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Audit faults Annapolis housing authority for management of voucher program

A new federal report found the Annapolis housing authority is struggling to manage one of its basic programs, firing four staff members who oversaw the waiting list for rental vouchers over just two years.

The audit by the Department of Housing and Urban Development, comes at a time when Executive Director Beverly Wilbourn is set to leave later this fall and the Board of Commissioners still has three vacancies and its chairman is up for possible reappointment. It also is moving forward on a long-sought redevelopment of one of its properties.

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In general, the audit found the authority used a preference system without clearly defining what it was or how it worked. For example, the agency awarded places on the list to people who were displaced or considered to be working families and lived or worked in Annapolis. It also admitted someone with a criminal record without any standards for how long a criminal record should be considered.

HUD said the Housing Authority for the City of Annapolis must update its system to define weight or rank, and develop methods for administering the list.

“These conditions occurred because the Authority: was unaware of some waiting list requirements, lacked controls to ensure that it maintained documentation to show that it properly selected applicants from the waiting list, lacked procedures to ensure that it maintained documentation to show that it admitted eligible families into the program and did not establish a reasonable time-frame before admitting applicants who had engaged in criminal activity,” auditors wrote.

The authority will answer the Office of Inspector General’s recommendations in the audit by “strengthening internal procedures and controls in its wait list and eligibility documentation” along with updating its administrative plan to “reflect those improvements,” Wilbourn wrote in an email Monday.

HACA administers 331 rental vouchers and 53 project-based vouchers, which offer the opportunity to choose affordable rental housing throughout the Anne Arundel County area. The waiting list is closed.

They are separate from the public housing apartment complexes and townhouses owned or managed by the authority.

Since HUD designated HACA a troubled agency in 2017, the authority has been engaged in mending issues in key areas, including governance, finance and procurement, occupancy and physical condition of the properties identified in two previous audits.

Yet it faces a number of challenges. In addition to changing leadership, it faces a massive federal discrimination lawsuit filed by 29 residents. Earlier this month, a state judge ruled HACA cannot use an expedited process to force payment of overdue rent or evict tenants because it is not inspected or licensed by the city as other rental units are under state law.

The authority and the City of Annapolis, also named in the federal lawsuit, have asked a judge to dismiss the complaints. HACA also has appealed the District Court ruling to the Anne Arundel County Circuit Court.

And the authority is moving forward with a plan to redevelop Newtowne 20 through a patchwork of bond funding, tax credits, grants, state and federal programs. Fifty-eight families live in the complex on Tyler Avenue, where residents complain of frequent plumbing, heating and mold issues.

HUD’s latest audit took place from October to June and reviewed the records from October 2017 to September. Documents such as program files, waiting lists, family data, housing assistance payment, financial statements, policies, and board meeting minutes were reviewed.

The audit was prompted by an allegation that the housing authority ignored discrepancies between income for applicants in the Housing Choice program and those selected and did not “properly administer its program," according to the report. The allegation was dismissed but HUD auditors found problems with the way the program was being run.

One employee was fired in July 2017. Three more employees later brought on were dismissed between May and September 2018 because of “performance and conduct issues."

The housing authority told the Office of Inspector General’s that there were concerns with “its program staff’s ability to identify income discrepancies when admitting applicants and conducting annual reexaminations," according to the final results of the audit.

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HUD stated it “lacked assurance” the authority placed participants or selected people from the list who met all eligibility requirements, the audit found. One family admitted into the voucher program did not meet requirements because of a criminal history.

A family member had a criminal background that showed “violent criminal activity" in June 2016 — two years before the family applied for assistance, according to the findings. The applicant was involved in theft and other crimes between November 2006 to February 2014.

According to the audit, the authority did not have documentation to explain why the applicant was admitted into the program. It also found HACA did not have specific policies on what constitutes a “reasonable time-frame” before considering people with past criminal activity.

HACA initially denied the family but reviewed the decision and admitted them after they objected. The authority justified the decision by saying the applicant’s crimes were mostly misdemeanors that happened more than five years before the application.

A timeline to determine if HACA has created a resolution plan in response to the audit has not yet been determined, said Lisa Wolfe, a public affairs officer for HUD.

“HUD will begin working with the auditee (HACA) to work through the findings and recommendations, making decisions on what the HUD (and Authority) actions will be and by when, and providing a management decision on each recommendation to OIG,” Wolfe said in an email.

The goal is to come to an agreement within 180 days since the report was published on Aug. 14 but the timeline will be negotiated between HUD and the housing authority, she said.

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