[Hpn] A washingtonpost.com article from wtinker@rcgnetworks.net

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Fri, 30 Jun 2000 07:40:17 -0400 (EDT)


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And if you believe GW Bush has us lower income Americans welfare or anything else in mind you should be seeing a psychiatrist on a regular basis!
A Brother
Bill

To view the entire article, go to http://washingtonpost.com/wp-dyn/articles/A22942-2000Jun29.html

Texas Housing Agency Falls Short of Bush 'Dream'


As he stood on the tidy front porch of Oberrion Gibson's new house in a run-down section of Battle Creek, Mich., in April, Texas Gov. George W. Bush proclaimed his commitment to making housing affordable for all Americans.

"How do we help every willing heart . . . own a piece of this great land?" he asked before joining hands in prayer with the 67-year-old Gibson. "I've got some ideas."

But back home, Bush's own housing agency falls far short of that soaring vision. A rapidly rising number of Texans live in unaffordable or substandard housing, and the state's housing agency--one of the few under Bush's direct control--is enmeshed in scandal.

A Bush-appointed board member was indicted for bribery earlier this month and refuses to step down, putting in jeopardy many low-income housing programs like the one Bush touted in Michigan. Meanwhile, the FBI and state investigators are continuing criminal probes into dozens of projects involving several other Bush appointees to the agency, the Texas Department of Housing and Community Affairs.

Housing activists, independent housing experts and some Texas legislators say the criminal investigations reflect deep-seated problems at the department, which they say receives scant attention from Bush and his top aides. They say the agency's board members and staff deliver lucrative work to favored developers and that the agency, since Bush became governor in 1995, has been more attuned to developers' interests than the housing needs of the poor.

Robert Bobinchuck, a developer who has given $10,000 to Bush's campaigns, said he sought to bring allegations of favoritism to the attention of Bush and top aides two years ago and was ignored.

"It's a genuine, certifiable mess," he said. "This could be the best housing agency in the country. Instead, it's a laughingstock."

Bush aides say housing may not be his top priority, but that the agency is well-run, citing efforts in the past year to increase funds for impoverished towns along the Mexican border, and to increase board members' oversight of key programs.

"I categorically disagree . . . that we haven't paid attention to housing," said Bush's legislative liaison, Terral Smith. "We haven't done it the way [critics] want. . . . The governor's philosophy is, I can't make everything a priority. But that doesn't mean staff isn't working on it."

The agency's executive director, Daisy Stiner, said, "We do well at our mission of serving low-income families. . . . I reject totally allegations of favoritism. We have a very professional staff, people of integrity."

For Bush on the campaign trail, emphasizing a commitment to affordable housing buttresses his effort to portray himself as a "compassionate conservative." He has held two campaign events stressing his "Renewing the Dream" plan, in which $1.7 billion in tax credits would build 100,000 homes by 2006. "Part of the American dream is saying, 'This place is mine,' " he said.

Yet the number of poor, elderly and disabled Texans living in unaffordable or dilapidated housing is at a record high, housing experts say. The problems exist throughout the state, from Dallas's impoverished Sand Branch community, where residents live amid rooting hogs and raw sewage, to the border, where 400,000 Texans live in extremely primitive homes, many without sewers.

The agency's critics include not only partisan Democrats and housing activists but also nonpartisan housing experts and loyal Bush backers.

A bipartisan panel of the state legislature recently concluded after months of review that the agency's problems "preclude it from effectively serving low-income families." It said the department "ineffectively administers" housing programs and appears to favor certain developers.

"The agency has many problems," said state Sen. Chris Harris, a conservative Republican who co-chaired the review. "I have major concerns that rural areas, such as along the border, aren't getting their share of money." Although Bush aides note they have increased funds to improve housing in the decrepit "colonia" communities along the border, many legislators say those efforts must be redoubled.

Affordable Housing Finance magazine, a sober publication for mortgage bankers, said the agency is known as "a stronghold of the good ol' boy network where tax credits are awarded with little regard for objective rankings" to developers with connections.

