HACP audit review

Sorry that this has taken some time to get to. I have been busy with work and other matters since the audit came out and have found little time to write this out.

The much awaited Housing Authority City of Pittsburgh Audit was released by Pittsburgh City Controller Michael Lamb's office.

**Update I left a voice mail for Michele Jackson Washington at the HACP for her to return my call, I had a few questions for HACP that I would like answered.

Finding: The City of Pittsburgh spent approximately the same amount in 2006 and 2007 on training and travel ($483,933) as the Housing Authority ($442,954) but with an average of over 3,250 employees compared to HACP’s 430 employees (not including those on disability and workman’s compensation). The Authority’s per capita educational/training costs were $506 in 2006 and $523 in 2007 compared to the City average of $75 per employee.

I know first hand about this. I was sent to Las Vegas Nevada for a week long training session to become a NEHRO certified Public Housing Manager. I thought this was sort of excessive and would be costly but there was nothing I could do to object because I needed the certification even though I didn't learn anything relevant at the training session. Overall the training at HACP is important but it seems to be out of line in terms of cost. Each time a travel request comes up it needs to be checked and someone needs to ask "is this really necessary?" Travel costs are way too high at HACP. There is no reason why HACP is spending nearly as much as the city of Pittsburgh when the city of Pittsburgh has 2820 more employees than HACP.


Year Travel/Training Costs Staff* Spent/Staff
Housing Authority (from invoices):
2007 $ 197,009/377/$ 523
2006 $ 245,945/486/$ 506
Total $ 442,954/863/$513

City of Pittsburgh (from CAFR):
2007 $ 263,317/3,281/$ 80
2006 $ 219,716/3,221/$ 68
Total $ 483,033/6,502/$74


Finding: In 2006, HACP hired an executive recruiting firm to find not only an Executive Director, but other upper management personnel at a cost of $150,910.05. Other City of Pittsburgh authorities and the Pittsburgh School District have used recruitment firms for assistance in finding Executive Director candidates. The City of Pittsburgh recruits and hires its directors through the City Personnel Department.

$150,910.05 to search for people who will be making lots of money? What happened to the old fashioned way of using the classified section? I know that is a little bit archaic but no way should over $150,000 be used to hire companies to fill positions. There is a lot of talent at HACP that deserve a shot at the positions that are being advertised. If HACP HR doesn't believe so then that's ashamed. These sorts of job recruitment's and listings need to be done by the Human Resources Department. Isn't that one of the purposes of the department?

Finding: Executives recruited from out of town received $57,902.91 in rental and moving fees for relocation to the City. Three employees were given several months rental as an incentive for relocation. Moving fees were also reimbursed. Rental and moving reimbursements are considered customary incentives by HACP as housing industry norms, and are acceptable to HUD.

This is absurd and should not happen. I always heard about this going on but I did not believe it because it seemed so outrageous. I believe that Caster Binion, Chief Operating Officer, was one of these Executives who who took full advantage of these fees. Were there no local candidates available for these jobs? How is this an acceptable expense to HUD? Eliminate the assistance. It is not needed and it is absurd that someone who will be making $70,000+ a year will need to be reimbursed for moving expenses. Especially when you consider the "talent" that these recruiting firms brought in.

Finding: HACP spends over $50,000 per year on employee parking leases.

Time to get rid of these. Have everyone pay for their own parking. Isn't this how most places do it? If you want to drive to work then you pay to park. At the worst have employee pay 50 percent of this fee. It's only fair.

Finding: During the 2006-2007 audit period, HACP spent $449,722.55 on promotions
and various other events. These included catered community and hi-rise gatherings,
demolition parties, advertising fees, various outside non-profit & charity functions and legislative tracking fees.


This is a big bone of contention for me. Demolition parties? Are you serious? Catered community gatherings? These are absurd and should be done away with immediately. There is no reason to be throwing money down the toilet like they are doing with "parties" like these. When the HACP is spending almost half a million dollars on things like these the last thing it is to the tax payers is a party. A total elimination of parties is the course of action for HACP.

Refreshments are something that do not need to be provided by a government agency. Why can't people purchase their own refreshment? Why did HACP spend $51,307.99 in 2006 and $33,016.37 in 2007? These expenses are unreasonable and should be cut from the budget.

HACP'S ADVERTISING & GOODWILL EXPENSES 2006-07
Category 2007 2006
Cater/Lunch/Flowers $ 33,016.37 $ 51,307.99
HACP Sponsored Events $ 28,723.42 $ 74,336.93
HACP Supported Events $ 10,858.00 $ 11,870.81
Ads/PR/Legislative $ 136,370.20 $ 60,010.89
Total $ 211,174.99 $ 197,526.62

Finding: Utility payments in HACP managed communities appear to be excessive compared to the budgets of other public housing communities. In 2007, HACP’s average utility cost was $3,121 per unit compared to Cleveland Housing Authority average of $1,956 per unit. Utility costs represent 8-1/2 to 9% of HACP’s entire annual budget.

