'Concerned' feds threatened to cut funding of Wilmington Housing Authority

The federal government has threatened to sever funding to the Wilmington Housing Authority after officials found its board to be undertrained and its chairman overbearing.

The board of WHA, which houses 10 percent of Wilmington's population, does not have adequate knowledge of public housing programs or the financial expertise to oversee them, the director of the Philadelphia branch of the U.S. Department of Housing and Urban Development told WHA's board in a scathing review.

It also pointed out:

• WHA Board Chairman Herman Holloway, Jr. inappropriately meddles in housing operations.

• The board fails to discuss the authority's fiscal health.

• The board, with an annual $18 million budget, lacks a member with a financial background.

• And that there is "a lack of decorum at meetings," during which profanity has been used.

"We are very concerned with the overall environment and nature of governance at WHA," Monica Hawkins, the Philly HUD director, wrote to the board in an Oct. 5 letter obtained by The News Journal.

Holloway makes no apologies for stepping up when he believes WHA staff don't address issues affecting residents. A self-described resident advocate, he said he answers calls at all hours to address housing complaints, explaining that his involvement stems from heartfelt empathy.

"I'm always trying to fix stuff, and I get in trouble for it," he said. "When they (WHA staff) are making decisions that are hurting residents, what are you to do?"

Hawkins said Holloway is overreaching, blurring the lines between operations and oversight.

A year and a half after an August 2015 governance review, little has changed. In October 2016, federal officials threatened to cut off the agency's "annual contributions contract."

To do so would be a disaster for Wilmington's low-income residents, said Karen Spellman, deputy executive director for WHA.

"All of our money comes from HUD," she said. "They’re talking about all of our programs… We’re talking about millions and millions of dollars."

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WHA oversees housing for over 4,200 low-income Wilmington families and provides housing assistance to the elderly, veterans and the disabled.

"The impact would be not only financial but emotional, spiritual, physical," said the 69-year-old Parkview Apartments resident. "They would be devastated."

Since the review, some of WHA's issues have been addressed, Hawkins said recently, but HUD continues to keep an eye on the organization and Holloway, the main focus of follow-up letters.

"We’re working with the board chair with a clean slate, giving him technical assistance so he understands what his role and responsibilities are," she said.

'Inappropriate' interference 

Holloway said he gets involved with WHA operations because he feels he must.

During interviews with The News Journal, he received multiple calls, and one in-person visit, apparently from WHA residents seeking his help. He said he receives an average of two or three such calls per week but can get as many as eight regarding issues like repairs and evictions.

When "adults are crying," he said he can't help but take action.

"If that's getting in the day-to-day, damn it, that's where I'll stay," he said.

Holloway is the son of the politician and activist Herman Holloway Sr., the first black man in Delaware elected to the state Senate. A park at East Seventh and North Lombard streets is named after Holloway Sr.

The younger Holloway said he followed in his father's footsteps by becoming a community activist in the late 1960s.

"When there's a breakdown... some of them come running to me," he said. "I'm sensitive to the people at the bottom."

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Holloway said he was a thorn in the side of WHA for decades before he became the head of its oversight. He was appointed by then-County Executive Tom Gordon in 2013. It didn't take long for him to butt heads with the executive director at the time, Fred Purnell, who had been there over a decade.

"Fred Purnell's philosophy was: We've got to run public housing like a business," Holloway said. "But you have to take into consideration compassion."

In one profanity-laden monologue at a 2014 meeting, minutes indicate Holloway stated in front of over 50 WHA residents: "I commit to you, if the good Lord gives me the strength: We are going to work like hell to straighten your God dam (sic) problems out! I'm tired of this s---! The money comes in and we don't even know the dam (sic) money is in and (Purnell) is off spending the dam (sic) money."

Ultimately, Holloway spearheaded a contentious February 2015 board meeting in which members voted 5-4 not to renew Purnell's contract. Purnell left the housing authority in March 2016 and now works for the city of Philadelphia as division director of housing and community development.

"It was a clash of two giant personalities," said Eugene Rudder, who replaced Purnell as executive director in October.

Rudder, who had been Purnell's special assistant, said that the board wants two things: information and respect. Under Purnell, Rudder suggested the board wasn't getting that.

"He was kind of a tough guy. He was very difficult to work for," Rudder said. "But he's probably the smartest man I ever worked for."

Purnell declined to comment for this article.

HUD initiated its review based "on the risk of having issues related to governance," Hawkins said, particularly related to Purnell and Holloway. But Holloway continued to involve himself in WHA's daily operations even after Purnell left, according to HUD.

The October letter cites several "inappropriate" actions, including that Holloway attempted to obtain WHA office space to meet with residents, requested a list of daily administrative priorities from WHA executive staff and contacted a WHA employee and "harshly chastised her (and allegedly used profanity)" when addressing a resident complaint.

Regarding profanity, Holloway made no excuses.

"My style and approach... I always was a no-nonsense kind of guy," he said. "I cuss when I get a little worked up."

Vice Chairman John Blyden defended Holloway, saying he felt the review was "far-reaching and manipulated by the old E.D. (Purnell)."

"(Holloway's) whole life has been about advocacy for people with no voice," he said. "His voice is needed. The question needs to be decided: in what capacity?"

Board members have indicated that they feel Holloway attempts to act unilaterally, minutes show.

