NHLP Preservation e-News #2 (Dec. 2002)
Preservation Group:Following are some recent items we thought you might like to know about. There are links in the text directly to the web sites mentioned. About once each month, we will send these news items to this e-mail list. Of course, if you have an item or announcement of your own, feel free to share it with the list.
Due to problems with the links in our first issue, we now include linked text, but repeat the web site information at the end of each description. In the case of multiple citations, the web sites are listed seriatim.
Policy Developments
The 107th Congress adjourned in late November with few legislative accomplishments, despite extensive groundwork of many bills and hearings laid earlier in the session. Even the annual appropriations ritual, often the only legislative vehicle of late, became enmeshed in larger budget politics and failed to emerge as a separate bill, folded instead into the Continuing Resolution funding federal operations until January 11. Thus, Congress enacted no laws addressing preservation issues, and pro-rata appropriations at FY '02 levels under the CR will be insufficient to fund HUD programs at current services levels if extended further into FY '03. The House's proposal to revise the Section 8 Voucher renewal funding formula, and the lower spending caps reportedly agreed to by the new Appropriations Chairs and the Bush Administration, pose serious danger to Congress' prior commitment to fully fund all expiring Section 8 contracts. The Center on Budget and Policy Priorities has issued two papers, an updated analysis of the House proposal and data on the proposal’s effects in each state, available from <http://www.cbpp.org>. (A review of the 107th Congress' actions on legislation related to preservation and other housing programs will be included in the forthcoming Nov./Dec. issue of the Housing Law Bulletin.)
Neither HUD nor Congress have taken any action to resolve the funding crisis for HUD preservation Technical Assistance grantees. More than 15 nonprofit groups receiving OTAG funds have seen their funding suspended as a result of HUD's response to the IG audits, the HUD VISTA program has not been restarted, and ITAG grants have remained unavailable for more than a year. Audits reports have now been published for all groups and the HUD Inspector General is preparing an umbrella report on all of the audit findings for the forty different reviews. <www.hud.gov/offices/oig/omhar.cfm>
Web Sites
The National Housing Trust web site includes Mark to Market information for residents. NHT has created a guide for tenants, which is posted to the site, as well as HUD’s M2M Brochure and links for tenants with more questions about M2M. A related part of the web site describes NHT’s coverage for technical assistance and a history of federally assisted multifamily developments.
http://www.nhtinc.org/otag/m2mres.asp
http://www.nhtinc.org/otag.asp
Recent Publications
HUD’s Office of Policy Development and Research published a study evaluating Qualified Allocation Plans adopted by states and a few cities throughout the country. The study compares QAPs as adopted in 1990 with those adopted in 2000 and 2001, and reviews eight elements of them: Geographic location, Local housing needs, Financing, Resident characteristics, Project activities and types, Building characteristics, Sponsorship and costs, and Affordability. The report is available from the HUDuser web site, or you can get a printed version for $5 by calling 800-245-2691.
www.huduser.org/publications/hsgfin/analysis_of_sqa_plans.html
The GAO issued a report entitled “HUD Management: Actions Needed to Improve Acquisition Management.” GAO-03-157, November 15, 2002. The report reviews HUD’s oversight properties it acquires, through single family mortgage defaults and multifamily property disposition. While it reviews weaknesses in HUD’s property disposition process, most of the report focuses on HUD’s oversight of contractors who complete this work, and training of HUD staff. It does not make recommendations to improve the results for the multifamily properties owned by HUD.
www.gao.gov/cgi-bin/getrpt?GAO-03-157
The Texas Department of Housing and Community Affairs Assessment published a detailed study of the expiring Section 8 properties in Texas and a review of those which have already opted-out.
www.tdhca.state.tx.us/pdf/MF/02-MFPresAssess-Sec8-021010.pdf
Ohio's Tax Credit Properties: What Happens in "Year 15"? describes the properties developed in the first years of the tax credit program, whose use restrictions lasted 15 years and now begin to expire. A similar report was published earlier this year by a the California Housing Partnership Corporation.
www.occh.org/Resource%20Files/Year%2015FINAL%20FINAL.pdf
www.chpc.net/pdf_files/tax_credits/TCAC_risk_analy_FINAL_ebk.pdf
On the Ground
Bryte Gardens, West Sacramento, CA (Rubanenko v. Martinez). This suit challenges HUD's approval of a Section 236 prepayment as contrary to Section 250 of the National Housing Act (12 USC Sec. 1715z-15). The District Court denied preliminary relief, and ultimately dismissed the case as moot. After the named plaintiff tenants appealed, they decided not to pursue the case, and other tenants harmed by the rent increase sought to intervene, but the Ninth Circuit recently denied intervention. Prospective intervenor tenants are evaluating next steps.
In two federal court cases in Idaho, the District Court has recently ruled that owners of several Section 515 Rural Housing Services properties may quiet title without complying with the prepayment restrictions of federal law. In one of the cases, the Court also denied the tenants' motion to intervene. Tenants' counsel are discussing appellate options with USDA's attorneys.
Applying local rent control to converted former HUD-subsidized properties: Topa Equities v. City of LA. Last year, the federal District Court ruled that the City of Los Angeles rent control law, establishing the base rent for HUD-subsidized properties being prepaid at the last federally controlled rent level, was not preempted by LIHPRHA or the National Housing Act. The owners have appealed to the Ninth Circuit, and recently filed their opening brief seeking reversal of the judgment, which was supported by an amicus brief filed by the Assisted Housing Management Agents and other owner groups. A responsive brief has been filed by tenant-intervenors represented by LAFLA, and an amicus brief in support of the City of LA will be filed around the end of January by other affected tenant and nonprofit housing organizations.
The foregoing news should reminds us that there is much work to do, so we together we can make it a Happy New Year!
James R. Grow
Staff Attorney
National Housing Law Project
614 Grand Ave., Ste. 320
Oakland, CA 94610
phone (510) 251-9400 x104
fax (510) 451-2300
e-mail: jgrow@nhlp.org
Craig Castellanet
Staff Attorney
National Housing Law Project
614 Grand Avenue, Suite 320
Oakland, CA 94610
510-251-9400 (ext. 106)
fax 510-451-2300
ccastellanet@nhlp.org