Legal Aid Society, Hughes Hubbard & Reed Class Action Settlement Promises Relief for Thousands Facing Eviction and Homelessness State and City to Increase Rent Assistance for Low-Income Families with Children

The Legal Aid Society and Hughes Hubbard & Reed announced today the filing of a settlement agreement with New York State which could result in dramatic increases in rent supplements for families facing homelessness. Under the terms of the settlement agreement – which is subject to court approval – a family of four facing eviction, will be eligible to receive a rent supplement of up to $1515 to rent a two-bedroom apartment. The current limit for the program is only $900 for a family of four, a cap that has not been changed since 2004. The lawsuit, Velez et al vs. Roberts, was originally brought by Legal Aid and Hughes Hubbard on behalf of three city families with children who were on the brink of eviction and homelessness.

“This settlement agreement should mark a very significant step in addressing the human needs of thousands of families facing homelessness,” said Seymour W. James, Attorney-in-Chief of The Legal Aid Society. “It does not make sense to force families out of their homes and into the City’s shelter system at a cost of more than $3,000 per month, when relatively-affordable apartments can be saved.”

The settlement agreement comes as skyrocketing rent increases and cuts in other rent supplement programs have helped drive New York City’s homelessness population into record numbers as families are unable to keep or find affordable housing given the out-of-date shelter supplements.

“Working with The Legal Aid Society, our team brought this case that was a long time coming,” said Ted Mayer, managing partner of Hughes Hubbard & Reed. “There are far too many families in New York who face the risk of homelessness each year, and we are thrilled that the State of New York and New York City came to an agreement that will ultimately help thousands of New Yorkers stay in their homes. Through this settlement, and the new ‘Family Homelessness and Eviction Prevention Supplement’ (FHEPS) Program, families will be protected from eviction and homelessness. The need is an urgent one, and we look forward to the approval process and to swift implementation of these critical measures.”

The fair market rent (FMR) for a one bedroom apartment across the five boroughs in New York City is now up to $1419, and a two-bedroom apartment is $1,637. The FMRs are released by the federal government’s Department of Housing and Urban Development (HUD) and are used to set Section 8 rent subsidy levels. But the federally-funded Section 8 program has long been hampered by budget cuts, with families facing waiting periods of many years for the coveted vouchers, another factor that has helped drive homelessness.

The settlement agreement also promises relief for another major cause of homelessness in New York City and elsewhere – domestic violence. Under the previous FEPS program families fleeing an apartment out of fear of an abusing spouse or partner were not eligible for the State rent supplement program unless they were also being sued in housing court, which was not generally the case.

“We are very appreciative of the fact that the State is proposing to join with the City to address domestic violence as a cause of homelessness,” said Susan Bahn, a veteran Legal Aid Society attorney who specializes in homelessness prevention. “Studies from the Independent Budget Office and others have documented that domestic violence is one of the main reasons why families with minor children end up in shelter.”

While the City was not a party to the litigation, it has formally endorsed the settlement agreement. Under the terms of the settlement, the Family Homelessness and Eviction Supplement (“FHEPS”) program will run for at least five years under an agreement between the State Office of Temporary and Disability Assistance and the City Department of Social Services.

Legal Aid’s Judith Goldiner, Attorney in Charge of the Civil Law Reform Unit, and Kenneth Stephens, Deputy Attorney in Charge, represented the plaintiffs. Special thanks and appreciation for outstanding assistance with this landmark case go to FEPS Team Members Kathleen Brennan and Susan Bahn, Brooklyn/Staten island; Amber Decker, Oren Haymovits, and Sharone Miodovsky, Bronx; Kat Meyers, Law Reform; Doug Seidman, Manhattan; Brooke Drew, Queens. Matt Tropp and Jack Newton were also instrumental in the case.

The New York Times
Poor Families to Get More Help With Rent From New York State
By Nikita Stewart
Feb. 27, 2017

In a settlement that could help thousands of families avoid eviction, New York State will substantially increase the monthly rent subsidies it provides to low-income families with children in New York City, a move that could help reduce the number of people in homeless shelters.

