Castro Firing Could Be Costly

- Rochester, NY (WROC) - The firing of the Rochester Housing Authority's executive director could prove very costly to taxpayers. The authority revealed Wednesday that Castro had a contract that runs through 2021 and is worth $980,000. An RHA attorney indicated new board members, who were appointed by the mayor, were not happy with the length and terms of the contract.

Castro was fired last week and replaced by City Councilman Adam McFadden, a move that had been rumored for weeks. 

Jules Smith, an attorney for Castro, said the contract has an arbitration clause, meaning any contract disputes are subject to a determination of a hearing officer. He added that the board did not follow the termination procedures laid out in the contract and the board had no cause to fire Castro.

"This is not the way to deal with someone who is an employee," said Smith. "You sit down with someone and say, 'Let's work this out.' They didn't want to cross the t's and dot the i's."

When asked if resolving the firing of Castro could cost taxpayers nearly $1 million, Smith said, "It could be done inexpensively. They could reinstate him on salary. If they are intent on termination, it will be very costly."

The RHA board has been vague about why Castro was fired, indicating there were "questionable business practices." The board has been advised by attorneys not to give specifics, because the matter could be litigated.

Supporters of Castro turned out to a regular RHA board meeting on Wednesday.

"I call upon you to suspend that action and to conduct a thorough evaluation of Mr. Castro's performance," said Rev. Laurence Tracy.

"I can't believe the cowardice and the unethical behavior that is portrayed," said former RHA board member Carol Schwartz.

"The board of the Rochester Housing Authority should be ashamed of itself for the manner in which you took Alex Castro out of this position," said Roberto Burgos.

McFadden is being paid $12,000 a month to serve as interim director, roughly what Castro was earning. He comes to the RHA from running a nonprofit serving city children.

"What makes me qualified? I have extensive background in accounting, working with people, running programs, providing services and raising money, unmatched in this community," McFadden said.

McFadden had some supporters at the meeting.

"I believe that Adam McFadden has been unfairly been targeted by everyone around and that was not his call. It was the board's call to do that," said Rev. Lewis Stewart.

Department of Housing and Urban Development officials were at the meeting. They were previously scheduled to be present. They are reviewing the ouster of Castro and whether McFadden has any conflicts because he's a councilman. An attorney for RHA does not believe McFadden has any conflicts.

RHA Board Responds to Mayor

The Rochester Housing Authority board chairman responded to the mayor's request for more information about the firing of previous executive director Alex Castro. Mayor Lovely Warren indicated if she did not get an explanation, she would ask for the resignations of board members. These are board member the mayor herself appointed after taking office.

George Moses wrote that RHA attorneys would send a confidential letter to the city's attorney to "protect the employment dismissal information surrounding the decision."

But Moses said in the letter that the board had concerns Castro was withholding information that prevented the board from analyzing "RHA policy, vision and financial commitments." Moses said the board had a "lack of confidence" in Castro.

Moses also sent the mayor a letter back in May outlining questions he had about RHA business relationships and board responsibilities. The mayor said she forwarded that letter to HUD.

On October 24th, George Moses released this statement:

Statement from George Moses
Chairman of the Board of Commissioners
Rochester Housing Authority

The Rochester Housing Authority is moving forward with its mission to provide affordable housing for those in need. We attribute recent events as a distraction from fully meeting that mission. The Commissioners understand residents’ concerns. Therefore, it is vital we focus on them.

We are committed to moving forward with transparency. Currently, we are responding to FOIL requests made by the Democrat and Chronicle. To clear up the tilted information as to a personnel issue that the Board is attempting to address methodically, here are some material and salient facts.

In searching for documents requested by the Democrat and Chronicle, we discovered procurement files held by former director Alex Castro are missing. Our employment counsel has contacted Mr. Castro’s counsel regarding this matter.

When we discovered the terms and extent of Mr. Castro’s employment contract in mid-September, the Board felt compelled to take action- the overreaching contract and the lack of counsel on that matter by long time general counsel served as the basis for an expedited call for the October 14 special board meeting.

The Board was appalled to learn that this was an overreaching contract with compensation and benefits worth $1 million that contained unwarranted protections for the executive director to the detriment of the Authority and it was extended for another 7 years. While on average, our residents earn $17,000 annually.

Further, Mr. Castro’s sweetheart deals were discussed and approved in secret meetings veiled as Executive Sessions where actual votes were taken but upon advice of counsel never recorded and posted in accordance with the Open Meetings Law. Both the February 2012 5-year contract and the extended contract entered into in January 2014 were all conducted in private.

We need to keep RHA’s residents in mind when we set staff salaries and not put ourselves in a position that appears greedy. The newsworthy discussion should be how could the prior Board enter into two secret contracts with former Director Castro. These are real substantive issues.

We are looking forward to successfully concluding the issues that have been raised by some in this community who would rather pursue a divisive course instead of addressing a fiscal and personnel issue.

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