Casey: Next HUD chief can heal rift with PHA

Sen. Bob Casey yesterday voiced optimism that the nominee to take over the U.S. Department of Housing and Urban Development will bring a "fresh approach" to the agency's dispute with the Philadelphia Housing Authority.

President Bush has nominated Steve Preston, the administrator of the Small Business Administration, to replace Alphonso Jackson as HUD secretary.

Jackson, who resigned March 31, was under federal investigation on allegations he used his position to help allies, including Philadelphia record producer Kenny Gamble.

After a morning meeting with Preston, Casey (D., Pa.) said the nominee had pledged to meet with him and Sen. Arlen Specter (R., Pa.) within two weeks to review future funding for PHA.

In a conference call with reporters, Casey said he hoped Preston could remove the "toxic environment" between officials of HUD and PHA.

Casey sits on the Senate Banking Committee, which must decide whether to approve Preston. No date for a hearing has been set.

HUD and PHA have been at war for more than a year and remain embroiled in a federal lawsuit. PHA has accused HUD of stripping it of special-funding status in retaliation for not transferring to Gamble land and properties that are part of the Martin Luther King development.

HUD has argued that PHA lost its "Moving to Work" status because it did not provide enough housing for people with disabilities. As a result, PHA will have less flexibility in how it spends federal aid.

Last Friday, Carl R. Greene, executive director of PHA, released an independent study that said PHA had more than the federal minimum of units for disabled tenants.

HUD requires that 5 percent of units be set aside; the audit found that 7 percent of PHA houses and apartments are certified as wheelchair accessible, Greene said.

Casey called the finding "a substantial factor" in any HUD determination over what to do about PHA's funding.

PHA's funding will hold at about $300 million this year. But Greene wrote in an April 28 letter to HUD that the department's plan for how the authority will relinquish its "Moving to Work" status was already having an impact.

Funding that the authority was using to build affordable housing will have to be redirected to so-called Section 8 rental vouchers for low-income tenants.

Greene said PHA also would not be able to use as much Section 8 money for paying for police and social services. He said PHA would have to cut 186 employees and end contracts for social services.

PHA has had to halt any plans for new affordable housing, he added. The move puts on hold the construction of 312 units in the Mantua, Paschall Homes and Warnock Street housing projects.

Aides for Specter and Casey have been working behind the scenes to avert funding changes that took effect April 1. But Casey said any ability to work things out had been "close to if not impossible because of the personalities in conflict under Secretary Jackson."

Casey said Preston might face some "pushback" from staffers on how to deal with PHA, "but I think he's willing to engage in that kind of debate."