State oversight group to begin investigating MaineHousing

Gov. Baldacci swears in Dale McCormick at the State House on Thursday, Feb. 11, 2010.
Photo from Joy Leach, Governor's Office
Gov. Baldacci swears in Dale McCormick at the State House on Thursday, Feb. 11, 2010.
Posted Oct. 18, 2011, at 2:08 p.m.
Last modified Oct. 18, 2011, at 4:18 p.m.

AUGUSTA, Maine — Members of the Legislature’s Government Oversight Committee on Tuesday directed the state’s watchdog agency to begin looking into the operations of MaineHousing.

The committee voted 5-3 to task the Office of Program Evaluation and Government Accountability with gathering preliminary research on MaineHousing to see if a full investigation of how they spend their money is warranted.

“I have my concerns, but I’m hoping there is no reason for those concerns,” said Rep. Leslie Fossel, R-Alna, who made the motion.

Added Sen. Roger Katz, R-Augusta, who chairs the Government Oversight Committee, “It may be time to take a look at what they’re doing.”

Not everybody thought adding MaineHousing to OPEGA’s work load was a good idea.

Sen. Margaret Craven, D-Lewiston said there is no evidence or indication of wrong-doing on the part of MaineHousing’s staff.

“We need to be looking at [agencies] where there are obvious concerns,” she said.

But if MaineHousing is operating above board, an investigation would reveal that, argued Sen. David Trahan, R-Waldoboro.

“No one should be afraid of an OPEGA review,” he said.

Craven later said she believes the decision was politically motivated and aimed at MaineHousing Director Dale McCormick, a former Democratic lawmaker who has been unpopular with some Republicans.

“I think we have ample opportunity to go into MaineHousing and say ‘Show me your books,’” Craven said. “It’s all federal dollars. Don’t tell me they aren’t taking charge of the money they dispense. They are under scrutiny all the time.

“It feels like MaineHousing is being targeted for the type of work it does and for the people who work there.”

McCormick, who did not attend Tuesday’s meeting but took a call later from OPEGA Director Beth Ashcroft about the planned review, had a simple reaction.

“Bring it on,” she said. “I think the more people know about what we do and how we do it, the prouder they are going to be. I think we are a model for how quasi-government agencies should be operated.”

MaineHousing oversees a host of programs and services designed to make housing more affordable to Maine people and serves more than 90,000 Mainers every year. Among the agency’s programs are coordinating the federal Low Income Home Energy Assistance Program and offering first-time home buyer loans to income eligible residents.

Because MaineHousing operates with federal dollars from a variety of sources, McCormick said her agency is under constant scrutiny already and employs an internal auditor that reports directly to the board of directors.

McCormick’s position is a gubernatorial appointment, but she was appointed and then reauthorized for another term under Gov. John Baldacci. McCormick said she has had a good relationship so far with Gov. Paul LePage’s administration.

MaineHousing is the largest of a handful of quasi-state agencies over which the Legislature has oversight. Perhaps the most notable other agency that has been scrutinized is the Maine Turnpike Authority, which was investigated by OPEGA earlier this year after its former director, Paul Violette, was suspected of financial impropriety.

That review led to Violette’s resignation and also to a civil lawsuit against Violette to recoup more than $500,000 in misappropriated funds.

OPEGA has several projects on its plate at the moment. It wasn’t clear Tuesday what priority would be given to the MaineHousing review or how long that review would take.

Editor’s note: Reporter Eric Russell’s father is employed by MaineHousing.

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