Can US Revive Ghettos Where Chicago Failed

AS the federal government takes charge of Chicago's gigantic, distressed public housing authority today, experts here are not asking ''why?'' but rather ''what next?''

Few familiar with the monolithic, 40,000-unit Chicago Housing Authority (CHA) doubt that drastic change is needed to alleviate the chronic disrepair and crime plaguing the nearly 90,000 residents of the high-rise ghettos.

But they question whether the takeover of the CHA by the US Department of Housing and Urban Development (HUD) -- by far the biggest intervention of its kind by the federal government -- will succeed in significantly improving life for residents.

''If the biggest slumlord in Chicago is the CHA, the second biggest slumlord is the HUD,'' says Professor Ed Marciniak, president of the Institute of Urban Life at Loyola University in Chicago. ''We've got to see whether HUD's programs for implementation are better than usual.''

HUD, together with Mayor Richard Daley, is expected to appoint soon a five-member oversight board to replace CHA Chairman Vincent Lane and his board of directors, all of whom resigned abruptly last Friday as the HUD takeover appeared imminent.

In a statement issued Saturday, HUD Secretary Henry Cisneros acknowledged the severity of the problems in Chicago housing by stating that for the next several months his agency will ''focus on the basics -- securing entry to buildings, maintaining grounds, repairing broken elevators, collecting garbage.''

The HUD's long-range plan, however, is to transform the CHA as part of a national strategy to turn around 16 of the country's most troubled public housing authorities, according to officials overseeing the CHA shake-up.

''We are going to each of these long-term troubled housing authorities and developing a unique plan that tries to address the problems in a progressive way,'' says Joseph Shuldiner, the HUD assistant secretary who is leading the CHA restructuring.

The HUD strategy has three key elements:

* Demolishing old, heavily concentrated high-rises and building new low-rise, low-density housing complexes that encourage economic integration by mixing public, market-priced, and subsidized units.

In Chicago, HUD will give priority to a multibillion-dollar plan to redevelop the Henry Horner, Lakefront, and Cabrini-Green complexes.

* Resolving ''serious management deficiencies'' at public housing authorities by dispatching ''recovery teams'' to offer technical aid, setting up receiverships, and, in worst-case situations such as Chicago, taking over operations entirely.

''We get them to shape up or ship out,'' said Shuldiner.

After the new CHA leadership is in place, HUD officials say they will attempt to break up the authority's highly centralized, bloated bureaucracy by turning over the management of individual housing complexes and programs, such as the federal rent subsidy program, to nonprofit or private companies.

* Streamlining HUD's regulation of local housing authorities.

In the last two years, HUD claims to have intervened successfully in large housing authorities in Philadelphia, Washington, New Orleans, Detroit, Kansas City, Mo., and several other cities.

Still, officials say that the public housing crisis in Chicago is unprecedented in size and scope.

''Chicago has perhaps the most difficult public housing stock in the United States,'' says Shuldiner. ''No other housing authority has the concentrated, 3,000- or 4,000-unit high rises that are poorly designed and poorly maintained.''

A recent study showed that seven of the poorest neighborhoods in the US are in Chicago public housing, he adds.

Moreover, any attempt at reform must overcome widespread corruption within the CHA, experts say.

Although Cisneros praised Mr. Lane's seven-year tenure at CHA as ''visionary,'' HUD has been investigating a possible conflict of interest in Lane's private business dealings with firms linked to the Nation of Islam.

No one has been charged with wrongdoing in this investigation.

Investigators are also probing the theft of millions of dollars of CHA employee pension funds and widespread bribe-taking by staff.

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