L.A. City Controller Wendy Greuel Finally Gets to Grit of Housing Authority Probe: Its Profitable 'Non-Profits'

By Simone Wilson Tue., Jan. 3 2012 at 1:30 PM

L.A. Housing Authority (center) gets roasted by City Controller (top right).

Through the end of 2011, the Housing Authority of the City of Los Angeles (HACLA) received a thorough spanking from press and politicians alike.

L.A. City Controller Wendy Greuel scrambled to play catchup with an Earth-shaking investigation by local news station KCET -- revealing swanky dinners, limo rides and overflowing gift baskets at an insulated city department.

And even now that HACLA's top dog has been replaced amid the controversy (for a second freaking time), Greuel refuses to quit. It almost seems HACLA has become her grand finale of a pet project...

... to wow the voters before her big 2013 run for mayor of Los Angeles.

We've had a couple gripes with Greuel's handling of HACLA so far: 1) That she didn't demand all these records a long time ago, and 2) That the probe hasn't gone deeper than the credit-card misuse of senior executives, already outlined by the KCET report.

Now, at least, Greuel is improving on gripe No. 2 by taking her investigation to the heart of the matter: HACLA's mysterious batch of non-profit organizations.

She gives herself a hearty pat on the back in a new press release:

Today, Los Angeles City Controller Wendy Greuel revealed that she is requesting financial records and information related to the Housing Authority of the City of Los Angeles' (HACLA) nonprofit organizations.
In a letter to HACLA's interim President and CEO Doug Guthrie, Greuel indicated that her probe will expand to the enterprise activities run by the Authority that together produce a profit of more than $15 million a year. These activities include rental income for the 2,500 units owned and managed by HACLA's nonprofits as well as the activities of the LOMOD Corporations and their subcontractors, which oversee the administration of HUD contracts.

It was off the top of these hugely profitable "non-profits" that former CEO Rudy Montiel, second-in-command Ken Simmons and their team of pampered employees enjoyed a 1-percenter lifestyle while thousands of Angelenos struggled to make rent.

Most offensively, Simmons -- who may not even end up leaving HACLA, in the end -- has used the success of HACLA's independent orgs as an excuse for all the extravagant personal expenditures.

As if, because the $400 steak dinners didn't come directly from taxpayer pockets, they were totally legit/deserved. Watch Simmons make that infuriating case to the L.A. City Council:

Not sure why it took so long for Greuel to target these under-the-radar cash cows at a public agency so suspiciously "flush with cash." But uh, better late than never, right?

[@simone_electra / swilson@laweekly.com / @LAWeeklyNews]

Tags:

City Controller, HACLA, Housing Authority, Ken Simmons, non-profits, Wendy Greuel

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Danetta

While HCALA is spending thousands of taxpayers dollars, the question needs to asked (why are they nickeling and diming residents from anywhere from $.05-$3.00.

I am already paying $20.00 extra because I don't get income until the middle of the month, so they (HACLA) get the $20.oo a month more on rent. If you don't have every penny, they give you a 2 day notice to go get a money bring to the Management office or you will face legal proceeding to be evicted. This is all the while they are spending thousands of dollars on themselves.

Decent_American

Look at Scott Butler's $50,000 HACLA sports car he tools around in all day and night cruising for guys in West Hollywood.

Ivy Miller

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Concerned Capital

This is water under the bridge - the real action is how the assets of CRA are about to get split up now that its clear state law demands redevelopment agencies get shut down.Who has time to worry about the past - those lessons will never be acknowledged or accepted by the wrong doers. Lets focus on the next 'cash' cow that's about to get dived up and make sure that LA tax payers are protected in the process.

HACLA WATCHER

If Greuel is serious she needs to reopen the 2007 Taracena case & question the fired HACLA whistleblowers/investigators who according to LATimes, Fox11 and public court records were investigating cover up by HACLA's CEO, City Attorney and involvement by one or more councilmembers and possibly the mayor.All public record. Millions of fraud at HACLA was being investigated until whistlblowers were fired. Wendy Greuel and other councilmembers knew about this because it was all over the news in 2007. Additionally all legal expenses opposing HACLA whistlblowers since 2007 has totaled multi millions by taxpayers and authorized by City Attorney. The Mayor was advised of all HACLA lawsuits according to his directions. Was HUD advised of these lawsuits prior to expensing as required by federal law and 2005 HUD OIG audit of HACLA and recent HUD OIG investigation of Philadelphia Housing Authority in 2011? According to Senator Grassley's office it doesnt look like HUD did their job and should disallow all of these legal expenses and force the City and State to pay for these.Wendy why dont u interview all of the HACLA whistlblowers and reveal why the District Attorney office stopped his HACLA corruption investigation in 2007?