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“We could receive a black eye and our excellent bond rating could be threatened. There are things that could negatively impact the district’s financial position,” she said. “And the reason we point out that risk is to address it before something like that happens.”
Glenn Lee, the city’s chief financial officer, disagreed with the auditor’s report and said in a written response that there was “no basis” for following its recommendations. He said the city’s independent auditing firm reviewed and agreed with the housing authority’s relationship with the city.
The audit report focuses on housing authority issues.The agency remains under increased federal scrutiny following damning 2022 report, not yet completed HUD-mandated audited accounting for fiscal year 2021 and beyond was completed last month. States and local governments are typically required by law to publish audited annual financial statements, which not only provide information to federal agencies but also provide bond buyers and others with insight into the government’s fiscal health. I will provide a.
Keith Pettigrew, the Housing Authority’s new executive director, spoke about stabilizing and reforming the Housing Authority. He told the board last month that he hoped to complete the 2022 report early this year, followed by the 2023 financial report soon after.
“My goal is to accomplish everything because HUD is breathing down my neck,” Pettigrew said. “So we’re going to call for more help.”
Alison Bourdo, a spokeswoman for the agency, said the new administration could not say why the agency fell behind in its 2021 and 2022 reports, but said the understaffed finance department is facing challenges. He said he was facing a software transformation.
Pettigrew, who took over in November, has been accused by federal authorities of allowing the public housing stock to fall into unacceptable disrepair, among dozens of other deficiencies related to poor leadership and mismanagement. He took over a government agency that had come under fire. He is tasked with overseeing the agency’s continued response to the emergency directive issued in 2016. September 2022 by the U.S. Department of Housing and Urban Development.
The D.C. Council is also increasing its focus on the agency, which serves approximately 30,000 households through housing vouchers, traditional public housing, and mixed finance developments. Last year, the council passed a bill tightening the agency’s financial reporting requirements, requiring that a report audited by the D.C. inspector general be submitted within four months of the end of each fiscal year starting in 2024.
Thursday’s report does not impose financial reporting delays on housing authorities. However, in a nod to the issue, if city officials determine that “DCHA’s financial information cannot be included because the information is incomplete or unaudited,” the city will at least disclose that deficiency in the district’s financial statements. He pointed out that it should be done.
The audit report also directly confronts the issue of mayoral control, which was up in the air last year and in 2022, as Mayor Muriel E. Bowser (D) successfully led an effort to replace the housing authority’s board of directors. I’m just throwing everything at it without doing anything. At issue was how independent the agency was from Bowser’s office, and who was ultimately responsible for its successes and failures.
The Housing Authority was managed by the mayor’s office until the 1990s. But after HUD deemed the department one of the worst-performing authorities in the nation and a lawsuit by homeless advocacy groups, a judge placed the department in receivership. Pettigrew later joined the agency in the early 2000s after Secretary of State David I. Gilmore brought him to the commission to help with its turnaround, and after the D.C. Council turned the agency over to the He has held multiple senior-level positions at. independent authority. ”
But Bowser, like his predecessor, appointed the majority of DCHA’s board members, whose independence has long been questioned. Although she has sometimes distanced herself from her performances, she has taken a more visible role in steering her own destiny in recent years.
In late 2022, following a scathing report from HUD, Bowser successfully introduced legislation to transfer the agency’s governance to an ad hoc reform commission she appointed.
In response to a request for comment, Bowser’s office on Thursday noted that the administration is making significant financial investments in public housing and asked the Office of the Chief Financial Officer to use the agency’s assets to guide those investments. asked to evaluate. “All of these actions reflect the current administration’s commitment and commitment to improving DCHA and improving access to safe and affordable housing,” Bowser spokeswoman Susana Castillo said in a statement. the statement said.
In response to changes in the Housing Authority’s governance, the district finance authority re-evaluated whether the Housing Authority should be considered a “component unit” of the district government and, like previous officials, concluded that it is not.
Patterson claims the decision means the authority does not have to be included in the city’s financial statements and does not comply with government accounting standards. This could threaten the city’s high bond rating, which was rated AAA in November by Moody’s Investors Service, she said.
Patterson said the grants the city is providing the agency deserve to be included. His report points to capital allocations from the district for fiscal years 2021 through 2023 totaling $151.8 million, among other funding injections.
“nevertheless [the city] They don’t want to acknowledge that relationship in their financial statements,” Patterson said.
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