The head of the Little Rock housing authority board instructed the agency's interim director to fire a deputy director in December as punishment for reporting concerns about the director, according to a federal whistleblower report obtained by the Arkansas Democrat-Gazette.
The board chairwoman and the interim director then told investigators differing stories about the incident, the whistleblower report shows.
The federal report concludes that Dana Arnette, a former deputy executive director and the chief operating officer for the housing authority, has a credible retaliation case.
The U.S. Department of Housing and Urban Development report is referred to in a federal lawsuit that was filed Thursday in the Eastern District by Little Rock attorney Chris Burks on behalf of Arnette.
The lawsuit asks for "both compensatory and punitive damages in an unliquidated sum."
The suit names the Metropolitan Housing Alliance as the defendant.
The HUD inspector general's report reveals that Arnette had a private meeting Dec. 12 with board chairwoman Leta Anthony to discuss then-interim Director Marshall Nash's absences from work, among other issues.
Nash fired Arnette five days later on Dec. 17.
Nash resigned abruptly in April.
The information comes to light as the Little Rock Board of Directors considers whether to appoint Anthony to another five-year term. The housing agency is the largest provider of rental subsidies in Little Rock and has an overall budget of more than $25 million for 2019.
Current interim Director Anthony Snell said he hadn't seen the filing Thursday afternoon.
"I can't comment on anything that I don't have," he said. "We have not been served, so if there is a lawsuit out there, we have not been notified of it."
Calls to numbers listed for Nash weren't returned, and a message sent to his Facebook page went unanswered Thursday evening.
Calls, text messages and emails to all five members of the board -- Anthony, Louis Jackson, Kenyon Lowe, Monique Sanders and Lee Lindsey -- weren't returned by Thursday evening.
Darryl Madden, a HUD spokesman, said in an emailed statement that "As a matter of policy, the HUD [office of inspector general] neither confirms nor denies any investigative actions that may or may not be underway."
Nash hadn't worked a full day in three years and went to the office only during lunch and at the end of the day, Arnette wrote in an email she sent to HUD's inspector general's office.
In her meeting with Anthony, Arnette also told the board chairwoman that it was hard for staff members to reach Nash, that they had to call him several times to get responses, according to the Dec. 18 email obtained by the newspaper.
Nash called Arnette while she was on her way from Dallas to Little Rock and told her to mail her keys, laptop and work phone back to the agency.
"He proceeded to tell me that he was directed to terminate me and I was no longer a fit for the agency and the agency was moving in a different direction," Arnette wrote in the whistleblower email.
Arnette said in an interview with the Democrat-Gazette on Thursday that she filed the Jan. 30 whistleblower complaint after she'd exhausted her administrative options. She had worked in the housing field for 20 years and had been at the Little Rock agency since 2014.
"I can't even explain it to you," she said of losing her job. "When I was in the airport, I felt like somebody shot me.
"It just felt like everything I had was just taken from me at that moment."
Anthony emailed Nash on Dec. 16, the day before Arnette's dismissal, saying, "I do want the Dana situation handled quickly," according to records obtained by the newspaper.
Anthony went on to refer to "the offer" made to a couple of other employees, then said there would be "major fallout" with Arnette. It's unclear what the offer was.
"She is already having issues about who gets to work or what it looks like on paper," Anthony wrote. "It has to be performance-based because [that] can be proven."
In a rebuttal to the federal report, Anthony said the emails were about restructuring the agency, not firing Arnette.
But in an interview with an investigator, Nash said the conversation was about firing Arnette.
Anthony emailed board members Dec. 17 to tell them Arnette had been terminated.
In a reply, board member Lindsey asked the reason for the firing and whether "it was in line with policy."
Anthony replied that it was in line with policy and that Arnette was fired for "performance and misconduct."
In a Dec. 21 newspaper article about Arnette's termination, neither Nash nor any board members cited a reason.
In Arnette's email to HUD, she said she'd never gotten so much as a citation for misconduct and that she'd met with Anthony to discuss the firing on Dec. 17.
"I went to see Chairperson Anthony as soon as I got to Little Rock and asked her what happened and why I was terminated, and she said she was waiting on a conference call this afternoon to get more information," Arnette wrote.
The HUD special investigator did not find any previous disciplinary records in Arnette's personnel file.
The investigator concluded that "personnel actions implemented against the complainant occurred within a timeframe that allows a presumption that the disclosure [to Anthony] contributed to the personnel action and those taking the action had knowledge of her disclosure."
The investigator interviewed Anthony on April 3 regarding the termination. At first, Anthony told the investigator that Arnette hadn't reported concerns about Nash's attendance, and that if she had, the board would have investigated.
She later said the opposite -- that Arnette did report her concerns and the board did not investigate.
In his interview with the investigator, Nash said Arnette was fired "due to activities that included undermining the board, her lack of respect of him as head of the agency, for not having discussions with Nash, and for not turning in a weekly report."
The HUD report notes that Nash did not document any discussions with Arnette nor any disciplinary action. He also said in his interview that he had not wanted to fire Arnette.
The agency's rebuttal said Arnette was "a disgruntled employee who wanted to be the next Executive Director" and that she was trying to undermine Nash.
The board appointed Nash to serve as interim executive director after pushing former Director Rodney Forte to resign in November.
Arnette said Thursday that she, along with most of the other employees, were confused when the board appointed Nash instead of one of the two deputy executive directors as the agency's interim chief.
A memo included in the HUD report states that Lawrence Clements, a HUD auditor examining the Little Rock agency for its management of the federal Rental Assistance Demonstration program, also questioned why Nash was selected.
When board members selected Nash, they told the newspaper it was because he didn't have any interest in becoming the next full-time director.
Nash resigned his position April 12 in the middle of a search for a new executive director. At first, Anthony declined to provide the newspaper with his resignation letter.
The Democrat-Gazette later obtained the letter through a public records request.
"Thank you for the opportunity to serve during this transitional time period," the letter says. "I believe that you are very close or have arrived at your decision on the new Executive Director for the Agency. Therefore, having bridged the gap between leaders, I am resigning my post effective immediately."
Burks said Arnette reached out to him when she was filing the whistleblower complaint.
"Hopefully the whole LRHA can just be better run as a result of this," Burks said.
Arnette added in an interview that she never wanted to go to the media. She assumed that reporting concerns to the board chairwoman would be enough, she said.
"I've just been following the process and provided the information and all of the documentation and facts," she said. "I did nothing but work hard for that agency, and I got a phone call, and I can't tell you how humiliating that was."
A Section on 10/18/2019