At Jordan Downs, housing agency’s lavish spending makes no sense

Barry Smith, 56, caught my attention Tuesday morning when he stuck his head into a dumpster at the Jordan Downs housing complex to dig for recyclable containers. When he came up for air, I asked if he’d heard the latest scandalous news about the spendthrifts at the Los Angeles Housing Authority.

No, said Smith, he’d been busy scraping to get by. So I told him about the newest outrage. Not only did the housing authority board quietly agree to a $1.2-million payout to the chief they fired last spring, Rudy Montiel, but an audit by City Controller Wendy Greuel and a report by KCET’s “SoCal Connected” have revealed lavish travel and dining expenses, as well as perks for employees, including $4,500 spent on Land’s End sweaters.

Housing officials ran up restaurant tabs of $2,000 and more at some of L.A.’s swankiest restaurants and charged the feasts to the housing authority, whose sole purpose is to provide and manage housing for low-income residents.

“It shocks me,” said Smith, who told me he’s never eaten at Ruth’s Chris Steak House, the Palm or some of the other high-end dining spots favored by officials who fed their faces on the public dime. He pointed to a Jordan Downs resident, a woman who was sweeping away dirt and leaves from the street near her unit. “Look at her, doing what they’re supposed to be doing, and they’re using the money for their own benefit?”

Smith said he rents a single room in a nearby house and has been on a waiting list for a one-bedroom Jordan Downs unit for two years. Just up the street from where he was digging for cans and bottles stood Eddie Louis, a retired custodian and eight-year resident of Jordan Downs. Louis hadn’t heard the news about housing officials either, but he didn’t find it surprising, given the $1-billion agency’s long history of malfeasance and an ongoing audit and criminal investigation.

Louis shook his head over the $1.2-million payout to Montiel (reported Sunday by my colleagues Jessica Garrison and David Zahniser), a handsome going-away present for a man given the heave-ho from an agency where people in need wait on building improvements or apartment openings. Louis said he has a friend who’s been on an apartment waiting list for five years. A female resident, working temporarily with a street-cleaning crew at the housing project, wondered if shameless spending by housing authority officials is one reason the planned redevelopment of Jordan Downs is taking so long.

Good question, and there are countless others, beginning with how a set of commissioners with the job of overseeing the agency did such a lousy job, and how nobody on the City Council or in the mayor’s office seemed to notice.

Montiel was seen by some as a reformer when hired in 2004, but tenants in housing projects overseen by the agency turned against him in 2010 and he tried to have some of them evicted for demonstrating at his Rancho Cucamonga home, which had a $30,000 security system paid for with agency funds. Some of the agency’s commissioners eventually demanded his head, but Montiel argued that was only because he was onto their corruption.

And now we find out that in addition to his annual compensation of more than $450,000 and 10 weeks of vacation, Montiel had also gotten commissioners to agree to pay him 18 months salary if he was terminated.

“I was aghast that they would have an 18-month severance package in the initial contract,” Greuel said.

As for the spending practices by the agency’s poobahs, Greuel used the words “outrageous” and “unfathomable,” noting that those officials were enjoying the high life with tax dollars during “these tough economic times, the worst since the Great Depression.”

Interim agency director Ken Simmons, who approved many of the expenses while working for Montiel, told “SoCal Connected” that he did so “under the direction of Mr. Montiel” and commissioners. He added that the spending happened when the agency was “flush with cash.”

Flush with tax dollars, in other words. Yours and mine.

In my interview with housing officials Tuesday afternoon, Simmons assured me that spending practices have been dramatically reined in under his leadership. He said that he regretted use of the word “flush” but that he was talking about Montiel’s attitude that when the agency’s enterprise housing programs were turning a profit, employees who were responsible should be rewarded. The mayor’s office is also quick to point out that not only did Montiel get ousted, but a majority of the commission has been replaced.

Greuel isn’t entirely reassured. She said her request for more agency records since Simmons took charge have not been responded to promptly, but that she now has a commitment from the new board president, Mitch Kamin, to support “a top-to-bottom financial review.”

Terrific, but it will take a lot of light and fresh air to repair the rot, and I still wonder how any employee, under any circumstances, could have thought it was necessary or acceptable to use public housing money to run up tabs at Bottega Louie, Rivera, Fleming’s, Parkway Grill and Drago Centro. At one restaurant, Harold & Belle’s, you and I, the taxpayers, picked up six lunch and dinner tabs greater than $1,000, including one for $2,233.

Greuel’s audit found that officials at the agency — which oversees no housing outside Los Angeles — spent $300,000 a year on travel in 2009 and 2010, which she called a 300% increase over travel costs in 2006.

Agency officials had a car detailed, paid for a limo, used agency funds for baggage fees on flights, bought thousands of dollars worth of gifts and spent a total of roughly $100,000 on “employee incentives.”

Employee incentives? Isn’t it incentive enough to work for a public agency with 13 paid holidays, healthcare, tuition reimbursement and a pension that can kick in as early as age 55?

The “incentives” were billed by human resources director Patrice McConnell, who made purchases at stores including Ralphs, Target, Honey Baked Ham, Mrs. Fields and Michael’s.

I wonder who got the $1,297.20 worth of See’s Candies.

steve.lopez@latimes.com