INDIANAPOLIS — After Department of Housing and Urban Development auditors spent just three days reviewing the Indianapolis Housing Agency’s books, federal officials found the IHA “insolvent” or unable to pay his bills.
“We’re running backwards,” IHA acting chief executive Marcia Lewis said after announcing the bad financial news to her board. “I can’t fix it without help.”
Those federal auditors, including a team from the State Board of Accounts, won’t report their findings until this summer. However, Lewis said his agency needs $10 million to balance its books, begin repairing its properties, and pay off old debts to HUD.
Lewis said experts from HUD’s risk management group will determine whether the agency can be reorganized, dissolved, or if its properties and work are divided among investors and private management companies.
“They’re going to see if they should smother this agency with technical assistance, they’re going to see if they should refer this agency to the Department Enforcement Center, which could lead to receivership, they’re going to see if they feel like if we were moving in the right direction and maybe there could be additional funds that they could release to help us.
Mayor Joe Hogsett said he would wait for those audits to come back and for the IHA to come up with a financial recovery plan before determining the future of the agency, which provides housing assistance to 24,000 low-income residents of the Marion county.
Barton Tower, one of more than a dozen IHA properties, towers over downtown Indianapolis, but locals who live there say it’s the pits.
“At this time, we do not have a manager on our property,” said Eric Hibbler, Sr.
“We need more maintenance staff,” said Nina Himes. “We have a maintenance lady here and she works really hard.”
“These issues are the results of years past,” helps Mary Chapman, “because of the wrongdoing, the embezzlement of past years, it comes upon us, the residents, the issues. Where is the money from past years that has been taken and why is no one held accountable? »
It’s a question Lewis asks herself as she’s been tasked with keeping the agency afloat while local and federal authorities decide what to do with the operation.
“When I walked through the door, I was like, ‘Is this the financial report we get? “, Lewis said.
HUD auditors found the agency’s books “messy” and that there were “individuals touching finances who shouldn’t have” in the past.
Auditors are reviewing IHA records dating back to 2007 for clues to the public housing agency’s financial chaos. Lewis said having four different audit teams reviewing an agency’s records is “unprecedented”.
“The ship is off the rails,” she told her board. “I try to sell everything.”
Lewis said essential and surplus IHA assets, including housing sites, could be sold to raise funds.
“We are in the process of reviewing our head office. I checked our title work to see if we are free and clear, do we owe any money on it, was it used as collateral on any of the other transactions,” she said . “I haven’t found anything that will stop me from selling the headquarters we’re currently in, and if that happens, we’re already talking with the city about moving to the city’s county building.”
Lewis said the IHA has vacant properties and commercial sites that could be sold to developers and owners.
“We’re trying to find out if there are any other packages out there,” she added. “There are other packages, but they have such expensive repair bills that we’re just trying to give them away because I can’t do what it takes to bring them back.”
Lewis cited deferred maintenance expenses including air conditioning, boilers and elevator service at several properties.
Some private lenders are considering taking over management of public housing currently under IHA’s control, although Lewis said she doesn’t think the current financial crisis will lead to the agency’s demise.
“I don’t see it disappearing in its entirety, but I do see a significant shift in the way we do business on the property management side of the house as opposed to the Section 8 side,” she said. about the operation that provides rental housing. vouchers to nine thousand people residing in private properties. “We will survive. We won’t look the same, but we will survive.
Lewis said the agency will step up collection of overdue rent and fees from residents.
“We will apply damage fees, we will apply late payments, we will apply other types of activities,” she said. “We’re going to let people know there’s a new sheriff in town.”
Lewis said the IHA has stepped up law enforcement to protect her properties and neighbors, although Barton Annex resident Mary Jo Evans said she is still afraid of strangers in her building.
“The homeless, I feel for them, but we don’t know what they’re doing,” she said. “Anyone can come in here. If you push a button they will let you in. They don’t know who you are. They just opened the door and it’s been broken for a month, the door has been broken for a month, so everyone came in, sleeping.
Lewis recently released the IHA’s “Moving Forward” transition plan which charts the course for stabilizing the agency while developing a long-term strategy. Evans said it couldn’t happen soon enough.
“I think someone should come in, take over the place,” she said. “[Someone] who is ready to do what it takes for us.
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