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ACORN Starts To Feel Funding Freeze

Housing counselors at ACORN Housing's North Philadelphia office have to refer clients to new attorneys for legal help, because the group isn't providing that service as long as its funding is frozen.
Pam Fessler/NPR
Housing counselors at ACORN Housing's North Philadelphia office have to refer clients to new attorneys for legal help, because the group isn't providing that service as long as its funding is frozen.

Federal funding has been temporarily stopped for the community group ACORN and its affiliates, and some people worry that worthwhile programs could be affected if the cuts become permanent.

The move comes after a scandal involving videotapes that showed ACORN workers telling a couple posing as a pimp and a prostitute how to evade the law.

In the undercover videos, ACORN workers at four offices around the country dished out some very sketchy advice. But in ACORN Housing's North Philadelphia office, the scene is far from the one seen in the videos, which were made by a conservative activist.


What you see here instead are several young women, with yellow case files piled high on their desks, trying to help poor people save their homes. ACORN Housing Corp., an ACORN spinoff, offers free housing counseling to low- and moderate-income homebuyers.

On a recent day, housing counselor Lianna Crosby talks with client Shawn Drayton about an upcoming mediation session at the city court. Drayton is trying to avoid losing his grandfather's house to a bad mortgage deal. But Crosby says there's been a last-minute change: She has to refer him to a different attorney for legal help, because ACORN Housing won't be able to provide that service as long as its funding is frozen. Congress has blocked, at least until the end of this month, most of the money ACORN Housing relies upon to do its work.

Some lawmakers say they want to make the cutoff permanent because of the videos and other problems with ACORN operations over the past several years.

The housing group is a major recipient of grants from the Department of Housing and Urban Development. It also received almost $24 million over the past two years for a foreclosure-mitigation counseling program created by Congress.

'I Just Couldn't Afford It'


Bruce Dorpalen oversees counseling at ACORN Housing offices around the country.

"We have a little bit of resources to keep going, but if this can't get resolved in a decent way, we would have to lay off staff, not be able to serve clients," Dorpalen says.

Clients such as Fred Butler, a retiree who came here for help, could be affected.

Butler admits he made a big mistake when he got a mortgage with a big balloon payment on his Philadelphia home.

"I just couldn't afford it. And it was just too much," Butler says.

But when he tried to pull out of the deal during a three-day grace period, his mortgage broker was nowhere to be found. ACORN Housing has worked with the lender to negotiate a more palatable deal that will keep Butler in his home.

ACORN's critics say the organization has misused federal funds, and they have called for multiple investigations. But neither HUD nor NeighborWorks America, a nonprofit that administers the foreclosure counseling grants, have reported any problems with ACORN Housing. And HUD continues to list ACORN Housing as one of about two dozen national, HUD-approved counseling agencies.

"They've been one of the highest-performing organizations, so in that regard we have not had any concerns about their performance under this program," says Ken Wade, CEO of NeighborWorks America. "But like everyone else, we were concerned with the videos we saw on television."

He says NeighborWorks is reviewing its contract with ACORN Housing to make sure none of the terms has been violated. Wade adds that if the funding cuts become permanent, it will be a challenge finding other groups to take over the thousands of foreclosure cases now being handled by ACORN Housing. Both HUD and NeighborWorks are waiting to see what Congress does next.

Approached By Videographers

National ACORN officials admit their group has made mistakes in the past, including concealing — until recently — an embezzlement scheme by the founder's brother. And they say they're fixing the problems.

But it could be too little, too late — which is especially troubling for those who work in the Philadelphia office. They're the ones who actually got suspicious when a couple showed up at their office last July asking strange questions.

"They said something about bringing girls from El Salvador into the country to live in the house with them and if I knew anything about getting them papers," says office manager Katherine Conway-Russell.

Conway-Russell says she had no idea she was being videotaped. She told the couple that ACORN couldn't help them and, after the couple left, workers called police.

But when videos — which were taken at other ACORN offices — became public last month, Conway-Russell says her office started getting crank calls. People asked if they could get help opening a brothel — and even threatened to kill one of the counselors.

"It's saddening to know that our staff works so hard to help people, and they feel like this is just an attack," Conway-Russell says through tears, "and it has nothing to do with what we do for the communities that we serve."

So for now, she says, she and the other workers here will just keep doing their jobs. And try not to worry too much about what comes next.

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