"This latest crisis is partly a reflection of a lack of leadership on housing by Governor Bush," said the magazine's editor, Andre Shashaty. "Bush has been extremely blase about housing and this agency, and during all the time it's needed leadership from him, it hasn't gotten it."

While Bush as governor has limited power over most agencies, he has broader sway over this one because it was created under his predecessor, Ann Richards, who saw to it that she had maximum clout. Unlike in other agencies, Bush named its director and all nine board members.

Bush didn't discuss housing in his two gubernatorial campaigns and has hardly brought up the issue while in office. Larry Paul Manley, a developer chosen by Bush in 1995 to be the agency's executive director, recalled asking the new governor about his thoughts on housing. "I don't have a housing agenda" besides Manley's own ideas, Manley recalled Bush saying.

Manley alienated activists by declaring that the agency would focus more on better-off working people needing help to buy a new house--folks who, if they didn't buy a new home, would "buy a bass boat," he said. While other housing agencies share Manley's goal, he was singularly aggressive in pressing deals favorable to developers.

One example: the River Woods apartments in a rough section of Austin. Under a contract with the federal government, the Texas agency had to ensure that the complex's units would be affordable for 50 years. But there was a catch: The owner could oust the poor tenants if the complex was deemed too rickety.

According to a tenants' lawsuit, the owners, who plan a luxury complex there, let maintenance lapse. The agency, relying on the developer's consultants, declared the place uninhabitable, allowing its demolition. The tenants' experts said the complex's structure is perfectly sound. Manley said the property is "substandard" and that it is short-sighted to obstruct investment in poor areas.

In 1996, the FBI and the Internal Revenue Service began looking into agency deals. When a legislator sent him a letter asking about this, Bush scrawled a note telling an aide to respond, and the letter was stamped "Governor has seen," according to a copy of the note.

Diane Glass, an agency employee who left on bad terms, started complaining to other officials about what she thought were sleazy deals with developers. She said that when she called Joe Allbaugh, the governor's chief of staff, he didn't want any documentation of her claims and told her to "go away." Allbaugh denied her account.

Glass was raising questions about a program that gives huge tax benefits to builders chosen by the board. The winners in any given year not only collect colossal fees, but can also reduce their income taxes by $240 million over 10 years.

But serious criticism has dogged the program, especially under Bush. Housing advocates and some developers and legislators assert that the board and senior staff members steer projects to a select few developers, some with personal or other ties to state officials--what some agency employees dub the "friends and family plan."

A cluster of developers keeps winning the biggest tax credit deals, the critics said, even when the agency's credit officers point out that some have little development experience or a poor credit history, that their applications are deficient or that their deals are unsound.

"It's possible to have no experience in housing and become an instant millionaire in Texas," said state Rep. Harryette Ehrhardt, a Democratic critic of Bush.

A 1996 state auditors report said there was "an appearance of impropriety" in the program. The board overrode the negative observations of the agency's credit officers on more than half the winning bids, even though most board members were ignorant of the credit officers' skeptical views, the report said.

Bobinchuck said he approached Bush with these complaints at an event in 1998. "I said, 'Governor, I'm not here to spoil your night, but there are problems at the housing agency that could be embarrassing to you.' " Bush sent him to Allbaugh, who expressed concern and urged him to inform the board. Bobinchuck did, and it ended there, he said.

"I was very disappointed the governor's office didn't get more involved," he said. "Allegations of this nature should concern you. . . .  Bush doesn't know the details. I tried to tell him. No action was taken."

Soon another complainer emerged. Howard Siegel had been the agency's chief credit officer, and had argued with Manley and other agency officials about deals they were pushing, including some involving friends of Manley from a thrift where he had worked. Siegel quit and soon was in Allbaugh's office, reading a three-page, single-spaced list of inferior projects that he said his superiors had rammed through the agency.

Within a week, Manley visited Allbaugh, said he was burned out and resigned. Both said they didn't discuss Siegel's allegations from days before--an odd lapse, because that very week the governor's office sent Siegel's list of allegations about Manley and the others to the Texas Department of Public Safety. The state agency and the FBI have spent two years on criminal probes of these and other charges.

