New London - The executive director of the New London Housing Authority was let go after a federal audit revealed the agency did not properly administer the $1 million in federal Capital Program funds it received over three years.

Joseph A. Abrams, who went out on sick leave in June, resigned his post Aug. 3.

In their response to an Aug. 7 report by the Office of Inspector General of the Department of Housing and Urban Development, authority officials said they were "unable to make appropriate decisions on contracts, proposals, budgets, internal controls, procurements, and other activities cited for violations'' because of the executive director's poor performance.

The auditor's report found that the housing authority had not properly administered $910,000 in federal Capital Program funds and may not be competent to administer new stimulus money.

The housing authority also cannot account for $91,000 in unsupported administrative fees for the program, and auditors have recommended the authority pay it back.

The August report found that the authority improperly awarded contracts, failed to establish written contracts and did not ensure that contractors paid workers minimum wages.

In its response, the five-member board that oversees the authority told HUD that it was not responsible for Abrams' managerial flaws.

"The Board, in addition, wishes to express its desire to avoid taking the blame for its Executive Director's unprofessional conduct, lack of responsibility and generally dismissive attitude toward any accountability to the Board of Commissioners as well as to federal and state regulators,'' officials wrote in comments at the end of the 25-page report.

The board indicated that once it was notified of the numerous regulatory violations in April, it "swiftly sought and obtained the resignation of the Executive Director and installed new management."

Abrams was replaced in August by Sue Shontell, acting executive director.

"I have not seen the report. I am no longer an employee, I have no comment,'' Abrams said Monday. "I have no desire to get embroiled in it.''

Shirley Gillis, chairwoman of the authority, could not be reached to comment.

The report, which covers Jan. 1, 2006, to Dec. 31, 2008, outlines a lack of formal accounting procedures; failure to regularly monitor capital funds; and accounting records that were not accurate or up to date.

The housing authority also did not accurately report obligations and expenditures to HUD to support $91,012 in administration costs for the capital program.

Shontell said that money is not missing. It was used for administration of the program but wasn't recorded properly, she said.

"Obviously someone was doing the work,'' she said. "But we didn't show how much admin time was spent on it.''

The audit is part of the inspector general's initiative to evaluate public housing authorities' abilities to administer stimulus money received under the American Recovery and Reinvestment Act of 2009.

Julie B. Fagan, field office director at HUD in Hartford, said the audit is under review by her office, which will set up a meeting with local officials to discuss the findings.

"We have no comment on the report yet,'' Fagan said. "We have to sit down and do reviews and come up with agreements."

She said any potential criminal investigation would be the responsibility of the criminal investigation division of the Inspector General's Office.

"It's really too early to say what's going to happen,'' she said.

The housing authority is a quasi-public agency that manages 224 units of federal housing and 580 units of state-subsidized housing. A board of directors, appointed by the city manager, oversees operations.

In April the authority received $381,000 in stimulus money for outside improvements to Thames River Apartments on Crystal Avenue. Last week, Shontell said the money was being redirected to purchase water heaters for Thames River and HUD's other property in the city, the Williams Park senior housing on Hempstead Street. The funds will also be used to install concrete platforms for garbage receptacles at Williams Park, repairing a retaining wall at Thames River and upgrading elevators at both complexes.

Fagan said the proposed changes are under review and a decision will be made in the next few weeks.

In May HUD "strongly urged" the board to contract with a management company to run the federal properties. It has been on HUD's list of troubled agencies since 1998, after accruing debts to utility companies, the city and the state.

Also, earlier this month, the housing authority was awarded $2.1 million in low-income tax credits for a $48 million project to renovate the 302 units of state moderate income public housing.

The project is a joint venture between the authority and The Carabetta Organization of Meriden. After construction, Carabetta is expected to take over management of Briarcliff, located off Colman Street and Bates Woods, located off Jefferson Avenue.

k.edgecomb@theday.com