National Housing Law Project Housing Law Bulletin

Emerging Legal Issues Regarding
HUD’s Housing Programs —
Part 2

• Suspending federal preferences
• Granting HUD unfettered discretion to manage and dispose of HUD-owned multifamily projects
• Imposing minimum rents
• Loosening up ceiling rents and deductions for earned income
• Delaying reuse of certificates and vouchers
• Mandating HUD to renew expiring Section 8 contracts
• Virtually repealing the single-family mortgage assignment program.

HUD issued implementing notices for public housing and certificates and vouchers and is about to issue another notice for project-based housing assistance programs.³

Congress has also passed a limited Housing Opportunity Program Extension Act, which President Clinton signed on March 28, 1996.⁴ That legislation not only extends the authority for several federal housing programs but also makes a few substantive changes. They cover the relationships between crime, drugs and alcohol abuse and eligibility for and eviction from public housing, as well as the prepayment of HUD-insured mortgages and extension of Section 8 Moderate Rehabilitation contracts.

By the end of April, Congress is likely to have enacted a government-wide omnibus appropriations act that will
fund the HUD programs for the rest of the year and make other substantive changes to HUD's statutes.⁵ These may include provisions:

• Suspending the public housing one-for-one replacement requirement until September 30, 1996
• Mandating the conversion to vouchers of certain distressed public housing developments
• Repealing Section 8(t) of the United States Housing Act which prohibits landlords from discriminating against certificate and voucher holders
• Eliminating the 90-day notice for certificate and voucher evictions
• Limiting the good cause for eviction requirement to the term of the lease for certificate and voucher holders
• Authorizing a "moving to work" demonstration for tenants at up to 30 public housing authorities (PHAs)
• Requiring HUD to run a demonstration regarding the restructuring of insured mortgages on Section 8 developments to bring their rents down to market levels
• Transferring HUD's Fair Housing Act responsibilities to the Justice Department as of April 1, 1997
• Barring HUD from enforcing the Fair Housing Act's occupancy standards unless the landlord has violated the standards set forth in HUD's March 20, 1991, interpretative memorandum.

Sometime before the fall of 1996, it is possible that Congress will make additional changes in federal law through housing authorization legislation now being considered.⁶

These bills, whatever their final form, will raise issues to be examined and dealt with as they are implemented at the local level. The issues we see arising go to the heart of effective housing programs and policies. In the January issue of the Housing Law Bulletin, the first part of this article began a discourse about what impact these changes will have upon people who participate or seek to participate in HUD's housing programs.⁷ It covered two categories of issues: first, those regarding who will have access to HUD housing assistance, who will be eligible and who will be selected; and, second, those relating to the amount of rent that participants in the programs will have to pay.

This second part covers two additional categories: first, when and how participants may be forced to give up their housing assistance, either through eviction or subsidy termination; and, second, reductions in the supply of assisted housing through (a) public housing demolitions or sales, (b) prepayment of mortgages or expiration of Section 8 contracts on privately owned, HUD-assisted housing, or (c) delay on reissuance of certificates and vouchers.

As we noted in Part 1, these articles are intended merely to scratch the surface, not to provide definitive answers. Their purpose is to alert housing advocates and low-income tenants about what is likely to happen and to suggest initial ideas about how adverse impacts may be avoided or at least ameliorated. As events unfold in the coming months and people begin dealing with their impacts, we hope to learn from those experiences and provide more information on continuing developments.

Eviction and Subsidy Termination Policies and Practices

Public Housing

Grievance Procedure. Neither the Balanced Budget Downpayment Act (Pub. L. No. 104-99), the omnibus appropriations act (S. 1594) nor the Senate authorizing act (S. 1260) makes any changes with regard to the public housing grievance procedure, but the Extension Act (S. 1494) and the House authorizing bill (H.R. 2406) would. The most extreme would be the H.R. 2406, which would require PHAs to exclude all evictions from the grievance process, as long as HUD has determined that the state's eviction courts provide hearings that comply with due process.⁸ A less extreme provision in the Extension Act would merely expand the categories of drug-related evictions that could be excluded from the grievance procedure by repealing the current law's requirement that the activity be "on or near" the premises.⁹ It would also allow PHAs to skip the grievance process for evictions that involve threats to other tenants, even if the threat is not criminal.¹⁰

