Oregon Public Broadcasting

Housing officials on Oregon’s North Coast can breathe a sigh of relief Friday. The Northwest Oregon Housing Authority got its prayer answered for a last-minute government bailout.

It will help maintain crucial rental assistance for more than 200 households at risk of losing it. But as Rob Manning reports, questions remain about how the agency got into a financial crisis in the first place.

As recently as Thursday, people depending on rental assistance from the Northwest Oregon Housing Authority were on edge.

Steve Cline: “Your heart just drops down to your stomach and you say – ‘oh my God, I thought I was settled’.”

Steve Cline is a 60 year-old veteran who lives in a subsidized apartment in St. Helens with his labrador, Yogi.

Steve Cline: “I moved from my car, to – I lived for a year in a room in the woods with no heat, and got through that. This, to me, was like the Hilton.”

He’s in a modest one bedroom unit. In May, Cline heard he could lose it. Then the housing authority found money for summer rents.

Thursday, Cline says some of his neighbors were feeling desperate, with assistance due to run out in two weeks.

Steve Cline: “You know, I’m probably one of the lucky ones – I have me to worry about. There’s families in here with children. There’s people that are more disabled than I am. They’re just looking at ‘I just got to make sure I’ve got enough money for a couple bullets, because that’s the only option I got left’.”

Staff with the nearby non-profit, Community Action Team, say a vet expecting to lose his rent assistance did threaten suicide. They called the police, and the man was put in a hospital psych ward.

Rental assistance clients can try to relax now. Top Oregon officials, including Senator Ron Wyden got federal housing leaders to spend nearly $800,000 to cover rents through December.

Ron Wyden: “$795,000 is going to be forthcoming and is going to help 219 folks with modest incomes, walking on an economic tightrope in low-income housing, they’re going to be able to stay in their homes.”

Earlier this week, U.S. Housing and Urban Development officials balked at bailing out the housing authority, because the problems weren’t entirely economic. Oregon state senator Betsy Johnson faults the agency’s management.

Betsy Johnson: “This is not the first time that this has happened with the Northwest Oregon Housing Authority. If it were, I’d probably be less critical. But this is the second, arguably the third time that this has happened, and I think that it is a clarion call for a higher degree of oversight at all levels.”

To untangle the problems, housing authority officials called on an expert from downtown Portland.

Jill Riddle manages the rental assistance program called Section 8 for the Housing Authority of Portland. She says the problems boiled down to this.

Jill Riddle: “It’s the specific Section 8 voucher program knowledge, and the leadership of directing that, in the appropriate way, that I would say, was lacking.” 

Riddle found that the Northwest Oregon Housing Authority mismanaged  vouchers in two ways.

The first problem goes back to last year, when the agency failed to hand out all its rental vouchers. When that happens, federal officials basically say “if you’re not using them, we’re going to take them back.” And they did.

Meantime, the housing authority was handing out more and more vouchers. HUD takes a dim view of that.

Lee Jones is an agency spokesman.

Lee Jones: “If it’s not in your annual allocation – we’re not going to fund them.”

But not only did the local housing authority give out more vouchers – it increased how much assistance it was providing to voucher holders.

Jill Riddle with the Portland Housing Authority says there was little planning or internal communication.

Jill Riddle: “There’s just no future projections going on at all. The accounting people weren’t aware of what the program people had done, and weren’t taking into account 200 vouchers that were leasing up.”

When the Northwest Oregon Housing Authority discovered the problem, they started spending reserves. Later, board members like Casey Mitchell learned that spending federal money on cost overruns is wrong.

Casey Mitchell: “I think the staff at the housing authority sincerely believed that those moneys were available to us to use in this manner. And I think that’s where the breakdown happened.”

Board members say there are lots of things that need fixing, and some questions that still need answers.

Rita Bernhard is a Columbia County commissione. She and Mitchell both have ties to the Community Action Team and sit on the housing authority board. She’s feeling grateful for the congressional intervention.

Rita Bernhard: “They’ve all been extremely helpful to us during this time period. And we are trying very hard to make sure this doesn’t occur again.”

The feds have put specific reporting requirements on the new money. More broadly, the recommendations made by the Housing Authority of Portland are expected to put the Northwest Oregon agency on stable footing, come January.