Several years after the federal department of Housing and Urban Development paid for Mercer County Housing Authority to tear down the former Steel City Terrace in Farrell, HUD wants some of that money back.

The authority recently received a letter requesting it return about $146,000 to HUD because the application was incorrectly approved, authority Executive Director L. Dewitt Boosel said Wednesday.

“It’s frustrating,” Boosel said, for the department to come back years later and demand the money be returned. “And we’re not the only authority who got this letter.”

The authority received $127,000 in 2004 and about $19,000 in 2005 that HUD now says is ineligible. The Steel City site is now home to Centennial Place, which was built with a multi-million dollar HOPE IV grant from HUD.

It’s a question of whether the funds were used for “demolition” or “disposition,” Boosel said. The authority applied for “demolition” money but under HUD’s reinterpretation of regulations, some of the costs would fall under the other category.

“It’s not clear at this point what the difference is,” Boosel said, adding that he and staff are researching the issue.

“The hard part to take,” said authority controller Connie Moroco, “is that we worked closely with HUD representatives in Pittsburgh … and they approved it. Now after an audit, another office says it’s not approved.”

“We didn’t do anything wrong,” said authority board member Timothy Jablon.
The authority has the cash in reserves, Boosel said. If it does not respond to the request, HUD will just take the money from future subsidies, he said.

Boosel said he has never encountered another situation where HUD has asked for money back.

The authority has 30 days to respond to the request and 60 days to pay back the money unless a payment schedule is set up, Boosel said.

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