Not worth the paper it is written on
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The Houston Housing Department gave false information to members of Houston City Council about the use of Tax Increment Reinvestment Zone (TIRZ) money for affordable housing. An investigation by Dolcefino Consulting has uncovered huge mistakes involving the reporting of the use of millions of tax dollars.
The other big headline. Eleven million dollars dedicated to affordable housing projects over six years with TIRZ money was never spent, and shoddy accounting for the surplus was simply ignored…for years.
Here is the history. Several Tax Increment Investment Zones created by our politicians had to promise to give back a third of their tax windfall to affordable housing. It is called TIRZ Fund 2409.
Since 2009, $70 million has been put into Fund 2409. The biggest contributor to the fund is the Uptown TIRZ. They have contributed $37,703,866. That’s just 30% of their leftover piggy bank. That tells you just how much tax money is now bottled up in Uptown.
Dolcefino Consulting started tracking Fund 2409 when we saw the payments in Uptown financial records while we were investigating that real estate deal disguised as a $200 million transit project. Uptown told us they didn’t have a clue how the money was spent, and we figured for $70 million we should have affordable housing units popping up all over town.
What we have learned is that the City of Houston has a $70 million fund that has NEVER been audited by the City Controller, and the Housing Department didn’t even know for sure what projects they had even spent it on. The original summary provided to the City Council Housing Committee was to be kind…full of huge mistakes on where the money went.
Here’s an example. City Council was told that in 2009 only $54,000 was spent on LARA, another city project that bought mostly empty lots at auction or lots no one else wanted. The 2009 documents claimed $1.2 million of TIRZ funds were spent on a project called Uplift Fourth Ward. After Dolcefino Consulting investigated the files and raised questions, housing realized their numbers weren’t worth the paper they were written on.
The new documents provided to Dolcefino Consulting show in fact $8 million of TIRZ affordable housing money was not spent on new houses, but buying empty lots, in many cases, lots no one else wanted to buy.
And that Fourth Ward project. Uptown now admits it didn’t get $1.2 million, but just $400 dollars. That’s a pretty big difference don’t you think?
“It is stunning that this housing piggy bank has never been broken open and independently looked at,” says Wayne Dolcefino, President of Dolcefino Consulting. “This is a city in deep financial trouble, with lots of folks who desperately need affordable housing. We need to know what the heck this money was spent on… to the penny, and what we got out of this deal.”
Assuming the new set of records are actually correct, and who knows, we do know a couple of things.
Remember when the federal government told the City they had problems with the way millions in federal housing fund were spent? The bureaucrats call it “findings.” Taxpayers call it what it really is. Thirteen million of the TIRZ funds were spent subsidizing the projects where the feds cried foul.
Other projects never happened…yet Housing just stopped keeping track of the projects on documents provided to City Council. And the documents raise even more questions.
If this is affordable housing money why do the documents say $592,000 was set aside for paving in Settegast, a Public Works Project. The money wasn’t spent in 2010, and the project disappears from the documents. Is that money part of the surplus Dolcefino Consulting helped uncover, or was it used for paving. No disrespect to the need for paving but that doesn’t get someone a place to live anyway.
You get the point.
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