Under USDA’s watch, some rural public housing is falling apart

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BELLE GLADE, Fla. — After days spent harvesting beans, bagging sugar and driving tractors in the blistering heat, the farmworkers return to decaying homes.

The residents of the Okeechobee Center in Belle Glade have mold creeping up their walls and ceilings riddled with holes. One mother reported roaches crawling over her infant’s face. Sewage was found leaking onto the ground outside the squat concrete buildings.

These broken-down homes were built with money from U.S. taxpayers. The Okeechobee Center is part of the country’s biggest federal housing complex for farmworkers, and is supported by federal subsidies that help cover some poor families’ rent. Though the property is privately owned, it is supposed to be closely overseen by the U.S. Department of Agriculture, which requires that the homes be “decent, safe and sanitary.”

Peeling paint inside Gertha Saint Juste’s home at the Okeechobee Center.Suzy Khimm / NBC News

But federal safeguards failed to prevent the property from descending into disrepair, NBC News found in a three-month investigation. And now, as low-income housing like the Okeechobee Center is falling apart, the Trump administration wants to eliminate federal funding that could help fix it.

Romeo Smith, 55, a tractor driver, points to the crumbling back wall of his home, where the metal rebar is exposed. He covered it with a piece of plywood, hoping to keep out the rain. A few doors down, paint is peeling from every corner of Gertha Saint Juste’s home, and roaches and mold have run rampant. She cleans constantly, worrying about her 6-year-old son’s asthma, but that only does so much. “You can’t clean to fix the hole in the wall,” said Saint Juste, 45, who washes and cuts produce at a nearby farm.

The Okeechobee Center is part of a little-known government initiative that houses more than 400,000 low-income families in about 13,000 privately owned properties across rural America, from Appalachia and the Mississippi Delta to California’s Central Valley. Built with federal loans, the properties are intended to address a shortage of quality, affordable housing in rural areas, with some specifically dedicated to agricultural workers.

Romeo Smith, 55, a resident of the Okeechobee Center.Suzy Khimm / NBC News

Unlike public housing complexes in metropolitan areas, which are supervised by the Department of Housing and Urban Development, the rural properties are overseen by the USDA — an agency best known for supporting food and farms, not affordable housing.

Amid staffing cuts and with limited resources to fix aging buildings, the USDA has pared back its housing inspection protocol, provides little public information about properties’ physical conditions and can be slow to take enforcement action when housing fails to meet federal standards, NBC News found in an investigation based on USDA documents, including inspection records and emails; government watchdog reports; and interviews with tenants, local officials and a dozen current and former housing officials.

“These are wildly underfunded programs with inconsistent, episodic attention by a challenged agency,” says David Lipsetz, a former USDA housing official and CEO of the Housing Assistance Council, a group that aids rural nonprofits.

Over the past decade, the number of staff members in USDA division overseeing the rural housing program, has plunged by 26 percent, according to federal data. At the same time, repair and maintenance needs have swelled: About 15 percent of properties built through the USDA’s two main rental housing programs are in poor or below average condition, according to a 2016 analysis commissioned by the agency. The report estimated it would cost $5.6 billion over 20 years to make all the capital repairs the properties need.

The back wall of Romeo Smith’s house has crumbled, exposing the metal rebar.Suzy Khimm / NBC News

Most owners do a “stunningly good job” keeping their properties in decent shape on a shoestring budget, Lipsetz said, and most housing advocates consider the initiative to be a success. But some owners have not kept up with basic maintenance and repairs, leaving their tenants with deteriorating roofs, faulty septic systems and other costly problems. Tenants in an upstate New York town complained about rampant mold and leaky roofs in 2014; in Walhalla, South Carolina, residents told a local paper about leaks and shoddy repairs in 2016. One farmworker complex in central Florida had such severe mold, water and termite damage that it was shut down in 2006 after the owner received approval to do so from the USDA, displacing all the tenants.

