U.S. Rep. Sean Duffy of Wisconsin, chairman of the House Financial Services Oversight and Investigations Subcommittee, has asked Julian Castro, director of the federal Department of Housing and Urban Development, to investigate the alleged misuse of federal funds by the St. Croix Chippewa. The 1,050-member tribe operates casinos in Danbury, Hertel and Turtle Lake. Specifically, Duffy wrote a letter to federal housing officials, asking them to explain why needy tribal members may not be receiving grants meant to help them.
Duffy wrote a recent study by the Wisconsin Public Research Institute raised alarming questions about how tribal leaders were using HUD grants. The WPRI investigation stated a federal audit of $2.3 million awarded by HUD to the tribe in 2015 showed more than $776,000 in back rent most likely never will be collected. The study also showed senior officials of the tribe’s Housing Authority were giving themselves loans from a fund designed to help the tribe’s poorest members. In addition, Duffy wrote the tribe did not follow proper procedures in awarding $308,000 in block grant funds to contractors doing housing work for the tribe.
A 2014 audit showed $444,929 in grant funds were awarded to contractors without following HUD rules on selecting and evaluating vendors and other indications of misuse of funds.
Duffy wrote, “These findings raise serious questions about the use of federal taxpayer dollars and whether such funds are getting to the tribal members who deserve and need assistance.” He asked Castro whether HUD officials were aware of the 2014 and 2015 audits and if HUD contacted the tribe about the audit’s findings and recommendations. He also inquired how HUD monitors the disbursement of Indian housing grants and other federal help “to ensure that resources are properly administered, allocated and accounted for by tribes.” He concluded by asking if the audit’s results have had or will have any impact on current or future financial HUD support to the tribe.
HUD awards $660 million to 587 tribes each year to help low-income members find affordable housing. Allegations of misuse are common across the nation, but the bottom line is tribes, as sovereign nations, do not have to abide by open-government laws, so taxpayers are unaware of how the federal dollars are used.
HUD’s Office of Native American Programs did lead a separate review of the 2015 audit of the tribe’s Housing Authority. HUD officials told WPRI that review was completed last June but has not yet been publicly.
