TESTIMONY OF LEGAL SERVICES NYC AND
THELEGAL AID SOCIETY REGARDING PROPOSED
REGULATIONS REGARDING SUCCESSION RIGHTS,
VETERANS’ PREFERENCES, AND NOTICE REQUIREMENTS
IN MITCHELL-LAMA HOUSING
November 7, 2013
Legal Services for New York City (LSNYC) is the largest provider of free civil legal services in the country. The nineteen neighborhood offices of LSNYC throughout the City represent thousands of low-income tenants annually in disputes involving tenants’ rights to remain in their homes.
Founded in 1876, the Legal Aid Society’s Civil Practice is the oldest and largest program in the nation providing direct legal services to the indigent. Annually, the Society’s Civil Practice provides free direct legal assistance in some 30,000 individual cases involving immigration, domestic violence, family law, and employment, in addition to housing, public benefits and health law matters, through a network of 10 neighborhood offices in all five boroughs and 17 specialized units and projects for under-served client groups.
Introduction
We welcome the opportunity to testify before the Department of Housing Preservation and Development in connection with its proposed new rules governing city-aided limited profit housing companies. As further discussed below, we urge HPD to delay these new regulations until the administration has an opportunity to determine whether it supports such significant changes to the program.
There are three major proposals that our comments will focus on: 1) the changes to the veterans’ preference, 2) the changes to the succession regulations and 3) the changes to the rights of tenants to receive notice when housing companies reconstitute as a housing development fund companies under Article XI. We strongly object to all three proposals.
Succession policy
In 1993, in accordance with the Court of Appeals’ seminal decision in Braschi v. Stahl Assoc. Co., 74 N.Y.2d 201 (1989), HPD promulgated the regulations that currently govern the rights of remaining family members in Mitchell-Lama housing. Now, on the eve of a new administration, HPD suddenly and inexplicably proposes to radically restructure the succession rules that have been applied in its Mitchell-Lama buildings for the past two decades. For the reasons that follow, HPD should withdraw the proposed regulatory changes to allow for more thorough public comment and for review by the incoming mayoral administration rather than precipitously proceed with its drastic revision of regulations that need no revision.
Ironically, it was just last month that the New York Court of Appeals reiterated the importance of succession rights in protecting low income families living in Mitchell-Lama housing. In Murphy v. DHCR, --N.E.2d---, 2013 WL 5637985 (2013), decided on October 17th, the Court of Appeals found:
Regulations providing for succession rights to Mitchell–Lama apartments serve the important remedial purpose of preventing dislocation of long-term residents due to the vacatur of the head of household ( see Notices of Emergency/Proposed Rule Making, NYS Register, Nov. 29, 1989, at 23–29). Succession is in the spirit of the statutory scheme, whose goal is to facilitate the availability of affordable housing for low-income residents and to temper the harsh consequences of the death or departure of a tenant for their “traditional” and “non-traditional” family members (seeBraschi v. Stahl Assoc. Co., 74 N.Y.2d 201 (1989);see also Rent Stabilization Assn. of New York City v. Higgins, 83 N.Y.2d 156 (1993)).
HPD’s proposals do not serve the “important remedial purpose of preventing dislocation of long-term residents due to the vacatur of the head of household”, instead, they do the opposite by narrowing the definition of both family and vacatur. In the proposed regulatory changes, HPD proposes severely limiting families’ succession rights in three ways: 1) limiting the definition of family 2) limiting the events that give rise to succession claims; and 3) imposing a narrow and draconian time frame within which a potential successor must apply for succession. We oppose all three amendments.
Since 1993, HPD’s succession rules have mirrored the provisions of the rent control and rent stabilization laws in following the holding of the Court of Appeals in Braschi. The Braschi court firmly stated that it was inconsistent with the purposes underlying the rent laws to rest protection against eviction on “fictitious legal distinctions or genetic history, but instead should find its foundations in the reality of family life.” 74 N.Y.2d at 211. The Court concluded that entitlement to succession rights “should be based on an objective examination of the relationship of the parties,” not on the legal formalities accompanying that relationship. Id., at 212. These principles apply no less to Mitchell-Lama housing, which constitute a scarce oasis of affordability for middle income families in the midst of New York’s steadily worsening housing crisis.
