Texas town shocked to discover it has housing agency from federal auditors concerned about fraud

Kyle, Texas, is a town about 20 miles south of Austin with a population of 34,000 — and a government housing agency that its mayor and city council were shocked to discover existed, receives federal funding, and has apparently had no real city oversight since maybe its launch in 1977. Mayor Todd Webster learned about the Kyle Housing Authority in a Nov. 2 letter from the San Antonio office of the federal Housing and Urban Development Department (HUD), listing several problems at the agency that suggested gross mismanagement, the Austin American-Statesman reports.

The local HUD office had audited the agency in March, and its report found poor maintenance of the federally subsidized units, undocumented expenses and paid absences, and a serious lack of oversight, including a doubling of the Kyle Housing Authority's executive director's HUD salary from 2012 to 2015 without any outside approval. Under Texas state law, the mayor is supposed to appoint the board of commissioners that oversees the agency, but the last board appointments were approved in 2007 by longtime Executive Director Vickie Simpson. Webster also told the American-Statesman that the housing authority apparently hasn't submitted any annual reports, as required by law.

Webster, immediately upon receiving the letter, selected five people to form a new board of commissioners, and Simpson notified the mayor of her "retirement/resignation" two days later, saying "it is time for me to move on and spend more time with my husband, who has been ill for the past six years." She maintains that she had planned on retiring before the letter, and said she won't comment on the allegations in the HUD letter until she speaks with HUD. You can read more about Kyle's November surprise at the Austin American-Statesman.

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