Suit claims misspending by Authority

The Orlando Housing Authority faces complaints from its former financial director, who says authority executives misspent federal housing funds on luncheons, events and vendors who did not go through the bid process for several years ending in 2011.

A jury trial is set for next year regarding claims from Debra Leggins, who was terminated from the authority in 2011 after raising concerns. Leggins, who worked there more than a decade, stated in a lawsuit that Orlando Housing Authority Executive Director Vivian Bryant inflated requests for federal housing dollars and deposited those funds into an authority account that lacked spending oversight.

Leggins seeks her job back, double back wages and legal fees.

Leggins’ lawsuit claims an account named Orlando Housing Authority Properties Inc.

“existed solely for the purpose of acting as a piggybank for funds obtained from various sources by OHA, so that OHA could funnel the funds” that were spent “in any manner seen fit … each time that OHA had surplus Section 8 funds [affordable housing rent], it siphoned the money into Properties Inc. rather than remitting to HUD.” Federal rules require that excess funds be returned to the government.

The United States Attorney’s Office and the U.S. Department of Housing and Urban Development stated they were aware of the case but could not comment on whether they were investigating the allegations regarding federal spending. Attorneys for both sides said they could not comment on pending litigation.

Orlando Housing Authority lawyers last month stated the authority believed the claims “amount to misrepresentations or mischaracterizations” of the authority’s actions. The agency recently cited its success in “turning around” the Sanford Housing Authority, getting higher performance ratings from HUD during its seven years administering the once-troubled housing agency in Seminole County.

Leggins’ attorneys last month updated the lawsuit to address concerns from U.S. District Judge Paul G. Byron that it lacked some specifics. The new details in the lawsuit stated Leggins, and in one case another employee, cautioned authority executives about spending that included:

■ The housing authority spent $31,283 of Section 8 funds with event planner Akens Design Inc. for a Carver Park grand opening, a volunteer luncheon and an art exhibit in August 2009. The federal government required the money be spent for housing needs, the complaint states.

■ The housing nonprofit contracted with Stratigi Staffing LLC for temporary staffing and split up the purchases, “falsely making it appear that there were separate purchases for an amount slightly under the $100,000 small-purchase threshold, in violation of HUD regulations.” The authority spent about a quarter of a million dollars with Stratigi during a 16-month period that ended in September 2011.

■ Orlando Housing Authority went through a bidding process to hire Hawkins, Delafield & Wood LLP for $35,000 to apply for a federal program, but later kept using the group without getting additional bids. It spent double the original bid amount with them. On Sept. 9, 2011, the authority paid HD&W “without any purchase order or back-up documentation.”

Lawsuit documents show that Leggins stated that her warnings about misspending practices prevented her promotion to the full-time chief financial officer position, which she stated she was denied. She was transferred to Sanford Housing Authority, operated by Orlando Housing Authority, while still performing her original job. And in July 2011, she was terminated. mshanklin@ orlandosentinel.com or 407-420-5538

Lawyers stated the authority believed the claims “amount to misrepresentations or mischaracterizations” of its actions.