By Jeffrey Anderson
DCHA Executive Director has a big mess on her hands
The District of Columbia Housing Authority Executive Director Brenda Donald appeared to threaten retaliation against her agency’s own internal auditor last week in potential violation of the Whistleblower Protection Act of 1989, following a report on a housing security contract the auditor submitted to DCHA’s Board of Commissioners that alleges violations of federal housing requirements and DCHA procurement procedures, according to a copy of the report and emails reviewed by District Dig.
Petuna Cooper, Vice President of DCHA’s Office of Audit and Compliance (OAC), conducted the review at the request of Commissioner Bill Slover. In her report to the Board, dated November 1, Cooper alleged findings of unfair competitive advantage; fraudulent emergency contract awards; falsifying procurement documents; illegal contracts in violation of non-competitive contract processes; split purchase orders and bid splitting; failure to take action on an apparent conflict of interest; and obstruction of an official internal audit.
Cooper’s report comes on the heels of a September 30 report by the U.S. Department of Housing and Urban Development, which found 378 contracts—including 49 multiple awards covering 220 contracts that each violate current DCHA procurement policy. HUD officials, who conducted a five-day site visit in March, directed DCHA to hire an “integrity monitoring firm” to review all of the contracts, and after detailing numerous specific contracts that skirted Board approval, also ordered DCHA to repay all misused federal funds.
The housing security arrangement with a software firm called Verbosity involves multiple contracts totaling $875,260.00 in non-federal funds that DCHA executed without any competition in violation of its procurement policy, according to the review by HUD, which instructed DCHA’s board to investigate the reason for taking these actions.
On November 8, Donald, an appointee of Mayor Muriel Bowser, accused Cooper of going over her head, and insinuated that she could be in the crosshairs of a retaliatory probe that could damage her reputation and undermine her findings, according to an email she sent to the Board, copying HUD officials Marilyn O’Sullivan and Patricia A. Knight—who headed the team that conducted the site visit in March—and Anita Bonds, chairperson of the D.C. Council’s Committee on Housing and Government Administration.
“It is with great disappointment and astonishment that I read the report on Verbosity prepared by Petuna Cooper and submitted directly to the Board,” Donald wrote. “This is not the first time Ms. Cooper has conducted an incomplete and one-sided audit. However, she unilaterally decided to submit this audit to the Board without review and guidance from me, her direct supervisor.
“It is even more disappointing that the Board excluded me from the executive session where, despite not being on the agenda, this report was discussed and accepted with Ms. Cooper’s inaccurate conclusions.”
Washington City Paper was the first to report on the existence of the report.
The DCHA Board has known for more than a year that the Verbosity contracts did not go through the required procurement process. Commissioner Bill Slover wrote to Donald last month to inform her that after months of requests for an explanation from her office, he was requesting OAC to review the contracts and report back to the Board—which consists of a voting majority HUD has flagged for lacking independence from the Mayor.
“I look forward to better understanding the specifics around this contract and the process by which this vendor was procured,” Slover wrote, in an email copied to the Board and seconded by fellow Commissioner Kenneth Council.
Donald expressed her preference to have her executive staff complete its own review of the matter first. “We are finalizing our review on Verbosity and will provide it next week. I would like OAC to hold off initiating an audit until after you have reviewed our report,” she wrote.
After a fellow commissioner—a Bowser appointee—supported Donald’s preference to hold off on a review by OAC, Slover raised additional concerns: “With all due respect, OAC should have been leading this review the minute this board realized there was a problem. That is the reason the office exists. There is a conflict of interest having the Executive review this. The HUD report aside, this board is obligated to engage OAC at this time to determine what went wrong. Why would we wait? We have already waited long enough.”
Cooper’s report states that in 2019, DCHA leadership bypassed “full and open procurement” by meeting with Verbosity’s principals prior to the contractor’s engagement with the department that would be managing the contract, conferring an “unfair competitive advantage” to the firm.
After the Board questioned the propriety of the Verbosity contracts earlier this year, Donald’s administration then “attempted to use emergency contracts to cover up the error of obtaining an illegal contract,” Cooper wrote, characterizing the matter as a “fraudulent emergency contract award” that would allow Verbosity to continue to perform on the contract.
“The documents submitted as justification memos were signed by [Donald] and one of them was backdated to May 2022,” she wrote. “The memos were not signed by the Contracting Officer as mandated by HUD regulations. One of the memos was allegedly written by a former DCHA [chief technology officer] back in May, but this apparently was not the case.”
Cooper further found that “purchase orders are kept under the federal threshold to avoid the legitimate procurement process,” a process known as “bid-splitting,” and that “an apparent conflict of interest” related to DCHA leadership’s meeting with Verbosity principals “was not addressed according to the HUD and District procurement and conflict of interest regulations.”
“Multiple attempts to withhold pertinent information and not respond to the auditor’s email request” resulted in “Obstruction of an Official Internal Audit,” she also wrote.
Donald told The Dig in a text message that “the facts speak for themselves,” and that she would have no further comment.
A memo to Donald in May from the interim Chief Information Officer (CIO) and director of Information Technology—submitted through Chief Operating Officer Rachel Molly Joseph, who was Donald’s chief operating officer during Donald’s prior stint as director of D.C. Child and Family Services—recommended that although the agreement with Verbosity had expired at the time, DCHA must extend the firm’s services to avoid any safety interruptions. (Those services include “activity-based tracking, alerting, and reporting for police and public safety related activities, based on mobile device communication by police officers and [DCHA] system/service administrators.”)
