MORE 1602 project LAPISI ...
The American Samoa Economic Stimulus and Recovery Office has completed a 1602 Project Interim Report, signed by its Executive Director Pat M. Galea’i, which Samoa News understands has been presented to the governor and will be sent to the U.S. Treasury with a cover letter from the governor.
The signed Interim Report is a 12-page document revised from “The Section 1602 Project Draft Report, revised on July 11, 2012” that was reported extensively by Samoa News beginning Aug. 30.
A copy of the Interim Report received by Samoa News also has attached a spreadsheet or matrix detailing the 132 projects, which includes name of project owner/developer, application scores, grant award, project cost, completion status, certificate of occupancy issued info, number of project units, units complete and units occupied.
For transparency and accountability, Samoa News has published the spreadsheet in today’s issue of Samoa News. Read with the Interim Report narrative, the two documents point to ASESRO recommendations that its staff “should continue to monitor and report compliance issues to the appropriate authorities” and that “there is clearly cause for further investigation and review by the grantor”.
A copy of the signed Interim Report, including spreadsheet is attached.
The Interim Report is not the final report, which according to ASESRO will be in January or Feb. of 2013, with completion of the 1602 project program Dec. 31, 2012.
THE INTERIM REPORT
The LIHTC Section 1602 program provides funds under the American Recovery and Reinvestment Act (ARRA) provision to finance construction or acquisition and rehabilitation of a qualified low-income building. The local program is administered by DBAS, which was approved to receive $30.77 million under the program.
The Interim Report’s objective remains the same as stated in the draft report — to evaluate “DBAS compliance with applicable federal rules and internal control procedures at grant origination (including application process), eligibility review in awarding of sub-grants, and administering of 1602 grant funds.”
Differences between the draft report, as reported in the Samoa News and the signed Interim report are found in allegations reported by Samoa News from the draft report and in the information that has been added in terms of review clarifications.
Two major allegations in the draft report are no longer found in the Interim Report. They are:
1 A subgrant was made to the girlfriend of the DBAS president; a subgrant to the sister of the girlfriend; a subgrant to another sister of the girlfriend and a subgrant to the brother of the girlfriend. The draft report alleged that these applications were “dubious” as each “did not have a completed Evaluation Criterion.”
2 “The emphasis was on maximizing the flow of grant funds into the hands of the developers at a time when the DBAS President was running for Governor.”
The Interim Report lists the first allegation under “Other issues that warrant further review” and as “questionable personal circumstances”, but has removed “girlfriend of the DBAS president”, instead noting “One family in particular received several sub grants…”, reporting the same amount granted, as in the draft report — $107,268.30, each for a one unit project, and that developers fees of $14, 500 were obtained by three of them “in addition to approved construction expenses”. No completed evaluation criteria forms for these awarded sub grants were noted in both documents.
The second allegation, which was found under Conclusions of the draft report is no longer stated, with the sentence now found under Part 3 Findings of the Interim Report — Concerns. The sentence now reads: “The emphasis was on maximizing the flow of grant funds into the hands of the developers "without due regard to compliance and prudence."
For comparison of other allegations noted in the draft report versus the interim report, a copy of the Interim Report is available online: samoanews.com
Found in the Interim Report, but not in the draft report is updated information, such as ASESRO has since received a copy of a quarterly report required by the US Treasury Department. However, it does not say what quarter or what report — performance or financial status. The draft report said no report copy had been received to date — July 11, 2012.
Other interesting information found in the Interim Report, but not in the draft report:
1 ASESRO says that some of the 1602 projects lack accessibility by the tenants they are suppose to serve. The interim report say this is “likely the result of the waiver granted to DBA, exempting them from individual market studies. It is beginning to appear that the blanket market study performed may have vastly overestimated demand for these units."
2 Under ‘Unsuccessful Application’__, it states that “it is disconcerting to note that some denied applications scored higher on the evaluations (47-56) than some approved applications (as low as 27), without explanation.”
3 ASERO says that through its review of DBAS paperwork, it cannot account for over $21 million of the more than $30 million 1602 grant amount, because the payments were not processed through their office, as required by the U.S. Treasury.
SPREADSHEET DETAILING THE 132 PROJECTS
Download attachment to see copy of spreacsheet.
The draft report was the subject of Senate hearings, which began the first week of last month with testimony from the former Development Bank of American Samoa president Lolo Letalu Matalasi Moliga, who questioned the “integrity” of Samoa News for reporting on the Section 1602 program draft report, which he described as “trash” that belongs in the “trash bin” next to Samoa News or at the landfill.
Lolo, in his testimony said much of the information in the Samoa News stories “is all trash” because there is no evidence or proof to support them.
He went on to say that DBAS has operated in accordance with the law and governed by the board. He challenged Samoa News to go read DBAS policies, read the rules and regulations and see if he has violated any rules and regulations pertaining to bank operations.
Lolo also said the Section 1602 program benefited the community and has brought changes to where low-income families reside. He said this program is for low-income families to reside in these homes but not for low-income families to build these homes.
He insisted the program operated in accordance with policies of the DBAS and regulations of the U.S. Treasury Department.
What is important is that the Freedom of the Press the newspaper has, should not be used to stir untrue controversy in a peaceful community such as ours, he said, adding that he does not mind being the target, but the innocent people should not be included. He did not identify the "innocent people".