The below two articles cover a response to federal probes into PHA's waste, fraud, and abuse following the Carl Greene sexual harrassment scandal. What I find interesting is how "bulletproof" former Mayor John Street remains despite the myriad of ethical issues within the PHA that he chairs as well as in his mayoral reign. If any readers live in public housing, please comment on this blog so I can better understand the lack of outrage that exists within the stakeholders that depend on PHA services.
In a letter Monday, the Department of Housing and Urban Development (HUD) notified PHA that it would not free up funds for future legal services, until the agency answered questions about past bills.
PHA spent $33 million on outside legal bills from 2007 to mid-2010 and expects to spend $40 million in the next five years just on labor and employment services, according to information from HUD obtained by The Inquirer under the Freedom of Information Act.
HUD spokesman Jereon M. Brown said the action was taken because PHA's bills for legal services are "excessive" and far above what other major housing authorities spend.
PHA's spending is quickly becoming a national issue, already prompting Congressional scrutiny.
"We have to justify this to the people who need housing, to the taxpayers...and to funders," Brown said.
Former Mayor John F. Street, PHA's board chairman, called the action "simply HUD's way of trying to coerce us into accepting its point of view" on disclosing certain information.
HUD first challenged PHA on its legal spending in 2002, raising concerns but never suspending funding.
PHA spokeswoman Nichole Tillman did not immediately respond to a request for comment.
Street said some of the information HUD was seeking was confidential, involving "a complicated attorney-client privilege waiver issue."
HUD has told PHA that it should waive that privilege with the federal government.
"The rights of others could be compromised by our actions," Street said in an email. "We must not set a precedent that could be of concern to PHA for years to come."
Under former executive director Carl R. Greene, the housing agency virtually dismantled its general counsel office, outsourcing most work to 13 law firms.
Speaking with reporters after the meeting, Kelly said the actions were aimed at preventing the problems that plagued the agency under Greene, fired in September for secretly settling harassment claims filed against him by female employees.
To some critics, the changes called into question why the board had failed to take action previously.
They noted that PHA has been without a permanent inspector general since 1999. For 10 years the watchdog post was filled by acting Inspector General Joseph Daly, who left in 2009 while still serving in acting status. No one has been named to replaced him.
The staff in the Inspector General's Office has dwindled, as workers retired and weren't replaced.
In 1994, the PHA board - including John F. Street, then City Council president - passed a resolution giving the board power to appoint the inspector general.
The official was required to report to the board. Street, who later served as mayor, is now chairman of the board.
Kelly told reporters that he expected a quick appointment to run the reconstituted Inspector General's Office, which will now be the Office of Audit and Compliance.
He said the office initially would be staffed by the people who have been working in the Inspector General's Office.
Kelly, who is on leave from his high-ranking job at New York City's housing agency, said the new office was part of his commitment "to make PHA a more transparent and accountable agency" and that it "demonstrates our desire to make sure our funding is effectively used."
PHA spokeswoman Nichole Tillman said in a statement that "the responsibilities of the new office are somewhat similar to the inspector general, but this department will be more visible, with a broader scope, assuring compliance across the board on policies such as ethics, procurement, and sexual harassment."
Street said he could not explain why the board never took action after the last permanent inspector general left in 1999.
"It [is] not possible to know for sure how the events which troubled Carl Greene and therefore PHA would have been different had the board acted to hire an inspector general back at that time," Street wrote.
Kelly said the Office of General Counsel would be responsible for overseeing PHA attorneys and outside lawyers hired by the agency.
It will be required to report to the board as well as the executive director. Under Greene, board members said they were blindsided by work he assigned to outside lawyers, including secret settlement of harassment claims.
Between 2007 and mid-2010, PHA paid $33 million to outside attorneys. Experts say that was far more than other public housing agencies paid.
The U.S. Department of Housing and Urban Development is reviewing the outside legal fees as part of a wide-ranging forensic audit.
During Friday's board meeting, Kelly announced that he had appointed Audrey Lim, who holds a doctorate in psychology, as his acting director of human resources, and Stacey Thomas as PHA's acting equal opportunity officer.