As the holidays approach, wouldn’t it be nice to know that the government is cutting out excess spending and focusing on helping out the “little guy?” Well, they sure don’t appear to be doing that.
RE-Insider can’t imagine a much worse scandal than what’s been taking place at the Housing Authority of the City of Los Angeles (HACLA), a mostly HUD-funded agency purportedly set-up to provide low-cost housing for L.A.’s poor.
Below are a few examples of the shenanigans happening at HACLA just since March:
• CEO Rudy “$400 lunches” Montiel gets fired after his frivolous spending is scrutinized by KCET-TV Channel 28’s “SoCal Connected”
• Before his exit, the board approves a $645,000 settlement with Montiel after he alleged his firing was a politically motivated retaliation
• Montiel received a total settlement of $1.2 million
• Ken Simmons takes over as interim CEO (even though he had been approving the exorbitant expenses as COO under Montiel)
• Simmons resigned yesterday citing the inability to overcome the misdeeds of the agency’s former CEO as his reason, even though preliminary data from an audit by the City Controller showed a 300% increase in travel expenses and numerous expenses for clothing, iPads, and other gifts as well as dining at posh restaurants
The local media has been reporting on HACLA’s misuse of government funds for a good five years or more. Where has HUD’s oversight function been all this time? Most of HACLA’s $1 billion budget comes from the federal agency. Shouldn’t HUD have been keeping a closer watch on this debacle?
During this housing market depression, HUD should be watching every dime and using whatever resources it does have to help turn the market around.
That would certainly help the less fortunate in L.A. this holiday season not to mention the real estate industry in 2012.