A U.S. Housing and Urban Development investigation has cleared the Navajo Housing Authority of allegations of mismanagement, misuse of federal funding and a failure to address a growing need for homes on the 27,000-square-mile reservation.
Regional investigators probed the housing authority in March, visiting six projects in Arizona and New Mexico, conducting interviews and reviewing plans and contracts. In its final report, released August 21, the federal agency concluded that NHA is in full compliance with federal housing statutes and regulations.
Investigators found there were no major deficiencies in program performance and no violations of statutory or regulatory requirements. They did find one “concern,” or minor deficiency, regarding an Arizona project in which NHA did not retain legal control of the site through its 2001 agreement with the developer. That led to the homes remaining vacant for years, the report said.
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The investigation began after the Navajo Housing Authority came under fire for “extravagant” spending and building too few homes. A series of news articles published by the Arizona Republic in December reported that too few homes were constructed and projects that were built often were not completed or had such severe problems they were uninhabitable.
Meanwhile, existing homes are overcrowded and people live in storage units or vehicles. The articles triggered a separate congressional review spearheaded by Sen. John McCain, R-AZ, who called for sweeping reforms.
According to McCain’s review, which relied on support from the Senate Committee on Indian Affairs, the housing authority received more than $803 million in federal block grant funding over the last 10 years but built only 1,110 homes.
“The Navajo Nation is facing a housing crisis,” McCain said in a statement in May, after the review was complete. The findings, he said, confirm “that the Navajo Housing Authority remains a broken public housing agency that is grossly misusing taxpayer funds.”
McCain also called for a new board of directors, possible cutbacks in funding and the creation of a separate agency to handle the development of new homes.
The Navajo Nation Council responded by dismissing the entire eight-member board of commissioners and other top administrators. A new, three-member board was appointed, along with an interim chief executive officer.
Although Housing and Urban Development investigators in March reviewed six of the 10 project sites that were scrutinized in the newspaper series, they found no violations—a fact that calls into question the scope of McCain’s probe and the integrity of the Arizona Republic articles.
“The projects addressed in this progress assessment were questioned in recent news articles in the Arizona Republic, causing concern among national stakeholders and Congress,” the report states. “The purpose of this review was to gather information on the conception, progress and completion of the projects in order to validate, dismiss, or provide greater context for the issues raised in the article.”
The report goes on to detail each of the six sites and conclude that while each had problems, no violations occurred. Since the articles ran, Navajo Housing Authority has argued that the facts were incorrect.
Federal funding is not dedicated only for the completion of new homes, but also for day care centers, maintenance of older homes, beautification efforts and other community-building projects. The $803 million in question also went to the modernization of 880 older homes, infrastructure projects, land acquisitions and the construction of community resource centers, the NHA has stated.
In their report, HUD investigators cited restructuring and reforms to NHA in recent years that have resulted in improved oversight and lower risk that federal funds will be misspent. New board members pointed to the report as a way to clarify misinformation.
“We have done our best to fix the problems of the past,” the board said in a statement. “We will continue to work with our tribal leaders and beyond to address the issues NHA faces as we move forward building homes and communities. We are the largest rural housing agency in the U.S., and we know we will continue to have challenges, but we are committed to finding ways to overcome them as they arise.”