Navajo Housing Authority Challenges McCain, Arizona Republic Claims

Navajo Housing Authority

On Wednesday, the Navajo Housing Authority announced that it would be restoring “trust with the people we serve by promoting transparency, communication, efficiency, and accountability.” Part of that process includes new leadership and reorganization as a result, effective June 30th, 2017, the current CEO of NHA, Aneva Yazzie will be stepping down from the position and the Board will be appointing an interim CEO.

“The message from the Navajo People and our elected leaders is clear – building safe and quality homes is a priority,” said the Navajo Housing Authority Board of Commissioners on Wednesday. “As a new Board, we are prepared to meet the challenges in front of us and excited to start this journey toward rebuilding NHA and creating a new direction. The Board is honored to serve and represent the Navajo people; and we are honored to provide leadership and service to NHA and its future.”

The new commissioners has moved quickly to call out the Arizona Republic for fake news. According to a press release issued by the commissioners they will begin providing the public with their own initial findings about the Authority’s performance.

“When we first got on board, we were provided a lot of negative, one-sided information about the Navajo Housing Authority (NHA) organization,” said Board Chairman Kris Beecher, Vice Chairwoman Derrith Watchman-Moore, and Secretary/Treasurer Sean McCabe in the press release. “But having been here for four weeks, we’re now finding out that a lot of information has been exaggerated and misinterpreted about NHA. And we want to clarify some of that misinformation.”

According to the Board, leaders have had “several formal and informal meetings with NHA staff, and they have been intently listening, and vigorously questioning NHA management.”

“Throughout our review, we have applied our knowledge of Federal regulations and processes as it pertains to federal funds and tribal lands,” they said referring to reports and documents submitted to HUD and the Senate Committee on Indian Affairs, including the HUD Draft Monitoring Report and the 2014 Government Accountability Office (GAO) Report. “We have had enough time to make observations and discuss solutions.”

“Most certainly, there are inaccuracies that the Arizona Republic reported that were repeated in national news media which led the Navajo Nation Council to pass legislation based on information from these media stories,” the Board said. “Let us be clear, however, there are things they got right, but there are also things they got very wrong.”

Leaders offered as an example of fake news, an Arizona Republic newspaper article dated March 22, 2017. The reporter claimed that the NHA spent $54.9 million in fiscal year 2016 to modernize just 50 houses at a cost of almost $1.1 million per dwelling. But the commissioners claim that the Republic story left out key facts, such as the fact that the “NHA was also in the process of modernizing another 332 homes that were between 50 to 90 percent complete.”

The Arizona Republic story also claimed that new housing construction was costing $750,000 per unit, but commissioners claim that the Arizona Republic ignored the “included cost for houses that were well on the way to completion but not yet completed.”

“There is no way NHA could or would build $1.1 million homes. This inaccuracy was repeated again in a June 1 Republic story,” said the Board referring to articles by Dennis Wagner and Craig Harris.

The commissioners point out that the U.S. Department of Housing and Urban Development (HUD) has a limit on development costs, which if exceeded would trigger an inquiry. “If this narrative were even slightly true, it would have triggered HUD to investigate and then sanction NHA,” they said. Commissioners note that a draft report released to NHA on June 1, 2017, HUD found no violations.

Commissioners take exception to a report issued by Senator John McCain. That report said that NHA had spent $125 million on the Houck, Ariz. Bluestone development project to date. Commissioners claim only $10.3 million has been spent.

McCain’s office found:

Over the past 10 years, NHA has received over $803 million in Indian Housing Block Grants (IHBG)—far greater taxpayer assistance than any other Indian tribe in the nation received.

But, in that time, NHA built a total of 1,110 new homes—far fewer than is needed to address the Navajo Nation’s chronic housing shortage.

A lack of sufficient planning by NHA exposed its wasteful, fraudulent and abusive use of housing funds. Additional independent inquiry of NHA financial management practices appears warranted.

NHA mismanagement of federal housing funding has resulted in cost overruns and schedule delays involving hundreds of homes totaling more than $125 million.

NHA Board members used income generated from NHA rental properties for “professional development” travel to Hawaii and Las Vegas.

