SHA officials say 'technicality' led to bad score

Officials with the Shelbyville Housing Authority were surprised to learn that a recent article in USA TODAY identified SHA as one of 61 agencies across the country that was "faulted by auditors for mishandling government aid, but still receives federal stimulus money."

While officials were completely unaware of the story until informed by the Times-Gazette, the director of the authority was able to explain why the agency appeared on the list in the first place.

Director Hershel Thrasher said the authority appearing in the USA TODAY audit was due to changing federal regulations and a "technicality."

Thrasher explained that a few years back, the department of Housing and Urban Development (HUD) needed a "better report card" on housing authorities so that Congress could be informed how well the federal agency was doing their job.

HUD set up the Real Estate Assessment System, which is made up of a list of items that housing authorities are graded on. Among the indicators that were graded on was the financial condition of the authority.

Thrasher explained that one of the entities budgeted by Director of Operations Ron Tillman ended its fiscal year during a different month than the other items budgeted, but that Tillman was require to report all the financial figures at one time.

So with two fiscal years ending on different months, this caused a discrepancy in the figures, Thrasher said.

In fiscal year 2006, the authority received a score of 72 out of 100, and Thrasher said that no one in the authority was happy with the score. But the next year, the authority got a score of 89.

Tillman said that HUD has now made a change so that the fiscal years in question now end on the same date. As a result of the change, in the 2006 report, the authority got a 15 out of 30 under the financial category, but in fiscal year 2007, the score for financial was 27 out of 30.

"As far as the list that USA TODAY was referring to, it's an old list," Thrasher said. "On the new list, we're almost at an 'A' ... a high 'B.'"

While the list compiled by USA TODAY shows stimulus grant money going to the Shelbyville Housing Authority as $829,593, other housing agencies under scrutiny, such as the Chicago Housing Authority, will receive nearly $144 million in federal funding.

Shelbyville's agency was the only housing authority in Tennessee listed in the USA TODAY audit as being cited "at least three times for problems managing federal money."

The USA TODAY audit was conducted by reviewing Office of Management and Budget (OMB) data that summarized thousands of audits completed since 2004 with help from Boston College business professor Elizabeth Keating.