The problem stems from allegedly lax oversight of the city’s Community Development Block Grant money provided by the federal government and distributed by the state. The same city office that administered that program was responsible for disbursing local awards in a $565,000 homeless prevention grant funded by the federal stimulus package and a $187,161 emergency shelter grant.
“Right at the time those funds were supposed to be administered was when the wheels fell off of the CDBG program,” said City Manager Don Hoyt, referring to problems in a home-improvement loan program that was the source of controversy over lax oversight in 2010.
The homeless-prevention and emergency-shelter grants were awarded in the fall of 2009, Hoyt said. However, by the time the city’s Community Development director resigned over the home-improvement problems April 2010, just $89,080 of the homeless grant had been spent. When the grant wasn’t disbursed, Anniston lost the remaining funds altogether, Hoyt said.
“(It was pulled) because of the collapse of the Community Development Block Grant program,” Hoyt said. “We didn’t have staff, and the reports weren’t coming in, and this was stimulus money, and it had to be spent by a certain amount of time, and we weren’t able to spend it.”
The Community Development Department has been unmanned since April, when two women came forward at a City Council meeting complaining about being left homeless after having work done on their homes through the program. They said they had complained to director of the Community Development Department, Clarence Williams, but had received no help.
The City Council requested an investigation by the Department of Housing and Urban Development, and the city’s Community Development Department was closed and the office placed under police guard to keep records from being tampered with. In mid-May, Williams resigned, never having returned to work after the investigation had begun.
The Alabama Department of Economic and Community Affairs, which administers the grants, took back the remaining $475,920 in the homeless-prevention grant and lopped off more than half of the emergency shelter grant to $93,287. In all, the city lost $569,794.
Some of the local non-profit agencies that were scheduled to receive money had already spent some of the awards they were scheduled to receive.
Community Enabler Developer had to pay back $2,000 that it had already spent on its clients, said Executive Director Maudine Holloway. Community Enabler was scheduled to receive $30,000 but only received $12,000, some of which it had to give back.
Rita Flegel, housing director for Health Services Center, said the organization was scheduled to receive more than $90,000 over 18 months and was suddenly cut off when it requested reimbursement.
“We did get some support from it. But we are in the hole, we’re in the red on money they owe us,” Flegel said. “Of course, we’re not able to access the $90,000-plus that we were supposed to get and we were counting on to employ staff.”
The money, which would have been used to assist clients with rent, utilities and hotel nights, things that would have kept them from being homeless, was to be reimbursed to the charity by the city. But when the grant was pulled, the city left Health Services Center holding the bag for about $2,100.
“They came in, they audited us. They looked at us. They told us all our files were great and correct and we had an agreement with them,” Flegel said. “The last thing we heard was ADECA had pulled their money. The city of Anniston does not have those funds to reimburse us.”
But the Health Services Center acted in good faith, Flegel said, and it is still requesting reimbursement from the city.
It is planning to send a certified letter to the city, again requesting the funding it has already spent.
“We’re a non-profit,” Flegel said. “We don’t have money just sitting around that we can pay out money and not get reimbursed.”
Hoyt said he didn’t know of any discussion about reimbursing money to the charities, but he would be willing to sit down with them and discuss it with them and legal staff.
But perhaps even more damaging is the loss of the more than half a million dollars that could have helped so many people in the area, she said.
“Our clients needed those monies,” Flegel said. “That’s why we went in on that agreement and when we started providing the service, turns out we can’t get our money back.”
Contact staff writer Laura Camper at 256-235-3545.