If some version of these provisions is adopted, there are strategies that could be pursued to mitigate their most adverse effects. One possibility is to put more pressure on HUD to re-examine its due process determinations and to withhold approval of the most summary eviction procedures if they do not provide the tenant a chance for a fair hearing on the merits. If, unlike the current version of H.R. 2406, the final legislation were to grant PHAs the option of keeping the grievance process, tenant organizations could negotiate with their PHA to retain the grievance process for all evictions or for those not involving criminal activity. Even if a PHA decided to exclude all evictions, tenants would probably retain a right arising from their leases to have a grievance hearing before being evicted, until the lease is amended. As a last resort, tenants could also try to re-establish a right to a pre-judicial hearing as a matter of due process, following the Escalera v. New York City Housing Authority¹¹ line of cases. Nonetheless, later decisions, such as Swann v. Gastonia Housing Authority, 675 F.2d 1342 (4th Cir. 1982), somewhat undermine that argument.

Notice Periods. Both the House and Senate authorizing bills (H.R. 2406 and S. 1260 respectively) would repeal current law¹² that guarantees tenants 14 days' notice of eviction in the case of nonpayment of rent, a reasonable notice in cases involving threats to health and safety, and 30 days' notice in all other cases. The Senate bill would substitute whatever notice is required by state law in all cases.¹³ The House bill would do the same, except in the case of nonpayment of rent, where it would prescribe 14 days' notice or the state law notice period, whichever is shorter.¹⁴

Again, depending upon which version of the legislation finally emerges, there may be strategies to mitigate the damage. If the federal statute merely defers to state law, it would still be possible for PHAs to put longer notice periods in their leases and thus tenant organizations could negotiate for such longer notice periods with their PHAs. For a while after the statute is enacted, PHAs probably will not get around to amending their leases. Until they do, the longer notice periods in the leases that were included to conform to the prior law would still bind the PHAs.

Crime, Drugs and Alcohol. Most of the substantive changes relate to evictions for criminal activity and alcohol abuse. Both the House and Senate authorizing bills and the Extension Act would give PHAs greater access to criminal records to use in evictions.¹⁵ All three bills would also make drug-related criminal activity grounds for eviction, even if it were not "on or near" the premises.¹⁶ In different ways, the bills would also either allow or require PHAs to evict non-elderly tenants or any tenants from public housing or public housing designated for the elderly if they currently use illegal drugs or if their alcohol abuse would provide reasonable cause to believe that they may or would interfere with other tenants' rights.¹⁷

These changes may be some of the most difficult to deal with. Nonetheless, in cases where a PHA oversteps the limits of these new authorities, the injured tenants should be able to secure some relief. For example, the statutory language on access to criminal records also contains some limits on the records that may be made available, the uses that may be made of the information, and the tenant's rights to be heard in order to correct the records. The House bill would prohibit disclosure of juvenile records and require PHAs to keep confidential any records they receive. If a PHA were to breach those limits, the bill would grant affected tenants a right to sue for damages and to recover attorneys' fees in addition.¹⁸ The Senate authorizing bill and the Extension Act would require PHAs to offer tenants a chance to dispute the accuracy or relevance of any record before it could be acted upon.¹⁹ The Senate bill would also limit use of the records to convictions within the previous five years.

With regard to the expanded substantive grounds for an eviction, there may still be some opportunity to curb excesses. For example, if a PHA were to seek to evict a tenant whose past alcohol abuse gave the PHA reason to believe that the tenant might disturb other tenants in the future, a court might interpret the statute as requiring that there be some abuse of alcohol during the term of the tenancy, especially if the PHA knew of a history of alcohol abuse before renting to the tenant. In extreme cases there might also be a due process argument that the PHA is acting arbitrarily if the nexus between past conduct and the possibility of future interference with other tenants is grossly speculative.²⁰

Certificates and Vouchers

Good Cause for Eviction. It is quite likely that Congress will revise the good cause protection for certificate and voucher program participants so that their landlords will be able to evict them without cause after their leases expire, just as with tenants in privately owned, unsubsidized housing. In addition, the bills are likely to authorize those landlords to evict at any time during the term of the lease, not just when the tenant has breached the lease but also in cases where the landlord has some other good cause for eviction. The omnibus appropriations act is likely to make that change for FY 1996, and the House and Senate authorizing bills would make it permanent.²¹

Again, this is a change that will be difficult to deal with. The easier cases may be ones in which a certificate or voucher landlord seeks to evict a tenant without cause but is operating under a lease that has not been amended to reflect the new statutory language. Tenants in that situation would seem to have a leasehold right not to have their tenancy terminated and not to be evicted without cause. The landlord's proper course of action in those cases would be to give the tenant notice, in accordance with the terms of the unmodified lease, that he is terminating the existing lease for other good cause, i.e., to exercise his new statutory option to use a lease that does not require renewal upon expiration. If a landlord were to go that way, he would not be able to exercise that right to terminate for business reasons until the first year of the current lease had expired.

