Detroit Housing Fee properties preserve failing inspections • Outlier Media

An open secret
The condition of the DHC buildings is no secret. HUD inspections are conducted annually and before move-ins and are required for all but the highest performing properties. The results of these inspections are sent to the DHC Board and to HUD.
The DHC consistently performed poorly in the 2019 inspections. Six developments received a rating of “fail” and five others were “almost failed” with scores between 60 and 71.
Henriquez is confident that this year’s results will improve.
“I think the results will be better in 2023,” she said. “We are educating and educating people and making them more accountable and we will see the difference in both improved productivity and the work done.”
Between February and April of this year, Outlier Media visited and interviewed residents of the Diggs Homes, Brewster Homes, the Villages at Parkside and dozens of single-family homes. Some were in good or fairly good condition. Others weren’t. As residents showed us their homes, reporters saw many dilapidated exteriors, boarded-up units, and even worse conditions inside the units.
There are around 3,300 public housing associations in the country. Because these agencies fund, manage and count the properties in their portfolios differently, it is difficult to come up with an “average” value against which to compare inspection results.
Still, based on descriptions provided by Outlier, conditions at DHC properties were a cause for concern for national expert Susan Popkin, director of the Urban Institute’s Housing Opportunities and Services Together initiative.
“What’s happening at the DHC sounds like poor property management,” Popkin said. “They are supposed to fix health and safety issues in a timely manner – like any other landlord.”
Popkin added that oversight is critical to an effective housing authority.
“They are enormously complex organisations. There are some very good housing managers and others who are not so good,” she said. “But if no one is keeping an eye on them, there can be problems.”
Henriquez has been at the helm of the DHC since 2019. The Board of Commissioners oversees their work and that of the Agency. Richard Hosey, Aaron Seybert, Penny Bailer, Achsah Williams and Keona Cowan are the current board members appointed by the mayor. Hosey, a developer who chairs the board, also serves on the boards of the Detroit Land Bank Authority and the Downtown Development Authority.
The board was presented with the latest inspection results from 2021, which showed that 13 out of 15 properties were defective. A memo on the board pack, compiled by DHC staff and acknowledging the poor performance, said: “The results were substandard.”
In its email response to Outlier, the board blamed many of the DHC’s problems on funding and understaffing, but not on its CEO.
“The board has full confidence in Sandra’s leadership,” it said.
HUD also has the power to intervene when public housing authorities are underperforming and may consider the authority “concerned”. They can then conclude a cooperation agreement with the municipality to improve real estate conditions.
In 2005, HUD placed DHC in receivership for nearly a decade due to poor ownership and mismanagement of funds.
HUD said it “takes its oversight responsibilities seriously” and is more engaged with local authorities in cases of “poor performance”.
“DHC failed to meet that criterion,” Michael Polsinelli, director of HUD’s Detroit field office, said via email to a spokesman.
is there a plan
The widespread acknowledgment of poor conditions on all DHC properties does not appear to provide incentives for further action by the city government.
“Lack of inspections is a concern,” Donald Rencher, the city’s group leader for housing, planning and development, said via email. “I believe DHC has been working on a capital plan for its public housing that will address many of the issues.”
Henriquez said the lack of money limited her ability to do much more than plug holes. The DHC is currently conducting a capital requirements analysis to determine exactly how much money it would need to refurbish its properties. However, she estimated the funding required would run into “hundreds of millions of dollars.”
DHC only has about $12 million a year available for capital improvements, Henriquez said.
Social housing agencies across the country are facing funding constraints as HUD cuts the amount of money it allocates to support public housing. But DHC has not taken advantage of HUD programs, which could fill funding gaps and improve conditions in its buildings.
HUD encourages public housing authorities to convert properties into a so-called “Rental Assistance Demonstration” (RAD). The tool allows public housing authorities to access various forms of financing such as loans or funds from partnerships with private investors, rather than relying solely on HUD grants, which can mean more money for property renovations. For example, the San Francisco Housing Authority has converted 29 projects with nearly 3,500 housing units to RAD.
RAD could play a big role in filling DHC’s funding gaps, but has yet to complete a single conversion. It will likely be years before the Commission completes the refurbishment of its weakest performing buildings.
Henriquez said that when she joined DHC, no action had been taken against RAD, although it had been an option for seven years. After the DHC was set back a year by COVID-19, Henriquez says it gives its approval to convert 308 Gardenview Estates public units it doesn’t own for such a project.
“We’re trying to make up for lost time,” she said.
Despite poor performance on RAD inspections and conversions, Mayor Mike Duggan has made the DHC an integral part of his affordable housing plan. The city plans to sell 12 multi-family homes to the DHC, which will spend $20 million on redevelopment for low-income residents.
Rencher said it’s important that DHC continue to make neighborhoods more affordable.
“DHC must have two strategies in developing and managing affordable housing,” Rencher said. “One for improving the stock of affordable housing and another for creating opportunities for new affordable housing units. DHC must do both to meet the needs of Detroit residents.”
Henriquez believes the company will be able to handle the additional management responsibilities.
“I agree that we haven’t learned to crawl yet. So why would you try to run it and add more to the portfolio?” she said. “I think by the time those units come on board and we’ve got all of that sorted out, we’ll be at a point where our property management skills will have improved significantly. It will make sense to add these to our portfolio.”
At her DHC-managed home on the west side of the city, Starreatha James thinks it’s possible the Commission is now beginning to tackle some of its long-standing problems. After Outlier provided the DHC with a list of issues and questions about James’ house, she said maintenance had been in touch and would be in soon to investigate and possibly fix the issues.
It might be too late. James’ family has reached the limit of what they are willing to endure. She says they are looking for a new place to live, even though it’s harder to afford a house on the open market.
“I don’t want to deal with the DHC anymore,” she said.