Former official at the Philadelphia Housing Authority sentenced for taking kickbacks

A former contracts manager for the Philadelphia Housing Authority, who is cooperating with investigators in an ongoing federal probe of the agency, was sentenced Wednesday to 50 months in prison for taking $25,000 in kickbacks.

Kerri Bizzell, 43, who handled small construction contracts, pleaded guilty in May to extorting the money from two contractors. She also admitted obstructing a grand jury by trying to prevent a contractor from disclosing the payments.

U.S. District Judge Mitchell S. Goldberg ordered her to repay PHA the $25,000.

Elizabeth Toplin, an attorney for Bizzell, argued for leniency on grounds that PHA was "amoral," with a "prevailing atmosphere of corruption."

Her client, she said, "learned her behavior from those at PHA in more senior positions than she."

Before her sentencing, Bizzell told Goldberg, "I solicited certain contractors. I changed documents. All those instructions came from my superiors."

By way of example, Bizzell began to talk about "a large construction company," but Goldberg cut her short and recessed the hearing. When the proceeding resumed, Bizzell did not pick up where she had left off.

Kelvin Jeremiah, PHA's interim executive director, said it "would not have been appropriate" for Bizzell to discuss in open court an issue that "may very well be" part of her cooperation with investigators.

"Part of her plea agreement is for her to be truthful and cooperative with the ongoing investigation," said Jeremiah, who joined PHA less than a year ago as head of audits and compliance.

Jeremiah said the sentence "sends the right message" that anyone engaged in "the fleecing of this agency of its resources will have to be held accountable."

The investigation prompted by the Bizzell indictment is just one of many involving the public housing agency, the largest landlord in the city, which receives most of its $371 million budget from the federal government.

Former Executive Director Carl R. Greene was fired by the board in September 2010 after commissioners learned that he was the target of multiple sexual harassment complaints, three of which were settled without their knowledge.

The U.S. Department of Housing and Urban Development took over control of PHA more than a year ago. Federal authorities are investigating PHA's use of federal funds as well as the theft of property by employees, according to sources.

Bizzell, a divorced mother of two, said in court that she joined PHA as a trainee in the construction department. She was transferred to contracts after it was disclosed that she was having an affair with a manager - an event, she said, that triggered "the downward spiral of my career."

Bizzell handled contracts worth less than $25,000. Generally, the contracts were awarded to small businesses that wanted to do repair, renovation or maintenance work for PHA. Bizzell's job included helping companies to navigate the contract process, evaluating bids, and directing payments to contractors.

Pamela Foa, an assistant U.S. attorney, said Bizzell "barely took a breath in her new position before she was wheeling and dealing."

PHA fired Bizzell in 2008 for failing to reveal her criminal record when she applied for a job at PHA. Since 1987, Bizzell had been arrested at least eight times for offenses including forgery, DUI, and receiving stolen property. During an acrimonious divorce, she was charged with contempt of court four times.

Foa said the extortion case had drawn attention. "The whole city is watching," she said. "The federal government is watching. Will it be business as usual at PHA?"

Jeremiah said Bizzell abused her position by developing a "pay-to-play scheme in which she personally profited at the expense of PHA's mission."

She was charged with extorting $25,000 from contractors who then passed on to PHA the cost in the form of higher prices. According to the indictment, PHA paid $283,756 for services that included Bizzell's kickbacks and were only worth $199,989.