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Starla Warren led the Housing Development Corporation for 20 years, and she, along with all six other HDC staffers, are being terminated and offered jobs with the Housing Authority.

Government boards typically go quiet the week before Christmas, but at the Monterey County Board of Supervisors, the Housing Authority of the County of Monterey and its nonprofit Housing Development Corporation, meetings were stacked up from Dec. 21-23. Officials were rushing to fix problems plaguing the Authority and undermining its effectiveness. The urgency to act was born out of pressure from the supervisors, the federal Department of Housing and Urban Development and a possible Civil Grand Jury investigation, says Jon Wizard, chair of the Authority board.

The Authority is a quasi-governmental agency founded in 1941 by the Board of Supervisors to enable the county to attract federal housing funds. It operates separately from the county although the supervisors appoint the Authority’s board. In 2005 the Authority created HDC as its housing construction arm to attract private capital, and in 2007 HDC became its own nonprofit with a separate executive director and staff, although still tied to the Authority. (The Authority’s board and HDC’s board are made up of the same members.)

In a joint meeting of the three boards on Dec. 21, Wizard called the bifurcated arrangement “atypical and dysfunctional,” resulting in a “toxic environment” at the Authority. The recommendation that day was to pull HDC back under the Authority, with the Authority’s executive director overseeing both organizations. The supervisors, HDC and Authority boards all voted in favor.

Two days later, the HDC board decided that all seven of HDC’s employees would be terminated and simultaneously offered positions with the Authority. That included longtime HDC President/CEO Starla Warren, who would still lead HDC, but with a new title and serving under the Authority’s executive director. (A housing authority consultant from Houston stepped in as interim on Jan. 3; Wizard expects they will find a permanent executive by September.)

Although HDC has been led by Warren for 20 years while the Authority has been lacking consistent leadership, Wizard says HUD officials and other experts recommended placing the Authority in charge of the nonprofit construction arm, a more typical arrangement. “It’s not that HDC is dysfunctional, it’s the relationship between HDC and [the Authority],” he says.

Warren declined to comment on the offer of a job at the Authority, but says the “rushed” decision by the board was a surprise. “HDC has done a great job of delivering affordable units,” she says. “It’s unfortunate this will impact delivering hard units to Monterey County.”

She says there are currently 171 units undergoing rehabilitation, 80 units under construction and another 80 waiting for funding.

Meanwhile, the Authority must fix deficiencies HUD officials found in a June visit. HUD sent a letter in October outlining concerns related to how the Authority was handling management of grants and other HUD requirements.

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