Portsmouth Housing Authority releases information about legal fees

PORTSMOUTH, Va. (WAVY) — The Portsmouth Redevelopment and Housing Authority (PRHA) is answering 10 On Your Side’s questions dealing with legal fees and how much they have cost taxpayers.

Last week, WAVY sent PRHA a Freedom of Information Act (FOIA) request to learn more about their legal fees, and how much the federal government refused to pay because the fees were too high and/or improperly bid.

As 10 On Your Side first reported in July, the U.S. Department of Housing and Urban Development (HUD) cited PRHA for failing to properly bid legal work. The highest scoring firm didn’t get the contract. Now, it’s clear exactly how much HUD is refusing to pay because of that.

“I am appalled,” said Pam Kloeppel, a former PRHA board chairperson.

From June 2015 though October 26, 2016, of PRHA legal fees of $383,000, federal sources through HUD would only pay about $170,000, and that is only 44 percent of the total. PRHA had to come up with over $213,000, or 56 percent, from other pockets of their scarce, precious money. That shocked Kloeppel.

PRHA Legal Fees | June 1, 2015 – Oct. 26, 2016
Total Legal Fees: $383,460
Federal Sources: $169,745 (44%)
Non-Federal Sources: $213,715 (56%) (Low Income Housing Tax Credits)

Kloeppel tells us, “Well you wonder where the other money is coming from. Is the money coming from services that should have been given to PRHA residents? Is it coming from economic development? Is it coming out of contracts for employees?”

For example, WAVY News has been reporting on terrible flooding in Swanson Homes, where 33 residents were forced relocate after Hurricane Matthew.

Dozens of residences condemned in Swanson Homes section of Portsmouth

Portsmouth Vice Mayor Elizabeth Psimas, who is a fierce critic of PRHA and wants the entire board to resign said, “You have $200,000 used of non-federal sources. Couldn’t that be used to help these poor folks at Swanson Homes, or pay for all these new water heaters, and pay for these damages caused by this flooding?”

PRHA Legal Rates 
Eric Moody and Assoc.: $160/hour
Cooper, Spong & Davis: $165/hour
Verbena Askew Law Firm: $400/hour

Kloeppel and Psimas are equally concerned about how much more per hour PRHA paid attorney Verbena Askew than its other attorneys. Askew gets almost two and a half times what the other attorneys get. It should be noted it was a different type of legal work. WAVY’s Andy Fox asked Kloeppel about that.

“Well HUD thinks that legal work was done illegally, and should never have been done.”

HUD refused to pay any of Askews’ $48,000 legal fees for representing PRHA after the authority was sued for failing to properly bid its legal work.

As we first reported in July, HUD wrote PRHA a critical review of several areas of concern after an on-site assessment of PRHA.

“HUD… determined… contract with Eric Moody not properly procured… Our office is prohibiting use of federal funds to compensate  for work under this contract.”

Psimas sums it up this way: “Look, it may not be Portsmouth city money, but it is still our money, and we want it to be spent properly. We don’t want it to be thrown away on all these legal fees for all these crazy legal challenges, and rebidding the legal fees three times. It is completely mismanaged.”

Late Tuesday afternoon, a source who does not want to be identified told us Monday, PRHA held a special board meeting and agreed to give a new legal contract to attorney Eric Moody and a firm out of Washington D.C. The source did not know the name of the firm.

Eric Moody did not return calls, and Cooper, Spong & Davis (who had been PRHA’s longtime attorney) decided not to bid for the work in protest to PRHA abruptly firing 40-year Executive Director Hal Short.

“We did not submit a bid because we don’t want to work for that organization,” said Cooper, Spong & Davis’ Rob Barclay. “We don’t like the way Hal Short was treated.”

As for Verbena Askew, she said, “I charge $400 an hour, and PRHA agreed to pay it.”

PRHA Interim Executive Director Donnell Brown was unavailable for an on-camera interview and was unable to provide more details on the numbers provided to us.