At the Okeechobee Center, home to more than 370 low-income families, the USDA spent years standing by while living conditions deteriorated, and the owner only made limited fixes, NBC News found.

The USDA says the conditions in Belle Glade are an outlier, blaming bad management by the property’s independent owner, the Belle Glade Housing Authority. The USDA will “overcome this mismanagement and restore Okeechobee Center into the safe and healthy homes that American farm workers have earned,” Phil Leary, state director of the USDA’s rural development office in Florida, said in a statement. The housing authority, in turn, has blamed tenants for not maintaining their homes and told NBC News it has done everything the USDA asked.

Housing advocates say the years of problems at the Okeechobee Center — which drew public attention after tenant complaints reached local officials this summer — show both the importance of the USDA’s role in protecting residents and the ways in which the agency is falling short. The rural housing initiatives are “orphan programs” that are critically necessary, but not a priority for the USDA because they are significantly smaller than the agency’s other programs, said Diane Yentel, president of the National Low-Income Housing Coalition, an advocacy group.

The USDA insists it takes prompt action when it uncovers problems.

“Any deficiencies are noted and must be corrected as quickly as possible,” the agency said in a statement. “An owner who fails to properly maintain or manage a property will be subject to progressive enforcement actions by USDA until the property meets the requirements of the loan agreement.”

Mary Cortes, 80, a retired farmworker who lives at the Okeechobee Center.Suzy Khimm / NBC News

But tenant advocates fear that years of underinvestment and neglect could leave aging properties in such poor shape that they ultimately become uninhabitable, accelerating the affordable housing crisis in rural America and putting its most vulnerable residents at risk.

Residents at the Okeechobee Center — where rent is less than $450 a month for a three-bedroom home — say they would have few alternatives if they had to move. “I don’t know where I’d go,” said Mary Cortes, 80, a retired farmworker who uses a wheelchair.

‘They don’t deserve to live like this’

An hour outside Mar-a-Lago, President Donald Trump’s members-only club, the green fields stretch for miles. Sugarcane, tomatoes, lettuce and beans all flourish in the rich, dark soil. Much of the farm labor is done by black and Latino workers — many of them immigrants — who harvest produce for low wages under the blistering Florida sun.

The Okeechobee Center began as a 1930s migrant labor camp, created under a New Deal program for Depression-stricken families. Propped up on wooden platforms, the homes were an upgrade over the squalid sheds where farmworkers slept. But living conditions were still rudimentary decades later. Edward R. Murrow’s 1960 documentary, “Harvest of Shame,” shows young children at the complex sitting on beds crammed together, with sheets chewed apart by rats; one boy had a nail stuck in his bare foot.

The black section of Belle Glade in the 1930s.Arthur Rosenstein / Farm Securities Administration

Later that decade, the federal government scaled up rural housing developments across the country as part of the War on Poverty. It gave out low-interest loans to build rental homes in rural areas, providing tenant subsidies and federal oversight for the length of the loan. In some areas, these were the only affordable rentals with electricity and indoor plumbing.

At the Okeechobee Center, which was then a segregated complex for black farmworkers, the federal government replaced the Depression-era apartments with individual, concrete-walled homes. “You couldn’t ask for better,” said Henry Lockett, 80, a Belle Glade resident who grew up across the street.

Inside a farmworker’s home in the Okeechobee migratory labor camp, in Belle Glade, Fla., in 1941.Marion Post Wolcott / Farm Security Administration

But over the decades, as the federal government shifted its attention to developing urban and suburban housing, and rural areas shrank, investment in rural housing dried up. The original agency that made the loans, the Farmers Home Administration, was folded into the USDA, which was authorized to create a rural housing division in 1994.

“You have responsibility for tenants,” said Larry Anderson, a former USDA official who helped create the agency’s housing inspection system in the mid-1990s. “It’s not the objective of the program to have them living in squalor.”