During a meeting about whether to renew Purnell's contract, Commissioner Vincent White called the effort "insidious," Commissioner Calvin Brown described it as an "ambush" and Commissioner Clarence Pettit alleged that "two or three people" make the board's decisions on behalf of the group.

According to the minutes, the situation led Commissioner Carl Stansbury to tell Holloway: "You are not GOD. You are one vote."

Bernadette P. Winston, the board chair before Holloway, said her board and executive director "worked very harmoniously."

"The commissioners understood their role and it was to act as the oversight committee," she said.

Former board member Dawn Thompson, who was appointed by Mayor Jim Baker, said the same.

"I don’t recall any public bickering among the board or staff during my tenure; we worked cohesively," she said in an email.

White, a real estate agent appointed by former Gov. Jack Markell, alluded to unscrupulous practices by the current board beyond the HUD review. In November 2015, he submitted a petition to the Attorney General's Office alleging the board had broken an open meetings law. The office found the petition failed to meet requirements for a violation in part because it was too "vague" and exceeded the time limit for filing a complaint, according to the response.

"There’s a lack of transparency regarding the activities of the board of commissioners that doesn’t translate into being the best governing commissioners that we could be," White said.

An unknowledgeable board

The WHA board "does not have adequate knowledge of public housing programs, and is not aware of relevant federal, state and local laws," according to HUD's review.

Vice Chairman Blyden doesn't disagree.

"We had to learn on the go because all the predecessors resigned once the new chair was elected," he said. "You’re put there to figure it out. It’s disheartening when you’re making decisions about millions of dollars and you just got the job and have no one besides the executive director giving you advice."

Former Mayor Dennis P. Williams appointed seven of the nine unpaid board members: Blyden, Stansbury, Brown, Pettit, Dorothea Black, Sharon Robinson and Corey Burris.

Blyden works for the Local 55 building union, Stansbury used to work in the airplane industry, Brown is a barber, Pettit is a pastor, Black was a rental property manager and volunteer for Holloway's King Center, and Robinson is a longtime public housing resident, according to Holloway. Burris is a Delaware Transit Corporation employee, a photographer and Holloway's former son-in-law.

Most of the commissioners did not respond to requests for comment.

Holloway said he asked Williams to appoint certain people – including Black, Robinson and Burris – to "give me a majority" to address resident complaints and "clean that situation up."

"He said, 'Man, you got it,'" Holloway recalled of Williams.

Holloway argued that experience working in public housing is not a requirement to be on the board, and that commitment to the job is more important.

Rudder concurred, saying while the previous board was the "best of both worlds" of passion and experience, a public housing background isn't necessary.

"For this board's so-called lack of expertise, they ask good questions, arrive at good decisions and they're willing to listen," Rudder said.

Blyden said comprehensive board training should be required by the state so that new board members don't have to "learn on the fly."

"If you’re not into finances, it’s going take you a while unless they break down the structure," he said.

Williams, who said in his farewell address that he would "always be Mr. Mayor," has not responded to questions about his appointment selections.

A representative for former County Executive Gordon said he was unavailable to comment during his last week in office. He didn't return calls the following week. Gordon and Williams left office on Jan. 3.

Funding on the line

Commissioner White said HUD's letter suggesting sanctions is "frightening."

"It’s very scary... to receive a letter like that threatening the funding for Delaware’s most vulnerable residents," he said. "For those residents, public housing is their last option or only option. They need to be represented with the most transparency and their interests first and foremost. We owe that."

Jordan, a retired nurse, said she landed in public housing after her husband was killed and her daughter contracted cancer. Money got tight, she said, and it still is.

"If I had to be displaced because this place shut down or because they lost funding, I would have a difficult time finding a place within my means," she said, adding she believes her neighbors are in the same boat. "I know people in here that don't know when they’re going to get their next meal."

Hawkins said terminating funding is rare, but she reminded WHA of HUD's power in its October letter to "indicate the seriousness" of the department's concerns.

"These are worst case scenario-type actions, but we thought it was necessary to put in there," she said.

Mayor Mike Purzcyki said he was "troubled" by HUD's findings and he is reviewing his appointment options for the board.

"I intend to address the concerns immediately," he said. "I want people on the board who understand responsible corporate governance first. To me, that is the job of a board of directors, to make sure management performs at a high, professional level. The board doesn't interact with the staff, the board doesn't meddle in any day-to-day details."

Executives may remove sitting appointees and replace them with interim commissioners "with or without cause," according to the Wilmington City Charter. Replacements would serve the remaining time of the previous appointee's three-year term before being eligible for reappointment.

County Executive Matt Meyer wouldn't comment on how he may use his appointing power, but said quality housing is "vitally important."

A spokesman for Gov. John Carney would not say what the governor may do with his appointing power.

Holloway said while the current board could make improvements, there has been no illegal activity on his watch. He cited a 2012 incident in which a WHA employee embezzled $179,000 from the authority over two and a half years.

He said he would "resign tomorrow" if he felt WHA was running properly.

"I feel good about my tenure," he said.

Contact Christina Jedra at (302) 324-2837 or cjedra@delawareonline.com.

Editor's note: An earlier version of this article misstated the job title of Fred Purnell. He works for the city of Philadelphia as division director of housing and community development.