Audit: Reckless spending, lax travel policies at LA's Housing Authority

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The Housing Authority of the City of Los Angeles came under fire again Tuesday. City Controller Wendy Greuel released a scathing audit, and some L.A. City Council members moved to take more control of the agency.

A continuing audit targets what it calls reckless spending and lax travel policies. City Controller Wendy Gruel said Housing Authority officials are duping Los Angeles taxpayers and wasting public money on lavish meals and hotel stays.

"It is unfathomable to me that an agency dedicated to creating and maintaining affordable housing for the poorest of families spent taxpayer money so irresponsibly when funds are insufficient to provide desperately needed housing in the city of Los Angeles," Greuel said at a news conference outside Los Angeles City Hall.

She offered several examples. "Public safety representative Scott Butler was approved to drive an agency vehicle to San Diego, but instead paid airfare exceeding gas cost and left the conference early to take a flight to Chicago and unnecessarily charged a hotel night that was not used."

Scott Butler did not immediately return calls seeking comment.

Greuel, who’s running for mayor of Los Angeles, began auditing the Housing Authority in March. That’s also when KCET public television’s “SoCal Connected” reported on large travel expenses at the agency.

Since then, the authority’s board has ousted chief executive Rudy Montiel, but he left with a payout of just over a million dollars. Greuel didn’t like that either. She said housing agency officials have made it hard for her to carry out the audit.

"Many employees that we spoke to expressed fear in coming forward, which I think exemplifies the culture of the agency," Greuel added.

"It shows they’re trying to hide," said L.A. City Councilman Dennis Zine, who joined Greuel at the news conference. "You’re not going to be able to hide behind something when the public is being defrauded."

Zine, who’s running for Greuel’s job, encouraged housing authority employees who know about bad expenditures to report them to save the agency, without fear of retaliation.

"This department is now facing a $9 million deficit and people are getting laid off. To me, if they hadn’t frivolously expended dollars, we wouldn’t be in this position," Zine said.

Zine and two other council members introduced a motion that would allow the city greater oversight of the Housing Authority; it also receives federal money to administer the Section 8 apartment voucher program. The other two council members are Eric Garcetti and Jan Perry, who are also running for mayor of L.A.