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Inadequate Record-Keeping Cost Acorn Housing $130K
Posted by Kevin Kane in ACORN, Featured Story, Politics on October 8th, 2009
From Steve Beatty, Pelican Institute’s investigative reporter:
More than two years before an ersatz pimp and prostitute raised troubling questions about Acorn Housing Corp.’s financial advice, Louisiana officials criticized the organization’s bookkeeping as it denied the group tens of thousands of dollars from a potential $1.5 million state contract.
The office overseeing the contract recommended against rehiring Acorn Housing in part because it couldn’t document its work. The contract was designed to inform low-income residents about the Road Home program and help them apply for post-hurricane benefits.
A much smaller $53,000 contract that Acorn Community Land Association had with the state attorney general’s office also was criticized for thin financial justification, though the group got its full payment and was recommended for future work. The contract was to tell hurricane victims of non-discriminatory housing policies as they sought temporary rentals.
In both contracts, the state files contain promotional materials extolling the virtues of paying for an ACORN membership – a solicitation expressly forbidden under the contracts.
“If you are not rich, you need to join your ACORN community group and work on the problems affecting you,” reads one flier in the attorney general’s file.
Several governors, including Louisiana’s Bobby Jindal, have frozen payments to ACORN or its hundreds of affiliated groups. The state has no current contracts, but records revealed the two expired contracts that paid the organizations more than $700,000.
ACORN officials did not respond to requests for comment for this story.
In the larger of the two state contracts, Acorn Housing was paid $671,000. However, it asked for much more: $801,000.
In the final evaluation of the contract, the state said Acorn Housing achieved the goal of reaching some of the targeted potential Road Home applicants, but it recommended that the state not rehire Acorn Housing.
That’s mainly because Acorn Housing kept lousy records, said Belinda Kennedy, who monitored the contract for the state’s Office of Community Development.
In the end, she rated Acorn Housing as being in “marginal compliance” with the state contract.
“There were items they were billing that we couldn’t account for,” she said in an interview this week.
Overall, the state said the invoices on file in the Acorn Housing office didn’t always match what was submitted to the state, some travel expenses couldn’t be confirmed or justified, and that the hours worked by employees weren’t always properly billed.
The final review of the contract said that Acorn Housing worked face-to-face with 629 households and another 159 over the phone in the 10 months between December 2006 and September 2007. Its subcontractor, working in rural western Louisiana parishes more affected by Hurricane Rita, reached more people, for a total of 2,099 households served by the contract.
Kennedy worked with Acorn Housing officials to try to clear up the bookkeeping problems, visiting the New Orleans office four months after the contract ended. She said she encouraged agency officials to work to justify some of the questionable billing.
“We never heard back from them,” Kennedy said.
More background on this story can be found here.
Questions About ACORN’s NOLA Contracts
Posted by Kevin Kane in ACORN, Politics on October 2nd, 2009
From the Pelican Institute’s investigative reporter, Steve Beatty:
Despite landing $625,000 worth of work with the city of New Orleans to develop or repair housing for poor people, an offshoot of the activist group ACORN appears to have done nothing to fulfill the contract, no longer has the specified office in New Orleans and no longer employs the director who signed the contracts.
Acorn Housing Corp. has received no city money in connection with the two contracts, city spokeswoman Ceeon Quiett told WDSU-TV recently. Neither Quiett nor her representatives responded to requests from The Pelican Institute to address other questions about the contracts, one of which expired Aug. 31.
Those questions include:
- How did Acorn Housing get the contracts, through competitive bid or otherwise?
- Why did no one with the city monitor the contract to ensure the city got what it expected?
- Is the money still available to help low-income residents of New Orleans?
- Do city officials expect the current contract, which expires Jan. 31, to provide any services?
- Will Acorn Housing continue to be included on the city’s list of designated non-profit Community Housing Development Organizations?
In response to a public-records request from The Pelican Institute seeking all documents associated with the contracts, the city law department could produce only the contracts themselves, and one of them lacked the attachments called for in the contract. No other records, such as required monthly progress reports nor necessary budget materials, were provided by the city.
“That’s all we have,” said Sarah Garrett of the law department.
A receptionist at the ACORN offices on Canal Street said the man who signed the contracts, Acorn Housing Director Gerald Cloud, no longer was an employee, adding that he left months ago. She said the current director, Martin Shalloo, was not available and referred further questions to Acorn Housing representatives in Washington, D.C., who did not return calls seeking comment.
The contracts say the administrative offices of Acorn Housing are at 1015 Frenchmen Street. That’s now an empty lot that shares a property line with the former ACORN headquarters on Elysian Fields. However, relatively new above-ground sewage lines indicate a trailer was there recently, and an undated image from Google Maps shows an office-style trailer on the lot. An Acorn Services van and two trailers sit amid piles of trash in the rear of the lot.
The address does not show up in the online database maintained by the Orleans Parish Assessor’s Office. However, 1017 Frenchmen is described as a vacant lot owned by Elysian Fields Corp., which IRS forms refer to as an “alter ego” of ACORN. Indeed, the Louisiana Secretary of State’s corporate database shows the same officers control both entities.
The first city contract, signed Sept. 1, 2008, would have provided $375,000 for Acorn Housing to develop 18 homes for low-income residents. It was to be part of an ambitious $20 million program by Acorn Housing. In the end, the agency wanted to develop 150 homes in the Lower 9th Ward, combining “100 adjudicated properties from the city of New Orleans and an additional 50 lots that we plan to acquire,” according to a project description attached to the contract. It said work would start in September 2008.
The 18 homes financed through the city contract were to be the first phase.
The second contract, signed Feb. 1, would reimburse Acorn Housing for up to $20,000 in “minor home repairs” to each of 10 low-income residents. The agency was also expected to train contractors and solicit beneficiaries through advertising.
ACORN’s Tax Problems
Posted by Kevin Kane in ACORN, Politics on October 1st, 2009
