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FOR IMMEDIATE RELEASE
HUD Slams St.
Paul for Violating Hiring Law The Department of Housing and Urban Development (HUD) has found the City of St. Paul in violation of requirements for hiring and contracting with low-income residents and businesses. Faith leaders in ISAIAH and the St. Paul Black Ministerial Alliance are calling for restitution for years of misuse of funds intended for the low-income community. The City and HUD are continuing to negotiate an agreement to come into compliance in a meeting tomorrow, January 29. But Lonnie Ellis, Minister of Social Justice at St. Thomas More Catholic Church, says: “After years of diverting money intended to go to the low-income community, it is not enough to simply ask the city to start following the law. There is at least $4 million in debt owed to the low-income community. We urge the national HUD office to step in and demand restitution.” The City receives around $10 million a year from HUD, and Section 3 regulations state that for any project receiving Section 3 dollars, to the “greatest extent feasible” 10 percent of contracting dollars must go to low-income businesses and 30 percent of the new hires must be low-income residents. A monitoring review conducted the week of May 19, 2009, found a failure of the city to report compliance “for the last several years.” For the past four years, at least $4 million should have gone to the low-income community in contracting, and possibly a lot more as many projects were at least partially funded with Section 3 funds. The faith leaders are calling for that money to be restored in the form of job training and small business development. From 2000 to 2008 Fredrick Newell made requests of city council members, the city attorney, the human rights director, relevant department heads, and mayors Kelly and Coleman to bring the city into compliance. In June of 2008, Newell filed a complaint with HUD documenting the city’s failure to notify potential low-income businesses and to exercise oversight over contractors. Newell and ISAIAH advocated locally and in Washington, DC, for HUD to conduct a monitoring review of the city. In its review, HUD found the problems went far beyond not meeting goals or reporting correctly, but that “staff had no working knowledge of Section 3.” Newell states, “the volume of documents which was collected between 2000 and 2008 persuaded HUD to turn our Section 3 complaint into a monitoring review that looked for compliance over a three-year period. Accordingly we received one of the most strongly worded Determinations of Non-compliance ever issued based on Section 3 compliance” The faith leaders applaud HUD for stepping in and forcing compliance. However, a letter has been sent to HUD Assistant Secretary John Trasvina, requesting the national office to call for restitution to be part of the agreement between the City and the local and regional offices of HUD. There is strong precedence for restitution from Long Beach, CA. There the City, HUD and the complainants were able to come to an agreement for the City to implement a $3.2 million small business incentive program based on 10 percent of construction costs and provide 3000 hours of work to low-income residents. Leaders from ISAIAH and the Black Ministerial Alliance have met with Mayor Coleman and his staff in recent weeks. Pr James Thomas, pastor of Mount Olivet Baptist Church and member of the Black Ministerial Alliance, says the City will not consider the groups’ provisions for restitution. “I’m disappointed that the city doesn’t seem to want to listen to us. But that doesn’t mean we’re going away.” Background: ISAIAH is a faith based community organization of 100 member congregations in the Metro Area and St. Cloud working for racial and economic justice. http://gamaliel.org/ISAIAH The St. Paul Black Ministerial Alliance is an ecumenical collaboration of 10 churches. |