Opinion
No. 401490/2012.
2012-09-14
Margarita PENA; Lisa Rivera; Kaliyma Decision/order Johnson, Gborlu Jentzen, April Bumbray; Norma Perez; and Paula Magalhes; on their own behalf and on behalf of all others similarly situated, Plaintiffs, v. Robert DOAR, as Commissioner of the New York City Human Resources Administration; The New York City Human Resources Administration, Elizabeth Berlin, as Executive Deputy Commissioner of the New York State Office of Temporary and Disability Assistance, The New York State Office of Temporary and Disability Assistance, Defendants.
Weil, Gotshal & Manges, LLP, New York, for the plaintiff.
LOUIS B. YORK, J.
In this proposed class action, plaintiffs challenge the implementation of the Family Eviction Prevention Supplement (FEPS), which is designed to prevent the eviction of families with one or more minors in the home. In short, plaintiffs allege that the program is not being implemented appropriately and that, as a result, many families do not obtain the supplemental assistance they need to avoid eviction or get back into apartments following eviction. Plaintiffs claim that, therefore, defendants are in violation of Article 17, Section 1 of the State Constitution and the statutes and regulations that have been promulgated under Article 17. Defendants are The New York City Human Resources Administration (“HRA”) and Robert Doar, as its Commissioner; and The New York State Office of Temporary and Disability Assistance (“OTDA”)
and Elizabeth Berlin, as Executive Deputy Commissioner of OTDA.
OTDA formerly was called “Department of Social Services.”
Currently, by order to show cause, plaintiffs seek class certification. In addition, the order to show cause asks for declaratory and injunctive relief, which the Court details below. Defendants oppose the order to show cause and, in addition, the State defendants cross-move for dismissal of the complaint. For the reasons that follow, the Court denies the order to show cause and the cross-motion, both without prejudice.
Background
I. The Amended Complaint
Before the Court is the State defendants' motion to dismiss the original complaint. However, by letter dated August 20, 2012, the State defendants asked that the Court consider the motion as one to dismiss the amended complaint. See Fownes Bros. & Co., Inc. v. JP Morgan Chase & Co., 92 A.D.3d 582, 582–83, 939 N.Y.S.2d 367,-(1st Dept.2012).
Article 17, Section 1 of the New York State Constitution (“Article 17”) provides:
The aid, care and support of the needy are public concerns and shall be provided by the state and by such of its subdivisions, and in such manner and by such means, as the legislature may from time to time determine.
Because of its constitutional basis, “the provision ... is not a matter of legislative grace.” Tucker v. Toia, 43 N.Y.2d 1, 7, 400 N.Y.S.2d 728, 730, 371 N.E.2d 449 (1977). In addition to basic grants for food, under this constitutional mandate the legislature provides shelter allowances, which are set administratively to take local rents into account. See Jiggets v. Grinker, 75 N.Y.2d 411, 416, 554 N.Y.S.2d 92, 94, 553 N.E.2d 570 (1990).
As plaintiffs note, the Social Service laws statutorily define the State's duties—which, in the case of housing subsidies, means providing financial allowances for shelter “that bear a reasonable relationship to the cost of housing,” id. at 415, 554 N.Y.S.2d at 94, 553 N.E.2d 570, and that enable families to stay together to the extent possible. Id. at 419, 554 N.Y.S.2d at 96, 553 N.E.2d 570. In addition, the State “supervise[s] all social services work, as the same may be administered by any local unit of government and the social services officials thereof within the state, advise them in the performance of their official duties and regulate the financial assistance granted by the state in connection with said work,” N.Y. Soc. Serv. L. § 20(2)(b), and the commissioner of Social Services has general supervisory powers over the local welfare authorities. NY Soc. Serv. L. § 34(3)(d). In particular, 18 N.Y.C.R.R. § 352.3 provides for rent allowances that take into account the cost of housing throughout the state. Subsection (a)(3) states that, with OTDA's approval, a social services district may provide shelter supplements to families with children.
Under this last provision, the City defendants sought and obtained approval for the FEPS program, which formally replaced the previous Jiggetts-generated program in 2010. As the amended complaint explains, FEPS is available to applicants who 1) are eligible for cash assistance, 2) live with at least one child either 18 or under or 19 and in a secondary school, and 3) are involved in an eviction proceeding in Housing Court. In addition, the rent in FEPS eligible families' apartments cannot exceed certain amounts which are tied to the size of the family in question. An applicant family is eligible for assistance up to one year from the family's eviction date, if any, or for up to six months after entry into a housing shelter. Upon approval, the family receives a rental supplement to their normal benefits which equals the lower of their rent shortfall or their maximum FEPS monthly benefit. The FEPS supplement goes directly to the landlord. In addition, a FEPS-approved family can receive up to $7,000 in rental arrears in satisfaction of a Housing Court judgment.
