Press Release  Sale of Melrose Public Housing Property Results In Legal Complication

Boston — State Auditor Suzanne Bump today issued an audit of the Melrose Housing Authority. The audit found the public housing agency to be compliant with state rules and laws in the areas reviewed.

The report also disclosed noncompliance with special state legislation by the Melrose Affordable Housing Corporation (MAHC) resulting from the sale of former Authority property.

State legislation passed in 2012 allowed the Authority to transfer two deteriorating housing properties to MAHC for sale. MAHC received $696,784 from the two sales and remitted $379,763 of that amount to the authority in accordance with the law. MAHC used a portion of the remaining funds to pay off a mortgage on a three-family property and to make improvements to it. Today’s audit reported that contrary to the law’s requirements, one of the three units is rented at market rate and the rent restrictions on the other two are for a defined term rather than in perpetuity. All three units should be provided as permanent affordable housing.

MAHC stated that it worked with a lender using the federal Home Investment Partnerships Program and believed that compliance with the program satisfied the law. Responding positively to the audit, the Authority stated it will work with MAHC to take appropriate steps that will bring it into compliance.

The Office of the State Auditor conducts performance audits of state government’s programs, departments, agencies, authorities, contracts, and vendors. With its reports, the OSA issues recommendations to improve accountability, efficiency, and transparency.

The audit of the Melrose Housing Authority is available here.

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