The Buffalo Municipal Housing Authority’s stunning level of incompetence was on display at the agency’s March Board meeting last Thursday, and it is having horrible impacts on the 31 public housing complexes that the agency manages.
The mismanagement is so dire that the authority did not receive $22 million over the last seven years, which it otherwise should have received under federal housing programs. Those programs weigh occupancy rates heavily in their funding formulas.
Despite a nearly two year waiting list for public housing, BMHA has a comparatively low occupancy rate due to two problematic properties: the AD Price Courts and the Commodore Perry complexes, which brings down agency-wide rates considerably.
Buffalo gets shortchanged in the range of $3 million a year due to the vacancies; but they have both fallen into a state of such disrepair that tenants leave and no one is willing to move into these units.
Which makes it peculiar that the agency — just this year — is reallocating $1.2 million from a Capital Improvements Grant for “operations and management” rather than on repairing uninhabited units that are costing the agency millions per year in federal funding.
When asked whether it was appropriate to squander a capital improvements grant for reoccurring operating costs, both the Executive Director, Dawn Sanders-Garret, and her Deputy, Modesto Candelario, seemed dumbstruck and unsure of how to respond.
“I’m just concerned that the residents are getting shortchanged on needed capital improvements,” I clarified.
“Well, we’re all getting shortchanged here,” Candelario responded with a dismissive, albeit sincere laughter.
“But is it wise to use a grant that was intended for one-time capital improvements for management expenses that are ongoing and reoccurring,” I asked.
“We’re allowed to use the grant for ‘management improvements,” Sanders-Garrett said indignantly.
“So they are one time expenses?” I inquired.
“No, they are ongoing expenses, but we can use the Capital Improvement Grant for management improvements,” she insisted.
She was very hostile so I stopped probing, as her behavior became agitated and she seemed to be on the brink of violence.
What happened to the rainy day fund?
The rational manager would insist that units in disrepair be renovated or condemned, because improved occupancy rates would yield an additional $3 million or so in federal funding each year — through the current formula.
This should the be the priority, but it hasn’t been — in fairness, for long before Sanders-Garrett’s tenure as Executive Director. But she has been the Executive Director for several years now and has made no tangible progress toward correcting the seemingly straightforward problem of repairing two derelict properties to habitable conditions.
In 2011, the agency’s fund balance had accumulated to over $17 million. Rather than address the conditions at either Commodore Perry or AD Price Courts, where vacancy rates are highest, the Board did not expend what they had called, “a rainy day fund.”
Then the federal government — noticing the unexpended funds — sought to “take them back,” according to Sanders-Garret.
So the agency proceeded to spend the fund balance for fear of losing the federal monies. The agency used a portion of the money for a slew of security improvements, including wireless cameras, lighting, fencing, and fleet replacement.
But the vast majority of the fund balance went to an asbestos removal contractor working on the long-vacant Kensington Heights complex. That contract had initially been awarded to another contractor for $3 million. That contract was broken on the allegation that the contractor had disposed of waste improperly.
It was subsequently awarded to another firm, and mysteriously inflated to $13 million. To this day, the agency has refused to make basic documents relating to the contract available to Commissioner Joe Mascia, the city’s most well known housing advocate. After the commissioner began asking questions about the contract, he was targeted for political retribution.
And just like that — mind bogglingly — the opportunity to redevelop Commodore Perry or AD Price Courts went up in flames.
At the time the agency was developing its “Perry Choice Housing Initiative” and was seeking a major federal grant to redevelop the complex. But that grant was later rejected because its author had stated as one of the project’s objectives, to dilute the concentration of the African American population in the neighborhood.
The Future of the Perry Projects
Candelario conceded that the occupancy rates should be a more immediate priority. I asked whether there was a way they could rearrange the operating structure of that property, whereas to better exploit the federal funding formula.
It turns our the AD Price Courts has just recently been approved for sale and the agency is looking at financing options for Commodore Perry, says Candelario. He says they are considering spawning Commodore Perry into a non-profit controlled by the Authority. Plans are in the works, but he offered few details.
The Commodore Perry Projects has long been rumored to be a potential site of the next Buffalo Bills Stadium.
Where is the leadership?
Commissioner Marcia has a plan to restaff the Authority’s executive ranks. He has already called for Chairman Michael Seaman’s resignation. His five year term expires in October.
Seaman is the City’s finance director and an appointment of the Mayor, as are four of the agency’s seven board seats. Only two commissioners on the board are elected by residents.
Mascia is planning on allowing Sanders-Garrett’s contract to expire on schedule later next month.
And his patience with the Mayor is waring thin.
“Numerous emails have gone unanswered. I have been warning him of the impending disaster, but it is falling on deaf ears,” Mascia explains. “Everyone knows that, when you appoint a majority of commissioners to the Authority, then you control it.”
In a 2006 Buffalo News article, Mayor Brown is quoted as saying “the tenants deserve nothing less than the best possible housing that is safe, clean, and affordable,” he said. “I will not tolerate any action that threatens those essential conditions in every BMHA owned properties.”
Now, the agency is vulnerable to federal receivership. The Department of Housing and Urban Development could make a decision to takeover the agency as early as next year, says Mascia.
“I have expressed my concerns regarding the Authority’s incompetence, misappropriation of funds, malfeasance, and boarder-line criminal activities of the entire executive staff.Ms. Sanders-Garett has constantly blamed staff for her shortcomings. She is the Executive Director. There is nobody to blame for mistakes that are this serious — only herself.Under suspect circumstances, she has chosen not to fill the position of internal audit since 2012 when the BMHA auditor retired under duress.There are no checks and balances, no accountability, and she continues to feed the Board these fairytales — with the help of the Chairman Mike Seaman who also holds the title of Finance Director for the City.~ Commissioner Joe Marcia
Mascia has a plan to transition the agency’s leadership and to identify an Executive Director who has “real property management experience.” Mascia shared with me some of the details of his turnaround plan:
- Four new Mayoral appointments to the Board of Commissioners; including one expert in each of the following areas: an attorney, a development expert, an accountant, and an urban planner;
- Identify an Interim Executive Director — perhaps Mike Clark, who has served as interim Executive Director before — to take on duties until a “rockstar” property manager with private sector development experience can be identified;
- Recruit a strong General Counsel and Assistant Executive Director;
- Eliminate the Buffalo Police Department contract and subcontract security services through a private provider;
Mascia endorses a recommendation made by the US Department of Housing and Urban Development, and is open to pursuing the governance model known as “resident managed corporations.” The model is similar to the Marine Drive Resident Corporation, which managed that property independently for over 40 years.
“Drastic changes need to happen. There needs to be less political patronage and more capable leadership,” Mascia says.
“The people of Buffalo realize that anyone in today’s economy is two paychecks away from public housing, and the Authority is obligated to provide an acceptable service,” he argues. “Over 80% of people in public housing are working poor. Our residents have jobs and they pay rent.”
Political observers suspect that mismanagement at the agency will become relevant in the Common Council elections later this year, which could be a vulnerability for those Councillors aligned with the Brown administration. They note previous administration scandals, including a situation involving the former Human Resources Commissioner.
There is at least one public housing complex in each of the nine Council districts, and residents have long expressed frustration relating to security, resident safety, drug dealing on premises, heating reliability, building maintenance, and poor treatment by management.
This is the third in a series of articles investigating the Buffalo Municipal Housing Authority’s management and contracting practices.