With more than 1,400 local families languishing on a waiting list for rental assistance, the Durham Housing Authority could be forced to return $600,000 in unused vouchers to the federal government because the agency's staff neglected to register needy residents for help.
The director of the authority's Section 8 program, along with her top assistant, quietly resigned amid revelations that at least 100 low-income families that should have received aid were turned away under the pretense that no money was available.
An additional $1 million in vouchers from the U.S. Department of Housing and Urban Development went unused and was returned last year, though that was not publicly disclosed at the time.
"The bottom line is that people who needed the vouchers did not get them," said Larry Jones, an outside consultant who ran the troubled agency until last month when a permanent director was hired. "We knew there was a problem, but we thought we had it fixed. I take full responsibility. It happened on my watch."
Housing agencies across the country have struggled to meet increasing demand for Section 8 assistance amid a climate of federal budget rollbacks and a difficult national economy. With a local allotment of more than $17 million for 2005, the program gives poor families vouchers to cover rent for private, market-rate apartments and houses.
For more than a year, a large sign by the Durham agency's front door has warned potential Section 8 applicants that only those with special needs, such as the elderly and disabled, could get on the lengthy waiting list due to a shortage of available vouchers.
A receptionist at the front desk was recently overheard advising a homeless woman to take the bus to Raleigh and seek help from that city's housing authority.
Section 8 Director Marcia Rogers and Program Administrator Bonita Tolbert resigned in August. Jones would not say whether the simultaneous resignations were linked to the failure to fully use the agency's rental vouchers.
"They left of their own accord," he said.
Rogers was one of a handful of senior managers at the authority to survive a staff reduction, which eliminated nearly one-fifth of the agency's work force in May. News of the trouble with the Section 8 program stunned some members of the authority's board, who said they were not told about the issue until last week.
"We were totally blindsided by this," board member Isaac A. Robinson said. "We beat up on HUD for cutbacks to Section 8, and then we turn around and send money back to Washington? It doesn't make sense. It's inexcusable."
Jones' firm, MD Strum Housing Services, was hired in January to help restore trust in an organization repeatedly rocked by scandal since April 2003 -- when then-Executive Director James Tabron resigned after it was determined that he had made personal charges on an agency credit card.
After Tabron's ouster, it was discovered that the authority was on the verge of financial collapse. The agency has since been the target of at least three federal investigations, with auditors alleging that more than $12 million in federal money and loans was improperly spent.
Many at the authority have been upbeat in recent months as the agency showed signs of improvement, such as an acceleration in construction on a $35 million redevelopment project aimed at reviving a low-income neighborhood east of downtown.
"This is indicative of the type of mismanagement we've suffered from in the past," Robinson said of the Section 8 foul-up. "Hopefully, this is the last gasp of the bad old days at the Durham Housing Authority."
Harrison Shannon, who arrived last month as the agency's new director, said he has told his staff to focus on getting at least some of the 1,400 families off the waiting list before the end of the year, expending as much of the voucher money as possible before the authority has to give it back.
"I can't really conceive of how this happened, but we're going to fix it," he said.
Staff writer Michael Biesecker can be reached at 956-2421 or firstname.lastname@example.org.