HUD Report Reveals Reckless Disregard for Residents

“HUD’s report shows a reckless disregard for tenants by Mayor Johnson and Willie Hines,” says Kevin Solomon, Associate Organizer with Common Ground. “This verifies everything that Common Ground and tenants have been saying. The problems we’ve raised for two years persist and have worsened. Shame on the Mayor for once again trying to bury an audit from the federal government that makes him look bad. No wonder Hines is suddenly resigning. We commend the new Board members for helping us get this report to the public.”

“The Mayor and Hines have gaslit us tenants for two years,” says Roye “Chris” Logan, Resident President at Mitchell Court. “For two years, they have been trying to make us believe that our problems weren’t so bad, our problems would be addressed, they care about us, we are unnecessarily loud. Well, we call bull. And so does HUD. We were right all along.”

“The good news is that this report will help guide reform, ” says Jennifer O’Hear, Executive Director of Common Ground. “With Hines stepping down, we have a real opportunity. We look forward to working with the new Board to clean up this mess and create the housing residents deserve.”

After 54 days, a new assessment of HACM by the U.S. Department of Housing and Urban Development (HUD) has finally become public.

The report was sent on October 18 to Mayor Johnson, Willie Hines, and members of the HACM Board at the time (Sherri Daniels, Darian Luckett, Irma Yépez-Klassen). Common Ground learned of the report on November 19. Despite repeated requests and FOIAs, none of the aforementioned shared the report; it was intentionally kept from the public to protect Mayor Johnson and Willie Hines’ reputations. Only the new Board members were willing to help make the report public.

The attached report identifies numerous, damning concerns, including:

• “Financial and operational reports provided to the HACM board contain misleading financial information that misrepresents both the financial position and utilization of HUD programs being administered by HACM.”
• “HACM is over-reporting cash balances, under-reporting accounts payable balances, and under-reporting tenant accounts receivable balances.”
• “There was an account reconciliation provided for audit purposes that contained an unreconciled variance of $2,561,093.”
• “HACM does not have adequate management of physical assets to ensure the provision of safe, decent, and sanitary housing for its public housing residents.”
• “HACM’s financial staff are not sufficient in number and do not display professional competence for a public housing agency of HACM’s size and complexity.”
• “HACM management is not providing high-quality public housing, accurate financial reporting, or compliance with HUD program regulations.”
• “The appointment of board members is a low priority for both the current and prior mayoral administrations.”
• “Board oversight of management is not sufficient to ensure HACM achieves its objectives and mission.”
• “HACM may not be adhering to HACM bylaws or State PHA governance statutes.”
  • Having just 1 resident board member when required to have 2.
  • Conducting business without a quorum.
• HACM’s “multiple instrumentalities [Travaux and LLCs] with separate governance structures creates conflicting priorities and missions that contributes to a failure of effective oversight.”
• “HACM is not correctly reporting cash in its audit filings or in the corresponding data submissions.”
• “HACM may be recording cash that is not physical cash held at a bank but rather IOUs of other programs and divisions within HACM or Travaux.”
• “HACM could not demonstrate that [annual inspections] were being conducted or that HACM staff implemented [the preventative maintenance plans].”
• “HACM does not have an adequate quality control system for property managers, completed maintenance work, addressing inspection deficiencies consistently, or oversight of contractors.”
• “HACM has not conducted a Physical Needs Assessment or a comprehensive Capital needs Assessment to identify the repair, modernization, and maintenance needs of housing developments since 2014.”
• “HACM lacks organizational quality control checks and balances needed to evaluate completed projects to assess their impact on housing quality, safety, and resident satisfaction.”

NOTE: This press release was submitted to Urban Milwaukee and was not written by an Urban Milwaukee writer. While it is believed to be reliable, Urban Milwaukee does not guarantee its accuracy or completeness.