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CES In The News

Los Angeles Times
Saturday October 12, 2002
Ruling Extends Tenants' Subsidies



A Los Angeles Superior Court judge has issued a preliminary injunction preventing the owners of six buildings in Los Angeles from removing their property from a federally subsidized housing program.

The judgment is a victory for tenants, housing advocates and Mayor James K. Hahn, who had argued that the owners violated state law by failing to properly notify several public entities and tenants of their intent to leave the program.

In a statement, Hahn hailed the ruling and vowed to "continue to fight to ensure that affordable housing tenants' rights are protected."

The ruling, issued Monday, affects six apartment buildings scattered in South Los Angeles, some in the USC area, known as L.A. Pro VI. Tenants of 127 units, who faced the possibility of higher rent or displacement, can remain in place for at least 12 months, officials said.

"That's going to give us 12 months to work with owners and other interested parties to keep these buildings affordable for the working families and seniors who live there, " said Sarah Dusseault, assistant deputy mayor for economic development.

Scott Chaplan, an attorney representing the owners of four of the buildings, has appealed the ruling.

"In this issue the statute simply didn't apply to our client," Chaplan said. His client, he said, "intends to continue being a quality low-income housing provider," and is open to discussion with the city.

At the heart of the city's argument is a 2-year-old state law concerning the federal housing program commonly known as Section 8. Under the program, the federal government pays the bulk of a low-income tenant's rent.

The law requires owners who wish to leave the program to notify tenants 12 months in advance. Several public entities must also be notified, including the California Housing and Community Development Department and the local mayor.

The notice allows public officials to search for ways to keep the units affordable or find solutions for the tenants who stand to face higher rent or lose their homes.

Housing advocates had asked the U.S. Department of Housing and Urban Development to reject the owners' application to leave the program, arguing that HUD's regulations require owners to comply with state and local laws.

But local HUD officials took the opposite view. They said the federal agency had no obligation to enforce state law and approved the owners' application to leave the program.

Faced with HUD's decision, and the impending end of the owner's contract with HUD, the city took the rare step of seeking an injunction. In the ruling issued Monday, Los Angeles Superior Court Judge Reginald A. Dunn said the owners' "alleged violation of state law will irreparably harm the city of Los Angeles and James K. Hahn by preventing the affected low-income tenants from obtaining proper notice and an opportunity to properly protect themselves."

Deputy City Atty. Jennifer Gregg, who with Richard Bobb represented the city in the case, said the ruling means the owners must enter into a new contract with HUD.

"If HUD is willing to renew the contract for an additional period, the owners are required to accept that renewal," Gregg said. "HUD has indicated it is willing to renew the contract if funding is available."

This Picture Did Not Appear In the Original Version of This Article

Larry Gross of the Coalition for Economic Survival said the impact of the ruling extends beyond the six buildings involved.

"I think this sends a tremendous message to owners who are looking to opt out or prepay that if they intend to do this, they have to comply with the laws or else the city of L.A. will take actions to ensure that they do," he said.

Dusseault added: "I think it sends a message to the federal government as well as to the owners."

Last month the Legal Aid Foundation of Los Angeles filed a lawsuit accusing the owners of failing to comply with the federal and state noticing requirements. Attorneys for the owners have not yet answered the lawsuit. "For now the tenants are protected," said Legal Aid staff attorney Christian Abasto. "We're not going to file any motions, as long as the owner applies to renew the Section 8 contract and as long as HUD approves it."

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