OIG News

McKinney Housing Authority Violated Federal Contract By Transferring Money. The Dallas Morning News(2/15, Getz, 432K) reports Jerry Kirkland, the Fort Worth-based inspector general for HUD, "has found that McKinney's public housing authority inappropriately gave close to $1 million in federal money to an affiliated nonprofit corporation – money that was used to pay for homes to lease to low-income residents." Officials "agree the violation was a technicality, but the federal government wants the housing authority to replace the money that was transferred." And Kirkland said that the McKinney authority "has been cooperative and that all parties are trying to work out a repayment plan." But he "added that if the authority is not repaid, in a worst-case scenario, authority officials could lose their jobs and the agency would risk a reduction in subsidies." The DMN adds Arthur Simmons, chairman of the housing authority board, "says the matter is far from cut-and-dried. He said the authority has spent years trying to clarify how federal money can be used to pay for affordable housing." But HUD spokeswoman Patricia Campbell said HUD records "do not show the McKinneyauthority requesting guidance from the federal agency before transferring any money." She added the contract "clearly 'prohibits the use of low-rent funds for any use other than the low-rent program.'"