Did Housing Authority Improperly Refuse to Increase HAP Payments?

Landlord of a multifamily housing project who received Section 8 rent subsidies in the form of HAP payments on behalf of low-income tenants sued the local housing authority and the New York State Housing Finance Agency (NYSHFA). Landlord claimed that the housing authorities failed to make proper payments under the HAP contract because they failed to pay rent increases that were due. NYSHFA asked the court to dismiss any claims against it without a trial. The court ruled against NYSHFA.  NYSHFA argued that it merely paid the amount of HAP payments due to landlord in accordance with the contract and criteria set by HUD. The agency claimed that it correctly denied automatic rental increases, correctly applied the non-turnover deduction, and properly required landlord to submit rent comparability studies before getting a rent increase. But landlord showed that NYSHFA may have lacked the authority to require a rent comparability study before granting a rent increase. A trial was needed to determine the facts.

Onondaga Hilltop Homes, Inc. v. Syracuse Housing Authority: Index No. 5:12-CV-626, NYLJ No. 1202592455974 (NDNY; 3/20/13; Mordue, J)