Sen. Grassley requests HUD to supply expense records of Bradenton Housing Authority

Employees were allowed to take agency's car with them after retirement

cschelle@bradenton.comJanuary 19, 2014 

BRADENTON -- Veteran U.S. Sen. Charles "Chuck" Grassley of Iowa is diving deeper into the troubled Bradenton Housing Authority, requesting records from the Department of Housing and Urban Development about the local agency's performance.

Grassley sent a three-page letter to Housing Secretary Shaun Donovan last week expressing concern about how an agency rated as a HUD high performer for its financial management could be in a deficit, coupled with generous employee benefit policies.

Grassley, citing the Bradenton Herald's coverage and the agency's personnel manual, is requesting six years of documents that were seized from the housing authority when federal agents raided a meeting in September, along with other spending records. Executive Director Wenston DeSue and his girlfriend, Special Projects Manager Stephany West, were escorted off housing authority property and subsequently fired by the authority.

"I've looked at dozens of housing authorities around the country, but I'm not sure I've ever seen one that gives a car or $10,000 check to employees on retirement," Grassley told the Herald. "Every housing authority has to account for how it spends taxpayer money to fulfill its mission of providing safe, affordable, decent housing to people in need. HUD needs to hold housing authorities, including this one, accountable."

Grassley, a member of the Senate Judiciary Committee, is taking housing agencies to task across the country for

financial and management problems. He's calling for an investigation into the Raleigh (N.C.) Housing Authority after the executive director there, making $280,000 a year, took up to 20 comp days a year to attend conventions to practice magic tricks, according to the Herald's sister publication, News & Observer.

Grassley also blasted the Tampa Housing Authority last year for spending $860,000 on travel and training since 2009 and for the $214,000 salary of its director, Jerome Ryan.

In Bradenton, DeSue's and West's excessive bonus pay and trips to Jamaica and Busch Gardens are under scrutiny. Grassley is also questioning the take-home vehicle policy where five of seven employees have take-home vehicles. HUD has asked DeSue and West to respond about their trips during company time, and the letter sent to the two in December is one of the last steps in the investigation before an indictment could be issued.

The BHA employee handbook, Grassley wrote, granted cars for both business and personal issue, providing a fuel credit card for each driver. Employees are required to arrange for routine vehicle servicing through the Development Director and must clean the car every other week at a designated car wash.

Also, if employees worked 15 or more years, the employees can keep the car when they retire or quit. If the employee didn't want the take-home car, they could take $10,000 instead, and if the car was leased, the housing authority would "immediately pay the lease in full."

"Interestingly, the policy places no limit on the value of the vehicle or the lease to be paid off," Grassley wrote.

Undoing the damage

The Bradenton agency's board members, along with interim Executive Director Darcy Branch, say they have been working to address many of the senator's questions before Grassley became aware of the situations.

"I think the problems he's raising are problems we're already addressing," Branch said Friday. "And we're going to have them in order in the next 60 days, and hopefully everything will be of his approval."

Branch did not have records immediately available to respond to the Herald because the agency's offices are closed Fridays (employees work 40 hours Monday through Thursday). But she did provide some insight and information about the benefits Grassley questioned.

The car-or-cash perk was approved in February 2012, according to the authority's personnel manual, and based on meeting minutes and management memos obtained by the Herald, the policy was most likely written by DeSue without the board's knowledge. No employee took advantage of that retirement policy, Branch said.

Minutes and agendas from January and February do not mention the policy, which went into effect Feb. 15, 2012.

DeSue would often use his management memos addressed to the board before meetings as minutes as well. According to his Feb. 12, 2012, memo, he wrote that the BHA would start a new vehicle policy that would allow the agency to lease cars instead of purchase them, and would trade in cars and use a cash balance toward a lease payment, turning a four-year unlimited mile lease to a two-year lease, according to the memo.

The agenda from January 2012 lacks any detail of what was discussed, simply listing "Call To Order, Roll Call, Consent Agenda, New Business, Commissioners Reports and Adjournment."

The board has given direction to Branch and its newly appointed attorney, Ric Gilmore, to update the personnel manual and procurement policy, revamp job descriptions and adjust salaries before a new executive director is hired.

DeSue left the agency initially with a deficit of about $400,000, but the authority expects to have a deficit less than $300,000 when the fiscal year ends March 31, Branch said. That deficit will be paid for out of reserve funds, she said.

Branch has already suspended the bonus policies and sick leave withdrawal that allowed employees to accrue sick time and cash it out for thousands of dollars. She said Friday she is not sure if she has the power to suspend the retirement policy and will have to ask the agency's attorney. Gilmore did not respond to messages seeking comment by deadline.

The company cars, often used to inspect housing authority properties, are necessary for workers to take home "because they're not safe at the housing authority," Branch said.

City Councilman Gene Brown, liaison to the housing authority, welcomes the senator's inquiries as the city figures out what it can and can't do to help its local agency.

"I welcome anything to make things better," Brown said.

Request for information

Here's what else Grassley is requesting with a response no later than Jan. 31:

• A copy of the former BHA executive director's most recent employment contract.

• Total amount of salary and compensation paid to the former executive director.

• Complete annual compensation payments to all BHA employees, including salaries, bonuses, longevity awards and cashed out sick time any other compensation (health care, retirement, take-home vehicle).

• The total number and description of BHA take-home vehicles. The number of BHA vehicles or $10,000 payments given as a retirement/separation benefit, as well as whether the housing authority paid off the vehicle lease.

• The total number of fuel and other credit cards authorized by BHA, along with the names of each employee provided with a fuel or other credit card, and the monthly fuel charges paid by BHA.

• In addition to every Friday, documentation of every weekday (both full and half) per year that the BHA has been closed and for what reason.

• A list all legal bills and professional service and consulting fees paid by BHA, including all vehicle service bills.

• All financial disclosure forms completed by BHA employees and document any Conflict of Interest waivers filed by the BHA and Board of Commissioners with HUD.

• All travel records for employees at BHA and BHA board members.

New documents obtained by the Herald show that DeSue was going to implement a pay freeze on cost-of-living raises, bonus pay and decrease in employee sick and vacation draws, according to a management memo from February 2012, because the freezes would reduce an agency shortfall to $22,000.

When DeSue was fired the following year, he was still receiving bonuses and made $171,060 when he was terminated.

HUD officials seized DeSue's and West's personnel files and contract, travel records, and some of the information is inaccessible, Branch said, but HUD did send a copy of DeSue's contract to the agency.

HUD "had what looked like a motor home behind our office and it was a base camp for them," Branch said about the raid.

The total salary and benefit amounts, credit card info, car work history and total days the agency was closed was something that would have to be researched, Branch said.

The agency's employees did work throughout December in 2013, Branch said, where in years past the agency was closed for about two weeks for Christmas break and still collected rent from residents.

As for the credit card questions by Grassley, some employees have purchase cards for Office Depot, Walmart, Home Depot and a fuel card, but Branch said she would have to retrieve statements to supply Grassley and HUD.

When it comes to the car maintenance, Branch believes that only basic maintenance like oil changes were performed on the agency's cars since 2008. She said she would need to research records for any other charges to see if employees followed DeSue's stringent car wash policy.

Board members, who are unpaid, have not traveled anywhere since 2008, Branch said, and she isn't aware if any board member since 2008 filed a conflict of interest waiver with HUD.

The Herald has filed Freedom of Information Act requests with HUD's Office of Inspector General for DeSue's and West's records seized and is awaiting a response of its inquiries.

Charles Schelle, business reporter, can be reached at 941-745-7095. Follow him on Twitter @ImYourChuck.

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