SPRINGFIELD -- A new statewide audit of Missouri's Housing Development Commission (MHDC) suggests vampaign contributions may influencr where the state's development dollars go.  State Auditor Susan Montee recommended elected officials should not make decisions about housing projects submitted by individuals from whom they've received campaign contributions.

"The perception is clearly out there that there is a system in place that encourages campaign contributions in return for projects. Whether that's the case or not, it certainly is a perception," said Montee at a press conference in Jefferson City.

The audit covers between 2006 and 2008, when Gov. Matt Blunt, Lt. Gov. Peter Kinder, Attorney General Jay Nixon and Treasurer Sarah Steelman were the four elected officials on the commission.  The MHDC has four statewide officials and six other commissioners.

While Montee's audit noted that it was difficult to match "specific donations to developers," it concluded the perception is money influences how the projects are selected.

"Something we don't talk about here implicitly in the conflict of interest is whether or not there needs to be a total different way of dealing with the fact that developers are giving campaign contributions to commissioners," Montee said.

The audit suggests, "elected officials serving on the commission should recuse themselves from decisions or actions on housing development projects proposed by individuals or entities from whom they have received campaign contributions."

A major benefactor of tax credits from the Housing Commission has been former Springfield Mayor Tom Carlson and his former development partner Mark Gardner.  The two have tapped into tens of thousands of dollars to revamp old buildings into apartment complexes around the city for low and moderate income people.

A review of campaign finance reports over the past four years shows Carlson-Gardner entities donated close to $15,000 in campaign funds to the elected officeholders who sat on the board.  Other Springfield developers and citizens have privately expressed concern about a system that seems to favor the well-connected.  Neither Carlson or Gardner responded to several requests for comments.

The MHDC said it is reviewing its standards of conduct related to that issue.

Other findings from the audit:  It appears two housing commissioners voted on projects when there was an appearance of a "conflict of interest." Also, 48 percent of former employees and 30 percent of current employees reported low job satisfaction. 

In addition, Montee noted purchases the commission made that "constitute a questionable use of public funds."  She cited $15,000 used for alcohol purchases at MHDC receptions in 2006 and 2007 as well as $28,000 spent on promotional brochures.

The MHDC takes exception to the characterization of "public funds."  It contends it is entirely "self-supporting."  Montee said that can't be true if elected officials serve time on the board.

Montee also questioned an $18,000 reimbursement to the group's executive director for legal expenses.  When Montee asked for documentation that wasn't provided, the director replied the requested information is relative to an ongoing investigation, the specifics which we are not at liberty to discuss."

To read the full audit, click HERE.

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