If the landlord has used a new lease without the former language concerning good cause for non-renewal, the tenant's position will be much more difficult to sustain. One possibility would be to try to establish in court a right not to be evicted without good cause, as was done in the cases before HUD issued regulations requiring certificate landlords not to evict without good cause.²² The difficulty with that argument, however, would be that those earlier decisions rested primarily on a reading of the housing statutes as implicitly creating a right not to be evicted without good cause.²³ In any new litigation, Congress' limiting the good cause protection to the term of the lease will have strongly undermined that reading of the statutes.

In these cases, it will be necessary to look closely at the final language enacted by Congress. For example, the Senate authorizing bill appears to grant PHAs the discretion to decide whether to allow a landlord to terminate a tenancy without cause at the end of the year. If the Senate version is chosen and the PHA has not granted the landlord that right, then there could be a defense to an eviction without cause at expiration of the lease.

The 90-Day Notice. Current law requires certificate and voucher landlords to give tenants 90 days' notice when they are terminating a tenancy for business reasons.²⁴ The purpose of the 90-day notice is twofold. One is to give the PHA or HUD some time to see whether anything can be done to keep the landlord participating in the program, and the second is to give the tenant, who has done nothing wrong, some additional time to find another place to live.

The 90-day-notice requirement was never liked by HUD and it has been under attack for at least two years. Now all the pending bills — the omnibus appropriations bill and the Senate and House authorizing bills — would eliminate the 90-day-notice requirement.²⁵ The appropriations bill, however, would eliminate the requirement only through September 30, 1996.

As with the change regarding good cause for eviction, dealing with the repeal of the 90-day notice will be easiest in cases where the tenant's lease has a 90-day-notice requirement written into it and the lease has not been amended. Landlords using those leases should not be able to terminate a tenancy without 90 days' notice, even if the statute has been repealed. The lease should be enforceable in its own right. Otherwise, it will be difficult to do anything to preserve a 90-day-notice right for certificate and voucher tenants, unless the PHA could be convinced to keep the clause in its model leases or a state legislature would enact a 90-day-notice requirement for landlords seeking to withdraw from a housing assistance program.

Demolition and Sale of Public Housing

The omnibus appropriations bill and the two authorizing bills would also allow PHAs to vacate certain buildings by moving tenants out, without PHAs having to meet the normal standards for demolishing or selling a project and without securing HUD approval. The bills vary somewhat on this point. The appropriations act would allow PHAs to consolidate occupancy among buildings or projects for purposes of improving the living conditions or providing more efficient housing.²⁹ The House authorizing bill, like the appropriations bill, would allow PHAs to consolidate occupancy and also would allow PHAs to relocate tenants from buildings that are not clean, safe and healthy before developing a plan for demolition or sale of the buildings.³⁰ The Senate authorizing bill rewrites Section 18 of the United States Housing Act and leaves out Section 18(d).³¹ That is the section that has been interpreted to prevent a PHA from vacating buildings unless it first meets the requirements for demolition and secures HUD approval.³²

All three bills would also allow or require PHAs to convert certain public housing buildings to vouchers, though the details differ. The appropriations bill would require a PHA, or HUD if the PHA resists, to "voucher out" developments that have more than 300 units, that have a vacancy rate of at least 10 percent, that cannot be made viable over the long term through reasonable measures and whose modernization and operating costs would exceed the cost of providing tenant-based assistance to the current residents.³³ The Senate authorizing bill allows, but does not require, PHAs to voucher out developments. The standard, however, is somewhat different. For that bill, the test is whether modernization and continued operation would cost more than vouchers for the same number of tenants, not merely for the current residents, if any, of a partially or totally vacant building.³⁴ The House authorizing bill is like the appropriations bill in that vouchering out is made mandatory, but the standard, as with the Senate authorizing bill, compares the cost of modernization and continued operation with the cost of vouchers for the same number of families that the modernized building would serve.³⁵ All three bills have additional requirements regarding the process and tenant involvement.

