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Auditor Publishes Damning Report Alleging Chronic Mismanagement of D.C.'s Affordable Housing Fund
Retweeted by Tom Sherwood: https://twitter.com/tomsherwood
bad news for DC's main affordable housing fund, which receives $100 million in tax dollars a year and is touted as a major investment of the current government
Link to tweet
Auditor Publishes Damning Report Alleging Chronic Mismanagement of D.C.'s $1 Billion Affordable Housing Fund
Alleged problems include potential fraud, under-spending on extremely low income housing, and an inability to preserve loan contracts.
MORGAN BASKIN MAR 20, 2018 8 AM
The first-ever comprehensive audit of D.C.’s Housing Preservation Trust Fund—a nine-figure coffer that provides loans and grants to developers across D.C., and is in many ways the backbone of D.C.'s affordable housing effort—is a damning one, indicating that chronic mismanagement of the fund by the Department of Housing and Community Development (DHCD) has likely wasted tens of millions of dollars, a report published this morning by the office of the D.C. auditor says.
Among the most concerning findings is the discovery that DHCD used housing trust funds to pay for “a significant and growing portion” of its employees’ salaries and benefits; that there is only a “remote” possibility DHCD will recoup tens of millions of dollars in loan repayments; and that DHCD failed to meet statutory requirements that dictate how much of its money should be spent on extremely low-income households, failing to contract thousands of legally required (and desperately needed) housing units.
Additionally, the audit said, officials in the Office of the Chief Financial Officer (OCFO) who oversee the fund’s dispersion “should have detected, prevented, and corrected many [of these] practices.” It concluded that the auditor “cannot rule out the possibility that fraud could have occurred during the scope of the audit.”
All told, the audit says D.C. officials “took undue advantage of the flexibility” of the fund, which “led to inefficiency and resulted in less funding available to create and preserve affordable housing for District residents.” (The auditor published an initial review of the fund almost exactly one year ago.)
Alleged problems include potential fraud, under-spending on extremely low income housing, and an inability to preserve loan contracts.
MORGAN BASKIN MAR 20, 2018 8 AM
The first-ever comprehensive audit of D.C.’s Housing Preservation Trust Fund—a nine-figure coffer that provides loans and grants to developers across D.C., and is in many ways the backbone of D.C.'s affordable housing effort—is a damning one, indicating that chronic mismanagement of the fund by the Department of Housing and Community Development (DHCD) has likely wasted tens of millions of dollars, a report published this morning by the office of the D.C. auditor says.
Among the most concerning findings is the discovery that DHCD used housing trust funds to pay for “a significant and growing portion” of its employees’ salaries and benefits; that there is only a “remote” possibility DHCD will recoup tens of millions of dollars in loan repayments; and that DHCD failed to meet statutory requirements that dictate how much of its money should be spent on extremely low-income households, failing to contract thousands of legally required (and desperately needed) housing units.
Additionally, the audit said, officials in the Office of the Chief Financial Officer (OCFO) who oversee the fund’s dispersion “should have detected, prevented, and corrected many [of these] practices.” It concluded that the auditor “cannot rule out the possibility that fraud could have occurred during the scope of the audit.”
All told, the audit says D.C. officials “took undue advantage of the flexibility” of the fund, which “led to inefficiency and resulted in less funding available to create and preserve affordable housing for District residents.” (The auditor published an initial review of the fund almost exactly one year ago.)