Better late than never: HUD takes over

by Leslie Turk

In a letter dated March 28, HUD made official its plans to take over the troubled Lafayette Housing Authority.

In a letter dated March 28, the U.S. Department of Housing and Urban Development made official its plans to take over the troubled Lafayette Housing Authority, via a "Declaration of Substantial Default." The letter, penned by Sandra Henriquez, assistant secretary for Public and Indian Housing, was addressed to City-Parish President Joey Durel, ex-board member Joe Dennis and current board Chairman Shirley Vige.

The action eliminates the LHA board, including the trio of members fighting in court to be reinstated and newly appointed members, says Dan Rodriguez, the HUD official who is acting executive director for the LHA. In its letter, HUD cites numerous problems at the agency, which has been under federal investigation since last summer, including weak accounting controls, misuse of funds, a non-compliant cash management system, lack of effective leadership, and improper implementation of the Disaster Housing Assistance Program. Read the letter here.

HUD is now updating many policies and procedures, Rodriguez says, including the procurement and personnel policies and the LHA's bylaws.

Why it took HUD so long to step in after the blistering 2008 and 2009 audits, which led to the resignation of Executive Director Walter Guillory and his deputy, Jonathan Carmouche, and a costly legal battle over seats on the LHA board, is anybody's guess. "That was a decision made at headquarters," Rodriguez says. "It's something that's been a possibility for a long time." He says the uncertainty of the board situation and the possibility that decisions made today could be overridden if the dismissed trio of board members, which also includes John Freeman and Leon Simmons, is reinstated by the courts, likely weighed heavily.

Rodriguez and a HUD employee out of the Atlanta office, Ada Halloway, will be in charge of the agency until a new executive director is hired and trained. "I would say at least six months," Rodriguez says. "It'll go on until the housing authority is back online."

Five candidates have been identified as most qualified for th ED post, and a panel of community leaders has ranked them. Rodriguez says he and Halloway will soon determine the next steps, but he thinks a new leader will be chosen soon. Once HUD is comfortable that the right person is in place and he or she has a stable senior staff and is properly trained, HUD will ask Durel to appoint a new board, Rodriguez says. "At that time, HUD will pull back."

And just in case anyone wants to challenge the takeover, Henriquez made it clear that's not an option. "Please be advised that this letter constitutes final agency action and there is no further right to administrative review by HUD."