HUD No. 05-098
July 19, 2005
HUD DENIES NEWARK HOUSING AUTHORITY APPEAL, TROUBLED STATUS STANDS
Federal agency sees brighter future for residents with increased HUD guidance
WASHINGTON - The U.S. Department of Housing and Urban Development designated the Housing Authority of the City of Newark (NHA) a troubled agency today, denying the agency's appeal request to reverse the designation.
"HUD has given Newark's appeal a thorough review and has determined the
housing authority must address its shortcomings," said Paula Blunt, HUD
General Deputy Assistant Secretary for the Office of Public and Indian Housing,
who issued the final score today in a letter to NHA Executive Director Harold
Lucas. "HUD stands ready to work with the agency to get it back on track
to provide Newark residents the services they need."
In its appeal, NHA asked that HUD increase the points it received under HUD's Public Housing Assessment System (PHAS), the assessment tool HUD uses to rate public housing authority performance. After reviewing the documentation NHA submitted, HUD increased NHA's overall PHAS score to 35 up from 33. Under the rating system, however, any score under 60 is designated troubled.
NHA also appealed its Section 8 Management Assessment Program (SEMAP) score. After reviewing the submitted documentation, HUD determined the materials submitted did not meet the standards of SEMAP quality control to increase its score of 31, which makes the troubled performer designation stand.
In April, HUD issued a limited management and certification review of the Newark Housing Authority. The review highlighted a number of shortcomings in its programs, namely $6.4 million in questionable expenditures from the Section 8 operating reserve account. HUD is especially concerned with NHA's use of $3.9 million to purchase 12 lots located in an area designated in Newark's downtown core area redevelopment plan. Phase 1 of the plan includes construction of an entertainment facility whose principal tenant would be the New Jersey Devil's National Hockey League franchise.
In the coming weeks HUD will work with housing authority management to develop a Memorandum of Agreement (MOA) between HUD and NHA. This MOA will include a timetable and clear steps NHA will take to raise its PHAS and SEMAP scores to remove the troubled designation.
HUD is the nation's housing agency committed to increasing homeownership, particularly among minorities; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development as well as enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet and espanol.hud.gov.