Three years ago, federal inspectors sanctioned the Hickory Public Housing Authority for awarding contracts to family members and misspending more than $500,000.
A new review has determined that agency officials haven’t done anything to prevent abuses from happening again.
Inspectors who descended on the Hickory office in October found financial files in “disarray,” unexplained bank accounts and no evidence that the board charged with overseeing the agency could monitor its finances.
Federal Department of Housing and Urban Development officials conducted their review after Observer reports detailed accusations from former employees who allege misspending, sexual harassment of tenants and other ethical lapses.
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A Dec. 3 letter obtained this week by the Observer details the results of that review, which raises questions about how the agency spends money intended to help house the poor.
Former employees allege that Housing Authority Executive Director Alanda Richardson misused public money to buy administrators and other officials iPads, pocketbooks, new office furniture, cell phones and other gifts.
The spending, according to the former workers, included money for staff members to attend a two-hour facial and makeup session with Richardson’s friend, who was a Mary Kay cosmetics consultant. Richardson told the women they could get $150 in products and the agency would pay the costs.
The federal review, according the HUD letter, said board members who are supposed to oversee the authority receive no regular financial reports. Federal officials also said they could find no records of board votes authorizing expenses detailed in a 10-page complaint three former employees sent to HUD earlier this year.
One of the expenses, for example, involved a 2014 lavish retirement party for a Housing Authority employee who is now on the payroll.
“We find the Board’s oversight of the (Housing Authority) and its Executive Director seriously lacking,” said the letter, which was sent to Hickory on Dec. 3. “This is most seriously troubling...There were no indications of internal controls or procedures implemented by the Board, to assure effective oversight.”
Federal officials found the agency financial files were unorganized. Several files were mislabeled and Richardson and another administrator had to go to an unknown location to retrieve some records, the letter says.
As a result of the review, the Housing Authority will remain under special supervision from HUD. That means federal officials will monitor spending by the authority.
The agency’s Board of Commissioners Chairman Sidney Myles did not return phone calls seeking comment.
Richardson declined comment, saying the HUD letter was addressed to the board.
Richardson, who has been executive director for 17 years, previously has denied any wrongdoing, saying the gift purchases helped boost workplace morale. She has defended the agency’s track record, noting that she has sent administrators to national conferences to bolster training and performance.
After the sanctions three years ago, she said she took those steps to try to comply with recommendations from HUD.
Board member Edward Fuller has staunchly defended Richardson.
“Our executive director has no peers as far as getting the job done,” Fuller said in an interview earlier this year.
About 60 miles northwest of Charlotte, the Hickory Housing Authority uses a $5 million annual budget and 15 employees to provide low-cost housing.
The city’s mayor has the authority to appoint members to the Housing Authority’s board of commissioners. The board oversees the executive director and helps set policy.
Hickory Mayor Rudy Wright has called for city leaders to more closely monitor the Housing Authority but has resisted taking steps to replace commissioners on the board.
On Friday, Wright said city leaders are now considering changes, including expanding the agency’s board or dissolving the authority altogether and creating a new organization to oversee affordable housing.
“Clearly, HUD is not happy,” he said. “We have got to find a way to make them happy.”
HUD harshly criticized Hickory’s hiring practices in its latest review.
Maintenance staffers were brought on without any evidence of education or training in construction and building trades. One employee, for example, had prior experience managing a rent-to-own furniture store and installing cable.
In one case, a man hired for maintenance work from 2008 through late 2014, lied on his job application. He wrote that he had been convicted on traffic offenses.
But HUD says a criminal record check revealed repeated convictions for assault on a female, forgery, drug trafficking and other felonies. The worker had no prior experience in building maintenance, trades or construction.
“This does raise the question why the (Housing Authority) would hire a convicted felon with annual charges and convictions of assault on a female and no relevant job experience or education to work as a maintenance technician, where he is able to access the homes of women and be required to interact with them daily,” the letter says.
Multiple female tenants have accused former administrator Montele Burton of paying their rent in exchange for sexual favors. Burton, who denies the allegations, resigned in February while under investigation for an alleged inappropriate relationship with a tenant.
The alleged harassment has raised questions about whether the agency conducts thorough background checks on prospective employees. Burton had been fired from another public housing agency for texts he sent to a female tenant and was placed on a “do not rehire” list after resigning from the Charlotte Housing Authority.