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HUD Housing Programs: Tenants’ Rights (The Green Book): 13.5.5.4 Civil Lawsuits

An “aggrieved person” under the FHA can also elect to pursue FHA claims in state or federal court.658 There is no requirement that an aggrieved person exhaust administrative remedies before seeking a judicial remedy.659 However, a complainant is not barred from pursuing judicial remedies simply because an administrative complaint has been filed, except: (1) when an administrative law judge has already begun a hearing related to the same allegations,660

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.1.1 Overview

This chapter covers the rules for establishing rent for the major HUD-subsidized and assisted programs, including public housing, Section 8 Project-Based housing, Housing Choice Vouchers, Section 236 properties, and Section 221(d)(3) Below Market Interest Rate (BMIR) properties.1 Appendix 4A, located at the end of the chapter, provides a quick overview of the basic rules.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.3.8.2 Payments Excluded from Income

For public housing and all types of Section 8, the United States Housing Act and regulations list specific kinds of payments that are excluded from annual income for rent-setting purposes. Other HUD rental programs also exclude certain items from annual income, as determined by HUD.344 These exclusions cover a wide variety of income, including that of minors and students, foster care, live-in aides, scholarship funds for resident household members, and certain lump-sums.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.3.8.4.3 Issues Related to the Prior Earned Income Disregard (Public Housing)

HUD’s FAQs deal with a number of questions regarding the relationship between the pre-1999 EID and the current public housing EID.411 The most important point is that a tenant’s receipt of benefits under EID program in effect prior to October 1, 1999 does not preclude receipt of EID benefits under the current program.412 Moreover, receipt of the former 18-month EID does not count against the four-year limit imposed by the current rules.413

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.3.8.4.4 The EID and Child-Care Expense Deduction

A household member receiving the EID cannot use the disregarded income in calculating the limitation for the child care expense deduction.414 The child care expense deduction is capped at the amount of earned income that the PHA actually includes in the annual income determination.415 Thus, for example, a single head of household who is the sole wage-earner and whose only earned income is fully disregarded for the first 12 months of employment may not be able to deduct any child care expense

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.3.8.5 Individual Savings Accounts

PHAs may offer public housing tenants the alternative of paying the full rent otherwise due and having the PHA deposit the rent overage in an individual savings account (ISA).417 The statute and regulations provide that amounts deposited in ISAs may be withdrawn only for the purpose of purchasing a home, paying education costs of family members, moving out of public or assisted housing, or paying any other expense authorized by the PHA for the purpose of promoting the economic self-sufficiency of residents of public housing.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.3.9.1 Overview

After determining annual income, owners and PHAs apply certain additional deductions to arrive at adjusted annual income. Either the annual income or the adjusted income may then be used to determine the tenant’s rent for the programs using income-based rents.422 For Section 221(d)(3) BMIR tenants without additional rental assistance who pay a budget-based rent, or for unassisted LIHTC tenants who pay a formula rent, the concept of adjusted income is inapplicable.423

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.3.9.3 Optional Additional Deductions (Public Housing only)

PHAs may also adopt optional additional deductions from income in determining the rents of public housing tenants.452 Such policies must be in writing453 and must be included in the PHA Annual Plan.454 The statute provides numerous examples of such deductions, including: excessive travel expenses for employment or education-related travel (not to exceed $25 per family per week); disregards of all earned income, or amounts earned by particular

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.4.1 Introduction

Public housing and Section 8 tenants whose rents are almost always income-based can be required to pay, as their “total tenant payment,” the highest of several figures that are described in detail infra.457 For public housing tenants only, PHAs may set income-based rents at a level below the maximum.458 Also, only public housing tenants can choose to opt out of income-based rents altogether, in favor of “flat” rents set by the PHA based on market value.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.4.2.2.1 Overview

Most public housing and Section 8 tenants, and a few Section 236 and Rent Supplement tenants, pay rent based on a percentage of their income. Of these, most pay 30% of their adjusted income as their rent. However, since the statute requires that the tenant pay the higher of 10% of annual income or 30% of adjusted income, the PHA or owner must do both sets of calculations to determine which figure is higher.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.4.2.2.3 10% of Income

The 10% of gross income formula465 is used only if it would produce a higher rent than any of the other methods, which is rarely the case. Its most common application is where the household has very high child care expenses, medical expenses, or disability assistance expenses, such that 10% of income exceeds 30% of adjusted income. All of the income-counting and exclusion steps described above are used, except that there are no deductions, which makes the 10% calculation somewhat simpler.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.4.2.2.4.1 Overview

PHAs (for public housing, Section 8 Vouchers, and the Section 8 Moderate Rehabilitation program) and Project-Based Section 8 owners must establish minimum rents ranging from $0 to $50 per month, subject to certain statutory hardship suspensions and exemptions.466 These minimum rents do not apply to any other HUD or federal housing program.

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.4.2.2.4.3 Exemptions from Minimum Rent

The law requires HUD and PHAs immediately to grant exemptions to their minimum rent policies to families unable to pay the minimum rent because of financial hardship.474 This includes situations in which: families have lost or are waiting for benefits;475 families would be evicted as a result of the imposition of a minimum rent;476 families’ circumstances change, for reasons such as the loss of employment;

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.4.2.2.4.4 Procedural Requirements on Setting Minimum Rents

For PHAs establishing a minimum rent for the public housing and Voucher programs, all tenants should receive notice and an opportunity to comment.492 Minimum rent policies must be included in the PHA’s annual plan,493 which triggers the public notice and tenant participation procedures.494 For public housing tenants, any changes to the minimum rent policy may require an amendment to the tenant’s lease, or to policies incorporated by reference

HUD Housing Programs: Tenants’ Rights (The Green Book): 4.1.3 Litigation

Tenants’ litigation to enforce their rights to specific rent limitations can take many forms. For PHAs and other landlords who are “state actors,” 42 U.S.C.A. § 1983 clearly provides a claim to enforce the Brooke Amendment and regulations regarding rent-setting, including utility allowances.