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Here's what we know about the risk of 'serious fraud, waste, and abuse' inside Milwaukee's housing authority
Federal reviewers at the U.S. Department of Housing and Urban Development reported that Milwaukee's housing authority was "at risk for serious fraud, waste, and abuse" in a December 2022 report.
That finding comes as the Housing Authority of the City of Milwaukee (HACM) has been under fire from tenants and city activists for poor record-keeping. Some tenants say they've been charged with unfair balances and then threatened with eviction.
Federal regulators have been keeping an eye on HACM since at least 2015, when a HUD audit found problems with the housing authority's financial record-keeping.
In April, HUD auditors reported the housing authority couldn't provide documentation to explain more than $3 million in discrepancies in its bank balance. HACM staff told auditors that when they couldn't determine what an expense was for, it was entered as a debit or credit to an account labeled "other revenue."
Staffing shortages in the Section 8 office have also created backlogs in paperwork and accounting, according to a December report. About 80% to 90% of staff positions turned over from 2021 to 2022, HUD estimated.
According to that report, HACM also didn't have access to the bank accounts for many of its properties that were previously managed by the now-defunct nonprofit Friends of Housing. HACM wasn't "successful" in switching over the signors on the accounts, the report said.
HUD found "at least $49,876.16 in questionable and/or disallowed costs" charged to HACM credit cards.
HACM is governed by a seven-member Board of Commissioners appointed by the mayor and confirmed by the Common Council for five-year terms.
Three board seats are currently vacant, and the mayor is tasked with nominating new commissioners.