CAIRO – U.S. Rep. Mike Bost said in a statement he has contacted federal officials from the U.S. Department of Housing and Urban Development to better understand their recent investigation of the Alexander County Housing Authority, but stopped short of calling for a criminal investigation as many have suggested should take place as allegations of misspending have come to light.
Bost, in a statement sent via spokesman Jim Forbes, said he’s “disturbed” by what he read concerning allegations of misappropriated federal funds by housing authority employees while public housing developments in Cairo have deteriorated, likely beyond a point of repair, leaving residents to live in substandard conditions.
The Southern Illinoisan, in an investigative report titled “Chaos in Cairo” that published on Sunday, detailed what appeared to be a pattern of generous employee contracts exceeding most deals for public sector employees, tens of thousands of dollars in retirement incentives, questionable pay for the former, long-time executive director after his retirement, excessive travel and other issues, after reviewing dozens of pages of federal HUD documents and agency records.
Bost’s 12th Congressional district includes Alexander County.
“If these allegations are indeed true, I will work in any way possible to ensure that this situation is rectified for the people of Cairo,” Bost said, in the statement.
It’s unclear to the newspaper whether an investigation is taking place beyond HUD’s extensive review and citations of problems following reviews in 2013 and 2014, which included allegations of funds intended for resident programs or capital improvements spent on employees, as well as citations for discriminatory practices that included segregation of African-American families in the housing developments that are in the worst condition, while focusing improvements and security on a slightly nicer complex for the elderly and where the housing authority built a third-floor office complex overlooking the Ohio River some years ago, as well as a family development in Thebes where the majority of residents are white.
In April, the Alexander County Housing Authority retained Tom Upchurch on a six-month, $35,000 contract to assist in keeping the agency afloat while federal HUD officials and the board determined a next step. Upchurch is the executive director of the Jefferson County Housing Authority based in Mount Vernon. Upchurch said that when he stepped into that role, the authority was in such financial straits that it had nearly become unable to make payroll and had fallen behind on its electric bill.
At least two of the authority’s housing developments -- Elmwood and McBride apartments -- may have deteriorated beyond repair, and residents there say they live among rats, roaches, and sometimes bed bugs, while also regularly dealing with plumbing problems that lead to mildew and mold. The complexes, home to almost entirely African-American adults and their children, have been described by officials as unsafe and unsanitary for habitation.
In recent months, Eggemeyer Associates Architect has been retained to examine all the housing authority’s developments and make a recommendation to the authority about next steps, which could include a need to raze the worst of the buildings and build anew.
James Wilson, who served as the executive director for 24 years until his retirement in spring 2013, signed off on much of the questionable spending. He met with The Southern Illinoisan on Saturday morning to defend much of the spending, such as the retirement incentives for himself and others, as intended to save the authority money.
Without apologizing or admitting any wrongdoing, Wilson did say the authority may have offered salaries and benefits in negotiations with the Laborers’ International Union of North America Local 773 that the authority didn’t have a way to pay for over the long haul, particularly as the federal government made cutbacks to HUD programs that fund the authority.
“I tell everybody we’re just like the state of Illinois,” Wilson, who also served as mayor for 12 years until 2003, said of the housing authority’s financial situation. “We lived it up too good. And we didn’t see this coming and we thought it would last forever and when the (federal cuts) came, we weren’t in a position to handle it.”
In saying he would have done some things differently, Wilson noted that others went along with the spending, including union officials, board members and employees.
But Wilson also took money for work he did not perform, under a settlement and contract HUD officials said were not appropriate. After his retirement, Wilson was retained as a consultant to work four hours per week, at a cost of $2,500 per month, for 18 months. After HUD questioned his contract and a lack of accounting of services performed, Wilson resigned his consultancy position, but negotiated a settlement with the board to pay the remainder of what he was owed -- roughly $27,500 -- as a legal settlement in exchange for him not suing for breach of contract. Wilson said his settlement agreement allowed him to draw down money at intervals convenient to him, but HUD stopped him from pulling down his final roughly $12,000 in January 2015. Wilson said he notified the agency in late 2014 with a handwritten note of his plans to draw down the rest of the money owed him at the beginning of 2015, a timing decision he said was because he wanted to take the money in the next tax cycle. When federal officials put a stop to the payment, Wilson sued the authority in Alexander County Circuit Court, to which the authority counter-sued alleging it was an illegal contract.
Wilson also took home $15,000 in January 2015, records show. Wilson said he came back on as executive director full-time because no one was qualified to replace former executive director Martha Franklin, the long-time finance director who stepped into that role upon his retirement, but who then requested to relinquish the role and return to finance director after less than two years on the job.
Her contract called for her to receive a $5,000 lump-sum payment if she were to terminate her contract for any reason. She received that money in January, financial records show. Wilson described Franklin, who is no longer working at the authority, as a very good friend. Wilson said Franklin has filed a grievance against the housing authority regarding her dismissal.
Wilson was on the job as executive director the second time for 11 days, he said. He stepped down, he claimed, after realizing HUD officials would not work with him. Wilson said he believed that was because he was aggressive with HUD officials during one of their reviews that led to the numerous citations. He said after realizing he could get no where with HUD officials, he thought it would be best to step down. Wilson said that upon returning to the leadership post, he required being paid the $15,000 up front for three months of service, because HUD officials had tried to interfere with his payments before. His contract stipulated he would not be required to return any of the money regardless of whether the contract was terminated by him or the board. He kept all the money, despite working for only two weeks.
Andy Clarke, a real estate broker who is chairman of the Alexander County Housing Authority, described the contract as “fraudulent.” As to whether a criminal investigation is warranted regarding this contract and other payments, Clarke said that’s beyond the scope of his expertise.
But he said he’s confident the board and federal HUD officials with Upchurch’s assistance can and will things around for residents who rely on public housing in one of the state’s poorest counties. While calling Wilson a close friend over the years, he said of the questionable activities, “It’s got to stop.”
“There’s a lot of hard work ahead and I think HUD is prepared for the long haul if the board is prepared for the long haul, and a lot of tough decisions have to be made.”
He added: “I knew the fight I was picking with one of my best friends. I’ve known him all my life, but I wasn't afraid. Sometimes you have to do the right thing.”
The Southern Illinoisan will continue to cover this developing story in the coming days.