I need info about a possibly dangerous HUD policy change toward housing co-ops: My letter to the National Association of Cooperative Housing

Note: If you regularly read my blog, then you probably realize by now exactly how pissed off I am at my local co-op housing board. But I am starting to think that my local mess might actually be part of a bigger picture and I'm exploring the possibilities. HUD used to respond rapidly when things got messy at our co-op. They'd come in and clean things up. They don't do that no more. Why? A subtle way to "let it happen"? And drown the Section 8 program in the bathtub without having to allow a bill through Congress eliminating Section 8?

If I am correct, then HUD could get VERY mad at me however. And this is NOT a good thing.

Here's a letter I wrote to the national housing co-op association. I'll keep you informed as to their reply:

Dear NACH:

I live at Savo Island Cooperative Homes, Inc., located in Berkeley, CA. It is one of many such housing co-ops that were built during the Carter administration. Ours was constructed in 1979.

I think that something is happening here that is beginning to disconcert me regarding HUD's newly-developed indifferent attitude toward several particularly blatantly self-interested actions taken by one or more of our Board members -- and I would like to know if other co-ops are experiencing the same sort of trend.

It appears that HUD's new policy toward our co-op is simply to let bad management practices by our Board of Directors go unchecked.

Here's what is making me suspicious: Approximately 12 years ago, I filed an informal complaint with HUD regarding how Savo Island's Board of Directors was postponing annual elections, moving their relatives into vacant units, breaking the bylaws, not collecting the rent, etc. HUD then took immediate action. Within months after I had filed my complaint and cited my evidence, HUD had staged a major audit of our property, the offending Board members were dressed down and the site manager was fired within 24 hours after the audit was complete. But now these same people are once again back in power at Savo and screwing up worse than ever. And I'm back to complaining to HUD about them once again.

But this time I'm getting a markedly different result.

12 years ago, Savo Island received immediate help from HUD. But now, 12 years later, HUD is doing nothing to help. Same situation, very different outcome.

In the last two years, I have done everything in my power to try and get help from HUD for the same problems Savo had 12 years ago -- as well as some new ones. I've filed complaints, sent e-mails, left voice-mail messages, written letters, etc. about these new problems that are severely endangering our co-op. Our roofs are leaking, our siding is falling off the building, we have gone through at least 12 management companies and our Board members are only concerned with moving their relatives into the Section 8 units and keeping their own market-rate rents at 1993 levels.

I have practically begged HUD for relief on these issues. And what have been the results of all my efforts? Nothing. Absolutely nothing. N-o-t-h-i-n-g. Why? I keep asking myself why. Why are the results of my complaints so different this time?

Then last week I had an informal conversation with a HUD insider and she basically spelled it out for me. "Jane, you are wasting your time. HUD isn't going to do anything to correct the situation at your co-op. HUD is just waiting around for Savo to emplode." And with the current Board of Directors at the helm, that won't take very long.

"But if Savo goes bankrupt or gets condemned or whatever because the current Board isn't able manage their way out of a paper bag and are so filled with self-interest that they can't even see straight, then what will become of our co-op?"

"What exactly do you think will happen to two city blocks of prime real estate located in an upscale part of the Bay Area?" the HUD insider replied. "Frankly, the land that Savo Island currently occupies is worth a mint. HUD will sell it, the Section 8 residents will be given vouchers and that will be that."

I wonder how many other housing co-ops are going through this same experience now? And is this an informal, "drown it in the bathtub" way to dissolve the HUD Section 8 program without having to go through all the work of having to shove a bill through Congress?

Everyone knows that it is extremely hard to find landlords in the Bay Area who will take vouchers and eventually the vouchers will simply lapse, saving perhaps even billions of dollars for the Bush-Cheney administration -- but without them having to get a formal bill through Congress that would officially de-fund Section 8.

Please let me know if you have noticed if this is a national trend toward letting Section 8 housing co-ops be allowed to decay due to an informal laissez faire policy by HUD. Thanks.