A Modesto nonprofit agency is under investigation for allowing staff and family members to live in government-subsidized homes rather than the disadvantaged people the properties were intended to help.
The Stanislaus Community Assistance Project has received $8.34 million in federal funds to buy and renovate 21 foreclosed Modesto housing units, including an apartment complex.
Whether SCAP spent that money wisely and who now is living in those remodeled homes is being questioned.
Example: It spent nearly $340,000 in taxpayer money to purchase and lavishly renovate a home at 913 E. Rumble Road, which is being occupied by the parents of SCAP's top administrator.
Executive Director Denise Gibbs' parents, Richard and Sondra Woodmansee, moved into the 2,383-square-foot Rumble home during the winter, the agency and city officials acknowledged Monday.
The Woodmansees, however, own a home on Modesto's Bluff Creek Drive, which means they may not be eligible to live in federally subsidized housing. They also own a home in Antioch.
Public property records show the Woodmansees purchased their Bluff Creek home two years ago for $219,500 in cash from Denise and Joe Gibbs. SCAP has been paying the Woodmansees to rent back the Bluff Creek home, which the agency apparently had been renting to another family through a different government-subsidized housing program.
Modesto and federal officials are auditing SCAP for questionable spending of taxpayer money. Modesto last week froze all funds to the nonprofit agency, pending completion of an audit.
Julie Hannon, Modesto's director of Parks, Recreation and Neighborhoods, confirmed Monday that Denise Gibbs' parents were living in the Rumble home.
"This is the first time I am aware that a conflict like this may exist," Hannon said. If tenants don't meet the government-subsidized housing program's guidelines, she said, they will be asked to leave.
Hannon said the city wants to know whether SCAP could be penalized for violating subsidized housing program rules.
SCAP spokesman Leo Briones said the Woodmansees pay $1,100 in rent for the Rumble home. He said he believes that they meet federal income guidelines. He said SCAP has stopped renting back the Bluff Creek home.
Community members who have been inside the Rumble home expressed concern about the $159,860 in remodeling done there in the fall at taxpayer expense. SCAP bought the home for $180,000.
"It's very, very high end," said Art Weisberg, a former SCAP board member who toured the Rumble house during a SCAP benefit in December. "It was the talk of the party."
Weisberg said the home was renovated with Brazilian hardwood flooring, a stone fireplace, solid-surface counters and stainless steel appliances — including two refrigerators. The home appears to have a new roof, fresh paint and revitalized landscaping.
"When I went though it, I thought, 'This is awfully lavish for any rental home that's supposed to go to someone in need,' " Weisberg recalled.
Gibbs' parents moved into the home sometime after that party.
The Rumble home may not be SCAP's only problem.
Hannon said city officials have discovered that four or five other SCAP properties — all purchased and remodeled with taxpayer funds — are being occupied by SCAP employees or their relatives.
Hannon said it appears that working for SCAP does not disqualify the employees from the housing program, but tenants must meet income guidelines. Some of the taxpayer-funded housing is intended for certain groups of people, such as seniors and those with disabilities.
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