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The ACORN scandal means it just got harder. The New York City office of the national group (Association of Community Organizations for Reform Now) that advocates for low- and moderate-income people is among the major providers of foreclosure counseling in the city. ACORN is also a major provider of free help in preparing tax returns. Much of that assistance is poised to disappear, now that the community organizing group is under attack after videos produced by a pair of conservative activists showed ACORN staff members giving advice to a purported prostitute and pimp on how to launder money from prostitution. (Those employees were fired, and ACORN enlisted former Massachusetts Attorney General Scott Harshbarger to conduct an independent inquiry of the group's management and performance.)
In the uproar that followed a Sept. 14 article in the New York Post, federal, state and local governments cut off funds and legislators distanced themselves from an organization with deep roots in their districts.
New York state’s Division of Housing and Community Reinvestment froze current funding for NY ACORN Housing Company's foreclosure prevention work pending an investigation, DHCR spokesman James Plastiras said. Losing the balance of the $365,000 contract – $243,400 – has a direct impact on how many struggling homeowners get help, said Ismene Speliotis, executive director of NY ACORN Housing Company.
A nonprofit developer that grew out of the larger community organizing group, but is independent from it, NY ACORN Housing Company has 1,300 foreclosure prevention cases in its 2009 database, Speliotis said. Not every case is active, but she said the lengthy database is a useful measure of how many people need help. The Center for New York City Neighborhoods, a nonprofit created in 2007 to coordinate foreclosure assistance, estimates it sent 10 percent of its referrals to the group.
“If you take an organization like ACORN housing off the table, the people feel it,” said Speliotis, who oversees a staff of nine housing counselors and administrative staff. She supervised the fired employees as well, but citing investigations by state Attorney General Andrew Cuomo and Brooklyn District Attorney Charles Hynes, Speliotis declined to discuss their behavior beyond saying that what she saw on the video bore no resemblance to her experience of their work. The group is not taking any new cases, but intends to continue pushing hard on the ones it has, she said. “We're probably going to have to reconfigure the staff. We're not ready to walk away from the work, but we can't work for free. And the work needs to get done.”
The work is labor- and time-intensive: Calling unresponsive banks and loan servicers, trying to get them to accept payment plans and mortgage modifications for sinking homeowners, and attempting to put the brakes on foreclosure proceedings that routinely roll forward even as modification agreements are being worked out in accordance with federal foreclosure prevention initiatives.
“I'm hopeful that [the state freeze] is temporary. We've had situations where we've not had access to funds before and we've figured it out,” Speliotis said.
