WASHINGTON -- A government critic says a lack of proper controls on federal housing department contracts may have cost taxpayers up to $1 billion in waste since 1975 and drastic changes are needed to keep more from being 'thrown down the rat hole.'
Al Ripskis, an outspoken Department of Housing and Urban Development program analyst, said his waste estimate was based largely on a random audit of 10 contracts by HUD's inspector general's office.
'They waste about two-thirds of the money that they've been spending on contracts,' Ripskis said.
'I think the whole thing is appalling considering how the Reagan administration is cutting back on Social Security, the poor, Medicare and everything, and here HUD is continuing to waste money on a wholesale level.
'It's just being thrown down the rat hole,' Ripskis said. 'Unless some drastic changes are made, it's going to continue to happen the same way in the future.'
The audit concluded HUD technical representatives ignored requirements for monitoring contracts and failed to pin down consulting and research firms for progress or cost reports.
Ripskis said the money involved in the 10 contracts studied ballooned from $3.8 million to $5.8 million -- an increase of 53 percent.
'And 50 percent of the final projects were defective and faulty, and they overran by one-third the time parameter provided for the contracts,' he said.
Noting HUD has spent $1.5 billion on such contracts since 1975, Ripskis said he 'extrapolated' that with the same kinds of cost overruns and faulty products from most of its contracts, the sprawling agency wasted $1 billion or more over the six-year period.
Charles Taylor, a HUD contracting intermediary, said he agreed with the audit report but contended it was 'overkill' because it emphasized only a few bad contracts. But Wallace Smith, acting head of the office of audit, said his office randomly picked 10 of the 288 existing contracts worth over $100,000.
The sharply critical audit even attacked HUD contracting employees for their handling of a $556,000 computer contract to create a data bank -- designed in part to help monitor other contracts.
The computer contract grew to $1.5 million over three years.
Among the contracts cited was a 1976 agreement with Southwest Research Institute in San Antonio, Texas, for $359,000 to study the durability of manufactured homes being transported on highways.
The contract grew gradually by nearly $165,000, to more than a half-million dollars.
George Renault, executive vice president of the Manufactured Housing Institute of Arlington, Va., said in an interview the HUD test for the homes was 'absurd.'
'They developed a bunch of parameters they thought were needed to test airplanes or fast-moving trains on tracks,' he said. 'It's like taking a battleship and seeing if you can get it to fly.'
Renault said HUD now agrees with his group that the study was of little value.
Ripskis said one of the 'bigger boondoggles' involved an $822,000 contract to University Research Corp. of Bethesda, Md., that grew to a total cost of $4.7 million.
The project -- to develop educational courses on housing rehabilitation -- was modified eight times to expand the number of courses and classes. The audit report said that to add two courses, using material from the original four, HUD agreed to hike costs by 61 percent, or $500,000. It said progress reports were not regularly received.
But Judith Kossy, a HUD representative recently assigned to the project, defended it as saving money by teaching city officials how to streamline rehabilitation projects.
'The contract was extremely well managed,' she said.