Authority ordered to recoup funds

March 18, 2006

PAT LITOWITZ
PLITOWITZ@NCNEWSONLINE.COM

The U.S. Department of Housing and Urban Development wants its money back.

In a report obtained from state Rep. Frank LaGrotta's office yesterday, the federal agency issued two findings against the Lawrence County Housing Authority as a result of its relationship with Affordable Housing of Lawrence County. The authority has until April 10 to recoup $200,500 it turned over to the nonprofit agency, which was created by the authority in August 2003.

"People in Lawrence County can take some comfort in knowing that the agencies responsible for oversight are doing a good job," LaGrotta wrote yesterday in an e-mail to the New Castle News. "This is, however, NOT the end of this process, but rather the beginning.

"There are ongoing investigations on both the state and federal levels of this issue, as well as others in the county."
HUD financial analyst Joe Piller "conducted a limited financial review of Housing Authority operations," wrote James D. Cassidy in a letter dated March 10 to Robert Evanick, the Housing Authority's executive director. Cassidy oversees HUD's Office of Public Housing in Pittsburgh.

From Jan. 23-25, Pillar reviewed documents such as property deeds, appraisals, financial statements, bank records and contracts. At issue was the federal funds the authority gave to Affordable Housing and the transfer of Housing Authority laundry equipment and operations to the New Castle-based group.

"Contributions or donations, including cash, property and services, made by the governmental unit, regardless of the recipient, are unallowable," Piller's report said.

While the authority has been ordered to recover the $200,500 in addition to the laundry equipment, no penalties or sanctions were taken against the organization, its board or executive director.

The report fails to address several issues involving Affordable Housing, such as what became of the coin laundry funds collected by board members, how federal funds were used, the purchases of eight county properties, and who is responsible for the group's failure.

"I think the Housing Authority should enjoin legal action against Affordable Housing, its board members and solicitor individually to recover every dollar it lent," LaGrotta said.

The Ellwood City legislator is also critical of Evanick's role.

"I think Mr. Evanick cannot, and should not, escape scrutiny and responsibility for whatever improper actions were committed by the Housing Authority or Affordable Housing that he participated in or had knowledge of ... Mr. Evanick is a very smart person, well-versed in HUD law and regulation.

"It cannot come as a surprise to him that some of the activities of the Housing Authority and Affordable Housing that were and are being investigated were, at the very least, questionable."

Like LaGrotta, state Rep. Chris Sainato said he is disturbed by the report's findings.

"I don't think it's very good," he said. "They need to get this mess cleaned up quickly. These are stupid things to have happened. If money's missing, money has to be accounted for."

Attempts to reach Evanick for comment were unsuccessful.

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