For the first time in two years, the Chattanooga Housing Authority is back in good standing with the U.S. Department of Housing and Urban Development.
HUD had listed CHA as a "troubled" housing agency since 2009, citing financial accountability problems.
Better interest rates on loans and being better positioned for competitive grants are two immediate benefits of the agency's newly gained "standard performer" status, housing officials said Tuesday.
"It has increased our credit rating in the eyes of lenders," said Naveed Minhas, CHA's vice president of development. "That affects us immediately."
On Tuesday, CHA officials got HUD's documentation, which said the Chattanooga Housing Agency earned a score of 81 out of a possible 100 points for its Public Assessment System rating for 2010 and therefore is back in good standing with the housing agency.
That's an improvement from the score of 66 that CHA received in 2009. HUD designates a public housing agency as "troubled" if the overall score falls below 60.
"Outstanding," said CHA board Chairman Eddie Holmes after getting the latest report.
It took "a lot of hard work from a very dedicated staff and a committed board to move us to this point," he said.
Being off the troubled list and considered a "standard performer" makes CHA more competitive, according to a CHA news release.
"We had to take more grants at a higher interest," said Holmes. "We're now able to get lower-interest funding, which is a good thing."
CHA recorded a $4.5 million budget shortfall in 2008, and landed on the troubled list after HUD found that the agency mismanaged funds for low-income housing and for a housing voucher program. The agency also took a $3.6 million Fannie Mae loan that was supposed to be for affordable housing and used the money to cover its own operating expenses.
The agency since has reached a loan settlement with Fannie Mae and cut one-third of its staff to improve its financial picture. CHA's senior management agreed to take 10 percent pay cuts, and several staff members also took on dual jobs.
The results showed in this year's assessment, CHA officials said.
In the news release, CHA Executive Director Betsy McCright said, "It took plenty of sacrifices, flexibility and can-do attitudes for us to get where we are today."
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The above story was modified on Nov. 16, 2011 to show the Chattanooga Housing Authority received an overall Public Housing Assessment System rating of 66 in 2009. The number was incorrect in the original version.