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HOUSING FUND DIRECTOR RETIRES AMID INVESTIGATION, HATFIELD ENDS 38-YEAR CAREER WITH AGENCY


Publication: THE CHARLESTON GAZETTE
Published: Wednesday, November 23, 2011
Page: 1A
Byline: ERIC EYRE STAFF WRITER


West Virginia Housing Development Fund Executive Director Joe Hatfield is stepping down next week after 38 years at the agency, according to a memo obtained Tuesday by the Gazette


Hatfield announced his retirement to agency staff members last month, five days after federal prosecutors issued subpoenas for records at Hatfield's office.


His retirement memo makes no mention of the federal investigation into the Housing Development Fund's decision to award a $3.67 million federal stimulus grant to Charleston developer Douglas E. Pauley last December. Pauley is building a 32-unit apartment complex on land formerly owned by state Treasurer John Perdue. Perdue serves on the Housing Development Fund's board of directors.


Hatfield has worked at the Housing Development Fund for 38 years, all but seven of those as the agency's acting or full-time executive director, according the Oct. 5 memo he sent to agency employees. The Gazette obtained a copy of the memo Tuesday.


"You have been the mind body and backbone of the Housing Development Fund over the years, I have been extremely proud to have been your executive director," Hatfield wrote. "But, as things happen, I must move on."


In a Sept. 30 subpoena, the U.S. Attorney's Office requested documents related to meetings last August and September attended by Pauley and Housing Development Fund officials.


It was unclear Tuesday whether Hatfield was present at any of those meetings.


Earlier this month, the Gazette requested the same documents under the state Freedom of Information Act, but Housing Development Fund officials refused to release letters and notes about the August and September meetings with Pauley.


In his memo, Hatfield said his retirement was a "difficult decision."


"We have accomplished much, and I have been honored to be with you to celebrate these many accomplishments," Hatfield wrote. "But the most important ones are those we get to see - folks moving into a house and making it a home."


Hatfield has declined to comment on the federal investigation, referring questions to an agency lawyer, who also won't comment on the inquiry.


In recent weeks, Hatfield hasn't been working out of the Housing Fund office in Kanawha City. No one answered the phone at Hatfield's home in Putnam County Tuesday. Housing officials would not say whether Hatfield's decision to step down was related to the federal investigation.


In other developments Tuesday:


n Pauley's lawyer, Ben Bailey, responded to a Gazette report that Pauley had named several of his low-income apartment complexes in West Virginia after Housing Development Fund administrators - the same people who review, evaluate and approve his applications for federal loans, grants and tax credit financing. The staff members also monitor and audit Pauley's projects to ensure they comply with federal housing regulations.


Bailey said Pauley has proposed "scores of projects" to the Housing Development Fund since the 1980s.


"Each requires a name. So they have been named after friends, family, pets, employees, contacts with the locations, business contacts, including those at the Fund, and even family and pets of others," Bailey wrote in an email.


The Gazette reported Tuesday that Pauley named a Dunbar housing project, Elle Bella Villa Apartments, after Housing Development Fund Senior Director Sherry Bossie's 9-year-old Yorkshire terrier. Bossie, who oversees housing projects at the agency, approved Pauley's $3.67 million federal stimulus grant application last December.


Bailey said Housing Development Fund staff initially rejected Pauley's proposal to build Elle Bella Villa Apartments - and another project named after a Housing Development Fund administrator's daughter.


"Sometimes the proposed projects were selected, sometimes they were not," Bailey said. "Naming proposals is one area where a developer can have a little bit of fun without causing any effect on the scoring system used by the WVHDF to select projects."


n Housing Development Fund officials refused to release a 2006 letter from the state Ethics Commission about Perdue's plan to sell an 11-acre property to Pauley, while Perdue continued to serve on the agency's board.


At the time, Perdue's wife, Robin, owned the property along with her late brother and his wife.


Perdue solicited the Ethics Commission's advice, presumably to ask whether he had a conflict of interest. A response was sent to Charleston lawyer Samme Gee, who has a contract with the Housing Development Fund. The Gazette had requested a copy of Perdue's Ethics Commission letter under the state Freedom of Information Act.


Housing Development Fund lawyer Tracy Webb told the newspaper Tuesday that Perdue's letter wouldn't be released, citing a "deliberative process privilege."


Last week, the Gazette also asked Perdue and his staff for a copy of the Ethics Commission letter. Perdue employees said they didn't have the letter and referred the Gazette to the Housing Development Fund.


Perdue has said he followed "all legal procedures" while selling his land to Pauley for $215,000 last December. The land was appraised at $11,000.


Federal prosecutors also are investigating $1,000 campaign contributions made by state Treasurer's Office employees to Perdue when he ran in the Democratic gubernatorial primary last spring.


Reach Eric Eyre at ericeyre@wvgazette.com or


304-348-4869.

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