September 2009 Bulletin Article Summaries

Obama Administration Rolls Out Choice Neighborhoods Initiative
The Choice Neighborhoods Initiative is the Obama Administration’s vision of a successor to the seventeen-year-old HOPE VI program. The initiative proposes to bring together diverse resources to build sustainable neighborhoods in which people will choose to live because they offer a better quality of life than the surrounding community. This article discusses the challenges and opportunities that the initiative presents to the advocacy community.

HUD, PHAs and Advocates Respond to Voucher Funding Shortfalls
A significant percentage of public housing agencies (PHAs) nationwide are confronting serious problems because of funding shortfalls in the Housing Choice Voucher Program. It is estimated that between 300 and 400 PHAs nationwide are confronting significant funding shortfalls. Overall, the Department of Housing and Urban Development (HUD) estimates that 15% of all PHAs are affected. This article provides an overview of the funding shortfalls and the responses of HUD and advocates.

Home Affordable Modification Program: Help for Homeowners or Another Dead End?
A class-action lawsuit recently filed in federal district court in Minnesota seeks to halt foreclosures on properties where a homeowner is eligible for a loan modification under the Home Affordable Modification Program (HAMP). In Williams v. Geithner, the plaintiffs allege that HAMP’s failure to provide homeowners with notice that their modification request has been denied or an opportunity to appeal their rejection violates constitutional procedural due process standards. This article describes the difficulties homeowners have faced in seeking HAMP modifications and provides background information on the program. It then discusses the constitutional theories and precedent on which the Williams action is based.

California Cities Take Steps to Protect Tenants in Foreclosed Properties
This article reviews two important developments involving the rights of tenants in foreclosed properties. First, the city of Richmond, California, has enacted an ordinance affording additional protections to these tenants. Second, the City of Oakland has settled its case against a JP Morgan Chase Bank that sought to evict these tenants illegally. The Richmond city council unanimously enacted a just cause eviction ordinance for tenants living in foreclosed properties. In Oakland, the city attorney agreed to a settlement with JP Morgan Chase in its lawsuit against the bank for violating the city’s just cause eviction ordinance.

Baltimore, Cleveland Receive Mixed Results in Suits Seeking Foreclosure-Related Damages
Last year, the cities of Baltimore and Cleveland filed groundbreaking litigation against banks to seek redress for damages caused by the foreclosure crisis. Both cities have experienced massive waves of foreclosures in recent years. The cities filed separate suits against banks in January 2008, resulting in different outcomes at the motion to dismiss stage. While a federal district court dismissed Cleveland’s case in May 2009, Baltimore’s federal claim survived a motion to dismiss shortly thereafter. This article examines the differences between the two cases, and attempts to distill why Baltimore’s case survived a motion to dismiss and Cleveland’s did not. Given the heightened pleading standards recently set forth in the Supreme Court’s decision in Ashcroft v. Iqbal, the decisions in the Baltimore and Cleveland cases provide critical cues for parties considering similar litigation.