A struggle to get Housing in order

When Rudolf Montiel came from El Paso three years ago to clean up the Housing Authority of the City of Los Angeles, he didn't know enough to be daunted.

It didn't take long, however, for him to get a sense of the challenges ahead.

Precious vouchers for the poor and disabled seemed to be for sale on the black market, allowing hundreds of newly arrived immigrants to jump to the top of a 10-year waiting list for housing subsidies. A consultant looking into the problem found "a virtual feeding frenzy in which corruption, manipulation and fraud is strongly evident."

That was hardly the only disturbing discovery:

Employees in one department appeared to be stealing, issuing themselves checks and then erasing the evidence.

Millions of dollars set aside for rehabilitating a Watts housing project seemed to be missing.

Parts of some housing projects had been commandeered by gangs to sell drugs, run brothels and hold dogfights.

Fresh from success building a nationally recognized housing authority in his hometown of El Paso, Montiel felt as though he'd entered a mysterious foreign culture, "like I was in the Kremlin, and I wasn't Russian."

Three years later, he still is struggling to bring order and ethics to an agency in which bad management and corruption have been endemic for at least 30 years.

Yet, even as he has trumpeted his reform efforts, new controversies have emerged on his watch.

In interviews, Montiel, 46, laid bare details of many agency woes for the first time, at times wishing aloud for an exorcist and comparing his job to fighting a multiheaded hydra.

To date, Montiel said, he's spent $7 million on private eyes, auditors and lawyers -- mostly lawyers. He's referred some staff for prosecution, sued some for damages and outsourced the work of a whole department.

There have been setbacks. Earlier this year, a Times review of internal documents showed that a former manager had directed nearly $800,000 in contracts to his brothers and politically connected firms without competitive bidding or after rigged contests. He allegedly overpaid for the work as well, doling out nearly $2,500 apiece to install toilets in housing projects. The manager, who was fired, has denied wrongdoing and a criminal investigation is ongoing.

Not long afterward, Montiel fired his chief investigator, the very person he had appointed to get to the bottom of such misdeeds. In a lawsuit, his administration accused the sleuth of engaging in a delusional witch hunt.