Homeless Agency Criticized

Times Staff Writer

The general manager of the Los Angeles Housing Department has accused the city-county homeless agency of mismanaging money and called for an immediate management audit of the agency.

Mercedes Marquez, the general manager, requested the audit of the Los Angeles Homeless Services Authority, or LAHSA, in a letter sent Tuesday to Mayor Antonio Villaraigosa.

In the letter, Marquez wrote that the agency, because of accounting issues, didn’t know it had $1.54 million in unspent money that could be used to fund programs for the homeless.


“Unfortunately, LAHSA’s report of unexpected balances is not reliable, because for the last two program years, they have not adequately tracked expenditures by funding source,” Marquez wrote.

In a Jan. 12 report on the city budget, Villaraigosa recommended several trims in spending on homeless programs because of an expected decline in federal community development block grant funding for the coming fiscal year.

These included not funding a recently opened shelter in Hollywood and a planned shelter in the San Fernando Valley.

Those suggestions have angered activists and some in City Hall who believe the mayor has put himself in the paradoxical position of saying he would reduce homelessness and then proposing to reduce spending to fight it.

Joe Ramallo, a mayoral press secretary, denied that the letter from Marquez -- one of Villaraigosa’s agency chiefs -- was a form of damage control for the mayor. Ramallo said the mayor would have budgeted differently, but that homeless-agency officials “didn’t tell us they had” the money.

Mitchell Netburn, executive director of the agency, was unavailable for comment Thursday because he was traveling.


Owen Newcomer, the chairman of the commission that oversees the homeless agency, said that he didn’t believe any irregularities or misspent money had been identified by Marquez.

“I don’t understand, because the problems at LAHSA have been resolved with the cooperation of the city and county,” Newcomer said. “I’m not going to speculate on motivations because it doesn’t make any sense to me.”

The agency and Netburn have been under scrutiny. In July, a joint audit by the city and county found that the Homeless Services Authority had a backlog of $5 million in unpaid bills from service providers and was borrowing money to pay bills.