Picking up the pieces

A locked chain link fence surrounds the empty buildings meant to house 60 low-income families. And it seems likely this complex will stay silent for some time to come. High Ridge Gardens stands today as a testament to all that has gone wrong at the Danbury Housing Authority in the past year. However, it is not the only casualty. One year ago, then-Housing Authority Executive Director Bernie Fitzpatrick was in the middle of the High Ridge renovation at the same time he was trying to carve out intricate financial deals to build between 150 and 200 new units of public housing on Scuppo Road and Chestnut Street. He was trying to nudge along the 70-unit Stetson Place condominium project on Route 37 because he arranged to buy 10 of those units on behalf of Western Connecticut Association of Human Rights (WeCAHR) clients with disabilities.--photo1L-- Fitzpatrick was also partnering with the Danbury-based Mental Health Association to build a 20-unit permanent supportive housing facility for the homeless in New Milford. He was negotiating to buy some downtown buildings to renovate into low to moderate-income apartments; and he was trying to build a 36-unit congregate facility for the elderly. Observers say hindsight suggests Fitzpatrick bit off far more than the authority could financially chew, imperiling all of those, and future projects, for years to come. As it stands now, the federally-backed $645,000 MHA project to benefit homeless adults is gone; construction of any new units is stalled indefinitely, and a state check for $3.5 million to build congregate elderly housing hasn't arrived. The Stetson Place project is proceeding, but it has been seriously delayed, and payments on those units, and to the contractor, have come under fire. The authority must pay the balance, about $50,000, on those units. "It's frightening,'' said Jean Bowen, WeCAHR executive director. Since February, Fitzpatrick and the housing authority have been under siege. Even after he resigned in May and the former authority board was removed and replaced this past summer, the authority has continued to struggle with continued revelations of muddled financial operations and executive mismanagement. "I'm very sorry all this has happened. I'm disappointed. I hate to see all this happening,'' said Trish Palmer, MHA director of residential services. "The Housing Authority has done so much good, and Bernie has done so much good over the last 17 years. I hate to see this mess, and things are now such a mess. I'm sorry that this is the legacy that is being left behind.'' What seemed in 2000 to be an ingenuous way to expedite much-needed housing renovations and new construction - an $11 million bond deal secured with the help of private financiers and leveraged by anticipated federal dollars - turned sour in February when it was discovered that Fitzpatrick had made some foolhardy, and unauthorized, financial moves. Fitzpatrick admitted he improperly advanced $1 million to a now-bankrupt Waterbury contractor for materials needed for the $5 million renovation project at High Ridge. The materials were never purchased, and the authority has yet to be repaid. He also advanced close to $1 million to buy the 10 units at Stetson Place before they were even under construction. That project has undergone numerous construction delays since it was started in the spring of 2001, though there has been some movement on the project. Ultimately, the unauthorized spending prompted Wachovia Bank of Boston to recall the bond, leaving the authority $6.5 million in debt. In addition, the authority's recently completed 2002 audit shows that the agency overspent $2.6 million of money provided for the federal Sec. 8 voucher program and now owes that money to the U.S. Department of Housing and Urban Development. "It was never financially viable for the authority to build 150 units. Even the renovations of Laurel Gardens and High Ridge would have driven the Housing Authority into bankruptcy,'' said Mayor Mark Boughton. Boughton's assessment of Fitzpatrick's financial errors echo a recent U.S. Inspector General's audit that indicates the former executive director's maverick housing deals were not only ill-advised but crippling the agency's ability to remain fiscally solvent. "Unfortunately, all of those projects were a vast overreach for a very financially troubled agency,'' Boughton said. "The Housing Authority is not going to be able to borrow money in the short-term other than to restructure its debt.'' To those who worked closely with Fitzpatrick over his 17-year tenure, including some of the authority staff, the looming question that remains is whether Fitzpatrick simply overreached because he wanted his agency to be a key player in answering the region's cry for affordable housing or whether personal ambition and arrogance prompted him to ignore good business practice. "I believe the Housing Authority got into trouble because it was trying to do more than could be done alone,'' said Chris Brown, Housatonic Habitat for Humanity executive director. Fitzpatrick is secretary for the Habitat board, though Brown said he is uncertain whether Fitzpatrick intends to retain that post now that he has left the authority. Fitzpatrick has not been