Serious questions were raised about the administration of the District Department of Housing and Community Development at a hearing last week.

Council Member Nadine Winter (D-Ward 6), who heads the Council Housing Committee and convened the four-hour oversight hearing, emphasized that it was a gathering "to get the facts, not a confrontation." But it was clear by the questions submitted that Housing Director Lorenzo Jacobs Jr. was face-to-face with some of his severest critics.

Several council members, including Winter, already have urged Mayor Walter E. Washington to relieve Jacobs of the housing post.

At the hearing, ad an hoc citizens community development committee submitted a six-page list of questions. The committee is composed of more than a dozen representatives of community-based groups, including an Advisory Neighborhood Commission, the United Planning Organization, the Shaw Project Area Committee, the Parent Child Center and two legal services programs that aid the poor.

The committee questioned why so much of the city's Community Development Block Grant funds are tied up in administrative costs. It also asked why some families who have been relocated to temporary housing, mainly because of urban renewal, had to remain there - often in substandard units - for more than a year, in apparent violation of federal regulations.

In addition, the housing development department was criticized for its slowness in processing building permit applications, causing builders to lose thousands of dollars in interest while they hold on to properties they cannot develop until their applications are approved. Critics also charged that the department has left thousands of housing units vacant and boarded in the midst of a housing shortage.

Other organizations also submitted questions for Winter to ask housing officials who were present at the hearing.

Jacobs began his remarks by defending his department. He said he thinks it has done a "commendable, creditable job" since it was officially created three years ago.

In response to questions, Jacobs and other housing officials said that of the $47.5 million that Washington has spent in community development funds during the past three years, $21.3 million were for administrative costs.

According to records in the area office of the U.S. Department of Housing and Urban Development, the $47.5 million the city had withdrawn from the U.S. treasury by March 31 was only 48 percent of the money that has been available to Washington during the past three years.

District housing officials contend, however, that there still are several months left in the current fiscal year and that most of the community development funds are obligated - as of December, $69.5 million had been earmarked for various projects - and will be spent by the end of that period.

Sarah Underwood, director of Community Planning and Development for the area HUD office, said in an interview that the city has made "substantial improvements" in its performance in the block grant program recently.

"They were very slow at spending in their first year," Underwood said. "We became concerned about it. But they have made substantial improvements in the last year. They are not among the fastest spenders nationally, but they are not at the bottom of the list either. They used to be at the bottom or close to it."

Underwood said she has no national figures to compare the amount of funds spent for administrative costs, but the District of Columbia is probably "on the higher end of the spectrum." That may be because the city must compete in the labor market with the federal government, which has high pay scales, she added.

In response to questions about relocation, Elbert Ransom, administrator of the housing division tht deals with relocation, said 1,355 families have been relocated by the housing department, most of them into permanent housing. Eighty-four of those families were tenants who later became homeowners, he said. He said 126 families who were relocated live in temporary housing, and "at least 75 or 80 of them" have lived in such quarters for at least two years. Although federal regulations require that tenants not be kept in temporaty housing for more than a year, Ransom said, the city is seeking a waiver for the HUD regulations.

Relocating large families is a "serious national problem," Ransom contended. "Resources for large low-income families are limited or non-existent. There is little or nothing in the way of programs. The private sector rejects such families. They're stigmatized . . . Where do you or anybody here suggest that we put these people?

Winter responded, "I suggest that you not move them out of their homes," from one rat hole into another." She told Ransom that he is one of the few in the city housing department who "tries hard," but added, "People are being moved around like musical chairs, out of one dilapidated house into another."

Ralph Spencer, administrator for building and zoning regulations, agreed with Winter that there is a backlog in processing building permits. He attributed the slowness to staff reductions and to problems in getting engineers to work for the city.

"With the staff we have, we're doing the best we can," Spencer said. "I know it discourages builders to some extent if they have to come to the District and have to be held up for four months."

The ad hoc committee and Winter also questioned the department's management of the city's federal (Section 8) rental subsidies program, a program tha allows eligible families to pay landlords no more than 25 percent of their income for rent. The difference is paid to the landlord through the program's funds from HUD. HUD has allocated help for 570 families or individuals in the city. In the past two years, however, the District has only helped 351 families.

The committee suggested that the city could more aggressively solicit landlords for participation.

"I find it most embarrassing to be fighting for Section 8, when we haven't used our existing Section 8 (allotment)." Winter said. "Developers and real estate people tell me they don't even know about the program."

Winter has asked for a report from the department within 30 days on the Section 8 program and on plans for vacant housing units in the city.

Winter was the only council member who attended the entire hearing, but several council members were there for brief periods.

Council Member David Clarke (D-Ward 1) criticized the department for withholding funds from tenants at the Kenesaw, an apartment building in the Mount Pleasant area where low-income black and Spanish-speaking tenants are trying to form a cooperative to buy and rehabilitate the building. The city has funds available for rehabilitation of such projects.

Clarke suggested that although the department withheld a little more than $1 million from the Kenesaw tenants the department later gave H.R. Crawford, a city property manager, almost the same amount of money for his program to rehabilitate and rent apartments and houses in the city to low and moderate-income families. Crawford, who is running for the City Council as an at-large candidate, tried to buy the Kenesaw last year for an investment group and met strong resistance from the tenants.

"We ought to be encouraging tenants (such as those at the Kenesaw) to put it together themselves and become homeowners," Clarke told housing officials. "Crawford can sell his properties (at the end of five years) at an inflated price . . . the project could be used for speculative purposes," Clarke said.

Housing director Jacobs said his department has withheld funds from the Kenesaw so far because officials felt the tenants are not yet ready to proceed with the project.

After the hearing, Winter told a reporter that she thought some of the answers provided by housing officials were "incredible . . . ridiculous.

"I hope they didn't think the questions were answered to our satisfaction," she said. "I tried hard to remain calm. They seemed very nonchalant about the whole thing."

Winter met again later with the ad hoc citizens group to discuss the oversight hearing.

"They were bitter about the whole thing," Winter said. "They felt I wasn't pushy enough. But I wanted it to be a fact-finding session." She said the citizens group is asking the City Council to withold its approval of next year's Community Development Block Grant applications or pass a resolution asking Jacobs' resignation.

The oversight hearing was to continue at yesterday's regular Council Housing Committee meeting.