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HUD OFFICIAL HUDDLES WITH GOVERNOR OVER VIHA

July 10, 2003 – A top official from the U.S. Department of Housing and Urban Development paid a call on Gov. Charles W. Turnbull on Thursday to discuss the affairs of the V.I. Housing Authority.
Officials at Government House had little to say at the end of the hour-long afternoon meeting between the governor and Michael Liu, HUD assistant secretary for public and Indian housing. But spokeswoman Rina McBrowne Roebuck said Turnbull would likely bring the subject up at a press briefing scheduled for 10 a.m. Friday.
Liu had appeared unexpectedly at a Senate Housing Parks and Recreation Committee hearing on Wednesday night, when he expressed HUD concerns about the Housing Authority's financial records, especially those from Fiscal Year 2002.
A government official with knowledge of the Thursday talks said HUD's concerns extend beyond sloppy bookkeeping.
Federal housing officials have reportedly asked the V.I. government about the status of a $12 million loan dating from 1999. Another issue is some $3.5 million in services rendered by VIHA to the V.I. government for which it is still awaiting compensation. And HUD is seeking repayment of $651,000 expended for the now defunct Housing Authority Police.
Sen. Celestino A. White Sr., who has spent much of his political career focusing on V.I. public housing issues, forecast a dire scenario: VIHA, he said on Thursday, will shortly be placed under federal receivership And once that happens, he said, the VIHA board of governors "will cease to exist."
Ray Fonseca, VIHA's reform-minded executive director, has been working closely with federal authorities, instituting austerity measures including staff layoffs, the dismantling of the VIHA police and the cancellation of a $6 million contract since taking over the troubled agency last October. On Thursday he said that options less drastic than federal receivership may be available. "The board will decide," he said on Thursday. "HUD either has to reach a memorandum of agreement or initiate a transfer."
The board is expected to weigh the options at its monthly meeting at the end of July.
Fonseca also said federal authorities may offer some supplementary accounting services to help VIHA sort out its bookkeeping.

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