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Third Circuit Requires HUD to Preserve Subsidy Contract

On September 8, in Massie v. U.S. Dep’t of HUD, the United States Court of Appeals for the Third Circuit ruled that HUD’s 2006 foreclosure sale of Third East Hills, a project-based Section 8 property in Pittsburgh, without a Section 8 contract violated the Schumer Amendment. (Starting in 2005, the Schumer Amendment has been annually enacted by Congress to require HUD to maintain project-based Section 8 contracts, absent limited exceptions.) Reversing the District Court’s summary judgment for HUD, the decision requires HUD to reinstate the Section 8 HAP contract, and also remands for further fact-finding on whether the tenants were displaced for a federally financed project and therefore entitled to URA assistance. Especially notable here are the court’s attentive analysis of HUD’s various assertions involving statutory interpretation, deference and financial feasibility, and its rejection of each one.

HJN member Kevin Quisenberry of the Community Justice Project in Pittsburgh successfully represented the tenants throughout the past four years of litigation. Jack Cann of the Housing Preservation Project, assisted by NHLP, provided invaluable support, including a persuasive amicus.

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