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Navajo Nation

WINDOW ROCK, Ariz. (AP) — The Navajo Housing Authority will forfeit $26 million of the $96 million in federal dollars it was awarded for affordable housing projects as part of a settlement.

The U.S Department of Housing and Urban Development had accused the housing authority of failing to use the federal funds to complete affordable home projects in 2012 as it had planned.

An investigation by the Arizona Republic found that the housing authority had a history of wasteful spending. Many of the newspaper's findings were later backed up by U.S. Sen. John McCain's office.

The Navajo Housing Authority board's chief executive officer stepped down and the board was overhauled after the investigations.

HUD had originally sought to recover the entire $96 million from the housing authority.

The housing authority and HUD were asked to "mediate if possible" after the authority appealed to the 9th Circuit Court of Appeals. The parties reached a settlement Sept. 8, according a statement from housing authority Tuesday.

"We evaluated all the options and determined it was in the best interest of the Navajo people to settle with HUD and restore balance rather than endure a lengthy and costly litigation process," said Roberta Roberts, the housing authority interim chief executive in the statement.

The $26 million will be put back into the housing funding pool and will be counted in the Native American Housing Assistance and Self Determination Act allocation in 2018, said Craig Kaufman, the lawyer who represented the housing authority in the matter.

Copyright 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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