available for comment since he resigned. For Bowen and Palmer, the most troubling part of the authority's current troubles is that it might considerably slow progress on building much-needed affordable housing for the region's most vulnerable populations. In this region, housing is at a premium in all income brackets, but for middle-income and low-income families the rental and home purchase markets are out of reach. "The next regime at the Housing Authority will probably be cautious, and there will be lots of safeguards that will tend to discourage innovation, and that concerns me,'' Bowen said. Fitzpatrick was long known in the community for his willingness to take risks that until a year ago paid off for the city's less fortunate and were praised by local, state, national and even HUD leaders. "Any time there is a crisis like this the pendulum swings the other way, and people are hesitant to go out there and do innovative projects,'' Bowen said. "On the other hand, the housing needs are still there, and there needs to be housing to meet a variety of possibilities from rentals and public housing to home ownership for people with disabilities. "There has been a great deal of advocacy for housing initiatives, yet it's a slow process. I'm worried this crisis will slow it even more.'' WeCAHR client Lisa Moran crosses her fingers that her long-standing dream of home ownership is not going to fall victim to the financial controversy swirling about the Housing Authority. Standing in the frigid cold outside the wood skeletal frame that is the first phase of Stetson Place, Moran said she can't wait to move into her own two-bedroom condominium. The 44-year-old WeCAHR client who is learning disabled but lives independently, is eager to be able to transfer her Sec. 8 housing voucher - that now allows her to rent a condominium - into a mortgage. Without this project, Moran knows that she and others like her might never have the chance to own their own place. So she stays positive that this will go through, and eventually be a standard option for others with disabilities. "I never thought handicapped people would ever be able to get a mortgage, and all the laws now have changed,'' Moran said, noting that through this project she would still pay just 30 percent of her income toward the mortgage. Stetson Place would include not only the 10 units for WeCAHR clients, but also four units for people on limited incomes and the remainder to be market rentals. Such mixed uses have been touted nationally as helping to break down stereotypes and build stronger communities. But she admits that the authority's difficulties have given her pause to wonder if her move might be delayed. Bowen, though, said the authority remains committed to the project despite its focus now on settling its outstanding debts. "Everything is a go,'' Bowen said. The up side of the authority crisis is that other community agencies and civic leaders are becoming acutely aware of housing needs and are coming to the rescue. "What it's done for all of us (non-profit organizations) is make us all a little more aggressive in terms of dealing with the tragedy of substandard housing because it is so apparent,'' Brown said. "When you have the Housing Authority down, all of the rest of us in the Greater Danbury Continuum of Care have to step up, and all the people who support us have to step up, too. "We're not a relief agency, but our future homeowners need more support than ever before.'' Boughton said he is confident that the authority will survive. HUD currently has two consultants working in the authority, and the new board has pledged its commitment to figuring out how to get the authority reorganized and financially stable again "We intend to play a bigger role in mentoring the Housing Authority because we have the resources to do that, and to help them follow good business practices that they should be following to the benefit of their residents,'' Boughton said. He said he has pledged that the city's staff, particularly its finance director, will be available to assist the authority as it strives to become solvent again. On Friday, the authority fired nine employees in an attempt to save $250,000 a year. Boughton said the Housing Authority is going to need time to get its finances in order, and so other non-profit developers, agencies and the surrounding towns will have to be tapped to assist with meeting the area's housing needs. "This doesn't mean the end to affordable housing in the city, or to public housing, but it may be several years down the road before it can acquire more property,'' he said. Palmer said she is saddened that her project fell victim to the authority's financial mismanagement. But she is confident that the new board is heading the authority in the right direction, and eventually, the authority will be able to move forward. "The Housing Authority is vital to thousands and thousands of people in the city of Danbury, so it must go forward and I think it will,'' Palmer said. "It will take a while. And there will probably be more heartache before it is finished. But I am confident Mr. Rizzo (Authority Chairman Anthony Rizzo) will get this job done.'' Contact Nanci G. Hutson at nhutson@newstimes.com or at (203) 731-3339.