HPD’s proposal to abolish succession rights for family members in non-traditional, “Braschi” relationships with the tenant of record contravenes the remedial purposes of the Court of Appeals’ decision and contravenes two decades of settled law. The recent legislation permitting gay couples to marry provides no basis for HPD’s regulatory change. Even after the legalization of same-sex marriage, numerous families will continue to consist of individuals united not by legal ties, but by close ties of affection and interdependence. Indeed, in Braschi, the Court of Appeals cited with approval cases endorsing succession rights for unmarried heterosexual couples and other non-traditional relationships. See, Braschi, at 213, citing, Zimmerman v Burton, 107 Misc.2d 401, 404 [unmarried heterosexual life partner]; Rutar Co. v Yoshito, No. 53042/79 [Civ. Ct, NY County] [unmarried heterosexual life partner]; Athineos v Thayer, NYLJ, Mar. 25, 1987, at 14, col 4 [Civ. Ct, Kings County], affd, NYLJ, Feb. 9, 1988, at 15, col 4 [App. Term, 2d Dep’t] [orphan never formally adopted but lived in family home for 34 years]; 2-4 Realty Assocs. v Pittman, 137 Misc.2d 898, 902 [two men living in a “father-son” relationship for 25 years]. Inexplicably, HPD also proposes to bar the succession rights even of adoptive children, who are generally treated the same as natural children in New York law. See e.g., N.Y. Domestic Relations Law § 117; N.Y. E.P.T.L. § 4-1.1(d). HPD should heed the holdings of New York State’s highest court – last month in Murphy and twenty years ago in Braschi – underscoring the importance of preventing dislocation of low income families from regulated housing and withdraw its changes to the definition of family.
Further, HPD proposes restricting the definition of vacatur to the head of household’s death or removal to a long term care facility and to require potential successors to apply for succession within 90 days from vacatur. This change would mean that family members who have lived in apartments, some for their entire lives, will lose their homes unless the head of household vacates under the limited circumstances required by HPD. Children, for example, who have grown up in Mitchell-Lama apartments, should not be forced from their family home based on a parent’s decision to relocate for retirement, remarriage, or indeed, for employment in another locality.
Additionally, in situations where the head of household removes to a long term care facility, it is often unclear for quite some time whether the head of household intends or is able to return to their homes. This ninety day time limit would ensure that families in this situation would lose their homes simply because the reality of dealing with sick, elderly and disabled family members does not comport with HPD’s arbitrary time frame. Because HPD’s proposed amendments would lead to dislocation of low income families from affordable housing, we oppose these amendments.
Veterans’ preference.
The proposed regulations weaken the existing protections for veterans in 28 RCNY § 3-02, conflict with the plain language of and undermine the legislative intent of PHFL § 31(7). Indeed, HPD seeks to curtail preferential treatment for veterans only three years after the Legislature voted to broaden the reach of the veterans’ preference by including veterans of the nation’s most recent conflicts, and to reaffirm its intent to “ensure that our fellow New Yorkers who are serving in the military know that they will always be welcomed home.” N.Y. Spons. Memo., 2010 A.B. 9501. With these proposed regulations HPD has taken what is a clear and unambiguous law and added additional requirements not found in the plain language of the statute, and contrary to the legislative intent of the 2010 amendments to PHFL § 31(7).
First, HPD proposes changes to the regulation which would apply the veteran’s preference only to those veterans lucky enough to have their applications picked in a lottery. By first subjecting veterans to a lottery before they can even be considered for placement on a Mitchell-Lama waiting list greatly diminishes their chance of successfully being placed in a Mitchell-Lama apartment. The statute does not allow for this kind of limitation on the application of the veteran’s preference. The plain language of the statute is that the preference is applied after closed waiting lists are reopened without making any provision for a lottery.