The complaint does not challenge the idea of FEPS, but its implementation. The first stated problem is that families that apply for FEPS benefits cannot do so at the HRA public assistance centers at which they apply for other benefits. Instead, they must apply at the offices of private community-based Funded Providers, which process most of the applications; or at the Legal Aid Society or other legal services organizations, which generally process the applications only in conjunction with their representation of a family facing eviction in Housing Court (collectively, “the FEPS centers”). Moreover, the families cannot apply on their own, but must go through one of these approved entities.
The second stated problem is that, once a family is deemed FEPS eligible, HRA stops working on their application for rental arrears, instead sending the families to the FEPS centers. The FEPS center must then forward the relevant information to OTDA, which sends its response to the FEPS center that processed the application. However, HRA, not FEPS, processes the approval and issues the checks, and the FEPS center ultimately delivers the checks to the landlords. Therefore, this adds several additional layers of communication prior to relief for the family, and these alleged inefficiencies elongate the process despite the imminence of the need.
The third stated problem is that the delays in processing FEPS applications have not diminished but increased. There is a greater demand for FEPS assistance due to the facts that more families have economic problems—according to plaintiffs, resulting in an 8% increase in the number of annual evictions in New York City last year-and that other benefit programs have been cut down or, as in the case of The Advantage Program,
are being eliminated. However, due to budget cuts to FEPS, services have been reduced. There are now four instead of five Funded Providers, and there have been layoffs resulting in decreases of staff of as much as 25%. In short, there is an increased need for FEPS assistance and yet the capacity of FEPS centers to assist FEPS eligible families has decreased. As a result, there are what plaintiffs deem to be unacceptable delays.
The Advantage Program provided temporary rental assistance to families in which all adults worked at least 20 hours per week, in order to help those families transition to self sufficiency.
Plaintiffs provide some specifics to underpin this general claim regarding delays. As of August 1, the date of the amended complaint, plaintiffs report that one of the Funded Providers, Bronx Works, was booked with FEPS appointments for the entire month and had stopped accepting FEPS applications altogether. There and at other FEPS centers, the applicants simply are turned away without appointments. Moreover, plaintiffs state that even after families apply for FEPS and the application is complete, it takes four to six weeks for the State defendants to reach their determination and an additional ten days or more for the family to secure the funds it needs for any pending judgment against it. Although the process is expedited when, for example, a FEPS family already has received a marshall's notice and is in immediate danger of eviction, many FEPS eligible families cannot obtain an appointment in time to alert defendants to this danger. Thus, plaintiffs assert, the process in place does not protect the needs of its intended beneficiaries sufficiently.
The complaint seeks certification for the following proposed class: “All individuals in New York City with minor children in their households who are eligible for cash assistance and who are seeking or have sought to apply for FEPS benefits and have been unable to do so.” Complt. ¶ 224. According to the complaint, the proposed class satisfies the requirements of numerosity, typicality, adequacy and superiority. Plaintiffs allege violations of the Constitution, of N.Y. Soc. Serv. L. §§ 24, 34, 131(1), and 131(3), of 42 U.S.C. § 1983, of 18 N.Y.C.R.R. § 352.3, and of various administrative and other directives. As indicated earlier, plaintiffs seek class certification. In addition, they seek a declaration that the State defendants have not provided proper oversight and supervision over the FEPS program. They also request an injunction requiring to (1) establish a “reasonable and adequate application system,” Complt. Prayer for Relief, ¶ d, which a) provides sufficient staff to enable families to apply for FEPS at local job centers as well as at the Funded Providers, within one business day of their requests, and b) waives rent and arrears limits as well as time limitations if these limits are exceeded due to government delays in processing families' requests-in short, by tolling the time limitations once a member of the proposed class seeks FEPS relief. Finally, they ask for attorney's fees, costs and expenses.
II. The Response
Neither the State nor the City defendants contest the fact that due at least in large part to budget cuts and the increased demand for FEPS assistance, the FEPS centers have not seen or processed the applications of families in need in a timely manner. However, in their cross-motion to dismiss the State defendants challenge plaintiffs' complaint and the current order to show cause on several bases.
First, they assert that OTDA and HRA are taking actions to correct the asserted problems, rendering the complaint moot. Second, in part because they have taken remedial actions and in part because they claim plaintiffs have not shown defendants will fail to abide by a decision in this case, they contend that the government operations rule bars class certification. They also challenge some of plaintiffs' contentions—stating, for example, that several Funded Providers have space in some job centers and process FEPS applications at those locations. They note that in May 2011—aware that due to the termination of the Advantage Program there would be a gap in housing benefits—OTDA approved HRA's request to increase the allowable FEPS ceiling by $50. This filled the gap in coverage but increased the number of FEPS eligible families and, therefore, the number of FEPS applicants.
By the time of the cross-motion, the State defendants explain, they had begun to correct the problem. Of necessity HRA and the FEPS offices share information during the application process, and an online FEPS application is being developed which will enable these offices to gather information and communicate with each other more quickly. Currently, BronxWorks, one of the Funded Providers, is participating in a pilot project using the online application process. Since the institution of this lawsuit, defendants have taken further actions, many of which the plaintiffs consider to be steps on the road to repairing this program.