Although the appropriations bill makes no changes regarding the grounds for demolition or sale and the requirement of HUD approval, both the Senate and House authorizing bills do. On HUD approval, both authorizing bills would streamline the process, require HUD to act on applications within short timeframes, limit HUD's grounds for disapproval and, in effect, turn HUD into a rubber stamp.³⁶ On the grounds for demolition and sale, the Senate bill makes the least change. It would allow demolition of projects whose rehabilitation is not cost effective,³⁷ whereas rehabilitation is now required unless it would be unreasonable. The House bill, however, adds several new grounds for demolition, including the fact that the development is distressed, has design or construction deficiencies that make cost-effective rehabilitation infeasible, or would be too costly to operate even if it were rehabilitated.³⁸

The net effect of all these changes will make it easier to demolish or sell public housing, and more projects will be lost. As is true even with the current law, efforts to prevent the loss of viable buildings will require the active participation of well informed and organized tenant groups. They will have less leverage because of these changes, especially the suspension or repeal of the one-for-one replacement requirement; but careful examination of the remaining statutory provisions on demolitions and sales is likely to reveal some requirements that at least will give tenant organizations entry into the decision-making process, if not a full basis to stop demolitions.

For example, the appropriations bill does not repeal the current law's requirement that PHAs consult with tenants before deciding whether to demolish or sell,³⁹ and both authorizing bills require such consultation before demolition, sale or vouchering out.⁴⁰ All the bills preserve some federal standards that define approvable grounds for demolition, sale or vouchering out, even though some of the versions are fairly vague. In sale situations, both authorizing bills would require that the tenants be given the first chance purchase the building.⁴¹ All the bills retain or include new provisions protecting current tenants against relocation without being provided an affordable place to live. Unless the Senate authorizing bill is enacted, the Uniform Relocation Act⁴² will also provide protections at least in demolition cases and where there is a sale, if the purchaser is using federal financial assistance. Beyond the housing laws, the Fair Housing Act will still apply and make unlawful a demolition or sale plan that either intentionally or in effect discriminates against protected classes.⁴³

In de facto demolition situations, i.e., cases where a PHA has so neglected a development that it has in effect demolished it by rendering it virtually uninhabitable, Section 18(d) of the current law will still be available to support a claim against the PHA, at least if neither the House nor the Senate authorizing bill is enacted.⁴⁴ Even though the appropriations act is likely to give PHAs more authority to vacate buildings and consolidate occupancy, which does cut back somewhat on the Velez holding, that amendment will not undermine the basic de facto demolition doctrine. That is because the appropriations act will allow consolidation pursuant only to a deliberate purpose of improving living conditions or making services more efficient. The basic de facto demolition cases are ones in which the PHA has no plans or purpose but is simply callously disregarding its responsibility to maintain and rent out its buildings.

Demolition and Sale of Privately Owned Assisted Housing

The buildings' physical and financial situations also differ. Some are in very bad physical condition, are expensive to operate and, in the most extreme cases, have been acquired by HUD after mortgage foreclosure. Others may be financially viable, with rental income at the certificate program's Fair Market Rent (FMR) for the locality, if their debt were restructured or forgiven in all or in part. Others may require such debt restructuring as well as significant repairs or renovations to be viable. Others are buildings that can attract rental income above the certificate program's FMR, either in their present condition or after some fix-up. Within that category, some may be financially viable at those rent levels with debt restructuring, and others without it.

What happens to these buildings will be heavily influenced by decisions that Congress makes regarding funding and the governing rules; the buildings' physical and financial situations; and case-by-case choices made by a variety of decision-makers, including the owners, potential purchasers, lenders and HUD, as owner, mortgage insurer or holder, or subsidy provider. Currently most of those factors are in a state of chaos, confusion and uncertainty. The legal issues that may emerge from the choices made for a particular building are also unclear. Despite the uncertainty, some are worth examining at this moment.

