HUD says Augusta must pay back home grants

Incomes of two buyers incorrect

The city of Augusta must once again pony up to the federal government over alleged misuse of affordable housing grants.


The U.S. Department of Housing and Urban Development wants back nearly $95,000 because in 2005 and 2007, two nonprofits sold houses to people who HUD ruled weren't poor enough to qualify for the assistance.

At issue are funds received through the HOME Investment Partnerships Program, grants meant to create housing for low-income families. HUD sends the money to the city, and the city's Housing and Community Development Department disburses it to six nonprofit Community Housing and Development Organizations, or CHDOs, which build and rehab houses.

This would be the second time the city has had to pay HUD over problems predating the tenure of Housing and Community Development Director Chester Wheeler, who started in April 2007. Two years ago, the city had to repay $288,786 after a HUD Inspector General's audit raised questions about HOME expenditures and missing documentation from 2003 to early 2007.

Another audit last year recommended that Augusta pay $94,751 over "unsupported housing activities" involving CHDOs. Assistant Director of Housing Hawthorne Welcher Jr. said he doesn't believe there was any ill intent by Laney Walker Development Corp. and Promise Land Community Development Corp.; they just miscalculated their clients' incomes.

"But the bottom line of it is, all of us have to pay better attention because that can't happen," Welcher said.

Laney Walker Development Corp. Executive Director Anthony Chandler wasn't with the agency when it sold the house at 821 Spruce St. in June 2005 but said the "mishap" appears to involve the buyer, an elderly woman, claiming only herself on her 2004 tax return, but claiming her daughter and two grandchildren on her HOME application.

HUD put her income that year at $41,663, city documents say, well above the $29,900 cap for a one-person household, but that amount stemmed from her losing her job and receiving her retirement pay in a lump sum, Chandler said.

"If HUD would have just looked at the whole situation, there wouldn't have been anything," he said. "She's still low income -- very low income."

Promise Land Director Sheila Boazman said the other case -- the June 2007 sale of the rehabbed home at 3804 Sheila Court -- stemmed from confusion over how much of a war veteran's pay for overseas service should have been included in the calculation. HUD rules say only combat pay can be deducted, which city documents say left the buyer with an income of $44,328 -- well above the $34,200 maximum for a two-person household.

Approval of the city's $94,751 repayment was on Monday's agenda for the Augusta Commission's Administrative Services committee meeting, but the meeting was canceled for lack of a quorum. If the payment is made, both families can stay in their houses, the directors said.