City of Lawton will reimburse federal housing funds

City Council members have directed city administrators to return more than $400,000 to the city’s federally-funded housing fund.

The action, coming after the council spent almost two hours in executive session Tuesday, directs City Manager John Ratliff to direct the Finance Department to transfer $480,423.70 from the city’s General Fund to the “appropriate housing fund” within the next 60 days. The action, unanimously approved by the council, comes in response to a Jan. 10 letter from the U.S. Department of Housing and Urban Development.

Tuesday’s executive session agenda items included an update of possible pending action concerning a HOME Program report directed to the City of Lawton.

City officials have said HUD and the Oklahoma Attorney General’s Office are investigating property transfers Great Plains Improvement Foundation made in June 2024. The foundation had been a community housing development organization (CHDO), an entity qualified to receive federal funding via HOME Program and Community Development Block Grant funds to aid housing needs for low-income residents. The foundation disbanded in mid-2024, according to the Oklahoma Department of Commerce.

City of Lawton attorneys filed foreclosure action Jan. 17 on seven properties, saying Great Plains Improvement Foundation had not followed the mandates of a restricted covenant  on property deeds when transferring ownership of those houses in June 2024. Federal and city officials, noting the transfer also was made to a non-CHDO entity, said the problem stems from the fact that Great Plains did not obtain written permission from the city before they sold the properites. The City of Lawton held liens on those properties because they were receiving HUD-appropriated funding, and neither the City of Lawton nor HUD was informed of the sale.

Because federal funds were used, the City of Lawton must return those funds, City Attorney John Andrew said.