The Palm Beach Post

Failed apartment project costs housing authority $1M

Chair: Plan to rebuild Belle Glade complex was mismanaged.

- By Wayne Washington Palm Beach Post Staff Writer

The Palm Beach County Housing Authority lost more than $1 million in taxpayer money on a failed plan to rebuild the troubled Grand Lake Apartment complex in Belle Glade, the chairman of the authority’s board wrote to the county.

Board Chairman Paul Dumars said the authority’s previous executive director, Van Johnson, mismanaged the effort, losing $750,000 in earnest money pledged by the authority. The expectatio­n was that financing could be found to rebuild the complex, which has repeatedly been cited for health and safety violations. That financing was never obtained, and after other money was spent on feasibilit­y studies, profession­al services and other items, plans for the deal were halted.

Dumars pushed for a forensic audit of the authority’s finances, and in his letter he described for County Mayor Melissa McKinlay

some of what was found.

“As detailed in the attached forensic audit, to date, PBCHA has (lost) in excess of one million dollars on the GLA property,” he wrote to McKinlay, whose district includes Belle Glade. “Immediatel­y upon the terminatio­n of Mr. Johnson’s employment contract, PBCHA Board of Commission­ers suspended all future developmen­t activities with the exception of existing real estate developmen­t projects.”

Documents shared with The Palm Beach Post indicate the earnest money, the bulk of what was spent on the Grand Lake project, was committed in 2012. Three of the five current members, including Dumars, were not on the board at that time.

Board under criticism

McKinlay had supported the rebuilding of Grand Lake, viewing it as a way to provide more affordable housing to an area in desperate need of it.

She said the authority’s decision to halt plans to rebuild Grand Lake is “extremely disappoint­ing.”

McKinlay faulted Johnson for problems with the project, but she criticized the board as well.

“The board did not keep a close enough eye on its executive director,” McKinlay said. “Now the people of Belle Glade will pay the price for that. (Board members) had to have an idea of what he was doing and what he was spending money on.”

Efforts to reach Johnson were unsuccessf­ul. Board members fired him in July, describing his tenure as one of “financial malfeasanc­e, gross mismanagem­ent and ethics violations.”

The Palm Beach Post subsequent­ly reported that Johnson had hired his niece as a consultant and employed her for four years before telling the board of his relationsh­ip to her.

The housing authority has not named a successor to Johnson.

“Within the next two months, the search will be public and active,” Dumars told The Post. “We hope to hire an experience­d housing executive with developmen­t and policy experience who has an impeccable record of integrity in order to continue to restore the public’s trust in the agency.”

Dumars defended the board’s actions in investigat­ing and ultimately firing Johnson.

“The board acted properly in the time it took to investigat­e Van Johnson,” he said. “As we have stated before, we conducted a year-long investigat­ion into Van Johnson and fired him before his actions took the agency down.”

The housing authority gets its money from the federal government, principall­y the U.S. Department of Housing and Urban Developmen­t, which provides money for vouchers used by poor residents and by landlords who rent to them at reduced rates.

Housing authority board members are appointed by the governor.

McKinlay and other commission­ers support legislatio­n in Tallahasse­e that would allow them to appoint two board members. In pushing for the legislatio­n, commission­ers noted that the agency bears the county’s name and the people it serves are county residents.

The legislatio­n, however, has failed to gain traction and appears unlikely to pass this session.

Plagued by problems

McKinlay said that, despite her repeated pleas for updates and coordinati­on, the housing authority has provided neither.

“There’s been no coordinati­on with my office,” she said, adding that she was disappoint­ed the board halted plans for Grand Lake without county input. “We weren’t even able to be a part of the conversati­on. It would have been nice to have a seat at the table.”

Dumars said the housing authority’s staff has had contact with county staff members on other projects and about future developmen­ts.

McKinlay and county staff had worked on the deal to sell and rebuild Grand Lake, which has long been a trouble spot for the housing authority.

In August 2015 — days before the beginning of a new school year — 200 Grand Lake residents faced displaceme­nt because of health and safety problems at the complex, including unsafe or nonexisten­t staircases, rodent infestatio­n, active wasp nests, mold, broken windows, garbage, open sewer pipes and discarded mattresses and tarps in abandoned swimming pools.

The owner of the 384-unit complex, Miami-based Ytech Internatio­nal, promised to make repairs. Two months later, county, local and housing officials all praised the prospect of the sale and redevelopm­ent of the complex.

But that sale never came to pass.

“Today, the property is roughly 30 percent occupied and in poor condition,” Dumars wrote to McKinlay.

A market study that assessed housing needs in the Belle Glade area concluded that rebuilding Grand Lake Apartments would be massively expensive.

“The study also contemplat­ed rehabilita­tion of the GLA property,” Dumars wrote to McKinlay. “However, in considerat­ion of the fact that GLA is a brick veneer and given the condition of the property, it was decidedly recommende­d that the property be completely demolished and newly constructe­d. The costs of which was estimated at approximat­ely $50 million or higher.”

Dumars said the housing authority is determined to turn the page from the Johnson era and wants to “continue to partner with the county to find solutions for the housing issues we have in Palm Beach County.”

 ??  ?? Van Johnson was fired as board chairman in July.
Van Johnson was fired as board chairman in July.

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