For projects that HUD has acquired through foreclosure, Congress has lifted virtually all legal limits on HUD's authority to decide what to do with the buildings.⁴⁵ In the Balanced Budget Downpayment Act, Congress has given HUD authority, until September 30, 1996, to manage and dispose of those projects "without regard to any other provision of law."⁴⁶ There is an increasing possibility that HUD may sell significant numbers of those projects "as is," without subsidies, because Congress has reduced the appropriation for property disposition to $261 million, although it has also authorized HUD to use money from the General Insurance Fund to rehabilitate distressed projects and cover other related costs.⁴⁷

It is difficult to gauge the impact of HUD's authority to dispose of projects without regard to any other provision of law. It is possible that Congress merely gave HUD more freedom to demolish projects that are difficult to salvage and to sell others without subsidies or other measures designed to continue their availability as housing for poor people. On the other hand, given the breadth of the language, Congress may have eliminated HUD's statutory duties to notify affected tenants and hear their views before making disposition decisions.⁴⁸ However, even if the statute were interpreted as no longer mandating tenant notification and consultation, the due process clause might require such consultation anyway.⁴⁹

It is also unclear whether Congress went so far as to exempt HUD's property disposition decisions from the strictures of the Fair Housing Act.⁵⁰ If a HUD official were to decide to demolish a project because of neighborhood pressure that was based upon the race of its occupants, the Fifth Amendment would make the decision unlawful, even without considering the Fair Housing Act. However, in cases where the HUD official merely fails to affirmatively further fair housing or to consider the disproportionate impact of the disposition decision on people protected by the Fair Housing Act, the legal question will arise. Despite the breadth of the language "without regard to any other provision of law," it seems unlikely that Congress intended to exempt these decisions from the Fair Housing Act.

For buildings that are in good physical and financial shape and are located where market rents high enough to make them financially self-sustaining, there are pending statutory changes that will increase the possibility of their leaving the low- and moderate-income market. First, for those buildings with older FHA-insured mortgages, Congress is likely to allow owners to prepay their mortgages in the omnibus appropriations act.⁵¹ Whenever any of those owners do prepay, tenants whose rents would increase above 30 percent of their adjusted incomes would get tenant-based assistance, if funds are appropriated, and the right to use that assistance without moving. In cases where the owners do prepay, one of the emerging legal issues will be to enforce the laws giving affected tenants the right to tenant-based assistance and the right not to move, assuming the finally enacted law retains those provisions. Beyond that law, there will be the Fair Housing Act, in some cases, if the effect of the decision to prepay or the motivation behind it is to make housing unavailable to people of color or other people protected by that Act.⁵²

Owners with expiring Section 8 contracts will also have few restrictions requiring them to renew their contracts, even if HUD offers to do so. The Balanced Budget Downpayment Act requires HUD to renew all project-based contracts that expire in FY 1996, except for Moderate Rehabilitation contracts, if the owner requests a renewal.⁵³ The Extension Act authorizes, but does not require, HUD to renew Moderate Rehabilitation contracts for one year if the landlord requests a renewal.⁵⁴

If the project is financially viable with its current debt structure and the rents it can generate on the private market, the owners may elect not to renew. In those cases, a number of legal issues may arise. First, if the owner has mortgage insurance under the Section 221(d)(3) or 236 programs or a Section 202 direct loan, or if the project was acquired from HUD under its property disposition program, the owner is barred from interfering with tenants' efforts to secure rental subsidies.⁵⁵ Such owners are also barred from refusing to participate in the certificate or voucher programs.⁵⁶ If Section 8(t)⁵⁷ is not repealed or suspended, any of those landlords who have at least one Section 8 contract would be barred from discriminating against applicants or tenants with certificates or vouchers. If such an owner were to refuse to renew the Section 8 contract or to accept certificates or vouchers tendered by the tenants, there would be a legal issue whether the owner would be violating the duty not to interfere or the duty not to discriminate.

If an owner wants to renew but decides not to do so because of a "no rent increase" provision in HUD's Notice implementing the Balance Budget Downpayment Act, a new issue will arise. The Notice states that owners who renew will not be entitled to their normal annual adjustment factor rent increase.⁵⁸ HUD defends that part of the Notice as being mandated by the language of the Act, which requires renewals "at the current rent levels."⁵⁹ HUD could have interpreted that language to mean at the rent levels to which the owner would have been entitled under the current law, but it did not. An owner with an expiring contract who wants the regular annual adjustment factor increase, or a tenant adversely affected by an owner's refusal to renew without such an increase, may have a claim under the Administrative Procedure Act that HUD has acted in excess of its statutory authority.