While NHA has made some improvements to internal controls in its accounting associated with its use of federal housing funds, oversight of NHA procurement activities must improve.

These findings support the following legal or policy conclusions:

NHA lacks both the plan and capacity to achieve its stated goal of providing 34,000 homes to Navajo tribal members.

NHA must improve how it manages its use of federal housing funds to instill confidence needed for Congress to continue helping the Navajo Nation address its chronic housing need.

While this report could not conclude whether any of the financial mismanagement cited above rises to criminal misconduct, the findings warrant additional independent review and support calls by Navajo leaders for overhauling NHA’s leadership and improving NHA’s oversight structure.

[Read the report here]

“This was also wrong and it was repeated by the Republic in a news story,” the commissioners said of McCain’s report. “NHA financial records show that the organization has only spent $10.3 million on the project to date. There are many other inaccuracies being compiled by NHA staff.”

“We have also discovered that these inaccuracies in media reports and legislative actions are attributed to Federal reporting forms that are not consumer-friendly, and limit grant recipients from providing a full picture of their activities during the year. These forms can easily be misread and misinterpreted – this is the case in the McCain report. These federal forms are what is called an Annual Performance Report, and housing authorities are required to complete these reports at the end of each year. Anyone that works in a government agency knows the limitations of most federal forms.”

The Board continued, “Further changes are coming. In the coming days we will be making hard and difficult decisions. Meanwhile, to correct much of this misinformation, we have directed the CEO and management to develop a consumer-friendly report that explains housing development activities. We are also looking to live stream all Board meetings so the public can watch Board proceedings. And there’s more to come.”

“We acknowledge the Navajo people and we want to emphasize transparency and accountability. We are working to that end. Meanwhile, we ask that the public and our leadership to be patient as we go through these difficult and trying times. And let us be clear: today’s statement does not in any way say that NHA has made no mistakes at any time in the past or that there are no issues. NHA must take responsibility for many of the things that have gone wrong in the past. But not addressing these damaging inaccuracies now would only further the spread of misinformation and hinder the truth. It is our fiduciary duty to set the record straight and put an end to the domino effect it has created,” they said.

On Wednesday, Navajo Nation President Russell Begaye and Vice President Jonathan Nez called on the commissioners to make changes in leadership in leadership and direction. “There is a current need for 30,000 or more homes for the Navajo people. This is not a projected amount, but the need as of today,” President Begaye said. “We are not talking about public facilities, renovating homes, replacing units, tiles or whatever. It’s simple. We need homes to be constructed for our people.”

The Office of the President and Vice President has reviewed the figures and reports that were put forth by the NHA administrative staff as requested by Senator John McCain’s staff.

“When we compute the appropriated monies per year against the number of houses that were built, it’s clear that NHA is not building houses for our people,” said Vice President Nez. “You can renovate all you want but that doesn’t give homes to families who need them.”

The Begaye-Nez administration has always prioritized the building of homes for the Navajo people. In reviewing funding that has been appropriated for these purposes, President Begaye and Vice President Nez clearly see that this is not happening. The administration sees no justification in NHA starting less than 100 homes per year.

“No matter how you skew the numbers, no matter the findings or perception of limited findings, the bottom line is how much money you receive and how many homes you’ve built,” President Begaye said. “Clearly, we have a process that is broken and we see a need for restructuring and reorganization within NHA.”

NHA’s press release addresses the numbers of houses constructed and monetary figures reported in the media and via Senator McCain’s investigation as being not completely factual.

“For NHA to say they are doing great and there aren’t any findings is totally unacceptable. Clearly houses are not being built and monies are not being spent,” President Begaye said. “There is a clear indication that we have a dysfunctional housing authority that continues to provide excuses for not building houses.”

The Begaye-Nez Administration views the bottom line as productivity. If NHA is not producing homes, then changes will be put in place that include changes to personnel.

“NHA’s track record is very clear. Houses are not being built. Excuses continue to be made,” said Vice President Nez. “If NHA were a business, it would have defaulted years ago. Because of their record thus far, changes will be made at an administrative level. It has to be done this way.”