April 20 2016 06:54 AM

Feds find Lansing Housing Commission financially ‘troubled,’ order clean-up

WEDNESDAY. April 20 — The U.S. Housing and Urban Development Department has ordered the “troubled” Lansing Housing Commission to get its finances in order.

“The Lansing Housing Commission has been designated as Troubled or Substandard for financial, physical and/or management indicators, or other deficiencies as HUD has identified,” reads an agreement signed by HUD, LHC officials and Lansing Mayor Virg Bernero. It came to light at a City Council Public Safety Committee meeting Tuesday.

The Recovery Agreement was approved by the LHC board in a special meeting Jan.6, signed on March 1 and filed with the Lansing City Clerk on Friday just before 5 p.m.

“The LHC has failed the Financial Assessment Subsystem Score since 2012 and has not submitted financial information timely as required by regulations and statute since 2009,” the action plan attached to the agreement reads.

The agreement was approved just weeks after a Dec. 16, 2015 audit report from the HUD Office of the Inspector General that found the Commission may have improperly received hundreds of thousands of dollars over 28 months and the agency underpaid rent and utilities some housing programs by just over $16,000.

The audit also found that LHC did not understand it obligations under Section 8 Housing rules and regulations. Its audit discovered that Patricia Baines-Lake, the agency’s executive director, had taken over oversight of the Section 8 program because there was no manager. “However, she did not provide adequate oversight,” the OIG audit reported.


Baines-Lake on Tuesday afternoon challenged the audit report findings laying the responsibility for some of the errors at her feet. Asked if that assessment from the OIG was accurate, she replied, “No. It’s not.”

HUD’s assessment was buttressed by the Recovery Agreement signed by Baines-Lake and Bernero on March 1. In the agreement’s action plan, HUD said Baines-Lake was not providing the board enough financial information “to provide sufficient oversight.” The agreement also identified Baines-Lake’s “lack of knowledge of the Housing Commission’s day-to-day finances leading to an excessive number of unpaid invoices and extremely low reserves.”

The agency has been under the gun for months as members of the Public Safety Committee have reviewed complaints and concerns from residents about substandard housing conditions and security and safety concerns at a five-story apartment building owned by the Commission. The building is called 3200 South Washington Park Apartments, but residents refer to it as ‘The Tower of Terror.’ On March 1, a man was shot to death on the fifth floor of the facility. Monday a 40-year-old man, Tava Jermaine Jacobs, was charged with six felonies stemming from that murder, including the murder itself. Lansing Police said Jacobs was not a resident of the building.

The combined safety and condition issues as well as the newly revealed financial concerns, Lansing City Council President Judi Brown Clarke said it’s time for Baines-Lake to resign.

“We are not well served with her in leadership,” Brown Clarke said Tuesday night by phone.

She added that she does not feel confident about moving the Commission’s budget forward “in any shape, form or fashion.” The new fiscal year begins July 1.


The Lansing Housing Commission has been classified as a “troubled” property by the U.S. Department of Housing and Urban Development. That classification brings with it increased oversight from the federal housing authorities, as well as written action plan with measurable outcomes.

Leaders from the Commission and Lansing Mayor Virg Bernero signed an agreement with Douglas C. Gordon, HUD’s public housing director in the Detroit Field Office, on March 1. It was filed with Lansing City Clerk Chris Swope on Friday just before 5 pm.

“Whereas, on the basis of an annual PHAS [Public Housing Assessment System] score, the Lansing Housing Commission has been designated as Troubled or Substandard for financial, physical and/or management indicators, or other deficiencies as HUD has identified,” the agreement reads, in part.

The agreement comes, in part, from a Dec. 16 audit report from the Office of the Inspector General of HUD. That report found the LHC had been overpaid by hundreds of thousands of dollars for some housing programs, while underpaying for other programs. It recommended repayment of some of that money using non-federal funding -- such as money provided from the city of Lansing.