HUD's current policy on Section 8 Moderate Rehabilitation contracts that expire after 15 years has been not to renew those contracts, but instead to issue certificates or vouchers to current tenants. Congress' Balanced Budget Downpayment Act appeared to preserve that policy, because it excluded Moderate Rehabilitation contracts from the Section 8 contracts that HUD must renew.⁶⁰ The Extension Act will alter that somewhat, because it authorizes HUD to renew the Moderate Rehabilitation contracts, but does not require HUD to do so.⁶¹ Even with that statutory language, there may be a claim that HUD must at least have a good reason for not renewing a Moderate Rehabilitation contract if renewal is requested by the landlord.⁶²

Because the legal claims needed to save the units are difficult, it is important with all of these privately owned buildings to identify those that are in jeopardy, to educate the tenants about the rules and the options, and to actively participate at each stage of any process that will determine the buildings' future. The leverage of possible litigation may influence the outcome of such decisions. But becoming involved, being informed, using whatever political pressure might exist, and negotiating hard and effectively for the best deal will produce more results than litigation alone.

Certificate and Voucher Delays

The constant struggle to close the gap between the number of families that need housing assistance in this country and the limited amount of assistance that Congress will appropriate each year received a major setback in 1995, when Congress rescinded the appropriations for incremental certificates and vouchers and other housing programs.⁶³ This year, Congress took one further step backward, mandating that PHAs delay for three months the use of certificate and voucher assistance that becomes available when assistance for a participant family is terminated.⁶⁴ The purpose of that provision is to reduce the federal government's spending on the certificate and voucher programs. Its effect will be to reduce overall the number of households that participate in the two programs at any time and to extend the time applicants spend on the waiting lists by three months.

HUD's implementing notice characterizes the statute as requiring a delay in the issuance of turnover certificates.⁶⁵ The Notice directed all PHAs to begin delaying reissuance by February 25, 1996. It makes clear that the delay is to apply only to turnover certificates and vouchers, i.e., cases in which a participating family voluntarily leaves the program, is terminated for cause or ceases to qualify because its income has increased and no payments have been made on its behalf for one year, or six months on newer contracts. There are many other situations where delay is not required, as the Notice explains. They include cases where the participating family is moving to a new unit, either because they want to or because they are being evicted or the PHA is terminating their landlord's Housing Assistance Payments (HAP) contract; where an applicant turns in a certificate or voucher because he or she has not been able to find a landlord to rent from; or where the PHA has received new funds for certificates or vouchers for any reason.

Legal issues may arise regarding the implementation of this three-month-delay provision, especially if PHAs fail to follow HUD's implementation notice. The most likely mistakes will be cases where families wish to move or applicants turn certificates or vouchers back in because they cannot find a landlord who will rent to them. A more fundamental issue may arise from HUD's interpretation of the statute as mandating a delay in reissuance as against a delay in use of the assistance. Although the caption for the section speaks of delay in reissuance, the actual statutory language is that the PHA must "delay for three months the use of any such assistance (or the certificate or voucher representing such assistance). . . ."⁶⁶ The significance of that distinction arises in the calculation of the three months. HUD requires a PHA to ensure that three months elapses between the date the certificate or voucher becomes available and the date it is reissued to a family.⁶⁷ Since Congress was concerned only about delaying use of the assistance, the relevant dates should be the last day for which a housing assistance payment was made under a participant's contract and the date payments begin under a new contract, not the date the certificate or voucher was reissued. When there is a delay between reissuance of a certificate and execution of a HAP contract pursuant to it, which is almost always the case, HUD's interpretation of the statute imposes more than a three-month delay. In cases where the applicant takes 90 days to find a place, HUD's interpretation delays the use of the assistance for six months, not three. When a PHA's use of turnover certificates and vouchers is considered in the aggregate, HUD's interpretation will always result in delays in use of more than three months, and with most PHAs the delays probably will reach or exceed six months. Thus litigation under the Administrative Procedure Act to set aside HUD's direction that PHAs delay reissuance of certificates and vouchers, as against their reuse, stands a chance of succeeding.

Another even more fundamental legal question is whether Congress can constitutionally require PHAs to delay reuse at all. Certificate and voucher assistance is made available to PHAs under Annual Contributions Contracts. The contracts are for a specific amount of money and have no language making the availability of those funds subject to future appropriations acts. Congress' imposition of the delay requirement has impaired its contractual obligation to make payments to the PHA. The injured parties are not only the PHAs but also the people who are applying to participate and for whose benefit Congress created the program and authorized HUD to enter into the contracts. Possibly the PHAs and those applicants have a claim that their contract rights were unconstitutionally impaired.

These are challenging times. As a result, please keep in touch with us and with each other, so that people who need housing assistance can mitigate the worst consequences of these changes and take advantage of whatever opportunities for improvement may arise.

