Troubled nonprofit owes contractor at Oakhurst

TAMPA -- Despite receiving more than $5-million in federal funds for the renovation of two low-income apartment complexes, the Tampa-Hillsborough Action Plan has not paid a Tampa contractor for work it completed there.

The contractor, A.F.C. Systems, completed security fence and electronic gate installation at THAP's Oakhurst Square Apartments in May. But it has been unable to collect $175,731 on an original contract for $453,257, according to a lawsuit.

A.F.C. is now seeking to foreclose its construction lien and take title to the Oakhurst Square Apartments, a pair of two-story complexes on North Boulevard just south of Interstate 275.

"I made dozens of phone calls and was told by THAP you have to resubmit your paperwork," said Rich Laplante, senior vice president at A.F.C "I kept being told they were not getting their money from HUD and that HUD was making them jump through hoops because of the scandal last year."

THAP, a nonprofit that provides housing and medical services to low-income residents, has seen its financial health decline after federal investigations into former THAP boss Chester M. Luney.

While working as an $80,279-a-year psychologist for Veterans Affairs, Luney channeled federal money to THAP, where he moonlighted as an executive paid $78,000 annually. The VA withdrew funding from THAP after disclosures that Luney falsified reports about conditions at a veterans shelter run by THAP.

Luney also is the subject of a grand jury investigation focusing on former Tampa housing chief Steve LaBrake, who oversaw millions of dollars in federal grants allocated to THAP.

Investigators want to know whether undue influence was involved in the building of a $650,000 South Tampa home by LaBrake and Lynn McCarter, his girlfriend and a former city aide. Luney provided personal favors and committed THAP resources to help the couple complete the home.

As the federal inquiries unfolded, the VA, the city of Tampa and Hillsborough County withdrew financial support from THAP.

THAP's latest money problems involve the U.S. Department of Housing and Urban Development renovation programs at the Oakhurst Square apartments.

Federal records show that THAP submitted invoices to HUD this year totaling $219,600 for work done at the apartments by A.F.C. Systems. But HUD approved a reimbursement of just $127,420.

The reason: no more money remained in the construction account, where THAP originally received two federal grants in 1997 totaling $5.66-million.

It is unclear why THAP ran out of money before paying a major contractor who was still owed $175,731. THAP officials who might be able to explain the shortfall did not return phone calls seeking comment.

This is not the first problem THAP has had with the HUD grants, records show.

Two years ago, HUD officials discovered that THAP had borrowed from one of its HUD grants to make payments covered by the second HUD grant. HUD rules prohibit the co-mingling of federal grant moneys.

HUD disallowed two THAP requests for reimbursement totaling $27,000 for Carteret Management Co., the firm that oversees day-to-day management of the Oakhurst Square apartments. The reimbursement requests were filed by THAP chief financial officer Lynn Knox. Her husband, Levi Knox, is the on-site manager for Carteret at the apartment complexes.

Last month, HUD wrote Knox and said it was denying other reimbursement in the tens of thousands of dollars for "management fees" until THAP provided detailed administrative costs of THAP Homes, the contractor hired to coordinate the Oakhurst Square apartment renovation. THAP Homes is a sister corporation to THAP and is overseen by the identical board of directors.

The only THAP Homes employee with a state contractor's license and eligible to oversee HUD-financed renovation was Shafter Scott. But Scott resigned from THAP Homes more than a year ago.

Ralph Atkins, a THAP accountant who retired from the nonprofit last year and has now been interviewed by agents with the FBI and VA's Inspector General, said he noticed money problems involving the Oakhurst Square project.

"I got the impression the money at Oakhurst was going somewhere it wasn't supposed to go," Atkins said. "Shafter Scott said there ought to be money for the project, but it seemed to run out, and I couldn't figure out where it was going."

HUD officials said federal safeguards should help insure that contractors like A.F.C. Systems get the money they are owed.

A HUD contingency fund established when the Oakhurst Square grants were made contains enough money to pay A.F.C., and all liens would have to be paid off before the grants could be closed out, officials said.

-- Jeff Testerman can be reached at (813) 226-3422, or by e-mail at testerman@sptimes.com.

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