The public assistance program, known as the Family Eviction Prevention Supplement, has remained flat since it was established in 2004, even as rents have skyrocketed. Under the settlement, a family of three eligible for $850 per month, for example, would now be eligible for $1,515, a 78 percent increase.

The increase, which could go into effect as early as April, was agreed to on Monday and settled a lawsuit filed in December 2015 by four single mothers — two in the Bronx, one on Staten Island and one in Manhattan. The women said they faced eviction because the monthly public assistance they received from the state was “grossly inadequate” and far below fair-market rent. In 2015, fair-market rent was $1,571 for a two-bedroom apartment and is now $1,637. Represented by the Legal Aid Society and Hughes Hubbard & Reed, the women were seeking increases in the Family Eviction Prevention Supplement for families with children who are under the threat of eviction and another benefit, known as the “shelter allowance,” for families with children on public assistance.

“I feel happy that it’s going to help other women with children,” said Daniela Tejada, 27, one of the plaintiffs who lives in a one-bedroom apartment in the Bronx with her daughters, ages 6 and 2. “It’s really hard out here. All these rents are superhigh.”

The settlement stops short of increasing the basic shelter allowance, which is $400 for a family of three, but focuses on families who are in imminent danger of losing their housing by greatly increasing the subsidies and expanding eligibility for the program. The program is currently restricted to families with minor children who have been sued by a landlord. Now, victims of domestic violence will be included, even if they are not in court.

The new eviction prevention subsidy will put a “substantial dent” in homelessness, Kenneth R. Stephens, a supervising lawyer with the Legal Aid Society, said in an interview. “It is probably the first real positive proposal on a scale that’s consistent with the crisis that we’re facing.”

New York City, the most populous city in the United States, has the largest number of homeless people though most are sheltered. As of last Tuesday, there were 60,061 people living in shelters overseen by the city’s Department of Homeless Services. That number does not count thousands of other people staying in specialized shelters overseen by other agencies for domestic violence victims and young people.

About 51,000 people were in homeless shelters when Mayor Bill de Blasio took office in 2014. The surge in homelessness has been nearly intractable for the de Blasio administration, which has struggled to find additional shelter and often uses commercial hotels as an expensive stopgap. Mr. de Blasio is expected on Tuesday to unveil a plan to open more shelters so that the city can move people from hotels and eventually transition them to permanent housing.

Steven Banks, the former attorney in chief of the Legal Aid Society and commissioner of the Department of Social Services, has pointed to the outdated rental assistance program as one of the drivers of the city’s ballooning homeless population.

In an effort to move people out of shelters and to prevent others from being evicted, the city has put in place an array of rental assistance programs, including its own Family Eviction Prevention Supplement. But that program has confused tenants and landlords since the eligibility, caps and amounts differ from the state. Under the settlement, the state and city programs would be consolidated.

There are about 10,000 families in the state program and an additional 1,000 in the city program, according to the Legal Aid Society.

The settlement will be converted to a class action to cover those families and others, though three of the initial plaintiffs no longer receive public assistance and will not benefit.

Ms. Tejada will see a bump in her subsidy, which is now limited to $850. Her one-bedroom apartment rents for $1,050, which was lowered from $1,300, after she fought her landlord in housing court.

Currently unemployed, Ms. Tejada, who had worked in a dental office, cobbled together the rent with the Family Eviction Prevention Supplement and child support. “Before, everything would go to the rent,” she said. “Now, at least, I can save and pay for school.”

Ms. Tejada said she would like to become a sonographer.

This month, Mr. de Blasio and Melissa Mark-Viverito, the City Council speaker, announced that the city would double — to $93 million — the funds allocated to help tenants fight landlords in court.

“This settlement, combined with adding access to counsel, is really going to be a game changer,” said Judith Goldiner, a lawyer with Legal Aid.

Tenants can win in court, but they still need to pay the rent. “A lawyer can’t keep you in your home without the benefits to keep you in your home,” she said.