Yesterday HUD released its report from the procurement review it conducted the week of July 28th. As part of the procurement review, HUD sampled eight contracts and did a cursory inspection of HHA properties. The report contains a major finding, which has prompted HUD to put the HHA on a “zero dollar threshold,” and ten observations.
HUD found that the HHA has no comprehensive vendor log, that the procurement process was flawed in each of the eight contracts sampled, and that the sampled contracts constituted $3 million in “unjustified non-competitive procurement.” It’s important to emphasize that these findings are just for the eight files HUD sampled. Extrapolating this data to the whole of the HHA lays bare how dire the situation is.
In addition to the procurement issues, the HUD report found that the HHA “lacks systematic and organized records keeping for all aspects of maintenance operation, including work orders, unit turnaround, preventative maintenance and annual inspections. “ HUD further found that there is a lack of institutional ability to manage the maintenance of a housing authority of this size. HUD has informed the Board that due to the cumulative lack of maintenance to the HHA properties, the HHA is at high risk of receiving the designation “Troubled” this Fall when they come to do their full physical assessment. This risk is compounded by the fact that the HHA lacks the funds to correct all the deficiencies before the physical inspection.
To be sure, all of these problems are huge. The strict zero dollar threshold imposed by HUD demonstrates the gravity of their findings. However, all of these issues are also fixable. And that’s what we’re going to do. These issues did not develop overnight, and they are not going to be fixed overnight, especially considering the financial constraints the HHA is facing. But, with the right management and a dedicated Board, the HHA will come out of this much stronger.
The Board is having a Special Meeting Tuesday August 26th to formally enter into the shared services agreement with the West New York Housing Authority. In addition, Mr. Fox will also continue his service to the HHA. Together the staff and Board are going to put together the Corrective Action Plan to address HUD’s findings. In addition, we are working on developing comprehensive procurement, personnel, and preventative maintenance policies that will be implemented by HHA management.
The Board will keep all stakeholders apprised of what is going on with the HHA. All are invited to come to our meetings and speak to the Board about their concerns, and hopes, for the HHA. A year from now, the HHA will be on much better financial and physical footing. We invite you to be a part of the recovery process.
Dana Wefer, Chair of the Hoboken Housing Authority
HUD’s letter to the HHA concerning the procurement review they conducted the week of July 28th. See below.