Substantial default cited as primary reason for takeover
WASHINGTON, D.C. – April 24, 2013 – (RealEstateRama) — The U.S. Department of Housing and Urban Development (HUD) announced today that, effectively immediately, it is taking control of the Housing Authority of the City of Cocoa (HACC).
In a letter to HACC President of the Board of Commissioners Bruce Tate Jr., HUD cited the agency for violating federal law and defaulting on its Public Housing Annual Contributions Contract (ACC) – the agreement that local housing authorities enter into with the federal government to administer HUD’s public housing programs. The major findings are:
Misuse of federal funds on non-ACC projects – An independent auditor found that HACC improperly used $1,301,523 of HUD funds for unauthorized pre-development and development expenses, which is a violation of the Annual Contributions Contract.
Violations of the Memorandum of Understanding – In the three years since HACC entered into a Memorandum of Understanding with HUD in March 2010, the Executive Director of HACC has not adopted corrective measures to address the problem, nor has the Board of Commissioners demanded action to resolve these issues despite HUD’s repeated attempts to stabilize the agency.
Over the last two years, HUD has worked with the HACC Board of Commissioners to resolve the issues, including the repayment of the $1.3 million which is supposed to be used to house elderly and disabled families of Brevard County under the Housing Choice Voucher program. HACC has the funds available. An official letter from HUD was sent to the Board of Commissioners in January 2012 stating that HACC was in violation of the Memorandum of Understanding and would need to repay the funds to enable the Brevard County families to be housed. The Board’s failure to act, even following a 10 day cure period, resulted in this action.
Assistant Secretary Sandra B. Henriquez said, “Taking a housing authority over is an act of last resort. We hope to quickly resolve the issues at the Cocoa Housing Authority so that we can begin the process of returning the agency to local control.”
Henriquez named Karen Jackson Sims, who has been with HUD for 15 years, as the recovery administrator to manage HACC’s day-to-day operations.
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HUD’s mission is to create strong, sustainable, inclusive communities and quality affordable homes for all.
HUD is working to strengthen the housing market to bolster the economy and protect consumers; meet the
need for quality affordable rental homes: utilize housing as a platform for improving quality of life; build
inclusive and sustainable communities free from discrimination; and transform the way HUD does business.
More information about HUD and its programs is available on the Internet at www.hud.gov and
http://espanol.hud.gov. You can also follow HUD on twitter @HUDnews, on facebook at
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Contact:
Donna White
(202) 708-0685
