It is always difficult when an apartment community decides to “opt out” of the federal Section 8 housing program.  While participation in “Section 8” is voluntary – the guidelines for opting out are not always easy to follow and the process does take some time.  Additionally, affordable residents who have been living at the community will likely be upset and unhappy with the decision.  And then may retain counsel to challenge management’s decision.

That is exactly what just happened at an affordable community in Brooklyn, NY.  Earlier this week, a group of residents sued the U.S. Department of Housing and Urban Development (HUD) and the management company claiming the owner is attempting to opt out of the Section 8 program without providing the proper one year notice.  The complaint further alleges that the result of this change will increase homelessness and will reduce the number of minority residents in the community.  With the case, the plaintiffs seek an order requiring that the owner renew its Section 8 contract, stop all evictions, and end all rent increases.  The plaintiffs also contend that management’s confusing signals caused what amounts to a panic for the residents as they only received four months notice that the housing program would be going away.

While residents are permitted to apply for what are known as “enhanced vouchers” with HUD to help permit them to remain in their homes, the residents must still ensure their units pass fair housing quality inspections.  There are some residents who may have problems with the voucher and/or the inspection requirement, which will force them out of their homes.  And that is always difficult.

In circumstances like this, management must ensure that all of the paperwork is correct and all of the requirements have been followed.  And, even if you have done everything correctly, I can guarantee that some residents will be very unhappy with the decision to opt out of the Section 8 program.  And then you will really need a lawyer like me to work with you in an effort to avoid lawsuits like this.

Just A Thought.