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August 27, 2014, 6:56 am

Another year or less for feds’ control of PHA

It’s been a year since the federal takeover of the Philadelphia Housing Authority and reform efforts are nearly completed — setting the stage for a return to local control, said Michael Kelly, executive director and federal receiver.

“Things are going good,” Kelly said. “Accountability and transparency are key words.”

Kelly, who steered PHA through the darkest days of its turnaround, is in the midst of a sort of goodwill tour on the anniversary of a takeover by the Department of Housing and Urban Development.

Last month, the city, PHA and HUD signed a yearlong cooperation agreement that leaves the beleaguered agency under federal control — essentially Kelly and Commissioner Karen Newton-Cole — for another year.

Though the agreement has a one-year term, Kelly said it could be terminated before that, which he expects.

“I think it will be less than a year,” he said, noting that federal and internal audits of the agency are substantially complete, except for audits of legal expenses, the release of which has been blocked in court by former director Carl Greene. “Only a court can [release them] and it’s still tied up within Carl Greene’s other lawsuits as well. When that gets resolved, this other domino could probably fall.”

Greene has a wrongful termination suit pending. A judge is expected to hear it within the next three months.

PHA has undergone a radical restructuring in the 18 months since Greene’s firing in August 2010 and the subsequent resignation of the board the following spring.

Kelly ran through a list of changes that directly addressed concerns raised by the Greene scandal. PHA has created its own legal department and hired a general counsel attorney, eliminating the use of outside attorneys, a practice established by Greene.

“We are not dependent on outside counsel at this point,” he said.

It created its own human resources department. Under Greene, there wasn’t one.

An audit department has been created to conduct annual internal audits. Greene refused to open the agencies’ books.

Kelly said the housing agency has also put new procurement and contract rules and procedures in place. In addition, PHA has restructured its budgeting procedures and moved to make sure its subsidiaries are operating legitimately.

The lion’s share of reform is done, Kelly said. But, the federal government is unlikely to hand control back to the city until the investigations, audits and lawsuits that surrounded Greene are concluded, and the state has voted on a new governance proposal now in the legislature.

“We need to see how all that plays out,” he said.

As HUD looks to cede control back to the city, Kelly added that he hoped to wait until new commissioners could be trained for their new role.

“It’s not good enough just to name these folks,” he said. “It’s important to have a rigorous training period so that when the keys do get turned back, they get turned back to folks who know what their responsibilities are so the executive director can’t pull one over on them — or they can’t do things that are outside the box.”

Meanwhile, Kelly is focusing on the future, improving the quality of life for tenants and helping them prepare to enter “the real world.”

PHA, which provides housing for 80,000 people, has a waiting list of 100,000 families.

“We’ve got a responsibility to provide the tools to these families to better compete in the private market,” he said. “So that apartment is available to people who are having a tougher time competing in the private market.”


Contact staff writer Eric Mayes at (215) 893-5742 or This email address is being protected from spambots. You need JavaScript enabled to view it. .