UNDER THE dark cloud of a massive federal investigation, the Philadelphia Housing Authority parties on.

PHA and Tenant Support Services Inc. (TSSI), a nonprofit subsidiary under contract with PHA to provide tenant services, will hold a six-hour catered holiday party tomorrow night at the John F. Street Community Center, at 11th and Poplar streets, in North Philly.

Agency employees were asked to pay $25 a ticket to attend the shindig, which features a cash bar and DJ.

PHA employees wrote checks payable to TSSI, which is organizing the party. TSSI, headed by longtime tenant activist Asia Coney, is part of a sweeping criminal investigation into the nation's fourth-largest housing authority, formerly run by Carl R. Greene.

Federal prosecutors are probing how TSSI, which receives roughly $450,000 a year from PHA, raised and spent funds. In September, the U.S. Attorney's Office subpoenaed TSSI's financial records and Coney's e-mails.

PHA spokeswoman Nichole Tillman said that employees deserve a holiday party and shouldn't be "punished."

"Every company has a holiday party," Tillman said yesterday. "PHA employees have continued to work hard to serve the residents of PHA. This is an opportunity for employees to meet with other employees in an informal setting."

About 200 people are expected to attend, she said.

TSSI-run parties have previously come under scrutiny. In 2008, at a gala marking Greene's 10th year as executive director, Greene asked hundreds of vendors, lawyers and friends of PHA to cough up a $1,000 to $5,000 donation to TSSI. TSSI reeled in $38,200 in donations, with $16,266 going to pay for the glitzy party. PHA leaders said that the proceeds had gone to a college scholarship fund for students living in public housing.

Current and former PHA employees, and at least one tenant leader, yesterday said that PHA should cool it with the parties.

"It's a disgrace," said Virginia Wilks, tenant leader for 27 years and president of the Richard Allen/Gladys B. Jacobs Manor Resident Council.

"With everything going on now at PHA and the focus on all those parties they had, why in the world would they hold a party?" she asked.

"It's like snubbing their nose in the face of everybody. How stupid can you be?"

Kuran Williams, who is listed on TSSI's website as its resource development coordinator, told a Daily News reporter that Coney was not available yesterday.

"I don't have anything to do with that," Williams said, referring to the party. When a reporter said that his agency is the party organizer, he said, "Thanks for your time." Then he hung up.

Coney, a Greene ally, earns about $102,600 a year, but lives in public housing and drives a PHA-owned 2000 Ford Expedition.

For months, Coney has dodged questions from reporters, and her employees have refused to open the door at its PHA-owned office at 56th and Walnut streets, in West Philly. The day-to-day operations of TSSI and its books are a mystery.

The PHA Board of Commissioners, led by former Mayor John Street, fired Greene in September after an internal investigation concluded that Greene secretly settled three sexual-harassment complaints against him. A fourth case is pending.

Greene has denied the allegations and has filed a civil lawsuit against the board and Street.

Street did not respond to two e-mails from the Daily News asking if he was going to tomorrow night's holiday bash or if he had any comment about it.

PHA employees learned about the party through a flier stuffed in their paycheck envelopes and advertised on PHA's internal Web page, Tillman said.

Party proceeds will go toward Toys for Tots, according to the flier.

Tillman said that once TSSI pays expenses, the remaining money will be used to buy toys for needy kids next Christmas. This year, TSSI gave 1,000 children toys, she said.

Tillman acknowledged that PHA employees will get paid to help set up and clean up after the event.

"We have staff that's going to do it - they'll be on the clock," she said.

In past years, PHA invited vendors and contractors, including law firms, to TSSI parties. This year, only PHA employees were invited, Tillman said.

"Vendors and contractors were not solicited by PHA to attend this event," Tillman said. "I can't really tell you if TSSI did [solicitations], but PHA did not."

The local carpenters union, however, purchased a table that seats eight for $200 total, according to Mark Durkalec, the union's business agent.

"It's a legitimate party. The price for the tickets seems fair," Durkalec said yesterday.

But some former and current employees said that they don't trust TSSI or Coney.

"It's a dumb decision," former Greene aide Jenelle Scott said. "People will wonder where the money is going."