Housing Agency's Spending Gets Lawmakers' Attention

Housing Agency's Spending Gets Lawmakers' Attention

CREATED Nov 16, 2012

By Phil Williams
Chief Investigative Reporter

NASHVILLE, Tenn. - Lawmakers are demanding answers about all that questionable spending at Tennessee's fun-loving housing agency.

Now, as a results of those questions from Capitol Hill, the Tennessee Housing Development Agency is admitting for the first time that some of that spending may have been out of control.

All of this follows an exclusive NewsChannel 5 investigation.

"Without rushing to judgment, we need to have these folks come in and explain why they are spending the money in the way that they are," said state Sen. Jack Johnson, R-Franklin.

Now, the legislature's Fiscal Review Committee has also summoned agency officials before the committee later this month.

"Appearance matters in government," Johnson said. "We are stewards of our state tax dollars. We are responsible to the taxpayers of Tennessee and appearances matter."

Our investigation documented a carefree atmosphere where the agency's former executive director, Ted Fellman, set the tone and encouraged his staff to have fun with public money.

"We work together as a team, we play together as a team," agency spokesperson Patricia M. Smith told NewsChannel 5 Investigates last month.

Even though THDA is responsible for meeting the needs of some of Tennessee's neediest citizens, Smith predicted lawmakers wouldn't care about those kinds of expenditures.

"Yes," she said, "they might be confused by the limousine -- and you'll tell them all about it. But I don't think they are going to criticize us for it."

But the agency's new boss has a brand new attitude.

"So you've heard from lawmakers?" we asked.

"Well, sure," he admitted.

"The main points of your broadcast are spot on. Some of these expenditures were inappropriate."

Perrey is a former member of the board that oversees THDA. He took charge a couple of weeks ago following Fellman's retirement.

"Frankly, some of what I saw surprised me," Perrey said. "Now that's on me for not asking enough questions, maybe not asking the right questions."

Take, for example, the agency outing to Dave and Buster's. Total cost: almost $10,000.

"I think there are other ways that you can have a rewarding place of work and to show your appreciation for the hard work that's done," Perrey said.

Then, there was that stretch limo for administrative professionals day -- at agency expense.

"The limousine?" we asked.

"No," he answered flatly.

"Should not have been done?"


Plus, there were the agency talent shows -- and the purchases of some rather unconventional costume items.

We had asked Smith, "Why would a state agency ever need to buy 'drag queen boobs'?"

"And I have no answer for that," Perrey said, with a laugh. "That will certainly not happen again."

Yet, even before our first story aired, Perrey himself had sent out this message to THDA staff, warning that NewsChannel 5 Investigates had begun with the bias that "such activities are inappropriate," adding "not one penny of taxpayers money is spent on any of this."

It's the same message delivered by the spokesperson.

"I would not call them public funds," Smith had said.

But, now, Perrey said he doesn't debate that point, "not at all, not at all."

"We are a public agency, those are public dollars, there are expectations for how we should do our work and spend those dollars," he insisted.

"I can't do anything about what happened two years ago or six months ago, but I've got a lot of control over what happens from Nov. 1st moving forward."

The legislature's Fiscal Review committee meets November 26th.

Perrey said his message to lawmakers will be that the housing agency does a lot of good work -- which no one questions -- and he plans to get the focus back on that work.

He added that the agency is only going to spend money on what make sense for its mission and eliminate anything questionable that lawmakers would not understand.

E-mail: pwilliams@newschannel5.com  

Related Stories:
Housing Agency: 'We Have Fun' - With Public Money
State Agency Not Sure Its Funds Are 'Public Funds"

View the documents:
Check register for THDA trustee account
Selected THDA credit card statements
Selected invoices for THDA expenditures