Manley defends the projects he promoted and denies any impropriety. He said Bush and his top aides had praised his leadership, especially in recruiting private developers. Citing plaudits from the National Association of Home Builders for the housing agency's record of building units at a fast clip, he said the agency under his lead enjoyed "fantastic success."

The investigations have worn on since Manley left in 1998. A number of current and former agency employees and developers have been interviewed by FBI and DPS agents looking into dozens of deals promoted within the agency by Manley, board member Florita Bell Griffin (who was indicted on June 7) and other agency officials.

Housing advocates had thought Bush or his aides would get more involved with the agency once the probes started, but they did not. "Bush's presence has never been evident on housing," Ehrhardt said, adding that in 1999 she asked Bush aide Smith why the governor didn't exert himself on the issue. "He said, 'Housing isn't on the political radar,' " Ehrhardt said. The aide has denied making the remark.

Tax credit projects selected in 1999, after Manley's departure, were just as tilted toward favored developers as in the past, activists said. The board again approved few projects along the border, rejecting some creditworthy proposals aimed at aiding the desperately poor there, activists said. "We shouldn't call it the low-income housing program but the middle-class subsidy and developer-enrichment program," said housing advocate John Henneberger.

But another, more immediate crisis emerged. The U.S. Department of Housing and Urban Development warned on June 15 that because indicted board member Griffin refuses to step down, the board may not take action on programs receiving tens of millions of federal dollars.

Appointed by Bush in 1995, she was indicted on charges of accepting a bribe and theft. If convicted, she could face up to 55 years in jail. The indictment says she used her position to bestow lucrative tax credits on developers who were her secret partners in a deal worth up to $500,000 to her.

State officials hope the standoff can be resolved this month, when Griffin is expected to attend a board meeting but stay mum. But HUD says there could be more trouble if Griffin helps choose the tax credit winners--as she has indicated she will.

HUD says it always suspends state housing agency board members who are indicted. But Bush aides blame "the Clinton administration" for the stalemate, adding that the governor won't try to remove Griffin or ask her to step down. Moving against Griffin now would require Bush to convene a special session of the Senate, an embarrassing pre-election prospect. Activists say he should have sought the two-thirds Senate vote needed to remove her as early as 1998, when FBI agents investigating alleged bribes searched her home.

Some state legislators and activists say Bush does not want to rile Griffin, a black city planner who says her pursuers are on a racial witch hunt. She says that if she's pushed out, she will provide details on allegations about which she has provided little evidence, such as lobbyists' homosexual orgies with legislators and years of "shady stuff" at the agency.

"Griffin plays the race card against people who criticize her, and Bush seems scared" to move against her, said Walter Moreau, head of a group that builds low-income housing. "But the main reason he doesn't act is he cares so little about housing and the poor."

Bush does indeed care, said spokesman Mike Jones, adding, "Under this governor, Texas has made great strides in housing."

Housing Problems in Texas 

600,000 Number of Texans who live in homes that are grossly unaffordable to them, paying at least half of their income for housing.

58% Percentage of poor tenants in Houston devoting more than half of their income to rent.

40% Percentage of very low-income Texas households confronting the most acute housing problems with a disabled adult.

3 times The number of Texas families facing the greatest housing needs is growing three times faster than the number of affordable housing units being created.

400,000 Number of Texans who live in decrepit, Third World-like housing in communities called colonias along the Mexican border; 334,000 lack adequate sewer services.

15% Percentage of Texas housing agency's money that the state legislature has told it to direct to the poorest Texans.

4% to 10% Percentage of Texas housing agency's money that has been directed to the poorest Texans, depending on which parts of the budget are counted.



Cities with the highest percentage of poor renters living in substandard housing:

San Antonio 29%

Houston 27%

Memphis 26%

New York 24%

New Orleans 22%



SOURCES: Texas Low Income Housing Information Service, Texas Department of Housing and Community Affairs, Census Bureau, Center for Budget and Policy Priorities