Chicago Housing Authority Reverses Debarment of Vendor

The Chicago Housing Authority quietly reversed course on a move to permanently bar the daughter of a longtime board commissioner from doing business with the agency, reopening the door to future contracts after an internal fight over procurement rules and ethics.

The contractor, Lovie Diggs, faced what CHA officials initially deemed permanent debarment after she was arrested, charged and later pleaded guilty in a criminal case, according to agency records and Cook County court documents. An investigation by WBEZ and the Chicago Sun-Times first reported that after Diggs’ attorney appealed directly to CHA leadership, the housing authority scrapped the debarment altogether.

Diggs’ firm, Lavi Decor and Cleaning Company, has been paid more than $1 million by the CHA. Diggs is the daughter of Debra Parker, a CHA board commissioner since 2018. Both outlets reported last fall that Diggs was one of three CHA contractors with close personal ties to Parker. The other two companies are owned by Parker’s sister and her longtime boyfriend, and together the three businesses have collected nearly $22 million from the agency.

The Diggs case stems from a February 2023 arrest in which prosecutors accused her of using another woman’s identity to obtain more than $5,000 in merchandise from a Bob’s Discount Furniture store, according to the publications. In 2024, Diggs pleaded guilty to a misdemeanor disorderly conduct charge as part of a deal that dropped a felony identity theft count. She was sentenced to probation, which she later completed.

CHA Inspector General Kathryn Richards concluded the case triggered grounds for permanent debarment under agency policy, which allows bans for conduct involving fraud, theft or deception. In July, CHA’s contracting department formally notified Diggs that it intended to bar her — and any company she owns or controls — from future CHA work.

Diggs’ attorney pushed back, arguing she was never convicted of a felony and that her case was discharged without a formal conviction. Internal emails show CHA lawyers initially floated an 18-month voluntary suspension as a compromise. Days later, the agency abandoned enforcement entirely.

“CHA has decided to cancel the proposed debarment proceedings,” Deputy Chief Procurement Officer Sheila Johnson wrote in an Oct. 30 letter, allowing Diggs to continue participating in CHA programs without interruption.

Neither Diggs, Parker nor Richards provided comment to the publication. CHA board chair Matthew Brewer and agency spokespeople did not respond to requests for comment.

In a report issued last month, the inspector general said Diggs’ guilty plea still ran afoul of procurement rules and noted court transcripts showed she acknowledged using another person’s identification to obtain goods. Richards also flagged broader concerns about favoritism tied to Parker’s family and associates.

— Eric Weilbacher