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REACTIONS VARIED TO VIHA TAKEOVER BY HUD

Aug. 20, 2003 – Dissecting the takeover of the V.I. Housing Authority took on the status of spectator sport among the territory's political pundits on Wednesday as word spread of the agency being placed in federal receivership. (See "Housing Authority now under HUD receivership".)
Gov. Charles W. Turnbull, who has been off-island for more than a week with no official word from Government House as to why, or when he will return, was among those greeting the news with resignation.
A statement from Turnbull issued Wednesday afternoon read: "As I stated during my meeting with representatives of the Department of Housing and Urban Development earlier this month, I am not in favor of a voluntary of involuntary receivership
"However, since HUD has proceeded to place VIHA into receivership following its preliminary review of the many documents in its possession, my administration is committed to working closely with HUD and its representatives to address all of the problem areas affecting the authority with the intention to turn it around to improve the quality of life for residents in the housing communities."
By mid-afternoon Wednesday, fingers were wagging and shoulders were shrugging in some quarters, while in others hands were clasped in gratitude.
Sen. Emmett Hansen II, chair the Senate Housing Parks and Recreation Committee, said the government can best help itself by trying to cooperate with HUD. "If we can go in and do what needs to be done and be responsible, and actually take this opportunity to learn from these folks," he said, "then we'll have the Housing Authority back in short order.
"But if we're going to dig in our heels and be very combative about it, rather than taking advantage of the situation, then we're in for the long haul."
Hansen said he has an appointment to meet with newly appointed HUD receiver Donna Ayala Thursday morning to discuss her plans for managing the troubled agency. He said he hopes to persuade Ayala to put in an appearance soon before his committee.
Sen. Celestino A. White Sr., long an advocate for public housing residents, said that upon hearing of the impending receivership, he made his way into a Housing Authority staff meeting called Wednesday morning to discuss the new order of business.
"I always hoped and wished and prayed that these tenants would receive what they are entitled to, which is safe and decent housing," White said, "and HUD continues to mandate that is the bottom line. So in HUD taking over, it's not to punish the tenant; it's not to punish employees; it's to straighten up what they thought was not going right."
Some public housing residents have been circulating petitions calling for the return of the agency's recently ousted executive director, Ray Fonseca, crediting him with taking the initiative of going into the housing communities to talk with people about their needs and concerns. For these residents, the federal takeover, with the arrival of unfamiliar personnel, represents a further distancing of housing managers from those they are obligated to serve.
On the other hand, one individual who has worked closely with the Housing Authority in the throes of crisis sees receivership as the solution to an otherwise impossible situation. Speaking on the condition of anonymity, this person said there was no way VIHA could struggle out from under its financial burden, a burden made heavier by up to $6 million in obligations the V.I. government itself has failed to meet. And federal authorities can afford to bring in the kind of technical and professional expertise that the V.I. government cannot afford, the person said.
The individual drew a comparison between VIHA's dilemma and that facing the central government, with the Housing Authority having taken a substantial emergency loan without a plan for paying it back or the means to do so. But, this person pointed out, one difference between VIHA and the government, which intends to borrow another $235 million on the bond market, is that there is a chance that under receivership HUD might forgive the $12 million emergency loan.
Sen. Adlah "Foncie" Donastorg, who chairs the Senate Finance Committee, faulted the administration for allowing the Housing Authority to lapse into near-insolvency and cast the crisis in political terms. "The federal government is going to recoup their investment of $12 million in any way that they possibly can … which includes increasing rent in public housing," he charged.
The firing of VIHA's former executive director, Ray Fonseca, two weeks ago by the authority board in its last meeting before it was dissolved was the last nail in VIHA's coffin, Donastorg said. He laid out his view of what happened before his Finance Committee colleagues Wednesday: "HUD continues to operate, work with the Housing Authority to get them out of the mess they're in. What happens? You vote to dissolve the board. The board reacts and goes after the executive director, terminates him. No stability, no leadership. Now you give HUD another reason to take over."

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