Explainer: Understanding the Raleigh Housing Authority Controversy

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The Raleigh Housing Authority has come under scrutiny recently as new outlets reported on salary and compensatory time given to its executive director Steve Beam.

The Controversy
In December, the News & Observer reported that Raleigh Housing Authority Executive Director Steve Beam makes $240,000 per year plus benefits, allowances and bonuses. All told, his annual compensation is about $280,000.

The N&O also reported that on top of his annual vacation and sick days, Beam also used compensatory time, which he accrues when he works more than a 7.5-hour workday and on the weekends. In total, the paper reported that Beam took off 54 days in 2009, 2011 and 2012.

Beam reportedly uses his time off to pursue his side business and hobby as a magician specializing in card tricks.

Beam is responsible for operations of the housing authority, which has a $50 million budget, a voucher program and housing communities that it owns and maintains.

Last week U.S. Sen. Chuck Grassley of Iowa and U.S. Rep. George Holding, both Republicans, announced they wanted a federal investigation into the Raleigh Housing Authority and Beam’s time off.

Beam’s Story
Beam has been with the housing authority for 28 years, serving as its executive director for almost 18, he said. He served with another housing authority for six years prior to coming to Raleigh.

As executive director, Beam manages daily operations and the development arm of the agency.

When Beam took over in 1996, he said the housing authority was in disarray, with multiple pending lawsuits, completely vacant properties, a Department of Justice investigation and properties in substandard condition. In 1992, there were two deaths at Walnut Terrace that were attributed to carbon monoxide poisoning.

“We were essentially broke,” he told the Record.

Beam said the city loaned the agency money to fix a broken boiler and awarded grants for regular maintenance.

 “When you look at that,” he said, “I don’t think anyone in their right mind would want to step into that circumstance.”

Beam said he saw the time commitment that was going to be involved in turning things around. Rather than taking a raise, he negotiated for comp time, he said.

“I took what was important to me,” he said. “We came to agreement based upon the conditions at the time.”

Beam said his comp time makes up for hours spent working late during the week and on the weekends. When he is away from the office, he said, he’s often answering work-related email and making work-related calls.

He didn’t take comp time during the first few years of his current position, but once conditions improved, he began taking time off in accordance with his contract.

Beam has been given raises since his initial contract was negotiated.

Board Supports Director, but Questions Surround Board Terms

“The salary, we feel, is appropriate for what Steve has done,” said current Raleigh Housing Authority Board of Directors Chair Kyle Dilday.

Dilday said that Beam’s contract is evaluated each year. The board uses salary surveys in the public and private sector and considers Beam’s length of service as factors in his evaluation.

The board has continued to adhere to the comp time standards that were laid out in Beam’s original contract. Dilday added that Beam spends a lot of time on boards, committees and commissions that often meet on weekends, which he said has benefited the Raleigh Housing Authority.

As far as what Beam does with his time off, Dilday said that’s his business.

“No one should care what he does with his personal time so long as it doesn’t take away from his job,” he said.

This week the board convened to consider possible changes to that contract; Dilday said Beam is willing to negotiate something that works for everyone.

The board itself has come under some scrutiny, particularly from Raleigh City Councilors. Some board members have been serving for almost 20 years. The N&O also reported that members seem to give Beam blanket approval, barely questioning his decisions.

The mayor is responsible for appointing people to the seven-member board of directors for five-year terms.

There are no term limits, which means members can continue to be reappointed.

Dilday has been serving on the board for eight years. Doris Wrench has been on the board the longest, having first been appointed in 1995. George Dail is not far behind, having been first appointed in 1996. Mike Penick and Thomas Bradshaw’s terms will end this year in August and April, respectively.

Dilday said that in the past the board has discussed term limits several times, but has opted to stay away from it because it takes a long time for new board members to get up to speed.

“We do have pretty good diversity between the older and the newer members,” he said.

He said that the mayor always has the option of not reappointing a member and appointing a new person once a term is over.

City Involvement, or Lack Thereof

Allison Hapgood, a spokesperson for the housing authority, said the Raleigh Housing Authority is a state-chartered municipality. This means that it isn’t run by any specific government entity. A port authority or airport authority are similar organizations.

Because the state charted the authority to be its own free-standing entity, the City of Raleigh isn’t involved in the day-to-day operations at all and doesn’t have any oversight capabilities.

Legally, the city doesn’t have any involvement with the housing authority aside from appointing members to the board. That responsibility rests solely with the mayor and not the rest of the City Council.

“They work with Community Development sometimes, but for the most part it’s federally funded and I appoint the board members,” said Mayor Nancy McFarlane.

McFarlane said she knows the board has been meeting regularly to handle some of the concerns that have been reported. As far as Beam’s comp time, McFarlane said that as she understands it, the board has been living up to the contract. The question for the board though, she said is, “Do you feel the contract is in line with what should be going on?”

The full City Council will be getting a report at its next meeting Tuesday where some of these discussions will be brought to light.

What Does the Raleigh Housing Authority Do?
The Raleigh Housing Authority is responsible for administering housing for low-income families in two ways: Through properties that are owned, managed and maintained by the authority and the Housing Choice Voucher Program, most commonly known as Section 8.

There are 1,372 public housing units and 3,869 units in the voucher program.

The voucher program provides vouchers to those who wish to find housing in the private market. The housing authority pays the landlord directly while the tenant pays for the utilities.

Learn more about how federal cuts are affecting this program.

Hapgood said that 95 percent of the authority’s $50 million budget comes from the federal government through the Department of Housing and Urban Development (HUD). HUD has a contractual agreement with housing authorities to provide funding based on federal regulations. HUD can recapture the funding if they weren’t used properly or in a timely manner.

The other 5 percent comes from tenant rents, rooftop leases and other small sources.

Instead of paying property taxes to the city, the authority makes an annual payment in lieu of taxes of about $300,000.

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