Houston Could Expand Audits After $8 Million Theft

Houston’s development zones are under a magnifying glass, following a high-profile corruption scandal, as the City Council considers deeper probes into spending practices.

The council could expand an ongoing audit of the city’s 24 Tax Increment Reinvestment Zones, doubling the cost of the audit to $1.3 million, the Houston Chronicle reported.

The expanded audit, conducted by Ernst & Young, would analyze spending patterns across all zones and conduct forensic audits on areas deemed priorities.

This comes after Todd Edwards, a former real estate manager for the Midtown Redevelopment Authority, was charged in June with misusing $8.5 million in public funds earmarked for affordable housing projects in the historic Third Ward.

Prosecutors allege Edwards funneled funds to companies he owned or co-founded, including one created with vendor Veronica Ugorji, who also faces felony charges alongside another vendor, Kenneth Jones.

Court records reveal Edwards and his associates received more than $9 million in payments between 2011 and 2021. Many of these funds were supposed to be used for the maintenance of over 500 vacant lots, which residents say remain overgrown and neglected despite significant expenditures.

The scandal has raised questions about oversight and accountability within Houston’s TIRZ program, which channels property tax revenue into localized development projects. Critics argue the lack of transparency has allowed misuse of public funds to go unchecked.

The expanded audit as a necessary step to eliminate inefficiencies and address potential corruption, the mayor’s office has said.

Midtown Redevelopment Authority Executive Director Matt Thibodeaux stated that the agency has strengthened its accounting practices and is cooperating fully with the city’s investigation.

“Midtown not only fully supports the city of Houston’s efforts but has also provided a significant amount of data to assist in these initiatives,” he said.

While the city’s audit will be funded by the reinvestment zones themselves, Midtown’s board has discussed conducting its own forensic audit in light of the allegations. The goal, according to Thibodeaux, is to restore public trust and ensure accountability.

— Andrew Terrell