RICHMOND, Calif. – A government probe into allegations of nepotism and fraud at the Richmond Housing Authority has expanded, with local police now joined by a team of FBI agents, federal housing investigators and county prosecutors.
Capt. Mark Gagan of the Richmond Police Department said the focus of their investigation is Debra Holter, the agency’s asset specialist, who heads the maintenance department for the East Bay city’s dilapidated public housing.
“They’re looking into how the housing authority approved contracts and the accounting of assets and resources at the Hacienda housing complex,” Gagan said.
Last year, The Center for Investigative Reporting revealed squalid conditions for the more than 100 seniors and disabled residents of the Hacienda housing complex. For years, residents complained that their persistent struggles with mice, mold and plumbing leaks were ignored by the housing agency.
A subsequent story found that Holter had steered almost $80,000 of emergency maintenance contracts to a vendor, some of it for work her husband ended up doing. More than a quarter of the new stoves and refrigerators bought by the agency also had disappeared under her watch.
The Richmond Police Department opened a criminal investigation into Holter in July, which the Contra Costa County district attorney’s office has joined. In addition, Gagan said two investigators from the U.S. Department of Housing and Urban Development, which oversees the housing agency, are tracking how federal money was spent and whether procurement rules were broken. The FBI, he said, is assisting the other agencies.
Gagan declined to say whether the expansion means Holter’s superiors and colleagues also could become targets for investigation. The DA’s office and FBI did not respond to calls for comment.
Holter’s direct supervisor at the housing authority was Kathleen Jones. Jones left the agency after CIR reported that her nephew, an in-house maintenance worker who also worked under her at the agency, had doubled his pay with overtime that appeared suspicious. For instance, he claimed he was completing the same jobs at the same times as another employee.
More than $340,000 in agency maintenance contracts were awarded over two years to Strongbuilt Construction Co. CIR found that Holter herself steered more than $78,000 in contracts to Strongbuilt with no outside bidding.
In 2013, she made more than $17,000 in overtime, on top of her $61,800 in compensation, that included organizing work orders for jobs later completed by her husband. She claimed all the work qualified as an emergency, which allows normal bidding rules to be bypassed and increases the amount of money paid to contractors.
Work orders indicated the jobs went to Strongbuilt, but residents said that it was Holter’s husband, Sidney, who showed up and completed the work. Sidney Holter is not licensed to do contracting work and previously told CIR that he worked as an unpaid volunteer. Strongbuilt’s owner said the two had never met.
After CIR reported that Sidney Holter was doing work for the housing authority, Debra Holter was placed on paid administrative leave.
Called for comment on the widening investigation, Sidney Holter hung up. In an email, Debra Holter said she wanted to respond to CIR’s questions but was not allowed to speak to the media during the investigation.
In December, CIR reported that more than $53,000 in appliances intended for Richmond Housing Authority properties had vanished on Holter’s watch. In all, 167 of the 598 stoves and refrigerators purchased for residents had gone missing in the previous eight years.
Debra Holter was in charge of the inventory and filled out the paperwork. In some cases, she claimed residents were getting new appliances to replace their aging stoves and fridges. Years later, the old appliances remained while the new ones were missing.
Debra Holter had a personal history of appliances sales. In 1998, just after she joined the housing authority, county building inspectors found that she and her husband were illegally selling stoves and refrigerators from their garage and backyard. Those appliances, however, never were traced back to the housing authority.