Mansions Built at HUD Expense

THE DAILY FED

Mansions Built at HUD Expense

The Times reported that tribal leaders, some of whom make upwards of $70,000 a year, built houses for themselves using federal money intended for poverty-stricken Indian families.

While 100,000 Native Americans are on waiting lists for public housing relief from their substandard living conditions, a well-connected few are profiting from deregulations that have created loopholes in the laws governing how HUD grants are spent. A mansion built on a Washington state reservation for a couple making $92,000 a year and a four-bedroom house on the Maine coastline built for a couple making $75,000, both financed with federal aid, may have looked unethical, but were apparently completely legal.

Deregulation at HUD since 1992 has relaxed rules concerning how subsidies are used by Native American housing authorities. Over the past five years, HUD has given nearly $3 billion in aid to tribal housing groups.

Even before the Times' stories were published, HUD Secretary Henry Cisneros last week asked the agency's Inspector General to investigate the paper's findings.