County Housing Aid Program Criticized
A federal review of the county’s Housing and Community Development (HCD) program details widespread problems, ranging from sluggish staff performance to concerns that low-income loans have been given to ineligible applicants.
The report by the Los Angeles branch of the U.S. Department of Housing and Urban Development is the latest criticism of the county’s beleaguered housing program, which came under fire in February when community activists in El Modena raised charges of rigged meetings, conflict of interest and mismanagement within the department.
The federal report is one of several audits of the program scheduled for this year and was not triggered by the complaints from El Modena, according to county HCD director Dhongchai (Bob) Pusavat.
The 11-page federal review, based on the examination of 15 randomly selected applications to the county’s Community Development Block Grant and Rental Rehabilitation programs, cites a dozen examples of cases in which the county apparently violated regulations or mismanaged funds.
In a response filed with HUD last week, the county stated that it disagreed with many of the report’s findings. “ In an interview, Pusavat said the program has funded only qualified applicants.
Among the report’s charges:
* The county allowed federal low-income loans to go to applicants who were eligible for bank loans or other private financing. In one case, according to the report, a borrower asked the county to help refinance a $92,650 conventional loan at a lower interest rate. After paying her debts, the borrower netted about $25,000. A county response filed last week states that the borrower netted about $6,150 and used the funds to pay for kitchen repairs not covered by the county’s loans.
* The county did not independently verify the financial status of applicants before approving federal rental-rehabilitation funds. The county responded that it verifies insurance, property tax, mortgage and other related information.
* County staff has a low level of productivity and is slow in processing loan applications each year. The county risks losing $156,659 in rental-rehabilitation funds because they were not disbursed within a two-year period, according to the report. The county responded that the federal reviewer miscalculated the number of applications processed but added that a plan was being created to improve staff productivity.