1. H.R. 2099, § 202(d) (reported out of conference committee Nov. 17, 1995, and vetoed by President Clinton on December 18).
2. The Balanced Budget Downpayment Act I, Pub. L. No. 104-99, 110 Stat. 26 (Jan. 26, 1996), considered at 142 CONG. REC. H883 (Jan. 25, 1996) (hereinafter cited as Pub. L. No. 104-99).
3. HUD Notice PIH 96-6 (Feb. 13, 1996) (public housing); HUD Notice PIH 96-7 (Feb. 13, 1996) (certificates and vouchers); see Housing Availability Curtailed by Continuing Resolution: HUD Issues Implementing Guidance, 26 HOUS. L. BULL. 21 (Feb. 1996).
4. S. 1494, 142 CONG. REC. S350 (passed the Senate Jan. 24, 1996), 142 CONG. REC. H1267 (amended and passed the House Feb. 27, 1996), and 142 CONG. REC. S1900 (that version passed by Senate without amendments March 12, 1996) (hereinafter cited as S. 1494). See also Limited Housing Authorization Bill Adopted elsewhere in this issue.
5. H.R. 3019, Making Appropriations for Fiscal 1996 to Make a Further Downpayment Toward a Balanced Budget, and for Other Purposes (passed the House Mar. 7, 1996). This bill was amended by the Senate, renumbered as S. 1594, Making Omnibus Consolidated Rescissions and Appropriations for the Fiscal Year Ending September 3, 1996, and for Other Purposes, and passed the Senate on March 19, 1996 (hereafter cited as S. 1594).
6. See H.R. 2406, the United States Housing Act of 1996 (reported from committee by H. REP. NO. 461, 104th Cong., 2d Sess., on Feb. 1, 1996) (hereafter cited as H.R. 2406); and S. 1260, Public Housing Reform and Empowerment Act of 1996, 142 CONG. REC. S152 (passed by Senate Jan. 10, 1996) (hereafter cited as S. 1260).
7. See Emerging Legal Issues Regarding HUD's Housing Programs — Part 1, 26 HOUS. L. BULL. 1 (Jan. 1996).
8. H.R. 2406, § 110(b).
9. S. 1494, § 9(a), 142 CONG. REC. S353 (Jan. 24, 1996).
10. Id.
11. 425 F.2d 853 (2d Cir. 1970).
12. 42 U.S.C.A. § 1437d(l)(3) (West 1994).
13. S. 1260, § 107(e)(1).
14. H.R. 2406, § 226(3).
15. S. 1260, § 107(h), 142 CONG. REC. S156; S. 1494, § 9, 142 CONG. REC. S352-53; H.R. 2406, § 224(b).
16. S. 1260, § 107(e), 142 CONG. REC. S156; S. 1494, § 9(a)(2), 142 CONG. REC. S. 352-53; H.R. 2406, § 226(5)(C).
17. S. 1260, § 109, 142 CONG. REC. S156 (allowing evictions, from designated housing only, if tenant "would" interfere with other tenants' quiet enjoyment); S. 1494, § 9(d)(2), 142 CONG. REC. H.1268-69 (Feb. 27, 1996) (allowing evictions from any public housing and termination of Section 8 assistance if tenant uses illegal drugs or abuses alcohol in a way that interferes with other tenants); H.R. 2406, § 227(a)(4) (requiring eviction from designated housing of any non-elderly tenants who "may" interfere).
18. H.R. 2406, § 224(b).
19. S. 1260, § 107(h), 142 CONG. REC. S156, and S. 1494, § 9(b), 142 CONG. REC. H1268, respectively.
20. Cf. Rudder v. United States, 226 F.2d 51 (D.C. Cir. 1955).
21. S. 1594, § 101(a), Title II, § 204(c), p. 662 (allowing tenancy terminations for other good cause during the term of the lease and for any reason after the lease expires); H.R. 2406, § 325 (same); S. 1260, § 201, 142 CONG. REC. S164 (same).
22. See, e.g., Swann v. Gastonia Hous. Auth., 675 F.2d 1342 (4th Cir. 1982).
