HUD No. 07-021
February 27, 2007
VI HOUSING AUTHORITY, HUD WITHHOLD $2 MILLION IN PAYMENTS
VIHA seeks to resolve escalating and questionable water bills
WASHINGTON - The Virgin Islands Housing Authority (VIHA) and the Department of Housing and Urban Development (HUD) are intentionally withholding a $2 million payment to the Virgin Islands Water and Power Authority pending discussions with the utility regarding astronomical water bills at five St. Croix communities. VIHA disputesthe accuracy of WAPA's extraordinarily high bills for these particular communities, which have been double to five times the cost of water in other Virgin Islands public housing units over a one-year period.
Water bills for D. Hamilton Jackson Terrace, Aureo Diaz Heights, Ralph D. deChabert Place, John F. Kennedy Terrace, and the Williams Delight communities over the past year have been ranged from $500 to $1,500 per month for water service per unit. During the same period, St. Thomas WAPA bills for VIHA communities have averaged $193 to $239 per month per unit.
"HUD's first priority is to ensure that families in VIHA communities will continue to receive water service, but these soaring costs are outrageous," said HUD Assistant Secretary for the Office of Public and Indian Housing Orlando Cabrera. "As stewards of taxpayer dollars, we must ensure we are being prudent with resources. As WAPA's largest customer, we hope WAPA management will consider VIHA's numerous requests to work together on a solution."
In a October 2006 letter to WAPA Executive Director Alberto Bruno-Vega, Michael R. Hollis, the HUD-appointed Recovery Administrator, asked the utility to review and adjust its billing for the five communities where massive water leaks have caused water bills to escalate at an alarming rate. Hollis has also made numerous calls to WAPA management to arrange a meeting to discuss and resolve the matter.
"There appears to be a serious problem - either massive leaks or erroneous billing - that will require VIHA and WAPA to work together in a constructive manner to bring this to a resolution," said Hollis. "We again offer to meet with WAPA to find an amicable solution."
"This action is in no way a means for VIHA not to pay its bills to WAPA," said Carmen Valenti, who serves as VIHA's Board Chairman under HUD's receivership. "Delaying resolution only jeopardizes the delicate financial condition of the housing authority and stalls its successful recovery."
Since the October letter, VIHA has continued to make timely payments on all invoices to WAPA, excluding the five communities under question. Since October 2006, VIHA has paid WAPA $2,366,410 through February 26, 2007, for both water and electricity.
When HUD took control of the failing housing agency in August 2003, it inherited a $4.16 million debt VIHA owed WAPA. VIHA worked with WAPA to negotiate a payment agreement to resolve this debt. VIHA issued its final payment to WAPA, as specified in the agreement, in December 2005.
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, and enforces the nation's fair housing laws. HUD's Office of Public and Indian Housing (PIH) is responsible for managing and administering a range of programs, including the two largest federal rental assistance programs - public housing and the Housing Choice Voucher Program (Section 8). Combined the programs serve more than 3.2 million low-income families in the U.S. PIH also monitors the operations of the nation's approximately 3,400 public housing authorities that manage the country's more than 1.2 million public housing units and administer other HUD programs. More information about HUD and its programs is available on the Internet and espanol.hud.gov.