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TC Palm
April 8, 2010

Report: Fort Pierce Community Services Department misused hundreds of thousands of dollars in taxpayer money

By Alexi Howk

FORT PIERCE — A Fort Pierce official is accusing former Assistant Community Services Director Dorina Jenkins of violating state law and said he’s uncovered the misuse of hundreds of thousands of taxpayer dollars, according to a March 23 memo sent to City Manager David Recor.

“There are dozens of examples of business practices involving the expenditure of literally hundreds of thousands of taxpayer dollars that I would have a hard time supporting,” said Fort Pierce Redevelopment Agency Director Jon Ward during a telephone interview.

Ward is now the head of the Department of Urban Redevelopment, which replaced the troubled Community Services Department on March 8. Jenkins, who oversaw all of the housing assistance programs in the Community Services Department, had been assistant director since 2005 and worked for the city since 1995.

When contacted, Jenkins referred questions to her attorney, Richard Kibbey.

Kibbey declined to address specifics of the allegations against Jenkins in Ward’s report, citing an ongoing investigation.

“Ms. Jenkins has consistently acted in the best interest of the city of Fort Pierce and her department,” Kibbey said. “We are confident she will be cleared when the investigation is complete. We do not want to get involved in the political issues that are swirling around this issue.”

The U.S. Housing of Urban Development’s inspector general’s office and the FBI launched a criminal investigation into Fort Pierce’s Community Services Department in February after a city-ordered forensic audit accused department staffers of cronyism, fraud and mishandling of state and federal money used to provide housing assistance for low-to-moderate income families, Ward said.

Mike Zerega, a HUD spokesman based in Washington, said Thursday he could not confirm or deny an investigation, and therefore could not comment.

Ward’s report details at least five areas of concern, including the department paying exorbitant rental fees to put clients in temporary housing while their homes were being rehabilitated and not collecting overdue payments on city-backed mortgages. One mortgage recipient hadn’t made a single payment in two years.

“These are clear examples of actions that should have never been tolerated,” Ward said.

Also, according to Ward’s report, after Jenkins was laid off March 1, she attempted to destroy hundreds of city documents when she returned to her office to collect her personal belongings. Ward said Jenkins was instructed not to remove anything from the office except for personal items.

“Ms. Jenkins was observed loading hundreds of files and other public documents into two large black garbage bags and directed a member of Public Works’ maintenance staff to take them directly to an outside Dumpster,” Ward wrote in the memo. “This act was a clear and deliberate attempted destruction of public records and a violation of (Florida Statute Chapter 119, the open public records laws).”

City officials removed the documents from the Dumpster, and they were later seized by special agents to be used as evidence as part of the criminal investigation, Ward said.

In this month’s billings for the city’s Reforming Employees with Assisted Collaboration for Homeownership, or REACH program, Ward said staff noted more than $154,000 worth of loans were in excess of 90 days past due “with no effort on the part of staff to collect funds.” He said some applicants hadn’t made payments on city-backed mortgages in more than two years, and there was no attempt from the department to collect the money.

In 2008, the Community Services Department rented a duplex at 1008 N. 17th Street owned by Maurice Shazier to temporarily house applicants whose homes were being rehabilitated by the department. The duplex consisted of two furnished, two-bedroom apartments.

Community Services paid $2,250 per month each to rent the two apartments for a total of $4,500 per month, more than double of what other area landlords were charging for similar apartments in the Lincoln Park community, the report states.

Shazier could not be reached for comment Thursday.

Interest rates on city-backed mortgages also were arbitrarily assigned and in some cases better interest rates were given to relatives of Community Services staff, Ward said.

Ward also pointed out in his report that former Community Services Program Specialist Serena Knight was given a $250,000 mortgage in October 2008 during the housing bust to buy a home in the Bent Creek neighborhood as part of the department’s REACH program. He said the mortgage was out of line with what other similar homes were selling for in the area and her mortgage was significantly higher than 13 other REACH applicants who bought homes that cost between $127,000 and $150,000.

Knight could not be immediately reached for comment Thursday.

THE ALLEGATIONS

Fort Pierce Redevelopment Agency Director Jon Ward put together a report on problems in the Community Services Department. The March 23 memo sent to City Manager David Recor alleges the following about the department:

It rented two apartments for more than double what landlords were charging for similar housing.

A former staff member received a $250,000 loan — when all other loans as part of that program were for less than $150,000 — using a 20-month-old appraisal.

