Thirty of 32 low-income housing units inspected in southern Maine recently failed quality reviews done by the federal government, according to an update provided to Sen. Susan Collins.
Collins had requested last December that the U.S. Department of Housing and Urban Development’s inspector general review the Section 8 program in Maine after problems with housing in the Norway area were brought to light during an investigation by the Advertiser Democrat newspaper.
“The failed inspection rates uncovered by the Inspector General’s investigation are shocking. They indicate systemic failures by both Maine State Housing Authority and affordable housing developer Avesta, rather than problems caused by one ‘rogue inspector’ as MSHA and Avesta previously had asserted,” said Collins in a statement. “It is appalling that taxpayers’ dollars are going to subsidize housing that fails to meet basic safety and health standards.”
Collins, the ranking Republican on the Senate Appropriations Committee’s Subcommittee on Transportation, Housing and Urban Development, released the report Tuesday. The HUD inspector general will release a full report at a later date.
According to the interim report, the inspector general’s office inspected units in March that had passed either MaineHousing or Avesta Housing’s inspections after March 2011. Of the 30 units that didn’t comply with HUD’s “housing quality standards,” 20 had been inspected by Avesta and 10 by MaineHousing. Some of the units contained health and safety violations, the inspector general reported.
“Also, several different inspectors, from both the authority and Avesta, were responsible for inspecting these units, and some units should not have been approved for initial occupancy because of deficiencies that would have existed at that time,” inspectors noted.
The report contains pictures and descriptions from inspected units. In one case, a picture shows electrical wiring hung over an interior doorway, which is a violation. In another, debris litters the yard and inspectors found “health and safety issues including open pool chemical containers.”
“The bottom line is people who live in federally subsidized housing should expect decent, safe, and sanitary conditions,” said Collins. “Unfortunately, this report shows that federal funds are instead going to property owners who fail to properly maintain their units. This is absolutely unacceptable.”
MaineHousing had been under increasing scrutiny since Gov. Paul LePage made appointments to the board last year. The scrutiny involved the Section 8 properties in Oxford County as well as the types of projects MaineHousing was funding, priority areas for the agency, and the amount spent per unit in development, among other issues.
Earlier this year, Executive Director Dale McCormick resigned after facing mounting pressure from new board members, including State Treasurer Bruce Poliquin, and the Maine Heritage Policy Center over management of MaineHousing. McCormick could not be reached for comment on Tuesday.
Peter Anastos, chairman of MaineHousing’s board of directors, said the report reflects the criticism he and others have leveled at past leadership of the quasi-governmental agency.
“It confirms what all us new board members felt from the moment we got there: the focus of the agency was totally out of whack, was on pet projects, the solar, the green, the carbon — they took their eye off the ball,” said Anastos. “The most important thing they should have been doing was making sure their core mission was taken care of.”
Peter Merrill, who is serving as interim director at MaineHousing, called the findings of the inspection “unacceptable.”
“That is just miserable, it’s unacceptable and we are going to do everything we can to address it to make it right,” said Merrill. “I believe that there is a systemic problem. I think there’s no question about it.
“We have a problem and we’ve discovered it’s a bad problem and it needs our immediate, undivided attention. And it’s got it.”
Of the six inspectors who worked on the properties, only one remains, Merrill said. The others have been reassigned or have retired or resigned. MaineHousing has hired five new inspectors, with three more hires pending.
“We are going to make sure that every apartment — whether it’s in Houlton or Eliot — is going to get the same inspection,” said Merrill.
The agency also is going to increase its inspector training so everyone is consistently applying the same rules across the board, he said.
As MaineHousing started looking at the program, it used a risk-based approach, attempting to check the areas with potentially the most problems, said Merrill. But the results “suggested that the whole portfolio was at risk,” he said.
So MaineHousing brought in an independent, out-of-state inspection group that examined 500 units and found 40 percent of them failed quality standards. The inspections were done earlier this year and the agency is working to make sure that the problems are resolved. Merrill noted that units can fail an inspection for a range of problems, with minor problems such as a cracked light-switch wall plate contributing to a failure. More serious health and safety violations also lead to inspection failures, he said.
MaineHousing oversees 3,200 Section 8 units, Merrill said, and “HUD wants to inspect just about everything in the next three or four months, so we’re working closely with them to do that.”
HUD’s inspector general soon will be inspecting 30 units in northern and eastern Maine as part of its review, Merrill said.
MaineHousing had outsourced inspections of Section 8 units to Avesta in York, Cumberland, Oxford and Androscoggin counties. But the agency is taking that work back in house and already has taken over inspections in Oxford and Androscoggin counties. York and Cumberland counties will be in MaineHousing’s hands by the end of May. All of the 3,200 units statewide will be MaineHousing’s inspection responsibility by the end of September.
The report questioned whether MaineHousing had the capacity to reorganize and take those inspection responsibilities in house while also running inspections.
“Since 10 of 11 units previously inspected by the authority failed to meet HUD’s housing quality standards, we are concerned that the authority may not have the capacity and expertise to accomplish both a reorganization while effectively managing the inspection program,” the report said.
Merrill said MaineHousing has been able to hire the right people to oversee the program and to inspect the properties.
Dana Totman, president and CEO of Avesta, said several things jumped out at him after reading the HUD inspector general’s report.
“When I looked at it, it sort of reinforced in my mind how substandard housing is simply very problematic. Also, I think it shows sometimes how difficult it is to distinguish tenant activity from landlord activity,” said Totman. “It also shows a bit that an inspection at one point in time might reveal something very different from an inspection several months later.”
Maine has the oldest housing stock in the nation and a poor population. Those factors create challenges in the affordable housing arena, he said.
The report also doesn’t provide details, Totman noted, such as when the newly inspected units were inspected last. A lot can change over a few months, he noted, sometimes at the hands of tenants, sometimes the responsibility of landlords.
“I think this situation starts to shine a light on the substandard housing that exists in Maine — particularly in the rural parts of Maine,” said Totman. “I think it’s incumbent on us to do our very best in creating newer, safer, decent housing.”