NYCHA’s second-in-command — who was heavily involved in the agency’s effort to hide its lead paint inspection failures from tenants and the public — announced his resignation on Monday.
Michael Kelly, the general manager of the Housing Authority, was instrumental in NYCHA’s response after the agency realized that for years it had violated local law and federal regulations requiring annual lead paint inspections.
Despite that knowledge, top authority managers continued to falsely claim NYCHA was in compliance and did not disclose this failure for more than a year.
Kelly, whose salary is $216,429, is the third top NYCHA official to step down in the wake of the lead paint scandal. Following the DOI report detailing these failures in November, two others — Brian Clark and Jay Krantz — resigned. A third, Louis Ponce, was demoted.
Kelly will step down on Feb. 22, to be replaced as acting general manager by Vito Mustaciuolo, a top official at the city’s Department of Housing Preservation & Development (HPD).
Mayor de Blasio, speaking Monday night on NY1’s “Inside City Hall” said it was a “natural” time to replace Kelly, as Hizzoner begins his second term. He didn’t mention lead paint.
“It was a decision at a natural point,” he said. “It’s a natural point where people have to make a decision about their own life. Michael Kelly did some very good and very important work for NYCHA. It was a good moment for him to move on.”
Mustaciuolo, he said, is a “perfect” choice to take over the troubled agency.
“He’s a real bulldog. He goes in, he gets results,” de Blasio said.
Since 2012, top NYCHA executives have falsely certified year after year that they were performing all the required lead paint inspections and remediation. NYCHA has also relied on untrained, uncertified workers to inspect and clean up thousands of apartments with lead paint.
NYCHA Chairwoman Shola Olatoye claimed she did not learn that NYCHA was in non-compliance until early 2016, but signed off on the false certification in October for that year anyway.
For more than a year Olatoye and Mayor de Blasio knew the authority had been violating the local law and U.S. Housing & Urban Development (HUD) regulations but did not inform tenants or the public.
Kelly was involved in the top-level effort to remedy the lead paint failures soon after the Manhattan U.S. Attorney opened an investigation in the fall of 2015 into whether NYCHA had filed false documents with HUD on lead paint and other matters. That investigation is ongoing.
In July, the Daily News revealed that NYCHA had been falsely claiming to be in compliance on lead paint, and in November the city Department of Investigation revealed Olatoye’s role.
The DOI report portrays both Olatoye and Kelly as out-of-touch about NYCHA’s lead-paint problems.
Kelly started as the Housing Authority’s general manager in April 2015 after being forced to resign from the Philadelphia Housing Authority due to an affair with a subordinate.
DOI found that senior NYCHA executives knew by spring 2015 that the authority was not in compliance with a local law requiring inspection for lead paint of all apartments with children 6 or under.
Questioned about this by DOI, both Olatoye and Kelly claimed that they did not learn that NYCHA was not in compliance with the local law until April 2016, and that they learned the authority was also in violation of HUD regulations by that July.
Ponce, a senior executive involved in wrestling with the lead-paint problem, told the DOI if he had been asked about this, he would have told his superiors that the authority was out of compliance — but he was not asked.
Kelly’s replacement, Mustaciuolo, is a veteran city official who oversaw an HPD program to fix decrepit private sector apartments by paying for emergency repairs, then going after negligent landlords for the bill.
Councilmember Ritchie Torres (D-Bronx), a longtime critic of NYCHA management, praised the appointment of Mustaciuolo.
“They’re facing a crisis of confidence and credibility,” Torres said of NYCHA. “It’s a brilliant selection and he’s a beloved public servant.”
Public Advocate Letitia James, — who has called for Olatoye to resign — also praised Mustaciuolo and wondered why NYCHA hadn’t sought help from HPD long ago.
“I don’t understand why NYCHA hasn’t utilized the expertise at HPD in the past to address some of the conditions at NYCHA,” she said. “It’s certainly overdue. It has been suggested in the past. It’s something they should have looked at a long time ago before they got to this point.”
Like de Blasio, Chairwoman Olatoye didn’t mention lead paint, but praised Kelly for helping NYCHA reduce its huge backlog of repair requests
“I and the executive team are grateful for Michael’s deep industry knowledge and connections and his commitment to improving the lives of the one in 14 New Yorkers who call NYCHA home.”
