Bringing down the House? Is there trouble at MaineHousing or is politics knocking at the door?

Amber Waterman/Sun Journal

Dale McCormick, director of MaineHousing, says all the agency expenses and payroll figures included in data given to the Maine Heritage Policy Center based on a Freedom of Access Act request are justified. The state Legislature and the Office of Program Evaluation and Government Accountability are reviewing the quasi-independent agency.

Were they allowed a do-over, MaineHousing officials say they might not have spent $59,000 on Hannaford gift cards.

Not because they regret the expense.

Rather, after the Maine Turnpike Authority scandal, in which its former executive director looted tens of thousands of dollars from the agency by buying gift cards for personal use, cards don't look so good.

"The turnpike took gift cards and gave them a bad name. 'Oh, my god, (MaineHousing Director) Dale McCormick is doing gift cards, too,'" said Peter Merrill, MaineHousing communications and planning director. "In hindsight, we wouldn't touch gift cards with a 10-foot pole."

MaineHousing's Hannaford purchases were just one of the unexpected elements in an open records request that has turned into a full-blown, high-profile investigation of the quasi-independent state agency. The Legislature, Gov. Paul LePage, the Maine Heritage Policy Center and State Treasurer Bruce Poliquin are among those wanting to shine a bright light on the agency.

To which MaineHousing has said, shine away.

Those wanting an investigation say their motivation is simple: to make sure the agency, which is responsible for hundreds of millions of dollars, is accountable to the people of Maine and handling its mission efficiently and above-board.

Defenders of MaineHousing counter that politics, personal interests and an unfounded suspicion that MaineHousing is the next Maine Turnpike Authority are motivating the current wave of interest.

A Sun Journal look at more than 75 MaineHousing expenses — to Google, to Hannaford, to consultants, to jewelry stores, for theater tickets and to companies that couldn't easily be found on the Internet — found some that could raise eyebrows and others that appeared plausible, and some inaccurate information being disseminated by one MaineHousing critic.

The contentious back-and-forth between the Maine Heritage Policy Center, a conservative advocacy group, and MaineHousing (also known as the Maine State Housing Authority) comes as McCormick's agency is under the microscope in the Legislature. The Office of Program Evaluation and Government Accountability is working on one rapid review and plans a more in-depth audit later in 2012, both at the direction of the Legislature's Government Oversight Committee. It's also a little-kept secret that Republican Gov. Paul LePage would like McCormick, a Democrat, to step aside.

Sam Adolphsen, director of the MHPC's Center for Open Government and the person behind the Freedom of Access Act request that resulted in MaineHousing sharing more than 60,000 expenses, maintains that for his part, it's not personal.

He's FOAA'd other agencies before and he'll FOAA again.

McCormick, with two years left in her term and a statute that makes her difficult to oust, says she feels attacked.

"You can make Jesus look bad," McCormick said. "And I'm not Jesus."

It begins

Since 2008 the Maine Heritage Policy Center has posted salaries, benefits and expenses online from a host of state agencies and departments, highlighting those it deems suspect or extravagant, conclusions that can be open to debate.

"We have billions of dollars . . . there, state spending, local spending, University of Maine," Adolphsen said.

In 2010, he sent a FOAA to the Maine Turnpike Authority for payroll and expenses and got that data six months later. MHPC flagged salary increases, alleging "explosive growth" in pay and benefits, then learned later, with everyone else, about MTA chief Paul Violette's misdeeds, which were left off the books. A state and Attorney General's Office investigation uncovered that theft. Violette is set to be sentenced April 6.

"After the Maine Turnpike thing played out, we said we really ought to look at the rest of the quasis (quasi-independent state agencies) to see what's going on there," Adolphsen said. "MaineHousing was the next on the list simply because of their size. It's a big agency, a lot of money."

On Feb. 17, 2011, Adolphsen sent a FOAA request to MaineHousing, asking for payroll and expenditures from 1998 to 2010, the same period supplied by the MTA.

An early estimate from MaineHousing to provide that information: It would take about 750 hours at a cost of $7,500.

"I think the most we'd ever been charged for data before was $200 to $300, by the university," Adolphsen said.

With that estimate, it seems, the stage was set.

Adolphsen's takeaway: "They were either trying to keep us from it or their accounting was so out of whack that that was a problem, as well. We felt either way, there really is something going on that isn't too good."

MaineHousing says much of the data was still on paper.

"They made an unprecedented request for information," Merrill said.

Though the two sides eventually agreed to a FOAA that covered fewer years, in January and February, MaineHousing released much of what had originally been requested.

"It makes me wonder, why did they come back with that outrageous cost and in the end were able to give us most of what we wanted?" Adolphsen said.

The agency says that three months into the request, the State Treasurer's Office called to ask how the FOAA was going. A week later, the Governor's Office asked the same.

