CHAMPAIGN – The man hired by the Housing Authority of Champaign County to be its new executive director left his old job in Gary, Ind., under fire earlier this year, with a federal report charging that he had "grossly mismanaged" a program to rehabilitate vacant housing authority apartments.
Edward Bland Jr., 59, was hired last week to be the new executive director of the county housing authority, with local board members citing his extensive experience during the hiring announcement.
One local housing board member, Jeffery Ford of Champaign, said Bland made the board aware of the controversy. Ford said a housing authority consultant, the Rosenberg Housing Group of New York City, had checked out the issue and not found it particularly troubling.
"There was no misappropriation of funds," Ford said. "(The U.S. Department of Housing and Urban Development) is constantly interpreting rules and reinterpreting rules. Ed has an excellent reputation within HUD and good references. It clearly didn't leave any lasting negative impression."
But articles from the Gary Post-Tribune and a Dec. 12 report by the Troubled Agency Recovery Center-North, an arm of Housing and Urban Development, shows that Bland was temporarily reassigned as executive director in July 2002 and spent the last seven months of his tenure at Gary in that status, after the Gary board learned of the investigation. His resignation became effective in February.
The report, provided to The News-Gazette by the Gary Housing Authority, was scathing about how Bland oversaw the vacant unit rehabilitation program, which used private contractors to renovate apartments and paid them $1.2 million.
"The failure to adhere to fundamental construction contracting protocols is the primary cause of the mismanagement," the executive summary of the report states. "Based upon internal Gary Housing Authority correspondence, the executive director was aware of the contracting problems, failed to take corrective actions and contributed to the perpetuation of the administration problems.
"Gary Housing Authority staff, knowledgeable in modernization, procurement and finance, were ineffective in their efforts to counsel and advise the executive director. The degree of executive director negligence warrants the board to review his performance and consider removal or suspension of any duties associated with modernization, procurement and personnel supervision."
Among the problems with the program cited in the report:
– Three Gary contractors hired to renovate the units didn't withhold Social Security and income tax from employees' pay, contending they were independent contractors, and didn't follow federal guidelines for rates of employee wages.
– Contractors used materials for renovation supplied by a Gary Housing Authority warehouse, as needed. Some requisition sheets showed an excessive number of items might have been taken inappropriately, such as tools, doors and cleansers.
– The three Gary contractors were all, at some point during the project, not properly licensed to do the work by the city of Gary.
– Payments to the contractors began in March 2001, even though work wasn't supposed to begin until July. "There was insufficient information to satisfactorily explain why payments were under way before the contracts were effective," the report said.
– Contracts with the contractors didn't include proper information, including proof of performance/payment bonds, apartment-specific listings of work to be done and work schedules.
– Inspections of the work done by the contractors "were extensive and detailed in their citations of deficient work," the report said.
The Gary Housing Authority was given a list of corrective actions to take because the housing authority had violated program requirements. They included having to have Housing and Urban Development review contracts before grant funds are spent.
Bland said he initiated the vacant unit rehabilitation program because it was a way to quickly make housing units available for rents, at a lower cost. He said the cost of using outside contractors was $2,300 per unit, compared with $7,500 per unit for using in-house staff.
"I did not see the report," Bland said. "We spent the money properly. I didn't take any money, I didn't play any favorites, and I built our reserves from $3.5 million to $15 million. I've been a professional for any housing authority I've ever worked for."
Bland also said he had a difficult working situation in Gary, with a staff that he inherited and several employees who were "politically connected."
"I tried to remove two people who forged work orders and the (housing) board brought them back," Bland said.
Gary housing board members are at a convention this week in Indianapolis and could not be reached for comment.
Ford said the Rosenberg Housing Group told him that there was a dispute about whether Bland had verbal permission from a federal official to use capital funds, rather than operating funds, for the vacant apartment rehabilitation program. Eventually, operating funds were used, he said.
Housing authority board Chairman Clyde Walker said he wants to find out more about the report before commenting. He said Bland has not yet signed his contract with the housing authority as local officials are awaiting the results of Bland's drug tests.
The Gary Post-Tribune, in an Aug. 13, 2002, article, disclosed that Housing and Urban Development had ordered the Gary Housing Authority to conduct an immediate audit of its financial records, which had not been done since 1999. Such audits are supposed to be done annually.
Also at that time, the Gary Housing Authority finance director, Willie Hollingsworth, was fired after 32 years there, the paper reported, when financial records were discovered to be "in shambles."
You can reach Mike Monson at (217) 351-5370 or via e-mail at email@example.com.