Private company may soon administer Milwaukee’s rental assistance program

Last Wednesday, the Housing Authority of the City of Milwaukee’s board was supposed to approve a contract handing administration of the city’s troubled Section 8 housing voucher program to the private company CVR Associates.

The federal Department of Housing & Urban Development ordered HACM to outsource management of its $42 million Section 8 housing voucher program in January.

The order came months after HUD, in two letters, notified the agency that its Section 8 bookkeeping contained discrepancies in the millions of dollars and posed a fraud risk.

Section 8 vouchers cap the amount of rent that qualifying, low-income tenants pay to participating landlords.

Activist organization Common Ground showed up to protest the vote, according to organizer Kevin Solomon.

The board delayed the vote, a move that Brooke VandeBerg, acting chair of the Housing Authority of the City of Milwaukee, or HACM, said was due to a voting member’s absence.

The board soon announced a special meeting for Friday, Oct. 11.

At that meeting, three of the board’s four current members voted to “hone in” on and continue “finalizing” a contract the Florida-based housing consultancy, further delaying a final, signed contract.

HACM’s board is appointed by Milwaukee’s mayor, and oversees its operations, which are led by Secretary-Executive Director Willie Hines.

Activists criticize unfilled board seats, privatization of public program

Solomon and the other Common Ground housing advocates oppose contracting with an out-of-state for-profit to run the voucher program and criticized the board for voting on the contract when three out of its seven seats are open, including one of its two statute-mandated public housing resident seats.

The group gives many HACM tenants a public platform and sued the agency in August over unsafe living conditions.

One of the six bids to administer HACM’s vouchers came from Milwaukee County, which manages a smaller Section 8 program itself.

Solomon said the county would have been a “highly qualified, local, not-for-profit, publicly accountable” choice to administer the program.

“If I’m a voucher-holder, and I have an issue, am I going to be able to get in touch with a for-profit company as easily as I would Milwaukee County, for example? No!” Solomon said.

Mayor Cavalier Johnson nominated two new non-resident board members in June after months-long vacancies.

Jose Perez, the alder who leads the committee, has urged HACM’s board to delay approving the contract until after his committee hears Johnson’s nominees.

“The Council has been public champions of residents. The fact that they haven’t moved right away has to give you at least some pause,” Solomon said, arguing that the Council’s hesitancy may point to a faulty process behind the Mayor’s selections.

HACM, Mayor’s office defend process and contractor choice

The committee that evaluated outsourcing proposals consisted of Milwaukee’s assistant city attorney, Mayor Johnson’s Policy Director, a VP of Lutheran Social Services, and three HACM directors — including Jacqueline Martinez, the director of the agency’s current Section 8 program.

The committee gave CVR Associates the highest average scores in firm experience, past performance, and their management plans.

The firm already manages voucher programs for public housing agencies in Chicago, San Francisco, Buffalo, and New York’s Westchester County. Its CEO is Fradique Rocha, formerly a lawyer for the Boston Housing Authority and a partner in a development firm.

While the committee’s report praised Milwaukee County’s voucher program, it was skeptical of the county’s staffing capacity and the fact that the county’s proposal was “less detailed.”

In a statement to WPR, HACM said CVR was selected due to its “extensive experience managing Housing Choice Voucher programs” and its “commitment to customer service.”

The statement also said that HACM will retain a Section 8 liaison to CVR, that the program would continue operating out of HACM’s offices, and that the agency’s current voucher program employees would be given first preference for hiring.

“It is anticipated that there should be little to no effect on the nearly 7,000 voucher households that HACM serves within the city,” the statement read.

Jeff Fleming, a spokesperson for the Mayor’s office, also said it’s “unreasonable for HACM to delay an important recommendation that HUD made in its audit report this much longer.”

He also pointed out that the Mayor’s only role in the running of HACM is nominating its commissioners, and claimed that Common Ground’s post-meeting protest at the Mayor’s office is an “effort to attract publicity.”

“The mayor is not an advocate for privatization of public functions,” Fleming said. “That said, there are appropriate situations when the private sector plays a role at the direction of a government agency.”