The federal government's top housing auditor today blasted the Philadelphia Housing Authority for paying "outrageous fees to law firms that were unnecessary."
In a statement accompanying a 114-page audit of PHA's legal spending, Michael P. Stephens, Acting Inspector General of the U.S. Department of Housing and Urban Development, called for "aggressive reform" at Philadelphia's scandal-ravaged agency.
"Having reviewed many housing authorities over the years, it is clear that the Board and Executive Director of the Philadelphia Housing Authority tremendously abused their positions," he said.
Carl R. Greene, the executive director for more than a dozen years, was fired last September. The board, led by former Philadelphia mayor John F. Street, quit last week.
"The outrageous fees paid to law firms were unnecessary and exorbitant and denied taxpayer funds to benefit the occupants of the Housing Authority," Stephens said.
The audit examined about $4.5 million of the $30.5 million in outside legal fees paid by PHA between April 1, 2007 and Aug. 31, 2010.
It found all but $11,800 lacked proper documentation, and said PHA should either provide that information or return the funds to the federal government.
Stephens singled out board votes by John F. Street, who approved giving contracts to his son Sharif's law firm at the time - Wolf, Block, Schorr and Solis-Cohen - between 2004 and 2008.
"Chairman Street's approval of contracts to the law firm that employed his son is an exceptionally distasteful conflict of interest," Stephens said.
"Our investigation on this issue continues. It is my hope that HUD will aggressively reform the overall management of this important Housing Authority and return the focus to improving the lives of those citizens that we serve."
John F. Street did not respond to a request for comment on the statement by Stephens. PHA, in a response signed by Greene's interim successor, Michael P. Kelly, contended that HUD was biased against PHA because of a long, contentious relationship with Greene.
The Kelly letter repeated John F. Street's assertion that he thought he had obtained a waiver from HUD to vote on the resolutions. HUD rejected that contention in the audit.
Ethics specialists say Street's involvement in awarding work to his son's law firm may have violated state ethics rules governing public officials.
On Friday, John F. Street told reporters that his son earned about $100,000 a year with Wolf Block.
But he said that he believed that amount was a typical salary for attorneys, and that Sharif Street received no special benefit because of his job as PHA board chairman.
Sharif Street left Wolf Block at the end of 2008. The firm folded early the next year.