HUD Figures Skirt Perjury, Prober Says

Some witnesses may have been “skirting perjury,” Rep. Tom Lantos (D-San Mateo) said Wednesday in disclosing that former Secretary Samuel R. Pierce Jr. would be called to testify again before the House subcommittee investigating influence peddling and mismanagement in the Department of Housing and Urban Development.

Lantos said the subcommittee he heads will also recall Paul J. Manafort, a strategist in George Bush’s presidential campaign, as a result of contradictions between testimony given by the two and evidence that has emerged since.

“It is clear that several people are not telling the truth,” Lantos said in a telephone interview. “Whether or not that would stand up in court, I am not sure. I think Pierce is in trouble. I think Manafort is in trouble.”

Attempts to reach Pierce and Manafort for comment were unsuccessful.

Lantos said he has offered Pierce several possible dates in the next three weeks to testify again before the House Government Operations subcommittee on employment and housing.

The panel began hearings in May into charges that HUD favored clients of influential Republicans in awarding grants under its moderate housing rehabilitation program.

Left Decisions to Others

When Pierce testified on May 25, he asserted that he left final decisions on grants to Deborah Gore Dean, his executive assistant, and two other officials.

But former Federal Housing Commissioner Shirley M. Wiseman has said since that Pierce ordered her in 1985 to approve generous grants for a rehabilitation project in Durham, N.C., despite staff objections. A confidant of Dean said that Pierce ordered Dean to push the grants through.

The Durham project was being promoted by the city’s Republican mayor, who is a former law partner of Pierce, and by a top strategist for Ronald Reagan’s presidential campaigns.

Ex-Official to Testify

Stuart E. Weisberg, the subcommittee staff director and counsel, said he contacted Wiseman on Wednesday and is arranging a date for her to testify. Weisberg said the staff is investigating other projects in which Pierce may have played a direct role.

“I don’t think that (Durham) is the only project that (Pierce) was involved in pushing,” Weisberg said.

Although he refused to name anyone, Weisberg added: “A number of witnesses have come very close to perjury.”

Manafort, a principal in the potent political consulting firm of Black, Manafort, Stone & Kelly, is an owner of CFM Development, owners of a Seabrook, N.J., housing project that will receive $31 million in rent subsidies from HUD over the next 15 years.

In testimony before the subcommittee last month, Manafort acknowledged that the consulting firm engaged in “influence peddling” on the project. When asked to list other HUD deals in which the firm had been engaged, Manafort failed to mention a similar Georgia project.

Savannah Deal Reported

A Manafort associate told Savannah officials last year that they would receive federal housing subsidies if they supported a CFM rehabilitation project, according to the Hartford Courant. The deal fell through late in 1988.

Lantos said the subcommittee expects to hold six more hearings before a monthlong congressional recess in August and then resume hearings in September.

He said that, during his four terms in Congress, he has experienced “nothing remotely comparable” to the “ecstatic reaction” of his constituents to his part in bringing the HUD disclosures to light.

The crowd at a Fourth of July parade in Redwood City on the San Francisco peninsula was “extremely enthusiastic,” he said, with hundreds shouting encouragement.

The hearings were the reason, Lantos said. He described constituents who get C-Span, the cable television channel that carries congressional hearings, as “literally glued to it.”

Lantos said his constituents are “unbelievably outraged” by the disclosures, with probably the most anger directed at “influence-peddling by the high muck-a-mucks.”

He noted that former Interior Secretary James G. Watt, who with an associate received a $300,000 fee for setting up a meeting with Pierce for a housing developer seeking federal subsidies, repeatedly opposed “government handouts” while he was in office.

“The idea of the same James Watt cashing in on low-income housing programs turns people’s stomachs,” Lantos said.

‘Craving for Clean Government’

“There’s a craving for clean government, for good government ethics,” Lantos said, and people view the HUD disclosures as “pointing in that direction.”

Within an hour after reading HUD Inspector General Paul A. Adams’ report on abuses in HUD’s moderate rehabilitation program last April, Lantos set the first hearing, Weisberg recalled. But the staff director said that neither he nor his boss had realized that the disclosures “would mushroom the way they have.”

In fact, Lantos allowed Weisberg to take his wife and 20-month-old son to Disney World on a previously scheduled trip rather than run the initial hearing on May 8, Weisberg said. Now, the subcommittee’s entire six-member staff is working on HUD, and Lantos is seeking additional investigators from the General Accounting Office.