Way too much of the budget is going down the toilet in utility costs. Residents don't pay anything for their utilities so there is no advantage for them to conserve or to not let the AC run all day. Residents are not penalized for going over any dollar value in utilities. The only system in place that HACP uses is a spot check during annual housekeeping visits from the property managers. If a second refrigerator is found in the unit then an extra charge is placed on that tenant's monthly rent charge. In my experiences I have found that not many residents care about utility usage. AC's are run all day even when the tenant is not home and lights were usually on for most of the day. This was a huge waste but there was nothing that we could do about it. One thing that HACP could do is at the time of a tenant move in there could be an educational pamphlet or session given to the tenant about the benefits of energy conservation. All future construction by the HACP needs to have single unit utility meters instead of the one for every building system that is currently utilized. When and if these individual meters are ever utilized there needs to be a cap for the residents so to assure that they aren't wasting.

Authority 2007 Utility Occupied Units Cost per Unit
Pittsburgh, PA $ 11,157,176/3,575/ $3,121
Cleveland OH $ 20,471,321/10,466/$1,956
Erie, PA $ 2,700,000/1,750/$ 1,543
Portland, OR $ 3,673,098/2,492/$1,474


Finding: HACP is one of the City of Pittsburgh’s larger property owners. Its family and hi-rise communities alone consist of over 4,000 units, are worth over $97,000,000 in fair market value and occupy 343-1/2 acres of land, according to the Allegheny County Assessment site. The Authority also owns approximately 225 scattered site homes.

This is unfortunately true. HACP pays zero in property taxes and nothing in lieu of taxes to the City of Pittsburgh.

Finding: The Authority has a five-year agreement with the City of Pittsburgh to pick up non-bulk residential waste in return for HACP purchasing a pair of waste trucks and leasing them back to the City of Pittsburgh.

HACP & the City of Pittsburgh should share services wherever possible. Cooperation between the two is vital and it would benefit the city of Pittsburgh as a whole to explore all possibilities of shared services.

Finding: HACP communities do not participate in a recycling program, which is in violation of Pittsburgh’s City Code Section 619.06 (a) and (b).

Big problem here. HACP needs to get in compliance with the city code as soon as possible. There is no excuse for not having a recycling program. Tenants need educated on recycling and the overall benefits to them and to the city about it.

Finding: The educational component of the FSS involves GED training, and produced only 12 applicants out of 44 tenant referrals, with two successfully graduating the program during the audit period.

I don't think HACP needs to be doing anything in terms of GED training. This is a waste of time for the FSS program. There are plenty of high GED programs that tenants can be referred to across the city. Clearly this is an area in which HACP is not performing well. A partnership with another agency is what I recommend here.


Finding: HACP spent $92,736 in 2006 and $74,288 in 2007 of its own funds on Clean
Slate plus an additional unknown amount in privately donated funds.

Everything about this program is a huge waste of money. No taxpayer money should be used to fund Clean Slate. The giving away of IPODS and other gifts is not a good use of taxpayer money. I know that there needs to be some sort of incentive to get the kids to come to this event but all of these gifts should come from private sources. $167,024 of HACP money is far too much for a program that has no tangible measurable results. This money would be much better spent within HACP. This money could hire close to 5 maintenance workers that would much more beneficial to the community.

Finding: The money spent on temporary employees is roughly the same as the cost of
hiring four or five full time employees at $30,000 per year with benefits, or several part time employees.

Just hire the full-time employees. Enough of these temporary employees. It's costing the same amount of money.

Finding: Prior to the Honeywell contract, HACP had awarded a 10-year energy services contract to Custom Energy, which was expected to save $4M in utility costs over the lifetime of the contract.

This audit neglects to tell us how much this contract was for and what the actual savings were for the length of this contract. Was this a good contract or not?

HACP Reimbursements for City Services:
The HACP does not compensate the City of Pittsburgh through a Payment In Lieu
of Taxes (PILOT) program for its City-provided services. According to Authority
administrators, HACP cannot make purely voluntary PILOT payments.

But they do in Erie:

The Housing Authority of the City of Erie (HACE) has paid a voluntary PILOT to
Erie since 1941, voluntarily contributing $53,000 in 2006 and $78,000 in 2007 for City services, along with payments to the school district and Erie County. HACE also gives financial support to city policing, code enforcement, and recreational activities worth an additional $532,000 in 2007 and $449,000 in 2006.

Something seems funny here. In Erie they do it but here in Pittsburgh HACP administrators claim they can't.

On another note that wasn't addressed in this audit I would like to to see HACP put all of their monthly board meeting minutes online so the public can see what was discussed and voted on.

Overall I thought the Controller's office did a good job on the audit. I unfortunately don't believe that the big wigs at 200 Ross Street will take any of the advice from the audit. HACP officials have shown in the past that they have flawed leadership and judgment, why would this change anything? The most disturbing part of all of the findings was that HACP officials will continue to use public dollars to cover any private funding shortfalls. Are they not reading the findings? Are they that out of touch with reality? No public dollars should be used to fund Clean Slate! The taxpayers got billed how much for the recruitment and salaries of these people making the decisions? What a ripoff.

HACP has taken no responsibility for anything and continues to try to fool themselves and the public into believing that they are a good agency that is out there for the betterment of the community when time and time again they have proven to be nothing but a problem landlord who continually wastes taxpayer money year after year. Is there a bigger problem landlord in the City of Pittsburgh than the Housing Authority City of Pittsburgh? I challenge you to find me one.