"We were taking so much flak and heat for getting it done, we just went ahead and did it and did not bother to charge the extra," Merrill said. "The staff just wanted to get it over with."

Data in hand, it didn't take Adolphsen long to sound alarms.

"There's $60,000 in Hannaford gift cards; we have no answer of where any of those went or who they were given to," he said.

Expenses given to the MHPC didn't include explanations from MaineHousing, and he claims requests for additional information were rebuffed.

Merrill said MaineHousing was asked once to explain Hannaford cards, given a 2½-hour deadline and wasn't able to meet it. The $100 and $200 gift cards, according to Merrill, went to staffers, temps and on-site contractors for three years, taxed like income. One of those years, the cards were given in lieu of raises.

Given that response, Adolphsen said, "There's a lot of people working very hard around the state that haven't had raises."

Numbers game

Among the 60,000-plus expenses in the MaineHousing data that the Sun Journal asked for more details on:

* $10,890 to Google — for an email spam filter.

* $26,000 to Maine State Prison Industries — for storm windows built by prisoners for Operation Keep ME Warm clients.

* $24,607 to Samoset Resort — for hosting the 2005 Governor's Affordability Housing Conference, partially offset by conference fees to attendees.

* $18,501 to New Forest Institute — for training 64 energy auditors, offset by American Recovery and Reinvestment Act funds.

* $2,378 to Pushard's Okinawan Karate — for personal protection training for several employees, some of them home inspectors going inside rentals.

(For more examples, see graphic.)

The Maine Heritage Policy Center, Treasurer Poliquin and others have cited many of the expenses — including the gift cards and agency spending on travel, advertising and training — as examples of inefficiency or bad judgment. They say it proves the need for greater accountability and oversight of the agency.

In response, McCormick said she has actually cut costs on travel, advertising and internal training. When it was suggested that she started minding costs only after Gov. LePage's new appointees assumed seats on the housing board last year, McCormick produced a list of cost-containment measures dating back to 2005.

MaineHousing also takes issue with the Maine Heritage Policy Center's math.

In a news statement after the data release, MHPC said that based on the expenditure information provided by MaineHousing, the agency's travel budget grew 137 percent over the past six years under McCormick (between 2005 and 2010). It actually grew 37 percent.

MHPC said education and training expenditures grew 287 percent during that time. It was actually 187 percent.

And that professional services went up 163 percent. They've actually risen 63 percent.

Adolphsen acknowledged that corrected figures were later included on a MHPC website. "If it's 187 percent instead of 287 percent, that's still too big a jump," he said.

Behind some of those increases, according to MaineHousing: an extra $93.4 million from the American Recovery and Reinvestment Act that the agency had to spend.

Merrill also takes issue with the MHPC assertion that the agency has spent $6 million on a special project counting carbon emissions saved through weatherization. His boss, McCormick, estimated the project will actually take $1.2 million to get off the ground and will bring an estimated $4.5 million back to MaineHousing over 20 years in the sale of carbon credits.

Countered Adolphsen, "(MaineHousing) Board Chair Peter Anastos had said the $6 million number."

'It's just not there'

A former state treasurer, McCormick has led MaineHousing since 2005. (She spent 2009 in limbo, waiting for then-Gov. John Baldacci to reappoint her to a four-year term, which he did in 2010.)

The agency estimates that among its first-time home-buyer program, energy assistance and rental assistance, weatherization and various programs, it helps 90,000 Mainers a year. It has a staff of 140 and a multiplier effect on job creation in the thousands.

"The shame of the misinformation and accusations is the economic engine that is MaineHousing and the good we do has moved to the back burner," McCormick said.

By current statute, MaineHousing's director can be removed from the post by the governor for "inefficiency, neglect of duty or misconduct in office." State Sen. Jonathan Courtney, R-Springvale, has a bill in the Legislature to change that. It would remove the four-year term and give the MaineHousing board firing power.

Courtney, the Senate majority leader, declined to say whether he wants McCormick out, but he said he wants his bill, if passed, to take effect this summer.

"I think we need to make sure no matter who is there that they answer to the board," he said. "I think that's been the goal from day one."

After coming out of committee Thursday with unanimous support, the bill will likely head to the Senate late next week, and to the Maine House of Representatives after that, he said.

McCormick said she doesn't intend to go anywhere.

"I have children; they need health care," she said.

McCormick said she's looking for a neutral third party to review MaineHousing books and practices.

"Where are we out of line, are we spending too little, too much?" she said. "It seems like we need a little objective view here.

"I think they think they can find another turnpike authority," she said. "We're not another turnpike authority."

Of politics and personalities

Adolphsen, who has FOAA requests out to Efficiency Maine and the Maine Municipal Bond Bank, said he still has questions. He's also flagged catering expenses, advertising and consulting fees.