The agency’s inspection system, though, is less rigorous and transparent than the one that HUD uses to evaluate public housing in suburbs and cities. The USDA’s inspection report does not tally the total number of violations at a property or provide numerical scores, and no information about inspection results is readily available to the public. (The agency said it was prohibited from releasing more detailed data without a Freedom of Information Act request. NBC News filed FOIA requests months ago, but the USDA has yet to release any documents in response.)

The USDA intentionally designed the system to be less codified than HUD’s to empower its field staff and encourage a “hands-on” approach to supervising its loans, said Anderson, who currently works as a housing consultant for rural property owners.

A pile of trash at the Okeechobee Center.Suzy Khimm / NBC News

But years of staff cutbacks — which accelerated under the Obama administration — have undermined the system, leaving the USDA without enough experienced field staff members, according to some housing advocates and former officials like Anderson.

The USDA also stopped using worksheets that indicated the frequency and severity of violations as part of a transition to a digital inspection system that was completed in 2015, according to documents and background information provided by the agency — a change that makes the system “less thorough and more subjective,” Anderson said. (The USDA says its inspection standards and protocol have not changed.)

At the Okeechobee Center, USDA records obtained by NBC News suggest a casual approach to inspection. Covered in mold and peeling paint, one home was in such poor shape that the USDA said in a July 2015 letter to the complex’s owner that the tenant “need[ed] to be moved to a different unit immediately.” But on the inspection report that year given to the housing authority, the USDA did not mark any official violations. Instead, the agency simply provided the owner with a bullet-pointed list of findings, which the USDA later acknowledged weren’t addressed in a 2019 letter to the housing authority.

The following year, living conditions appeared to be deteriorating, according to agency documents. “In general the units are in extremely poor condition and in need of substantial rehabilitation,” the USDA said in August 2016. The USDA can take forceful action in response to violations, including foreclosing on the property or issuing fines. To avoid such measures — which could displace tenants — the USDA recommends asking owners to create a formal “workout plan” for correcting serious problems

But such a plan never came together in Belle Glade, according to agency records and interviews with staff and former officials. In 2017 and 2018, USDA staff visited three times but only spoke in general terms about aging buildings and minor upkeep, such as cleaning up stray beer cans, said Alan Sullivan, executive director of the Belle Glade Housing Authority. No one demanded a comprehensive plan to fix the longstanding problems, he said. (The USDA held the meetings “to discuss concerns with the unacceptable level of deferred maintenance of the property,” the agency wrote in its 2019 letter to the housing authority, but says the owner had not taken the proper steps to submit an assessment of the property’s repair needs. Sullivan contests this, providing NBC News with his correspondence with the agency.)

The current problems caught the attention of local authorities and media this summer after Families First of Palm Beach County, a social service agency, heard about one family’s predicament: Rats were biting their children’s feet, roaches skittered everywhere and mold covered the walls. The report reached local officials and prompted an immediate response from Sens. Rick Scott, R-Fla., and Marco Rubio, R-Fla., as well as the USDA, which demanded a repair plan from the housing authority in July.

Deteriorating conditions inside a family’s home elicited a local outcry in July.Families First of Palm Beach County

“These are some of the poorest families in my community, who are doing some of the hardest work,” said Melissa McKinlay, a Palm Beach County commissioner. “They don’t deserve to live like this.”

The conditions were so grim that McKinlay enlisted the county health department to assess the properties in August. The county’s inspection reports describe damaged walls, widespread mold, rodent droppings, roaches, exposed wires, missing smoke detectors and a “sewer line discharging sewage onto the ground,” among other serious violations.

The USDA says that it followed all standard policies and procedures in Belle Glade, noting that the government had poured millions into the complex over the years to expand and rehabilitate the buildings. The property’s owner has $3 million in reserves that it should have spent on repairs long ago, the USDA said, faulting the housing authority for failing to fix the problems promptly.

