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CBS 6 investigation finds HUD passes Section 8 complexes in disrepair

HENRICO COUNTY, Va. -- Raw sewage on the ground, stairs in disrepair, and boarded up windows are just a few of the 140 code violations Henrico County issued to the Essex Village apartment complex back in November of 2016.

Deputy County Manager Doug Middleton told CBS 6 Problem Solver investigator Melissa Hipolit "it's not a place anybody should live," after issuing the violations.

But, the Section 8 complex had previously received a decent inspection score from the U.S. Department of Housing and Urban Development (HUD): a 75b out of 100.

Essex Village

"HUD did inspections and gave them passing grades, and they just kept right on going," Middleton told the Henrico County Board of Supervisors at a recent meeting.

Middleton maintains the problems the county found did not happen overnight, and he raised questions at the meeting about HUD's process for holding landlords who receive millions in taxpayer dollars accountable.

"There's a problem with the system, sir. That's the best I can describe," Middleton said.

In fact, the CBS 6 Problem Solvers uncovered examples from across the country where similar low-income housing properties had received good inspection scores, but had major problems.

For example, at Eureka Gardens in Jacksonville, Florida, HUD was forced to retract its most recent inspection score of 85 when city inspectors found 163 code violations.

And in 2015, the roof collapsed at the Burton Apartment Complex in Cincinnati, but the property had received an impressive 90 on its most recent federal inspection.

Michael Kane, who heads up the national union that represents tenants in privately-owned, HUD subsidized properties  like Essex Village (National Alliance for HUD Tenants), said he's not surprised by the findings.

Michael Kane

"HUD has been not the best oversight agency because it's been starved of resources," Kane said. "The inspectors are counting paper clips while missing the big problems that are plaguing tenants in many of the building."

"What's the disconnect there? Why are these properties getting good scores and yet having problems?" Hipolit asked Kane.

"They're using a scoring system designed in the 90s, before there was awareness of a lot of these issues, and they just haven't changed it," Kane replied.

HUD's Real Estate Assessment Center (REAC) oversees the inspections, which are conducted by private companies contracted by HUD.

CBS 6 dug into Essex Village's inspection from December of 2015 and found that just five percent of the nearly 500 apartment units were actually inspected.

"Is that really a good accountability measure, five percent? " Hipolit asked Kane.

"No, we don't think so. We think they should look at more," Kane responded.

Kane said HUD needs to update its scoring system because he said the current one does not give enough weight to issues like mold and bed bugs.

He said tenants also want HUD to involve them in the inspection process.

"You're saying the inspectors don't talk to the tenants? " Hipolit asked Kane.

"Yeah, they're told not to. The current protocol at REAC is that their inspectors are scientific investigators, and they can't talk to the tenants," Kane said.

Hipolit asked HUD if that is true and a spokesperson would only say that residents are encouraged to be present during the inspection of their unit, but did not directly answer the question of whether inspectors talk to tenants.

Both Kane and Middleton said something needs to change ASAP considering the amount of taxpayer dollars the owner of Essex Village is receiving to subsidize rent.

"We can't overlook the fact that responsibility for the inspection process and ensuring that they were doing what they were supposed to do and what they were receiving that $5 plus million dollars a year for rested with HUD,"  Middleton told the BOS.

CBS 6 has repeatedly asked for an interview with someone at HUD, but they have denied all of our requests. We asked why, and have never received a response.

A spokesperson did tell us in an email that HUD believes its inspection methods result in a fair representation of property conditions on the day of the inspection.

She said the inspections are designed to identify issues that need to be addressed, but added that HUD recognizes the process is not perfect, and HUD has made changes over the years to improve the process.

She pointed out that just last month Congress directed HUD to hire 19 more quality assurance inspectors.

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