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The Navajo Nation accepted more than $1 billion for houses. So, where did it go?

December 20, 2016

SHIPROCK, N.M. – Carletta Begay and her family thought they were getting their big break.

They’d been living in a flat-topped box home on the Navajo Reservation. All six were crammed into a few hundred square feet, paying rent to a local housing corporation.

But one spring, a contractor for the Navajo Housing Authority started work on vacant lots sprinkled throughout the South Shiprock neighborhood. New houses were going up, 91 in all. Begay believed one could be hers.

The project was part of a federal housing-support program that directs hundreds of millions of dollars to tribal communities across the country.

The Native American Housing Assistance and Self-Determination Act, or NAHASDA, took effect in 1998 to ease housing shortages in Indian country. The Navajo Nation, the country’s largest tribe and whose reservation is one of the poorest places in America, gets the biggest share — $1.66 billion since it was enacted.

Despite that, an Arizona Republic investigation found the Navajo Housing Authority, the agency responsible for that money, has failed in ways almost too numerous to count.

Among them:

  • More than $100 million has been squandered on projects that never housed anyone. Some housing developments sit empty years after they were built. In the northern Arizona community of Tolani Lake, nearly $7 million was wasted on igloo-shaped fourplexes that still sit empty.
  • Much of the money received for Navajo housing simply sat unspent, collecting until the surplus was so large federal officials began pushing to take it back. Currently, there’s close to a quarter-billion dollars sitting in the tribe’s federal account.
  • Federal pressure to lower the surplus caused the housing authority to go on a spending binge the past several years, yet few homes were built. In 2016, for example, the NHA spent $152 million, but built just 26 new houses. The majority of the funds was spent on modernizing existing residences.
  • Among projects that actually were completed and occupied, many allegedly are plagued with construction problems. In Aneth, Utah, for example, $3.3 million was spent to build 23 homes that residents claim are beset by construction defects.
  • The NHA spent much of its federal money on things that don’t directly house anyone. In Fort Defiance, Ariz.,about $6.7 million was spent to open a 17,000-square-foot youth center with a gym and computer room last year.

A low point arguably came in 2007 when HUD investigators determined that the NHA repeatedly allowed misappropriations, price-gouging and excessive delays.

Auditors for the Office of Inspector General found that $53 million went to 14 housing projects that were either unfinished or never started. Contractors were hired without competitive bids. Procurement codes were ignored. Building inspections were not done. Homes were built without access to roads. Workmanship was so flawed, and building materials so shoddy, some homes were ruled unsafe to inhabit.

Mismanagement led to corruption and chaos, followed by lawsuits and bankruptcies.

Problems did not end after the inspector general’s report, despite new NHA leadership and pronouncements about a reform campaign to meet Navajo housing needs.

Nearly a decade after the 2007 investigation, there is little to show. Only several hundred new homes have been built.

Over the last several years, HUD has issued fines and rescinded NHA funds. Members of Congress have pushed to cut Navajo housing allocations. And some tribal leaders are now pressing to shut down the agency.

Today, the NHA touts a new vision in pamphlets illustrated with glossy images. Plans call for construction of 200 units near Houck, Ariz., a rural outpost 35 miles west of Gallup, N.M. But after more than two years of talk, no earth has been turned and locals say the proposed project has no water supply.

In terms of sheer waste, however, nothing compares to what happened in Carletta Begay’s neighborhood.