The Village of Oak Park expects to hear within the week a detailed report on mismanagement of its federally funded single-family home rehabilitation program and whether it will owe up to $300,000 to the U.S. Department of Housing and Urban Development (HUD).
Just how much the village will owe is subject to ongoing talks with HUD, said Village Manager Tom Barwin. A HUD spokeswoman did not respond to a request for comment.
The would-be fine regards improper documentation for income qualification of homeowners who benefited from lead abatement grants, in some cases for hundreds of thousands of dollars.
“It was kind of lead abatement gone wild,” Barwin said. “I don’t think that’s what the program envisioned.” Barwin, on the job since August, was not in charge when the grants were made.
Village President David Pope remembers that trustees, including himself, raised questions over funding projects whose budgets doubled or even tripled because of lead abatement.
“The response we received at the time was that HUD’s regulations required that all lead be remediated in such circumstances if a project exceeded $25,000,” Pope said.
In recent months, Pope has said that some “ugly rocks” have been overturned at village hall. “This was one of them,” Pope said.
“The board directed that the village cooperate fully with HUD, making all information available to them and pursuing these issues through an independent investigation,” Pope said. “We are awaiting the results of that investigation but are fully committed to pursuing each of the issues identified and to instituting operational and policy changes to bring our programs back into compliance with the best-known practices in terms of housing programs.”
Barwin estimated that, if a fine were imposed, it would amount to $250-300,000. He said the village attempted to obtain records to prove income qualification (homeowners need to be in the low- and moderate-income categories to qualify), but that one former participant has since died and others would not participate. He said the village will ask for clemency regarding the fine, but “if that’s what they have to do, that’s what they have to do.”
Barwin said other shortcomings might be uncovered in the report and that the report will be turned over to the state’s attorney in case mismanagement might spill over into malfeasance.
If fined, HUD will reclaim the money by lowering future payments of Community Development Block Grants (CDBG) to the village, Barwin said.
The village has received approximately $2 million annually in recent years in CDBG funds. Much of the funding is kept by the village for street improvements in areas of the village that qualify, while approximately $375,000 goes to help fund public services such as PADS and the Infant Welfare Clinic. Funding for those programs should not be affected by the fine, Barwin said.
The single-family rehabilitation program has been halted since a HUD-requested investigation began in April 2006.
Wednesday Journal reported at the time that the village was improperly mingling rehab and lead abatement funds, that it did not bid out jobs to get the lowest costs and that it did not review project costs to ensure they were eligible for federal funds.
Since then, the housing program staff has evaporated: two took early retirement and one had already resigned. Cynthia Breunlin, housing programs manager and the only remaining administrator in the department, is away on “family medical leave,” Barwin said, which is unrelated to the investigation.
Program will improve
The original review of the village’s rehab and lead abatement program turned up more questions.
“I think by mutual agreement both the village and HUD officials thought we should dig a little deeper in our review of those cases, which is what we are finalizing now,” Barwin said.
Meanwhile, the village will need to retool its single-family rehab program.
“We will probably move into an era of much, much smaller rehab projects that are based on urgent, emergency needs,” Barwin said. Project costs will likely not top $20,000 or $25,000.
Since he came to Oak Park, Barwin has begun reviewing every department in village hall; sort of a tune-up of its management.
“The incorporation of meaningful performance measures, together with Tom’s departmental review effort, will clearly help us to strengthen our ability to deliver excellent services in this area and all areas in the future,” Pope said.
“So while this situation clearly does not reflect positively on the village’s management of its housing programs in this area, the outgrowth of this investigation and collaborative review with HUD should help us to move strongly in the direction of effective program management and oversight, and improve service delivery for the community,” Pope said.
He added the requirement to spend less on each project will mean getting lead abatement and home improvement benefits to more people.
“Clearly we want to get this fixed, and we are committed to doing so,” Pope said.
The village’s investigation and HUD talks should wrap up this week, Barwin said.
“The village has a long, rich history of doing amazing things in the area of housing,” Barwin said. “It’s because of that rich history that … [this is] an extra disappointment.”
CONTACT: dcarter@wjinc.com