current contracts don’t expire until 2018 so there’s no need to rush into signing new contracts,” Grassley said. “Instead, I recommend HUD takes serious steps to address the program deficiencies and determine if this demonstration should continue.”
In 2012, the Government Accountability Office found that HUD had failed to identify the performance data needed to assess program results and could be doing more to ensure that MTW agencies were meeting all requirements.
In his statement, Grassley charges that HUD’s failure to require any meaningful accountability has led to financial abuses at several of the participating agencies.
He says the Chicago Housing Authority “has diverted approximately $432 million in federal funding into a reserve fund instead of issuing over 13,500 vouchers to Chicago families who need affordable housing assistance.”
A CHA representative did not return a call for comment.
Grassley also cites recent six-figure salaries at the Atlanta and Philadelphia housing authorities.
“I expect a lot more answers and accountability before there is a vote on Ms. Castro Ramirez’s nomination,” Grassley said.
In his written statement, he refers to the head of the Philadelphia Housing Authority earning a salary of more than $300,000 as well as throwing lavish parties and secretly paying sexual harassment claims.
Those claims refer to a CEO who was removed several years ago.
Current President and CEO Kelvin Jeremiah's salary is $225,000, according the Nichole Tillman, spokeswoman for the agency.
Joy Fitzgerald, interim president and CEO of the Atlanta Housing Authority (AHA), has an annual salary of $261,100, according to the agency.
In his statement, Grassley said AHA has had at least 20 employees earning between $150,000 and $300,000.
An AHA representative told AHF that the agency has reduced its number of employees within the $150,000 to $300,000 annual compensation range to 17.
If confirmed, Castro Ramirez would replace Sandra Henriquez, who left the agency at the end of June after more than five years in the post.
Connect with Donna Kimura, deputy editor of Affordable Housing Finance, on Twitter @DKimura_AHF.