GAO discussed the Housing Authority of New Orleans' (HANO) operational problems, focusing on the Department of Housing and Urban Development's (HUD) efforts to correct these problems. GAO noted that: (1) obstacles to improving HANO performance include HANO inability to perform routine maintenance and repairs on its buildings, and persistent interference by HANO board of commissioners into HANO daily operations; (2) such interference has resulted in cancelled modernization contracts and delays in HUD-mandated improvement actions; (3) HUD provided HANO $90 million in 1994 and over $37 million in 1995 to modernize unsafe buildings; (4) despite the presence of a professional property management contractor, HANO performance significantly declined in 1993 and 1994; (5) HUD attempts to resolve HANO management problems have not proven effective; and (6) in February 1996, HUD declared the housing authority in breach of its contract and negotiated a partnership agreement to improve the living conditions in HANO public housing.