“As such, DCHA has an immediate need to establish an emergency contract for the safety, security and well-being of DCHA Residents,” the email to Donald states. “For the reasons set forth below, DCHA intends to award an emergency procurement for Automated Technology Services for up to [120] days to Verbosity, LLC.” (DCHA made a second “emergency” award to Verbosity after the first 120 days expired.)
The interim CIO’s conclusion was that “The law grants great discretion to agencies in their decisions. The DCHA Information Technology Department concludes that the law and the facts support a noncompetitive procurement of Verbosity as a sole source procurement.”
In her email to the Board, which includes ex-officio member John Falcicchio, Bowser’s Chief of Staff and Deputy Mayor for Planning and Economic Development, Donald went on the offensive, criticizing the Board for demanding that she place Joseph and General Counsel and Senior Vice President Lorry Bonds on leave, actions she claimed were beyond its authority. (Donald has since reinstated Bonds and Joseph.)
Then she took aim again at Cooper—and unnamed members of the Board: “Finally, given that this report was submitted only to the Board and not to any staff, the fact that media have a copy means that Ms. Cooper and/or one or some members of the Board leaked the report, violating your own code of ethics, thus creating unnecessary public distraction and collateral damage to the reputations of Ms. Bonds, Ms. Joseph, and myself.”
Donald also placed blame for contracting irregularities on the previous administration at DCHA, and specifically, former Executive Director Tyrone Garrett. Yet she too has had her hand in keeping Verbosity engaged as a DCHA contractor.
Reacting to Cooper’s findings, Donald told the Board that she directed the Office of Administrative Services and Bonds—DCHA’s procurement officer when it first contracted with Verbosity—to either terminate the agreements “or convert them to legal procurements.”
Of Bonds, she wrote, “In addition, I directed her as part of her performance plan to create the necessary processes to ensure these arrangements would and could not be repeated and to document all decisions so that no future leaders were left with the same situations that I inherited.”
Before welcoming “further review by a qualified, objective party,” Donald, a veteran government fixer who Bowser has turned to before, blasted Cooper one last time:
“There are many more inaccuracies or leaps to conclusions in the report which I am happy to discuss, but I want to point out one other ridiculous conclusion. The Board requested a review of the entirety of the Verbosity relationship. This report is incomplete focusing only on the actions of my team to clean up the mess that the Garrett administration left. Ms. Cooper says that the justification for an emergency sole-source contract was ‘illegal and fraudulent’ because the original agreement with Verbosity was not justified as an emergency procurement.
“I’m not sure how Ms. Cooper knew that since she skimmed over the main objective of the Verbosity review, which according to the HUD report was to ‘investigate DCHA reasons for taking these actions,’ referring to the lack of a competitive process in the initial selection of Verbosity.
“In the very detailed decision memo, staff explains that the reason for the current emergency, sole-source procurement was to ensure continuity of the essential work for OPS until we could issue a competitive procurement solicitation. Nothing more; nothing less.”
In comments to the Washington Post, which first reported details of the Verbosity report, Donald defended her actions: “This is a cleanup — a legal cleanup — process that is well documented.”
That cleanup cannot come soon enough. Multiple sources familiar with DCHA described a dysfunctional agency in free-fall. Several said that Donald considered tendering her resignation after the Verbosity report surfaced, but that Bowser directed her to stay on.
However, Donald’s handling of this latest controversy may spell trouble, as Cooper does not appear inclined to passivity. In response to Donald’s broadside of November 8, the veteran auditor wrote to the Board and defended her actions: “Trying to discredit an audit because there is disagreement with the findings does not negate the truth of the findings,” she wrote. “Further, all of the findings in the Verbosity report, every single one, is supported by factual documentation and a statement from former staff indicating malfeasance by the parties in the report. This is not a one sided review.”
Cooper also leveled her own criticism of Donald:
“Director Donald has taken the results of this audit personally when the audit presented clear and convincing objective evidence of the findings. As for my qualifications, never in my 30 plus years of conducting audits for state agencies, hospitals and other entities have I been so disrespected after completing an objective internal audit. Since this report has been performed by a qualified and objective party and has implications of criminal procurement malfeasance, the only recourse is to share this report with the proper authorities namely HUD and the OIG. Not doing so will give the appearance of obstruction of a HUD recommended review.”
She added, “Director Donald’s response below is an example of the anticipated retaliation and micro-aggression as a result of this and other audit reports. The OAC is bringing this fact to the awareness of the Board and thus invokes the Whistleblower Protection Act of 1989.”
Cooper declined a request for comment from The Dig.
On Monday, as the situation escalated, Board members expressed concern, after Cooper sent them an email informing them that Donald had “excused” her via text message from attending the Executive Leadership Team meeting that she customarily attends.
Cooper, according to an email chain reviewed by The Dig, reminded the Board that when she first presented them with the Verbosity report, the commissioners “guaranteed that this kind of retaliation will not be tolerated,” and that DCHA employees “have the right and responsibility to make protected disclosures when they are aware of certain types of official misconduct…”
This prompted an urgent response from Commissioner Kenneth Council: “This has gone far enough! [Director] Brenda Donald has proven that she is unfit to be DCHA ED and we need to remove her before she brings more negative attention to this agency. This is my shop and it has happened before. So now, we need to do responsible thing and remove Brenda Donald before she placed this agency in a position that we can not defend. This is wrong and we all should know it.”
Slover concurred: “I do believe that the agency is now exposed to potential legal actions by Ms. Cooper based on events and actions since the release of the Verbosity report. More importantly she was assured that this would not happen. This, the email from director Donald and the grilling she was given in the Wednesday meeting need to be addressed. We need to onboard an attorney ASAP to help us navigate this.”
