Landlords' lawsuit: PHA's $200 course was bogus

About 4,000 landlords who participated in a subsidized-housing program knew that there was a cost of doing business with the Philadelphia Housing Authority.

Between 2008 and August 2010, they had to pay $200 each to PHA for a mandatory one-day training course, but they say the money wasn't spent on instruction.

Instead, the agency used it for an illegal lobbying fund and for the "personal gain and enrichment" of PHA employees, the landlords contended in a federal class-action lawsuit they filed against PHA yesterday.

PHA diverted the funds to its nonprofit subsidiary, the Pennsylvania Institute of Affordable Housing Professionals, which used the money "to advance political causes and lobbying efforts," and personally benefit PHA employees, the federal lawsuit said.

PHA spokeswoman Nichole Tillman said the agency stands behind the landlord-training program, which she said has led to better-maintained rental properties and cleaner neighborhoods.

"PHA receives far fewer complaints about problem properties or problem tenants," she said. "At a time when the city is looking for ways to deal with blighted property issues, citizens should be reassured that PHA requires its landlords to invest in themselves and their property management knowledge base through this daylong course."

The suit demands that each landlord who had to pay be compensated $10,000 to $100,000, amounting to a total of up to $40 million.

Eight property owners participating in the housing-voucher program - once known as Section 8 - are named in the suit. Among the defendants are three current PHA executives, three former executives and former Executive Director Carl Greene.

On Sept. 23, PHA's Board of Commissioners, led by former Mayor John Street, fired Greene, dubbing him "a serial sexual harasser." A board investigation concluded that Greene secretly settled three sexual-harassment claims against him for $648,000.

Greene has denied the allegations and has filed suit against the board. Greene claims that board members violated his due-process rights and breached his employment contract. Greene reportedly wants at least $4 million to settle his lawsuit against the board.

Yesterday, attorney Joseph Podraza Jr., who represents the PHA board, acknowledged that the board has received a "settlement demand letter" from Greene's attorney, Clifford Haines.

Podraza, of the Sprague & Sprague law firm, declined to detail the letter, but said: "He can make whatever demands he wants, but we feel very strongly that his claim has no merit and that we will ultimately prevail . . . . We have no intention of paying the demanded figure or any other figure demanded by Mr. Greene."

Haines did not return a phone call from the Daily News yesterday.