Tuesday, August 3, 2010

Are Cincinnati Officials "really' worried about Knox Hills HUD complaint? YOU BETCHA!!!

While city officials continue to put on a "happy face", one must wonder if Cincinnati officials might just be a little worried?


Why would city officials be concerned about a bunch of 'crazy preservationists' trying to save blighted neighborhood on the top of a hill in Fairmount? Because Knox Hill isn't just a bunch of crazy preservationists, it is also a bunch of"internet savvy" people, that include attorneys, real estate experts, and people with experience in grant writing and auditing... the biggest problem for the city is that these people are not going to 'go away'.
At the center of the controversy is the demolition of several homes in the neighborhood in 2009, some of those properties were historic eligible in the eyes of the neighborhood group, a citywide problem. The problem was that there seemed to be no Section 106 review process in which city officials (in this case, the Urban Conservator) to solicited public response regarding projects in with Federal monies are uses, mostly CDBG and NSP funds. Knox Hill has maintained since its founding, that city policies like VBML and demolition of viable structure hold back neighborhood turnaround.


Federal law required that Section 106 review, be done on ALL properties older than 50 years old to determine if those properties were "Historic eligible' in which case the city might still be able to demolish, but would be required to conduct and impact study to determine if the property could be stabilized in stead.


Knox Hill filed a complaint with HUD last year and cc'd OHPO Ohio Historic Preservation Office which has a programmatic agreement with the city in which the city details how it conducts its process including 106 reviews. To date OHPO still does not have that information from the city and since Knox Hill"s initial complaint there have been additional data submitted about other properties in Fairmount and Westwood that may have been demoed without a proper 106 review. Other people, and other neighborhood groups, are now involved because of conscerns that this city is bulldozing viable properties while not dealing with more serious blight issues like abandoned apartment complexes.



Even IF the city comes up with a process going forward, it must also deal with the bigger problem of hundreds of properties on the demo list that have not been properly reviewed. Preservationists are adamant that ALL these properties must be revistited. The bigger "catch-22' for the city is that if HUD finds there was no process, the city could face a Class Action lawsuit by owners of properties that may have been historic eligible , but were denied process because the city failed to conduct a proper 106 review. HUD also could order the city to REPAY the funds back to the Federal Government. While that used to be highly unsual a few years ago, in today's politically charged climate, numerous taxpayer watchdogs groups and partisan allegations of Stimulus waste, the climate is right for HUD to take a "get tough" approach.



In fact HUD has already forcing cities to repay monies on variety of fronts:


In July of this year Auditors for the U.S. Department of Housing and Urban Development recommend that City of Montebello repay $1.3 million in federal funds, plus interest, because the city didn't properly use an affordable housing grant, according to a report released by OIG.
The HUD Office of Inspector General's audit found the city improperly requested, received and disbursed $1.3 million in HOME money for a proposed project containing affordable housing units, then reported the project was complete even though construction hasn't yet started.


Also last month, Augusta Georgia must pay back HUD 95,000.00 because two non profits sold homes to people who were not poor enough to qualify for assistance

The issue was that the city received funds through a HOME Investment partnership program. HUD sent money to the city that then distributed it to Community Housing and Development Organizations, called CDHO’s, that then build and rehab houses. Two years earlier, Augusta had to repay $288,786 after a HUD Inspector General's audit raised questions about HOME expenditures and missing documents from 2003 to early 2007


Cincinnati is already under scrutiny regarding stimulus funds according to the Office of Inspector General that total some 8.4 million in funds:


810,000.00 to establish financing mechanism for purchase and redevelopment.
2.2 Million for purchase and rehab.
2.5 Million to demolish blighted structures
2.1 Million Redevelopment of demolished or vacant structures
830,000.00 for planning and administrative costs.

A HUD report issued in 2009.

The office of The Inspector Generals report came to the following conclusion in a 24 page report:


"The City did not have sufficient capacity to effectively and efficiently administer its Neighborhood Stabilization Program. It lacked adequate policies, procedures, and controls to ensure that Neighborhood Stabilization Program funds are used effectively and efficiently and in accordance with applicable requirements. Further, the City did not have sufficient staff to assist in administering the Neighborhood Stabilization Program to ensure that it has sufficient capacity to effectively and efficiently administer program funds. "


Couple that with the Office of Inspector generals report dated May 22,2009:


Title: The Cincinnati Metropolitan Housing Authority, Cincinnati, Ohio, Needs to Improve Its Controls over Section 8 Housing Assistance Payments


In which the OIG found numerous problems with overpayments, collecting payments on vacant units and other administrative issues. Interesting reading for those of you who feel Section 8 is being poorly run in this city:


Combine the above with Knox Hill's complaint regarding section 106 as it affects the NSP monies used for demolition and the city could face a full blown audit that points out the real flaws in city government and accounting practices.


A full audit could force the city to justify why those properties were selected and why the city has no plan for redevelopment of the vacant lots that are left behind (A problem they recently found in the City of Buffalo, which also has a problem with holding property without any plans for future development). How contractors are selected? Do all contractors have a certified person in abatement on site at all times (required under new regs adopted this year)? Was proper lead and asbestos abatement conducted and audit trails on disposal. Administration issues, are monies being well spent on neighborhood development programs and is the city providing proper oversight of those funds?



Knox Hill is trying to set up a meeting with the Office of Inspector General to further discuss their concerns regarding city accountability on projects while it awaits the outcome of their "citizens complaint" under review by the Columbus office of HUD.


No doubt there will be more to come.

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