City Housing Authority Chief Retires

As officials grapple with the city’s most troublesome housing crisis in recent years, Donald J. Smith, executive director of the Housing Authority of the city of Los Angeles, has stepped down.

Smith, who served as executive director of the Housing Authority for the last 10 years, was scheduled to retire April 30, but on Thursday officials confirmed that Smith’s retirement became effective Wednesday.

“I have decided to accelerate my retirement due to some health and personal matters,” Smith, 65, said in a statement released Thursday. “After 10 years, I leave the Housing Authority proud of my record.”

Assistant Executive Director Lucille Loyce will serve as interim director of the Housing Authority, one of the largest such agencies in the country.

Smith’s departure leaves vacant three key housing positions. On Wednesday, the mayor’s office announced that Michael Nogueira, chairman of the Housing Authority’s board of commissioners, would resign as chairman but remain on the board. In an unrelated action, Sarah Dusseault, the mayor’s deputy for economic development, which includes housing matters, also announced her impending departure.

The decision to fast-forward Smith’s departure is viewed as the latest fallout from the Housing Authority’s problems with Section 8, a federal program that subsidizes the rents of low-income tenants.

“This crisis magnifies with each month that passes,” Dusseault said. “We need a leader at the helm immediately to deal with it.”

Smith’s lame-duck status frustrated HUD’s efforts to find a long-term solution to the problem, Dusseault said.

Last month, for the first time in its history, the Housing Authority suspended 1,500 housing vouchers, citing a lack of funds. If no solution is found, housing contracts may be canceled for 3,600 more low-income families that receive Section 8 assistance.

The problem stems from a clash between a long-standing practice at the authority -- which continued under Smith’s tenure -- and a new federal policy. Each year, the Housing Authority issues more vouchers than can be accommodated by the program, much like an airline overbooking a flight to make sure all seats are filled. In the past, local officials could tap into reserves or the next year’s allocation of vouchers to cover the costs of any vouchers used.

But Congress recently took away the Housing Authority’s ability to use certain types of reserves to pay for vouchers and has not allocated new vouchers.

Local factors have added to the problem. Section 8 participants in Los Angeles are more successful in finding property owners willing to use the voucher than they have been in the past.

Local housing officials, the mayor and others had lobbied HUD officials in Washington, asking the federal agency to allocate more vouchers, give them more money and determine how much of the Housing Authority’s reserves can be used to bail out the program.

Earlier this month, a pair of HUD officials visited the Los Angeles office in an attempt to determine how much money the agency could use to pay for the over-leased vouchers.

Although Smith is regarded by many in the housing community as a capable administrator, the authority he headed had its share of troubles before the Section 8 crisis.

In 2003, the U.S. attorney’s office opened a criminal investigation into Housing Authority finances amid questions from federal auditors and tenant leaders’ allegations of misuse. HUD spokesman Larry Bush said he was unaware of the status of that investigation.

Still, many among the city’s housing advocates and those who provide services to homeless people have applauded the work of the Housing Authority under Smith’s leadership.

“This Housing Authority, in its Section 8 administration, has a national reputation for going way out of its way to make sure low-income people have housing,” said Jan Breidenbach, who sits on the city’s Affordable Housing Commission and is head of the Southern California Assn. of Non-Profit Housing. “They have tried to be innovative and ... they have done everything they can to fulfill their mission.”

Robin Hughes, executive director of the Los Angeles Community Design Center, a nonprofit affordable housing developer, praised Smith’s “comprehensive understanding of public housing.”

At a meeting today, FRI the Housing Authority’s board of commissioners will elect a new chairman and discuss the search for a permanent executive director.

Smith, a graduate of Cal State L.A., began his career in housing at the Housing Authority in 1971. Until 1980, he served as the agency’s director of management and then spent the next 13 years working in various housing-related positions with the Community Development Commission of Los Angeles County. In 1994, he returned to the city’s Housing Authority.