UPDATE 1-U.S. housing chief quits amid investigations

Mon Mar 31, 2008 12:15pm EDT

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By Patrick Rucker

WASHINGTON, March 31 (Reuters) - The U.S. housing secretary announced his resignation on Monday amid investigations into his role in government contracts, creating a vacuum at an agency seen as a vehicle for addressing the housing crisis.

Housing and Urban Development Secretary Alphonso Jackson said that he is leaving office on April 18 "to attend more diligently to personal and family matters."

Jackson, who took office in March 2004, made no mention of federal investigations into whether he influenced the awarding of contracts.

In recent days, lawmakers have said Jackson should resign as the clouds over his role risked distracting the agency from addressing the worst housing bust in generations.

Lawmakers want to retool the agency's Federal Housing Administration to aid more homeowners who face foreclosure.

A White House spokeswoman said that President George W. Bush accepted Jackson's resignation after the two men met on Saturday morning. In a prepared statement, Bush said that he and Jackson had a "strong friendship" and praised his works as head of the government's largest housing agency.

Senator Christopher Dodd, chairman of the Senate Banking Committee, said in a statement that he hoped "this change in personnel will be matched by a change in policy that brings real solutions to the housing crisis."

Dodd, a Connecticut Democrat, recently called for Jackson to step down because the investigations were hindering his effectiveness.

Jackson, who once headed the Dallas housing agency, has enjoyed close ties with fellow-Texan Bush but has been damaged by several scandals in his time as HUD Secretary.

In the spring of 2006, Jackson told an audience that he had spiked a contract when he heard the winner disparage Bush. An internal probe found no evidence that Jackson had behaved illegally but the agency's independent investigations arm is now examining other cases of alleged wrongdoing. (Editing by Tom Hals)

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