Let’s Nail Down O.C.’s Role in Sloppy Repairs

For more than 20 years, various county departments have directed the rehabilitation of low-income family housing using federal Housing and Urban Development (HUD) money.

The idea that helping homeowners repair their homes prevents neighborhood deterioration is well-founded, but by the summer of 1996, disturbing allegations of shoddy, unacceptable contractor repair work, as well as abuse of authority by county employees, were being made by many homeowners. The complaints were directed at the county’s Housing and Community Department (HCD).

The well-intentioned goals went up in smoke when at least four untrained HCD personnel were allowed to oversee and direct the work of unqualified and unscrupulous private contractors.

The task of identifying qualified homeowners, writing contracts, conducting the bidding and contract award process and overseeing work was far beyond their qualifications. They were not trained. They were not contract administrators. They never had been licensed contractors and were not trained building inspectors. But they acted in all of those capacities.

Most of the rehabilitation work required state and county building permits. The records now reveal the HCD project managers were aware that permits were nonexistent for practically all of the projects.

Not only were the contractors allowed to continue without permits, but without permits there were no inspections, which gave the contractors carte blanche to do whatever they wanted, with obvious cost savings.

More than just shoddy work resulted.

In many instances, the homeowners were left with health and safety hazards such as water heaters plumbed with plastic pipe, improperly wired outlets and garbage disposals connected with lamp cords.

Replacement windows were never sealed, which allowed winter rains to destroy mobile home particle-board floors. Double-wide mobile homes were left uncoupled.

In the two-year period that produced most of the shoddy and illegal work, four contractors were responsible for more than 50% of the projects.

A report for the county in 1996 found: 1) a pattern of inflated pricing over original bids; 2) a failure to itemize; and 3) billing that almost always equaled to the exact penny the approved funding for grants or loans.

Many of the homeowners later would tell the U.S. Department of Justice investigators that HCD project managers steered them to those four contractors. Any reasonable observer would question why the HCD managers would hand over so much work to so few contractors.

If the contractors produced acceptable work, rewarding them with contracts might have been somewhat justified, but this clearly was not the case. Shoddy-work complaints were coming in weekly.

Senior county administrators who were charged with HCD management oversight stonewalled the homeowners’ complaints until the press picked up the story in January 1997.

The next month, Supervisor Todd Spitzer accused county CEO Jan Mittermeier of covering up a sheriff’s investigation of the brewing scandal in the HCD department. This investigation has never been released.

Was there a cover-up?

In April 1998, 33 of the dissatisfied homeowners filed a federal lawsuit against the county and eight contractors. In late December 1999, the county agreed to a settlement requiring it to repair more than 250 contractor-damaged homes, and pay for ancillary damages such as pain and suffering, inconvenience and loss of use.

The eventual costs to county taxpayers could amount to several million dollars. Furthermore, the settlement does not provide punitive action against any county employees or the contractors for their inexcusable performance. And it does not order barring the unscrupulous contractors from the county’s “Qualified Bidders List,” where all but one (who relocated out of state) remain today.

According to the current director of HCD, the county retains these contractors on its qualified bidders list because nothing warrants their removal. But if there are not grounds for removal from the list in the failure to obtain permits, in the avoidance of safety inspections and in unacceptable work, where would it be?

While the county denies any wrongdoing, the agreement to settle is tantamount to admitting its culpability.

To determine if kickbacks or any other personal benefits were provided to any county employees or private contractors, an independent investigation by someone outside county government is called for.