GOP senator urges HUD to look at fraud and abuse in the department

Caroline May | Reporter

In the ninth installment of Sen. Tom Coburn’s letter writing campaign looking to show responsible ways to cut spending in light of the sequester, the Oklahoma Republican put the spotlight on wasteful and fraudulent activities at HUD.

“For years, HUD has awarded millions of dollars to slumlords and to [Public Housing Authorities] that overpaid executive directors and board members,” Coburn wrote in his Friday letter to HUD Director Shaun Donovan. “Sadly, the tenants are the ones who suffer from the horrible conditions and total mismanagement even though the funding is available to fix the substandard conditions.”

The examples of fraud and waste Coburn pointed out to Donovan included $1 billion provided to the New York Housing Authority (NYCHA) that Coburn said has been unspent despite widespread reports of mice, leaky roofs, and broken locks. He further pointed to another $42 million also allocated to NYCHA for security cameras that the city has not yet used.

“Public assistance should be targeted at helping the poorest and most vulnerable,” Coburn wrote. “Better oversight of irresponsible PHAs and eliminating unnecessary bureaucracy would ensure HUD can comply with sequestration without evicting families from their homes or cutting services for those truly in need.”

NYCHA was not the only housing authority Coburn pointed to. He further cited examples, in which PHA executives, some pulling in hundreds of thousands of dollars in salary, misused their funding, at times for personal gain. And in Los Angeles, Coburn cited the embezzlement of $520,000 — from funding that should have gone to assist low-income people — by the brothers of the Housing Authority of the City of Los Angeles executive director.

“I applaud the Inspector General for pursuing these cases and pursuing justice on behalf of those who live in these communities,” Coburn wrote, but added that HUD should be working to find out just how prevalent such issues of fraud are.

“There are about 4,000 PHAs across the country participating in HUD’s public housing and/or voucher programs, managing over $24 billion in federal aid. Opportunities to improve finances across these programs are vast,” He noted.

“The benefit is protecting services for the most vulnerable. Over 700 PHAs were scored just last year by HUD as having substandard management or finances,” Coburn continued. “The agency also needs to examine every option possible to encourage local PHAs to consolidate and streamline their administrative costs to better serve public housing needs.”

In his Feb. 14 written testimony to the Senate Committee on Appropriations on the impact sequestration would have on HUD, Donovan explained that sequestration would have devastating effects on homelessness and on other vulnerable groups that HUD works with on housing needs across the country.”

“It is my hope and all of our hope in the administration that Congress can find a bipartisan solution to our budget and deficit concerns without risking our economic recovery and imposing the kind of serious damage that the sequester makes inevitable,” Coburn further quoted Donovan’s testimony in his letter, asserting that part of that solution should be a review of the department and its programs.

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