Augusta leaders discuss housing department’s multimillion-dollar scandal

AUGUSTA, Ga. (WRDW/WAGT) – Augusta Commission members held a budget workshop session Thursday, and there was much discussion about the Housing and Community Development Department.

That’s the department that left the city on the hook to pay back millions in federal grant money.

The city got more than $6 million in grant money during the COVID pandemic, supposedly to help people who were in danger of eviction.

The city never spent the money for that purpose, so the government demanded it back.

The department didn’t have the money on hand, so the city had to repay it, and then some, from the general fund – $6.3 million of the original grant money and $2.1 million in penalties.

The scandal led to the exit of Housing and Community Director Hawthorne Welcher and sparked an audit of the department.

“The community is highly concerned, just like we are about the fact that we’ve had this many levels of issue. And there doesn’t look like there has been any accountability with it,” Augusta Commission member Don Clark said.

“As of a week ago, still receiving liability issues out of the inadequacies coming from the department. The last pot of money for the emergency rental assistance, we had to pay out some more additional funds,” he said.

On Oct. 28, commissioners in closed executive session approved the payment of up to $32,237.32 from contingency funds for rental assistance previously approved by the Housing and Community Development Department.

This means leaders agreed to take the money from their emergency fund and use it to help people with their rent as part of a program the department had already put in place.

Mayor Garnett Johnson said at the time this was an effort to address letters that were sent out, falsely leading people to believe they were getting some emergency funds.

“ Despite all the great things that it has achieved in the past, the last 12 months have really damaged the public’s trust in Housing and Community Development,” City Administrator Tameka Allen said.

“ I would like to see us refocus this department on its core mission,” she said. “That is implementing its core grant programs as efficiently and effectively as possible. From a financial perspective, we need to live within our means, spending grants appropriately and reducing Housing and Community Development’s dependence on the general fund.”

Commissioners learned at the budget session Thursday that the department owns 64 rental properties compared to the 12 it owned a few years ago.

Allen admitted she only recently learned the current number was 64.

A department staff member said: ”Back before COVID, we found out that we had additional program income and we had a lot of individuals requesting houses, decent safe housing. So our director at that time chose to take that program income and purchase homes to put low- to moderate-income people in.”

The staffer said the department can adjust the rents according to incomes.

The staffer said the homes are managed by a private company, but commissioners admitted they have little oversight of how rents, tenants or repairs are handled.

Commissioners said they need a breakdown of the rental program (who’s in the houses, what rent comes in and how it’s advertised) as well as clarity on how the city monitors the property management company.

“The more I dig, the more I find,” Allen said.

Allen recommended setting a target to reduce general fund subsidy of the department by about $500,000, including five positions in administration and support, as well as other cuts.

Commissioner Jordan Johnson wanted to be sure these cuts wouldn’t gut redevelopment projects.

Allen said she plans to keep the redevelopment sector, the supervisor, and at least one coordinator so those bigger capital projects can keep moving.

She said the department needs a reset after a year of lost community trust and costly mistakes.

She says the goal is to get the department back to its core U.S. Department of Housing and Urban Development programs and fix financial controls once the ongoing audit is complete.

She says the audit is on track to be completed within the next 45 days

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