23. See, e.g., Lopez v. Henry Phipps Plaza South, Inc., 498 F.2d 937 (2d Cir. 1974).
24. 42 U.S.C.A. § 1437f(c)(9) (West 1994).
25. S. 1594, § 101(e), Title II, § 204(b), p. 662; S. 1260, §§ 206(b)(3)(E) and (F), 142 CONG. REC. S166; and H.R. 2406, § 501(a)(1) (repealing the United States Housing Act entirely).
26. Pub. L. No. 104-19, § 1002, 109 Stat. 235 (1995).
27. S. 1594, § 101(e), Title II, § 201(b), p. 654.
28. S. 1260, § 115, 142 CONG. REC. S160 (also makes the Uniform Relocation Act inapplicable to public housing demolitions and sales); H.R. 2406, § 261(j) (authorizing but not requiring replacement units).
29. S. 1594, § 101(e), Title II, § 201(b)(1), p. 654, reactivating Pub. L. No. 104-19, § 1002(a)(6), 109 Stat. 235 (1995).
30. H.R. 2406, §§ 261(k) and (l).
31. S. 1260, § 115, 142 CONG. REC. S160.
32. Velez v. Cisneros, 850 F. Supp. 1257 (E.D. Pa. 1994) (holding units vacant with no plans for their restoration to the market violates Section 18).
33. S. 1594, § 101(e), Title II, § 203, p. 655.
34. S. 1260, § 116.
35. H.R. 2406, § 203(b).
36. S. 1260, § 115; H.R. 2406, §§ 261(h) and 108.
37. S. 1260, § 115.
38. H.R. 2406, § 261(c).
39. 42 U.S.C.A. § 1437p(b) (West 1994).
40. S. 1260, §§ 115 and 106; H.R. 2406, § 261(d).
41. S. 1260, § 115; H.R. 2406, § 261(g).
42. 42 U.S.C.A. §§ 4601 et seq. (West 1994).
43. 42 U.S.C.A. § 3604 (West 1994); See, e.g., Tinsley v. Kemp, 750 F. Supp. 1001 (W.D. Mo. 1990) (tenants stated valid claim of violations of Title VI and Title VIII).
44. See Velez v. Cisneros, 850 F. Supp. 1257 (E.D. Pa. 1994) (HUD and PHA liable to tenants for de facto demolition); Henry Horner Mothers Guild v. Chicago Hous. Auth., 780 F. Supp. 511 (N.D. Ill. Nov. 20, 1991) (complaint stated a valid claim of de facto demolition); Tinsley v. Kemp. 750 F. Supp. 1001 (W.D. Mo. 1990) (tenants stated valid claim of de facto demolition).
45. Pub. L. No. 104-99, § 401.
46. Id.
47. Id., Title II(b) and § 401.
48. 12 U.S.C.A. § 1701z-11(c)(2)(D) (West Supp. 1995).
49. Cf. Tenants for Justice v. Hills, 413 F. Supp. 389 (E.D. Pa. 1975).
50. 42 U.S.C.A. §§ 3601 et seq. (West 1994).
51. S. 1594, § 101(e), Title II, p. 629.
52. 42 U.S.C.A. § 3604 (West 1994); Young v. HUD, No. C-85-4642 (N.D. Cal. preliminary injunction denied Sept. 1985), injunction pending appeal denied, No. 85-2584 (9th Cir. Oct. 1985), 19 CLEARINGHOUSE REV. 657 (No. 39,655 Oct. 1985) (Fair Housing Act claims rejected), settled Feb. 1986; cf. Betsey v. Turtle Creek Assocs., 736 F.2d 983 (4th Cir. 1984).
53. Pub. L. No. 104-99, § 405(b).
54. S. 1494, § 2(a).
55. 12 U.S.C.A. § 1517z-1b(B)(2) (West 1989).
56. See, e.g., Pub. L. No. 100-242, § 183, 101 Stat. 1872 (1988), noted at 42 U.S.C.A. § 1437f note (West 1994) (nondiscrimination, etc.).
57. 42 U.S.C.A. § 1437f(t) (West 1994).
58. HUD Notice H 96-7 (Mar. 15, 1996), p. 5.
59. Pub. L. No. 104-99, § 405(b).
60. Id.
61. S. 1494, § 2(a), 142 CONG. REC. H1267.
62. See Abrams v. Hills, 415 F. Supp. 550 (C.D. Cal. 1976), aff'd, 547 F.2d 928 (9th Cir. 1976), vacated and remanded, 455 U.S. 1010 (1982).
63. Pub. L. No. 104-99, ch. X, 109 Stat. 232 (1995).
64. Pub. L. No. 104-99, § 403(c).
65. HUD Notice PIH 96-7 (Feb. 13, 1996).
66. Pub. L. No. 104-99, § 403(b).
67. HUD Notice PIH 96-7, p. 3.