Portland housing bureau is still loosey-goosey
Just a little more than three years old, the City of Portland housing bureau has yet to achieve stability. Created by merging the housing function of the Portland Development Commission and the old Bureau of Housing and Community Development, the new agency, staffed with 57 people and administered by city commissioner Nick Fish, has had its inaugural director recently leave office. And now a new report by the city auditor finds the bureau in a state of at least moderate disarray.
The two criticisms that jump out of the report at our eyes are (1) the bureau still doesn't have a mission statement clearly defined in the city code, and (2) it still isn't doing such a great job administering the unwieldy collection of assets and loans that it inherited from the chaos at the PDC:
The Bureau’s core business functions and authority are not included in City Code, so this information is not easily available to members of the public. As such, the Bureau is less transparent than ones where the core business functions are clearly defined and easily available to the public. Additionally, because the core business functions are not defined in Code, Bureau or City leaders could arbitrarily change the focus of the Bureau or alter the Bureau’s core business functions. Since many housing solutions require long-term approaches, there is a risk that Bureau goals and solutions may not be achieved....According to Bureau management, they began the process of updating City Code in early 2011, but were advised that the Code changes were not required to conduct business. After we shared information about this risk with Bureau management in 2012, they began working to revise City Code to incorporate detail of their authority and told us they are currently in the process of filing documents to update City Code....
The Portland Housing Bureau manages a large and complex portfolio of housing loans and assets. The majority of the loans and assets were inherited from the Portland Development Commission.... The total loan balance during FY 2011 was $302 million....
During our audit, we found that the Bureau does not have a long term guiding policy for asset management and loan issuance to help determine investment priorities, including whether resources are best spent on maintaining existing assets versus investing in new projects....
According to Bureau staff, most of the loans the Bureau issues are called soft-loans, which have low interest rates and long amortization periods. Repayment requirements for the loans vary and in part, are dependent on the financial condition of the housing project and the borrower, which is also affected by renters' income level and ability to pay rent. Bureau management told us that some of these soft loans may not be repaid. The Bureau has the ability to restructure borrowers' debt, but has yet to develop a shared approach to doing so with City Council....
In addition, the bureau provides financial assistance to developers for the rehabilitation and preservation of housing properties....
Currently, the Bureau is using the MITAS data system administered by PDC to help manage the asset and loan portfolio. However, according to Bureau staff, the current system is not an effective tool to manage, track and report on loans and assets, and data generated from the system is not reliable. The Bureau is in the process of replacing the old data system with a new Housing Development System (HDS). Bureau management told us that the new system will improve their asset and loan management capabilities.
Handouts to developers coupled with weak accounting systems -- it sounds to us like a real recipe for disaster.
Back when the merger took place, Fish promised:
The new Portland Housing Bureau will be a powerhouse agency that will cut through bureaucracy and streamline the delivery of essential services. It will merge the best of the work, culture, history and expertise of two city agencies and blend them into one high-performing bureau. The result will be more and higher-quality housing, delivered faster, with greater accountability.
It appears the bureau still has quite a way to go to meet that standard.
UPDATE, 10:05 a.m.: The O's take on the audit is pretty funny -- we need more taxes!
| Posted at 8:26 AM | Permalink |
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Comments (9)
Now I'm confused. What's the difference between this newly created Portland Housing Bureau and the Housing Authority of Portlland, now known as Housing Forward! or whatever other silly name it now has?
One of these must be a bureau created by bureaucrats just to give jobs to other bureaucrats.
Posted by Mr. Grumpy | May 23, 2012 9:52 AM
I have also been confused in the past, but Fish was quick to correct me. Housing Forward is not part of the city government. It's some sort of unique quasi-governmental organization that handles a lot of money. Check for your wallet.
Posted by Jack Bog | May 23, 2012 10:04 AM
Portland's housing bureau does not and never has supplied 1 square inch of housing. It's a massive "middle man" siphoning off federal funds before they reach actual housing agencies. The bureau was successful in destroying a key 1990s era reform to the housing system, locally controlled small Community Development Corporations (often affiliated with churches).
The bureau, which does not operate with public meetings, used their position in the money stream to divert funds to corporations they controlled. Millions of dollars remain unaccounted for. Ask them about the now disappeared Housing Our Families corporation. Ask for a copy of the required audits and required federal tax returns.
Posted by Mike in NE | May 23, 2012 10:44 AM
Nick Fish is way over his head as a commissioner.
Posted by John Benton | May 23, 2012 11:19 AM
The Housing Bureau has other problems too. Federal funds have designated uses with very descriptive requirements for "affordable housing". Fed regs do not allow use of these funds for what Portland is now calling "student housing" and "work force housing", and calling them as "affordable housing". There is a mix of these federal funds being misappropriated to these uses.
Also there has not been any open/outreach public meetings concerning this expansion of what constitutes "affordable", even if only city monies are used without any co-mingling of federal funds. Requests for such openness has been made, but no results.
It's not legal or appropriate for CoP to ignore the federal requirements or the required public input on a major change to housing policy.
Posted by Lee | May 23, 2012 11:33 AM
You'd think the feds would be interested in federally funds being misused. So, why is it CoP seems to keep being handed a free ride from the feds?
Posted by Mr. Grumpy | May 23, 2012 12:18 PM
There’s a huge HUD office staff in downtown Portland that is supposed to be monitoring housing funds. They are bitter that HUD was embarrassed by several housing failures that led to the 1990s reforms that were supposed to take control from the feds and hand housing to local non-government groups.
My observation is that HUD staff is not bright and know nothing about housing. They actually work for the “system” that delivers them a paycheck so they want to change nothing. The operation struck me as Affirmative Action for white people who have an education but no marketable job skills.
Posted by Mike in NE | May 23, 2012 1:25 PM
The Bush and soon the Rominy TAX CUTS should soon slow their
pipeline of money to a trickle.
Posted by from Where I Sit | May 23, 2012 5:04 PM
oops, It's Romney, "the most beautiful word in any language is one's own name" says Dale Carnegie
Posted by from Where I Sit | May 23, 2012 5:06 PM