Audit of NLV agency confirms dysfunction

By Timothy Pratt

Friday, June 19, 2009 | 2 a.m.

If a second source was needed to confirm whether the North Las Vegas Housing Authority served people poorly and squandered millions, that confirmation has arrived.

A new audit, the second such report in six months, provides more evidence of why the agency turned over its programs in the past year to the Las Vegas Housing Authority.

Despite the latest findings, however, a top city official overseeing the nearly defunct agency said it is still too early to name names and get to the bottom line.

For that, we’ll have to wait for the results of two more audits, said Gregory Rose, North Las Vegas city manager and overseer of the housing authority since Executive Director Don England quit in January.

According to the most recently completed audit and Rose, the agency’s 2007-08 problems included overdrawing $1.3 million from the bank for the Section 8 voucher program, running up an $800,000 deficit in the same program, allowing tenants into public housing without verifying income, and entering into contracts without allowing bids.

The result: Federal money for helping people in need was mismanaged even as the Las Vegas Valley’s economy began tipping toward the highest unemployment and foreclosure rates since records have been kept.

“We know today there was poor management in both programs ... (and) standard practices for contracting were not adhered to,” Rose said.

But we don’t know exactly what happened, how much money was involved all told and who is responsible or liable for returning any of that money to the federal Housing and Urban Development Department, he added.

Rose said that in February he ordered a separate audit of the Section 8 program, and that audit is not finished. He also said the Housing and Urban Development Department will audit the entire agency, which may take months. Comparing notes with the feds is needed to get to the bottom of what really happened, he added.

Larry Bush, a HUD spokesman, said his department agrees “that there are unanswered questions, and we are taking a deep review” of the most recent audit. The department left questions about how long it has had the audit and other details of its own investigation unanswered.

Still, Carl Rowe, executive director of the Las Vegas Housing Authority, now in charge of running the North Las Vegas agency’s main programs, said several things were clear.

“People didn’t receive services they were supposed to receive,” Rowe said. In the public housing program, “there may have been people let into the program who were not eligible, or paying more than they need to.” And contracts were issued without competition or what would commonly be considered fairness and transparency, which could have resulted in taxpayers spending more than necessary. As for who is liable, Rowe said that fiduciary responsibility lies with the board, and the executive director works for the board. One or the other may have to refund some or all of any misspent money to HUD.

The North Las Vegas agency’s board includes four City Council members: Chairman William Robinson, who recently lost a bid for mayor; former Mayor Michael Montandon; Stephanie S. Smith; and Robert Eliason. Shirley J. Hogan is the fifth member. The Sun was unable to reach board members for comment on the audit.

At the June 10 meeting, when the auditor presented his report, several of the board members said they didn’t understand the findings and would have liked to have known about the problems earlier, said Rowe, who was at the meeting.

But the board members approved budgets and other decisions made during the years the overdrafts, deficits, and questionable contracts occurred.

The most recent audit differed from February’s because it clarified which findings were most serious, Rose said. Still, the auditors, from a Georgia firm, reviewed only some agency files, and now an attempt is being made to review more files, he added.

Rowe’s agency has taken over the Section 8 and public housing programs, a process that has required his staff to examine the North Las Vegas agency’s files as well.

He said the contracts the North Las Vegas Housing Authority entered into without competitive bids included one for maintaining elevators, another for security guards and a third for pest control. The three totaled nearly $130,000 for the first year and had no end dates. Rowe terminated the contracts.

Rose said in February he hoped to determine “what happened and who was involved, in a transparent manner, as soon as possible.”

This week he was more deliberative. “It would be wonderful if we could very quickly go through the housing authority’s books,” he said.

“But it is critical that HUD come out and do a thorough review.”