Housing Official Says Funds Are Misused

A Los Angeles Housing Authority commissioner has resigned, firing off a sharply worded series of letters--including one to the U.S. Department of Housing and Urban Development--alleging serious mismanagement, misuse of public funds and other problems in the agency that oversees the city’s low-income public housing.

Diane L. Middleton, an attorney who was appointed to the commission four years ago by Mayor Richard Riordan, alleges numerous problems in the housing authority, focusing mainly on what she calls ill-conceived plans and delays in modernizing the Jordan Downs and Imperial Courts housing projects.

A second commissioner, Maurice S. Kane, who served as the commission’s vice chairman, also resigned this week, and in a letter to Riordan, cited concerns with the commission and the housing authority administration. Kane was ill and could not be reached for comment Wednesday.

Kane and Middleton cast the only two votes against the renewal of a four-year contract for housing authority Executive Director Donald Smith late last month.

In an interview, Middleton said she believes that the housing authority deliberately kept information from her, and that HUD should conduct an independent audit on federal funds awarded for improving conditions at the two South-Central housing projects.

“I don’t do this lightly,” Middleton said. “I was always a believer that good government would win out. . . . But it’s no longer enough for me to just vote no. I don’t want to sit on that side of the table.”

In her resignation letter to Riordan, Middleton went further, saying: “After four years, I am greatly disillusioned at the misuse of taxpayer funds that I have encountered and the disregard for the rights of taxpayers, public housing residents, HACLA [Housing Authority of the City of Los Angeles] employees and contractors.”

The housing authority is overseeing a $35-million renovation of Jordan Downs and a $15-million project at Imperial Courts. The agency oversees all Los Angeles’ low-income public housing funds--most of which come from the federal government--without City Council oversight.

Housing authority officials, however, downplayed Middleton’s allegations, saying expenditures of public housing funds are carefully scrutinized with outside audits, as well as by the commission.

Smith, the executive director, said he will respond to the charges to the mayor by week’s end.

“I don’t believe there’s any misuse of taxpayers’ funds,” Smith said. “We have had careful oversight . . . I’m a little confused about exactly what she’s talking about.”

Commission Chairman Diego Cardoso said he has asked for a full report on Middleton’s charges, adding that he has not found similar problems with the staff or the agency.

“I understand the frustrations she has had,” Cardoso said. “The best way is to work with the staff and the commissioners.”

But Middleton is not the only one to raise serious concerns about the improvement projects at Jordan Downs and Imperial Courts. Rep. Juanita Millender-McDonald (D-Carson), whose district includes both projects, wrote a letter to the commission in November questioning what she believes are potentially life-threatening changes in the construction work and raising concerns about the bid process and the quality of work performed.

In a 10-page response to the congresswoman, Smith said that the housing authority is “dedicated to seeing that all modernization work is completed to the highest standards” and that all federal, state and local requirements are being met.

But Middleton disputed Smith’s claims, saying she believes the authority hasn’t followed through on many promises to the commission, including one to employ a large number of residents in the renovation projects in apprenticeships and other jobs.

“Being a commissioner should not be equated with being an investigative reporter,” Middleton said. “It would be a tooth-and-nail battle to get information.”

Middleton also alleged that residents who came forward with such information risked reprisals. “It goes against everything I have fought for all my life to blame the residents for mistakes made by senior staff, [to] treat competent adults like ill-behaved children, and generally attempt to control by intimidation, fear and threats.”

Smith downplayed Middleton’s claims, saying that the residents are being employed as apprentices, security guards and in other jobs and that the agency is responsive to residents’ concerns and complaints.

Smith and others cite a plumbing problem in Jordan Downs, for example, in which raw sewage flowed from drains. “We’ve taken it seriously,” Smith said. “We’re on schedule and we’re fixing it.”