Wednesday, May 30, 2012 by .(JavaScript must be enabled to view this email address)

Judges Consider Whether NYC Is Under ‘Contract’ to Keep Rent Subsidies

Excerpt from: New York Law Journal

ALBANY - Whether New York City has an obligation to continue rental subsidies it now provides for thousands of once-homeless people is being debated this week at the state Court of Appeals.

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In a class-action, the Legal Aid Society argues that unexpired agreements signed between the city, participating tenants and landlords amounted to legally enforceable contracts that obligate the city to continue the rent subsidies. The agreements say the city "shall pay" and "will pay" the money for at least one year, and for a second year if a tenant's income eligibility allows, advocates contend.

Two lower courts disagreed, saying the city was not required to continue the program.

An Appellate Division, First Department, panel held 4-1 that the "trappings" of the language of contracts did not bind the city to keep it going (NYLJ, March 21).

"Ultimately.all of the surrounding circumstances lead to the ineluctable conclusion that the Advantage program was a social service program no different than any other, and not a contractual obligation undertaken by government," the majority of the First Department found.

In dissent, Justice Karla Moskowitz (See Profile) wrote that New York City "clearly agreed to pay plaintiffs' rent in return for plaintiffs' leaving the shelter system" when it signed tenants up for the program.