New Questions on Use of Tax Money for Dallas Affordable Housing

A federal investigation and policy changes also in the works

Dallas City Council Members Monday learned 10 non-profit groups are well behind on plans to use federal housing money to build affordable single family homes.

The new questions on use of federal money come under two big clouds hovering over the non-profit housing groups. A federal investigation on past use of the money is thought to be nearing completion and a new city housing policy is scheduled for adoption that would direct the money away from neighborhoods those agencies serve.

Councilman Lee Kleinman said the money approved by the City of Dallas two years ago for the 10 groups that have fallen behind schedule should have been reprogrammed Monday.

“They pull early development fees out of the city but they don’t actually perform at all,” Kleinman said. “We need 20,000 affordable units in this city. Between those ten projects, there weren’t even 100 units.”

Former Dallas City Council Member Diane Ragsdale called Kleinman’s suggestion “grossly irresponsible.”

Ragsdale runs one of the non-profit groups, Inner City Community Development Corporation (ICDC), which focuses on the area near Fair Park. She said some of the homes her agency planned are behind schedule but city red tape was partly to blame.

“There is significant progress going on in every possible way,” Ragsdale said. “We just simply need the city to step up as well and help us forward.”

The 21 houses ICDC is building will sell to first time home owners for around $105,000 but they cost around $140,000 to build, Ragsdale said. The federal housing money from the city makes up the difference.

Ragsdale said the real problem is too little funding for neighborhoods where decent affordable housing is desperately needed.

“It’s so grossly unfair that we who work in the most disenfranchised neighborhoods continue to get beat upon and beat upon and beat upon,” Ragsdale said. “That’s why people feel that in many ways, the city does not really want these neighborhoods to improve.”

Her agency could see future taxpayer funding eliminated by the new proposed Dallas housing policy. It would direct public funding to areas where more progress is already evident to increase the chance that additional tax money would be effective in attracting private investment.

It could have the opposite effect in her area.

“It would stop the momentum we have begun,” Ragsdale said.

At the same time, results are expected soon from an ongoing investigation by the US Department of Housing and Urban Development that started two years ago when former city officials were unable to document spending of $29 million worth of federal housing money.

Kleinman said the new policy was developed and new officials put in place after past problems surfaced.

“It’s cronyism. It’s non transparent. It’s back office deal making,” he said.

Ragsdale denies any improprieties involving her group.

The Dallas City Council Housing and Economic Development Committee Monday refused Kleinman’s request and send the issue of funding all 10 non-profit groups on for a future vote of the full City Council.

But Kleinman said the Committee also asked that results of the federal investigation be provided to the City Council before a final decision on completing the funding for these unfinished projects.

A City Council vote on the new housing policy is planned next month.

Contact Us