The Belle Glade Housing Authority submitted a written plan to the USDA in mid-August explaining how it was “stepping up on our care of the property,” and is now waiting for a response. But the management also blames some of the most egregious health and safety violations on tenants themselves. “If they don’t take care of it, if they leave their food sitting out, they’re unfortunately going to have problems, whether it be roaches or rats,” Sullivan said. He added that cultural differences have exacerbated the chronic mold and mildew. “We have a big problem with the people that are from Haiti — they don’t want to run the air conditioning.”

The struggle to fix the Okeechobee Center echoes shortcomings that government watchdogs have flagged as well. In a 2011 report, the Government Accountability Office found that 50 percent of all USDA properties dedicated to agricultural workers had violations related to their physical condition, finances, or management without a formal workout plan in place to address them, or were in default, which meant the owner was at risk of losing them.

While only a handful of those properties were in “high levels of disrepair,” the USDA routinely let problems languish and was unable to identify or track the most severe problems, compel owners to make fixes or direct funds toward high-need properties, the watchdog’s report said.

‘Now we have to pay the price?’

Under the Trump administration, threats to the USDA’s rural housing programs have been mounting. Despite growing concerns that limited staff and resources have undermined the USDA’s work, the White House has proposed slashing funds for rural rental housing for 2019 and 2020, eliminating direct loans and grants for fixing existing properties or building new ones. Shortly after taking office, Agriculture Secretary Sonny Perdue eliminated rural development’s top leadership post, replacing it with a lower-level position, prompting Congress to reinstate the job in December. The White House has yet to nominate anyone for the position.

Legislators from both parties have rebuffed the administration’s defunding requests, defending USDA housing as a vital resource for rural America. Since 2016, Congress has increased funding for the agency’s two main rental housing programs by about $18 million, and for a preservation and rehabilitation fund by $2.5 million. But funding remains low compared to previous decades and has not kept up with the needs of the programs’ aging homes, former agency officials and housing advocates say. (The administration said the president’s budget has prioritized rural housing by fully funding rental assistance for tenants. Perdue is “highly invested” in the division, working to fill hundreds of vacant positions, according to the USDA.)

To help close the gap, the House recently passed a bipartisan, $1 billion bill to expand rehabilitation funds and help tenants stay in their homes after owners pay off their USDA loans. USDA staff also needs to be willing to “pound the table” when owners fail to act, Anderson said; advocates want the agency to have stronger enforcement tools, and have suggested bringing in third-party inspectors to assess the properties instead of agency staff.

Making long-term fixes can be costly, however, and USDA is under no obligation to pay or secure financing. Owners have limited options, as low rents often restrict the amount of funding they hold in reserve: They can try to use tax credits for redevelopment, seek investors or sell the property, often to nonprofit developers who aim to salvage them as affordable housing. States including Oregon and Minnesota have taken steps to make it easier for such financing deals to come together.

But other rural projects have struggled to find a lifeline. In Belle Glade, the housing authority has “developed a list of needs” for long-term repairs — estimated to cost more than $17 million — but doesn’t know yet how it will pay for all of them, Sullivan told the USDA in August.

Monique Mottley, 30, with her 3-year-old daughter and 7-year old niece, outside Mottley’s home at the Okeechobee Center.Suzy Khimm / NBC News

But finding new investors or buyers for the Okeechobee Center will be an especially tough sell, given the property’s poor condition and site design problems, said Steven Kirk, president of Rural Neighborhoods, a nonprofit community development group in Florida. “My view was, ‘Tear it down, don’t fix it,’” said Kirk, who thinks the property should be replaced with new housing. “We’d like to be there, but even as a charitable group, we can’t.”

In the meantime, tenants will help foot the bill. With the USDA’s encouragement, the housing authority has asked the agency to approve a 10 percent rent increase to help raise more funds for repairs, rankling some tenants who say they’re still waiting for basic fixes.

“Everything isn’t done correctly,” Monique Mottley, a resident, said, “and now we have to pay the price for it?”



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