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HARP-ing On

City-run program to repair shabby homes is under federal investigation.

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New rules and a new home outside Memphis government are likely on the way to clean up a city-run program tasked with cleaning up some of the city's rundown homes.

A federal investigation is under way of the now-suspended Housing and Rehabilitation Program (HARP). The probe will review allegations of loose quality controls at the city level that allowed shoddy work by contractors hired by the city. The program gives financial and construction assistance to low-and-moderate-income homeowners in Memphis to make the repairs necessary to bring their homes into compliance with city codes.

HARP uses federal funds to repair roofs, perform electrical work, resolve plumbing issues, and more to keep people in their homes, especially the elderly, city officials said.

The federal Housing and Urban Development Office of Inspector General is reviewing HARP to determine if city staff ran the program fairly and if the processes to award bids and select contractors met federal guidelines. A partial report of their findings was issued to the Memphis City Council last week. The full report is expected by the end of this year.

The partial report includes "before" and "after" shots of homes on which HARP contractors had made repairs. The "before" shots show rotted holes in bathroom floors covered with plywood, broken windows covered only by black plastic and duct tape, and walls around a bathtub rotted through to the exterior bricks. The "after" shots show successful projects with those same spaces tiled, cleaned, dry-walled, and painted.

 The program is run by the Memphis division of Housing and Community Development (HCD). The division's director, Robert Lipscomb, told the city council's Housing and Community Development committee that his agency began getting calls two years ago from homeowners complaining about the quality of some of the work done by HARP contractors the city hired. From there, he said his agency began the initial investigation into the program.

"As a result we suspended [HARP], and the staff involved in it were terminated, reprimanded, or both," Lipscomb said. "We also terminated contractors who we thought didn't meet the standards."

Two HARP inspectors have resigned and one has retired since the local investigation began in 2011. The list of approved contractors has slimmed from 45 to 10.

City council member Wanda Halbert wanted to make sure that changes made to the program would allow contractors to also have their say in any project reviews.

"I want to make sure the door is always open to hear both sides," Halbert said. "I know in government they rely on the staff, but the staff isn't always right. We need to make sure that whoever we put in place is fair to everybody."

The list of open cases has shrunk from 61 to 18. While the program is still suspended, its staff, which was reduced from 17 employees in 2005 to three this year, continues to audit the last of the projects completed by contractors and ensure they're up to code.

Lipscomb said he is in talks with Enterprise Community Partners, the national nonprofit group focused on affordable housing, to shape rules for a new program and to issue bids for a new group to take the reins of the HARP. The size of the program, he said, would depend on how many private partners join the project. The Plough Foundation is involved, Lipscomb said, and Memphis Light, Gas & Water has contributed nearly $2 million to the project.

The problem of deteriorating homes in Memphis is exacerbated by two things, Lipscomb said.

"Our housing stock is old, old, old, and our people are getting older," he said. "Also, if we don't get other resources on this problem, we can't solve the problem."

In 2005, the HARP in Memphis had a budget of $3.2 million. It sagged through the recession to a low of $250,000 and has rebounded somewhat and projected to be just over $1 million next year.

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