The official government watchdog in Jefferson Parish has published a scathing report on a local agency that provides financial assistance to homebuyers, citing improper employee benefits, "excessive" per diems for board members and deficits that threaten the agency's financial stability. 

The report, issued by the Jefferson Parish Inspector General's Office, includes 12 findings against the Jefferson Parish Finance Authority, which is supposed to help low- to moderate-income residents buy homes, typically by providing money for down payments. 

The report also faulted parish government, primarily the administration of former Parish President Aaron Broussard, for some of the problems. "This audit revealed a breakdown at the highest level of local government," the report says.


The finance authority is an independent agency governed by an eight-member board appointed by Parish Council members and the parish president. It gets no taxpayer funding, instead financing itself by taking a cut of the money earned when the mortgages it arranges are sold as securities.

The relatively small agency — it has just a handful of employees — reported $2.4 million in operating expenditures in 2016.

Despite its independent status, the agency's staff members have been part of the parish pay plan, and the executive director was added to the parish system nearly a decade ago.

The latter arrangement started when Terry McCarthy, an executive assistant to Broussard, became the Finance Authority's executive director. In order to keep McCarthy from losing his public benefits, then-parish Chief Operating Officer Tim Whitmer told the parish Finance Department to include the top job at the Finance Authority as a parish position, according to the report. 

The inspector general's report argues that neither McCarthy nor the other employees of the agency should have been entitled to parish benefits because the authority is not technically part of parish government.

McCarthy retired earlier this year, and his successor, Valerie Brolin, is not classified as a parish employee.

The report also says that McCarthy and the board elevated his administrative assistant, Sheila Rodrigue, to assistant director, increasing her salary by 57 percent from 2009 to 2016. The position's qualifications were written with Rodrigue in mind, but she was not qualified to carry out the duties, the report says. 

The report also criticizes excessive per diem fees paid to members of the agency's board. Members are supposed to serve without compensation, but they are allowed to collect a per diem, or daily fee — now set at $150 — for attending authority meetings, which are held weekly. 

For 2015 and 2016, the report says, the authority paid out more than $120,000 in such fees. Two board members earned more than $17,000 each over the two years in per diem payments, and a third fell just $50 short of that figure, the report says.

The report also criticizes the agency for payments to two law firms, saying that they appeared excessive and that the work was not properly documented; for not properly disclosing the higher interest rates and fees associated with the down payment assistance; and for operating with a deficit over the last two years.

The inspector general's report drew responses from the agency's board and board member Marcy Planer. 

The board's response disputed several of the inspector general's findings.

"The report does not include a comprehensive presentation of the overall JPFA financial picture and includes only some facts chosen to support (inspector general's) conclusions," board Chairman Greg Faia wrote. "It is especially concerning that (the inspector general) would overlook certain financial information, therefore placing the JPFA, which is vital to assisting new homeowners in Jefferson Parish, in the poorest posture possible."

Faia noted that Brolin, who was hired earlier this year, is not classified as a parish employee but has a written confirmation from the retirement system that she should be allowed to participate in it as long as the parish acts as the paymaster for the authority. Furthermore, Faia wrote, the Finance Authority employees under Brolin should be classified as parish employees.

In her response, Planer agreed with the inspector general's findings on per diems. She said the authority's board meetings regularly last less than half an hour and could be held less frequently.

Faia denied the agency is in danger because of financial mismanagement. "The JPFA has continued to build its cash balances, which will enable it to operate and continue to place people in homes in the parish for many years to come," he wrote.

Faia said the board will consider some of the report's other criticisms and either create or revise some policies and procedures.

Follow Faimon A. Roberts III on Twitter, @faimon.