The MaineHousing data release has been MHPC's most high-profile splash to date, earning a top-of-the-page icon of a smiling McCormick on MHPC's The Maine Wire site.

Adolphsen, though, bristled at how MaineHousing has presented the data.

"We've now paid them, essentially, to produce this information, and now they're using it on their own website and touting (themselves) as being transparent and being public, where it appears it never would have happened if we didn't push them to do it. And they charged us $800 along the way," he said.

Jim Melcher, an associate professor of political science at the University of Maine at Farmington, suspects the controversy around MaineHousing is about more than politics and personalities. It could be about philosophy, he said: Should money be spent here or should it be spent there?

The timing is also such that, "with the turnpike stuff, it is easier for Republicans to say, 'Look, this is part of a pattern, this is what we got elected to do, to clean these things up,'" he said.

Former Republican state Sen. Peter Mills now leads the Maine Turnpike Authority. He was one of several senators to vote against McCormick's reappointment in 2010.

"It wasn't for wrongdoing, it was for management style," he said. "That may well be what this comes down to. The OPEGA report may be nothing more than passing judgment on whether some of the expenditures represent good judgment."

His major goal the past 11 months, Mills said: Restoring public faith in the Maine Turnpike Authority.

Having others look for the next MTA, not wanting to be the next MTA, "It's not great for morale," he said. "It gets thrown up at us by customers. When they get mad at us, they bring up Paul Violette and the gift cards."

When the OPEGA reviews come out, Merrill expects to hear MaineHousing could do better; the same, he said, could be leveled at any agency.

"What we've faced is a continuous brow-beating and insinuation of inappropriate, unethical, possible illegal activity, and it's just not there," he said.

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CRYSTAL WARD's picture

misinformation from MHPC

The MHPC job is to pass out as much incendiary information as they can , even if it is not correct -- 37% is not 137% , 63% is not 163%
and 187% is not 287% -- MHPC screams with misinformation and whispers the corrections. All the big numbers ,all the hype and all the time wasted -to prove what??? The the MHA is NOT like the Maine Turnpike Authority. Gov.Lepage's and Tres.Poliquin's, Kangaroo court is not holding up to the light of day. The people are catching on to the MHPC tactics (throw as much mud at the wall and see what sticks) don't wory about the whole truth or do all the research or get all the informtion just scream loud, often and keep repeating. The people will be fooled only so long MHPC.


Crystal, part of the problem

Crystal, part of the problem is that some people think they know all the answers when they really don't understand the issue, the problem, the cause, or the solution. They see one or two "bad apples" and assume that all are bad, which is not the case. If more people would educate themselves with reliable sources then maybe the dialog would change and solutions to problems could be found.

JOANNE MOORE's picture

I would certainly give more credence.....

..... to the word of Dale McCormick over anyone at the Maine Heritage Policy Center, a right-wing think tank, and Bruce Poliquin who would like a little less light shed on his affairs.

But mostly I would take Dale at her word before our lying Gov. LePage, who, in the style of Pontius Pilate, keeps his hands clean while Jon Courtney get his bill passed this summer which will change the statute that only the Gov. can fire her.

Friends of Dale know the real reasons why the "Bubba Patrol" want her out and it has nothing to do with management "style".

We need more people like Dale, who cares about the the people she serves and less like LePage, Poliquin, and other assorted wackos who serve the one percenters with tax giveaways and nepotism.

 's picture

It will be over soon

LD 1778 will take care of all of this mess.

There is a reason why Craven and Rotundo tried to kill OPEGA years ago. Sunlight is a great disinfectant. Stay tuned.

 's picture


When browsing the detailed expense report at the end of this article, I noticed that huge sums of money were given to Tanerprise Inc. without any explanation as to why the money was spent. Is anybody familiar with this company?


Comedy central

Multimillion dollar snafu at DHHS along with obfuscation and disinformation and we get "Heck of a job Brownie" and a few thousand for a picnic at Maine Housing and the sky is falling. It truly is laughable.

AL PELLETIER's picture

Get with it SJ

Spring forward one hour.

AL PELLETIER's picture

Lots and Lots

of splainin to do there Lucy McCormick.

Mark Brennick's picture

1.5 millon on new

1.5 millon on new appliances.Help I need a new refrigerator.

 's picture

Looks Like A Duck Walks Like A Duck?

Has to be a duck! Face it folks this director of this agency is going to cry LOUDLY because she is indeed under pressure and a lot of those expenses are indeed questionable.

Now lets look at that property deal she had to rescind on was that an open and ethical deal?

You can spin it anyway you want to but facts are the cold hard truth and you can not hide that

AL PELLETIER's picture

Hold your applause!

Dan got up on the wrong side of the bed this morning.


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