Housing agencies faulted in audits to get $300M of stimulus
WASHINGTON -- The federal government will soon send more than $300 million in stimulus funds to 61 housing agencies that have been repeatedly faulted by auditors for mishandling government aid, a USA TODAY review has found.
The money is part of a $4 billion effort to create jobs by fixing public housing projects that have fallen into disrepair. Recipients include housing authorities in 26 states that auditors have cited for problems ranging from poor bookkeeping to money that was spent improperly, according to the review of summaries the agencies must file with the federal Office of Management and Budget (OMB).
The government has promised to closely monitor how the agencies spend the money. Still, some watchdog groups are concerned. "I think taxpayers are going to have to steel themselves to hear that a lot of this money has gone down the tubes," says Leslie Paige of Citizens Against Government Waste.
Congress gave the Obama administration permission to withhold stimulus aid from housing authorities that the Department of Housing and Urban Development lists as "troubled" because of factors such as poor maintenance and financial management. But HUD decided to release the money to these authorities because they "should have the opportunity to improve their housing," spokeswoman Donna White said.
Nationwide, about 175 housing authorities are on HUD's troubled list, including many of the 61 that had faced repeated criticism from auditors. "We're watching this extremely closely to ensure that this money gets spent in a responsible way," said Peter Grace, a special assistant to HUD Secretary Shaun Donovan.
The stimulus package more than doubled the $2.5 billion the federal government typically spends to maintain public housing each year. Housing agencies have a year to spend it. To speed work, the law lets them bypass some state and local purchasing rules, such as competitive bidding, says James Armstrong, an analyst with the Public Housing Authorities Directors Association.
USA TODAY reviewed OMB data summarizing thousands of audits completed since 2004 with help from Boston College business professor Elizabeth Keating, who studies audits. The review identified authorities receiving stimulus aid despite having been cited at least three times for problems managing federal money.
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