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Audit: Bowser administration awarded millions to developers with low-ranking proposals

D.C. Mayor Muriel E. Bowser Bowser speaks at a seminar Thursday at the new Washington Mystics arena in Southeast Washington.
D.C. Mayor Muriel E. Bowser Bowser speaks at a seminar Thursday at the new Washington Mystics arena in Southeast Washington. (John McDonnell/The Washington Post)
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The administration of D.C. Mayor Muriel E. Bowser (D) awarded tens of millions of dollars to affordable housing developers even though evaluators scored their proposals poorly, according to an audit released Thursday.

Bowser last year awarded $103 million for nine housing projects. But the audit found five of those winners ranked in the bottom half of 20 applicants, including the two lowest-scoring proposals.

In doing so, the Bowser administration passed over five higher-ranking proposals that would have created an extra 353 affordable housing units, including 95 for the city’s poorest residents, according to D.C. Auditor Kathleen Patterson. Those five projects ultimately received funding in March as part of a later award cycle.

The new report is the latest to question how the District spends hundreds of millions from the Housing Production Trust Fund, the primary tool for addressing a dire shortage of affordable housing in a rapidly gentrifying city. Bowser has made the fund the centerpiece of her housing strategy and has lobbied the D.C. Council to expand the fund.

The council increased the annual contribution to the trust fund to $116 million in the budget it passed this week, short of the $130 million sought by Bowser.

Read the full audit and DHCD response here

“Increasing the number and type of affordable housing is a very important priority,” Patterson said in an interview. “We are simply not doing this if we are funding projects that don’t meet all the requirements or don’t meet the requirements in the best way possible.”

Polly Donaldson, who has final say about which projects are funded as head of the D.C. Department of Housing and Community Development, said there are valid reasons for the officials to fund low-ranking projects.

“The panel’s scores may not take the bird’s-eye view of the whole portfolio and consider what would be most effective and efficient, in combination and in line with the administration’s priorities and needs across the city,” Donaldson wrote in a letter to auditors.

Donaldson refused to provide the auditor’s office with documentation that detailed the decision to choose the lower-scored projects.

Her letter noted that an unexpected availability of housing vouchers — which are included in trust fund awards as a way to house the city’s poorest residents — changed the feasibility of projects reviewed by the auditor.

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Donaldson also said written proposals may not reflect a developer’s ability to deliver housing units, and that city officials should have discretion to consider past experiences with developers.

The housing proposals that won despite low scores include Anacostia Gardens Apartments, Petworth Station, Mary’s House and complexes at 1100 Eastern Avenue Northeast and 3500 East Capitol Street NE. All five development firms or their executives have given campaign contributions to Bowser, records show.

The Department of Housing and Community Development refused to provide the D.C. auditor with a host of documents relating to how the housing projects were evaluated and selected, even after the auditor’s office took the rare step of issuing a subpoena. Donaldson said the documents should be private because they relate to “deliberative process,” although the auditor’s office has broad powers from Congress to receive documents on the operations of city government.

Auditors were able to obtain the documents through other means.

“I wouldn’t hesitate to go to court if it was necessary,” Patterson said.

Thursday’s report follows earlier audits that found the city poorly managed the fund and tapped housing dollars for unrelated purposes, such as window frosting and gym equipment for the housing agency’s office.

Bowser declined to answer questions about the latest audit at an event Thursday morning, saying she hadn’t seen it.

John Falcicchio, the mayor’s chief of staff, said Donaldson “has the authority and the responsibility to make decisions about how best to create and preserve affordable housing. We have full confidence in her ability to do so.”

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Council Chairman Phil Mendelson (D) said he hadn’t read the audit as of Thursday afternoon, but was troubled that the housing agency refused to comply with the auditor’s subpoena and suggested such a move may be “contrary to law.”

The auditor “has very broad authority to access all documents,” said Mendelson.

Patterson recommended lawmakers pass legislation that would require the Department of Housing and Community Development to publicly release documents relating to the selection of affordable housing projects.

Council member Elissa Silverman (I-At Large) has already introduced a bill to that effect.

“We need to understand why projects receive dollars and why projects didn’t for this critical program,” said Silverman. “If we are not following the scoring, then why are we having a competitive bid process at all?”

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