Interest rates on loans seemed to be arbitrarily assigned.

Prices paid for temporary housing of clients while homes were being renovated varied and seemed to be arbitrarily determined.

Assistant Director Dorina Jenkins violated state law by notarizing documents involving family members.

Jenkins attempted to throw out two garbage bags full of city records.

The department hadn’t collected overdue payments on city-backed mortgages. One mortgage recipient hadn’t made a single payment in two years.

RENT MORE THAN DOUBLE

In 2008, Community Services Department staff authorized the rental of a duplex at 1008 N. 17th St. for applicants whose homes were being rehabilitated. The duplex, owned by Maurice Shazier, consisted of two furnished, two-bedroom apartments.

One apartment was leased in May for five months and another in September for eight months at $2,250 a month each, more than double the highest estimate from experienced area landlords. A typical furnished two-bedroom apartment in the Lincoln Park community rents for $450 to $700 a month.

In addition to paying the rental rates, the Community Services Department continued to pay $200 a month for storage of the applicants’ personal items.

In October 2007, Community Services paid $2,500 for foreclosure prevention assistance on another property owned by Shazier during the month he purchased the 1008 N. 17th St. property.

In an Oct. 16, 2008, memo to former Community Services Assistant Director Dorina Jenkins, Finance Director Gloria Johnson refused to continue to pay the rent at 1008 N. 17th St. and pointed out that the owner of the property had not qualified for the foreclosure prevention grant the previous year.

In an Oct. 17 response to Johnson’s memo, Jenkins defended the rental rate, ignored Johnson’s concerns and payments continued until April 2009.

The foreclosure prevention funds were never recovered.

In 2008, the Community Services Department paid the owner a total of $28,000 in rental fees. The property’s 2009 assessed value was $38,700 and was purchased for $45,000 in 2007.

SOURCE: March 23 memo from Fort Pierce Redevelopment Agency Director Jon Ward to City Manager David Recor

$250,000 MORTGAGE LOAN TO FORMER CITY EMPLOYEE

In September 2008, the Community Services Department gave former Community Services Department Program Specialist Serena Knight a $250,000 mortgage to purchase a home in the Bent Creek neighborhood using Reforming Employees with Assisted Collaboration for Homeownership, or REACH, program money.

Knight, who accepted a voluntary separation package from the city last year, had helped implement the same program she received money from.

In all, 14 homes were purchased with REACH money. All of the homes, except Knight’s, cost between $127,000 and $150,000.

Prior to being approved for the $250,000 mortgage, Knight was given a Community Services grant for $2,485 to avoid a rent eviction on an $800 per month apartment and then was subsequently given an additional $1,988 “re-entry” grant to rent at another location.

Fort Pierce Redevelopment Agency Director Jon Ward, who now heads the department said the Community Services Department had used a 20-month-old appraisal valuing the house at $275,000 when there was a contract on the house during the time of the appraisal for $239,990.

“In a downtrending market, where prices had dropped at least 25 percent since the appraisal was written, (Community Services Department) staff chose to accept this flawed figure,” Ward wrote. “City policy clearly forbids the use of an appraisal over one year old.”

Ward said Knight has not made a payment on the home since October.

SOURCE: March 23 memo from Fort Pierce Redevelopment Agency Director Jon Ward to City Manager David Recor

ASSISTANT DIRECTOR GIVES MONEY TO MOTHER, NOTARIZES DOCUMENTS

Prices paid for temporary housing of clients while their homes were being renovated varied widely and seemed to be arbitrarily determined.

Temporary housing averaged between $700 and $850 per month or up to $27 per day, but while repairs were being done on the home of Community Services Assistant Director Dorina Jenkins’ mother, Emma Bolden, Community Services approved a $5,577, 39-day waterfront hotel stay on South Beach for Bolden averaging $143 per day.

“Aside from the conflict of interest issues, all of the contractural documents and agreements surrounding (the Bolden project), were notarized by former (Community Services Department Assistant Director) Dorina Jenkins in a clear violation of the Florida Administrative Code. ‘A notary public may not notarize a signature on a document if the person whose signature is to be notarized is the spouse, son, daughter, mother or father of the notary public,’” Fort Pierce Redevelopment Agency Director Jon Ward said.

SOURCE: March 23 memo from Fort Pierce Redevelopment Agency Director Jon Ward to City Manager David Recor


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