There’s Some Hot Competition For America’s Worst Federal Agency

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Mark Tapscott Executive Editor, Chief of Investigative Group
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Ask Americans what the worst federal agency is and odds are it will be the Department of Veterans Affairs (VA), but there is another that may actually be worse: the Department of Housing and Urban Development (HUD).

There is no doubt that VA is a bureaucratic nightmare. Repeated investigations by media outlets across the political spectrum have exposed a department that, among much else:

        • Used secret appointment lists for veterans hoping to see a doctor.

        • Lied about delays in getting benefits to deserving veterans.

        • Covered up multiple management misdeeds, including the activities of the “Candy Man” doctor who handed out opiates like, well, candy.

As bad as those examples are, recent reporting by The Daily Caller News Foundation Investigative Group’s Luke Rosiak exposed even more outrageous behavior:

        • Career bureaucrats, not veterans, dominate the top decision-making ranks at the department’s medical centers.

        • Managers made a collective bargaining deal with the American Federation of Government Employees to favor union members over veterans in hiring.

        • When veterans are hired, they are typically given janitorial jobs.

Congress has multiple investigations digging into VA, and both Democratic and Republican presidential candidates promise to fix the broken department if they are elected. But things still aren’t changing very quickly.

So how could HUD — or any other federal agency or department — be worse than VA? Reporting in recent months by TheDCNF Investigative Group make clear that waste, corruption and incompetence are the norm for HUD.

Tax dollars doled out by HUD fund hundreds of local public housing authorities across the country. Just about every kind of corruption imaginable, including street and white-collar crime, is endemic:

        • Dozens of maintenance workers at Baltimore’s long-troubled Gilmor Homes Project demanded sex from residents in return for keeping the heaters on and the stoves working. None of the offenders have been fired, even though they are paid with HUD funds.

        • Residents of two Memphis public housing units lived in rat-infested apartments because, according to TheDCNF IG’s Ethan Barton, for years HUD refused to send inspectors to the projects, which received $60 million in federal funds.

        • Barton also reported on how Chicago’s Carmen-Marine Project took $23 million in HUD funds but couldn’t account for how it spent the federal money. Grant oversight officials at HUD said nothing when the project’s managers repeatedly failed to file required accounting reports.

Nobody should be surprised by such examples of waste and fraud funded by HUD at the local level, however, because even the department’s most senior leaders can’t account for how they spend hundreds of billions of tax dollars nationally.

As a result, there is a seemingly endless parade of examples of HUD officials pouring federal funds into worthless projects, funding special interests, and evading even the most basic accountability measures:

        • HUD officials have channeled at least $429 million in Section 4 funds for “capacity building” among anti-poverty activists groups. Neither HUD nor Congress, according to Barton, have ever audited the program.

        • A Maryland-based non-profit got $305 million from HUD but spent most of it on lavish salaries for its top executives, while failing to generate required matching funds from private sources.

        • HUD’s books are so badly done that billions of dollars in spending by the department is impossible to audit, according to the Inspector General. And that watchdog has been warning HUD about its books for a decade.

Despite it all, no top HUD executive has been fired during President Barack Obama’s tenure. In fact, being HUD secretary can be a stepping stone to better things in the nation’s capital.

Shaun Donovan, Obama’s first HUD secretary, was promoted to the White House in 2014, becoming director of the Office of Management and Budget despite having presided over a federal department whose books were full of mistakes, omissions and false data.

And the outlook is even better for Donovan’s successor, Julian Castro, because, according to the Los Angeles Times earlier this week, he is considered a strong contender to be former Secretary of State Hillary Clinton’s vice presidential running mate if she wins the Democratic presidential nomination.

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