Second, HPD proposes a change to the regulation under which they will only apply the veterans’ preference to Mitchell-Lama applicants who are the “head of household”. This proposed move has the potential cut out many families who would otherwise be eligible for the preference but where the veteran is not the head of household.[1]
This change will act to deny Mitchell-Lama housing to some of the most vulnerable of our veterans. Sadly, many veterans are profoundly disabled due to injuries suffered during their service. These veterans are often in the care of their family members and due to their disabilities would be unable to act as head of household on a Mitchell-Lama housing application. A veteran suffering from traumatic brain injury (TBI) may not be able to sign the forms required or manage their affairs to the extent needed to act as the head of household on a Mitchell-Lama. These veterans will be denied the ability to benefit from the veterans preference for Mitchell-Lama housing if the proposed changes to the regulations are enacted. Moreover, it would clearly contradict to the intent of the statute if a veteran who has volunteered for another tour of active duty would be denied the veteran preference because he or she was overseas serving our country and was not available to be listed as the head of household on an application for a Mitchell-Lama apartment.
Not only is the proposed change deleterious from a policy point of view, but it contravenes the statute that makes no reference to a “head of household” requirement. Indeed, while PHFL § 31(7) does not contain the phrase “head of household,” the concept of head of household is not one that is foreign to the drafters of the PHFL. One need only look two sections down in the statute to find the term “head of household” in reference to rent setting where the “head of household” is age 62 or older. PHFL § 31(9)(b). The presence of the term “head of household” in the same statute demonstrates the ability of the legislature to use the term deliberately. If the legislature intended the concept of “head of household” to apply to the Veteran preference, they would have specifically included such language as they did later in the same statute.[2]
Limitation of tenants’ right to notice of HDFC conversions
Under current regulations, when a building leaves the Mitchell-Lama program, or when a building undergoes a preservation reconstitution, tenants receive one year’s notice of this change. HPD proposes that when a development reconstitutes as an Article XI HDFC, in contrast, tenants be given only thirty days’ notice. In addition to severely limiting the time tenants have to learn about, understand and respond to such proposals, HPD restricts the information that tenants receive about Article XI reconstitutions. Where developments either dissolve and privatize or reconstitute for preservation purposes, tenants are entitled to numerous documents relating to the housing company and its plan. This allows tenants to understand what is proposed and to provide input about the plan moving forward. Restricting the information available to tenants and limiting notice to tenants, serves only to ensure that tenants lack the ability to respond to the housing company’s plan. This leaves the decision about whether this reconstitution preserves affordable housing in the hands of HPD. The only requirement in the regulations is that there be a thirty-year regulatory agreement. There is no mention of the need to preserve these developments as affordable housing. For all these reasons, we oppose these amendments.
Conclusion
The proposed changes to HPD’s rules governing City-aided limited-profit housing companies are significant and would greatly affect the low income families that reside in such housing. Considering that in two months there will be a new administration in New York City, we urge the agency to hold these proposals in abeyance until the new administration has an opportunity to review them.
As always, we look forward to working closely with HPD in the future to discuss any need for amendments to the rules. Thank you for giving us the opportunity to testify today.
[1] It is troubling that HPD is currently operating as if this change to the regulations is already in place. The Veterans Justice Project at South Brooklyn Legal Services, along with the Veterans Advocacy Project at the Urban Justice Center, recently filed an Article 78 proceeding in New York County Supreme Court alleging that HPD and a Mitchell-Lama development failed to go through applications for a reopened Mitchell-Lama waiting list and apply the veterans’ preference before conducting a lottery. As a result, Aaron Glover, a decorated veteran of the United States Air Force and current employee of the United Stated Department of Veterans Affairs, was improperly denied a space on a waiting list. This case is currently pending before the Court. See, Glover v. Visnuskas et. al., Index # 101413/2013 (New York Co. Sup. Ct.)
[2] Again, HPD has been acting as if this proposed change to the regulations is already in place. In Bumagin v. Wambua, et. al., Index # 402217/2012 (New York Co. Sup. Ct.), Ret. Sergeant Martin Bumagin was forced to sue HPD after his family was denied a veterans’ preference on the grounds that his mother was listed as the “head of household” while Sergeant Bumagin was on active duty in the United States Marine Corps and was deployed in support of Operation Iraqi Freedom. HPD agreed to afford the Bumagins the statutory preference only after Supreme Court Justice Michael D. Stallman issued a Temporary Restraining Order preventing the leasing of the subject apartment.