The Nation : HUD Program’s Mismanagement Cited

An inspector general’s report said a major rehabilitation program of the Department of Housing and Urban Development was plagued by poor management and had awarded contracts worth millions of dollars without following rules for competitive selection. HUD Secretary Jack Kemp said the report revealed “some fundamental flaws” in the moderate rehabilitation subsidy program, a $225-million-a-year program in which developers acquire and renovate subsidized housing projects. The report said that because of poor management HUD had agreed to pay $59 million in excess housing assistance over the life of 15-year contracts it audited.