D.C. City Council member Charlene Drew Jarvis (D-Ward 4) called yesterday for an audit of the D.C. Housing Finance Agency's operating funds after allegations by a former employe that the executive director was charging personal expenses to the agency.
Jarvis, who chairs the council committee that oversees the agency, said that internal agency documents supplied to her raise a "number of questions" about expenses charged to the agency by its executive director, Thomas M. Zuniga. She said she asked D.C. Auditor Otis Troupe to examine the agency's expenditures to determine if the funds are being spent properly.
A spokeswoman for Zuniga said yesterday that the agency's attorneys have advised Zuniga not to discuss the matter because of a pending suit against the agency by the former employe. The agency has denied that expense account funds were mishandled in a response to the lawsuit filed in D.C. Superior Court.
The Housing Finance Agency, a quasi-independent city agency run by a nine-member board, sells millions of dollars in municipal bonds to private investors and provides low-interest loans to home buyers as part of a city program to increase the supply of affordable housing for low- and moderate-income families. "This agency is very investor sensitive," Jarvis said. "We want to be very sure that there is nothing about its internal operations that cast a cloud over it."
Mayor Marion Barry, who appoints the agency's board members with the consent of the council, said yesterday through a spokeswoman that he regards the allegations as "serious," and "is confident that the chairperson of the Housing Finance Agency will move expeditiously to clear up the matter."
Theresa L. Watson, the head of the agency's board, could not be reached for comment yesterday.
Jarvis, who chairs the council's Housing and Economic Development Committee, said she has also asked Troupe to audit discretionary funds used by the city Department of Housing and Community Development, the Department of Employment Services, the Washington Convention Center and the Minority Business Opportunity Commission, the other city agencies that come under her committee's jurisdiction.
A federal grand jury is currently investigating a special administrative fund controlled by the Department of Employment Services in connection with former deputy mayor Ivanhoe Donaldson's handling of the fund when he headed the department in 1981. The special administrative account, which is tied to the city's unemployment compensation fund, is one of several city accounts that are separate from the city's main financial management system.
Jarvis said her audit request of discretionary funds at the agencies is unrelated to the federal investigation and is not based on any evidence of wrongdoing. She said the information will help her committee evaluate the agencies' budget requests for the coming fiscal year.
Jarvis said that the city supplies the Housing Finance Agency with its operating funds, but as an independent agency it controls its own expenditures and operates outside the city's central financial management system.
Allegations concerning Zuniga's handling of agency funds were raised in a suit filed in Superior Court by Kathleen I. Davis, 36, the agency's former office administrator, and were disclosed in a report broadcast Thursday by WJLA-TV (Channel 7). Davis is seeking reinstatement to her job and more than $1 million in damages.
An earlier report on WRC-TV (Channel 4) detailed thousands of dollars in debts owed by Zuniga in connection with his business activities before he joined the D.C. government in August 1983 as a housing department official. Zuniga became executive director of the Housing Finance Agency in March.
Zuniga recently said that he has outstanding debts of more than $100,000 stemming from work he did before he became a city official.
In her suit, Davis alleged that Zuniga used an agency American Express card issued in his name to pay for personal expenses, charged airline tickets for his children to the agency and authorized payment of agency funds without proper documentation.
The agency denied the allegations in its response to the suit.
Davis said in an interview yesterday she raised questions about the expenses to Zuniga in August and later listed her allegations in detail in a letter sent to Watson, the board's chairwoman. Davis said Zuniga fired her on Oct. 30 after she gave him a copy of her letter.
Jarvis said she is "very disappointed" that Zuniga and Watson have not yet responded to an earlier request she made to them for an explanation of Zuniga's personal finances and agency personnel policies.