In addition to the State defendants' cross-motion, the Court has before it the City defendants' opposition papers. The City defendants claim, first, that their role in the FEPS program is limited and therefore injunctive and declaratory relief is improper against them. They state that although they may refer FEPS eligible visitors to FEPS offices, HRA is not authorized under the current system to process applications. Instead, HRA works with the Funded Providers and other approved FEPS offices by providing them with relevant public assistance data about the applicants and by processing the approved application. They do note that the plan in place is one they proposed to the State defendants; they add that they modeled the plan on the prior Jiggetts-based program. Further, they oppose the request for injunctive relief on the ground that plaintiffs ask the Court not simply to direct defendants to correc the existing problems but to involve itself in the management of the FEPS program, overstepping the bounds of justiciability. They finally assert that, as the State defendants argue, the government operations rule preempts class certification.
III. The proposed changes to the FEPS processing systems and plaintiffs' reaction.
At oral argument, defendants explained that they were taking numerous additional remedial measures as well to address the problems. Moreover, plaintiffs approved of many of the proposals—although, as they made clear, they believed the proposals did not address all of their concerns or render this lawsuit moot. In light of this flux in conditions, however, the Court asked that defendants detail the proposed changes and plaintiffs explain where, in their opinions, the problems still exist. Plaintiffs approved of the following proposals:
1) Defendants have added $3 million to the FEPS budget for the 2013 fiscal year, and this will enable the Funded Providers to add and train staff.
2) FEPS providers already have added staff members—some previously trained, others currently in training.
3) As of August 3, all FEPS offices take down for every visitor the name, public assistance case number (if applicable), date of eviction or pending eviction (if applicable), and the reason the applicant cannot be seen on that date.
4) With respect to the applications, the FEPS centers are performing what defendants call a “triage.” If an eviction is scheduled to take place within seven days, the applicant will be seen immediately. In addition, if the applicant family is not seen immediately and as a result of the delay FEPS limits (such as the limit of $7000 in rental arrears) are exceeded, these limits will be waived.
5) Through the development of the online application system currently being tested in the Bronx, see supra p. 7, the HRA application will become more efficient.
6) Through the utilization of more staff and resources at OTDA, the processing by OTDA will be expedited.
7) HRA will issue checks within 15 days of FEPS approval.
8) The FEPS ceiling has increased by $50 per family, to make up for the gap in coverage due to the defunding of the Advantage Program. See supra p. 7.
Plaintiffs contend that the above changes are laudable but express the following concerns: First, they have suggested to defendants specific criteria for prioritizing FEPS cases when the applications are not about to be evicted. Second, they have suggestions as to how defendants should use their staff, so that, in plaintiffs' opinion, defendants maximize their ability to address the needs of the proposed class. Third, they suggest that defendants post written notices and conduct other methods of outreach to inform plaintiffs' proposed class members about the changes in the program and the availability, in general, of FEPS. Fourth, they have suggestions as to how defendants might apply the tolling and waiver described in paragraph 4 above to those applicants who were turned away prior to the creation of the lists described in paragraph 3 above.
In response to these concerns, defendants have replied that for one thing, some of plaintiffs' suggestions (presumably, in particular, that defendants institute notice and outreach requirements) go beyond the scope of what they seek in the amended complaint. For another, they state, plaintiffs' suggestions as to the allocation of defendants' resources is excessive. For a third, defendants explain that their triage process is not limited to those who are to be evicted within seven days; instead, they examine the exigencies of all applicants' cases and prioritize them based on their respective circumstances. For a fourth and final answer, with respect to applicants who were sent away without appointments before the City defendants began writing down their names and first appearance dates, defendants state that they will waive the FEPS limits for all individuals in this group who can establish the date of their first request.
Analysis
I. Injunctive Relief
In their brief, plaintiffs seek a preliminary injunction which enjoins defendants “from denying eligible families access to FEPS benefits by ordering them to establish a reasonable and adequate application system that ensures eligible families have timely and adequate access to FEPS benefits on a time basis.” Pl. Mem. in Support, at p. 16. In particular, they seek an order compelling defendants to allow the putative class members to apply for FEPS benefits at the job centers, to process all applications within one day, and to guarantee that sufficient staff is on hand at each center to accommodate all applicants. They also seek an order directing defendants to waive the rent and arrears limits when these amounts are exceeded due to defendants' prior delays.
As plaintiffs point out, to obtain a preliminary injunction they must show they are likely to succeed on the merits, they will be irreparably harmed absent the injunction, and the equities lie in their favor. Gliklad v. Cherney, 97 A.D.3d 401,-, 948 N.Y.S.2d 48, 50 (1st Dept.2012). In addition, the decision as to whether to grant this relief lies within the Court's sound discretion. Weeks Woodlands Ass'n Inc. v. Dormitory Auth., 95 A.D.3d 747, 759, 945 N.Y.S.2d 263, 273 (1st Dept.2012)(reversing trial court's decision where law not properly applied); see also Gillaland v. Acquafredda Enter. ., LLC, 92 A.D.3d 19, 24–25, 936 N.Y.S.2d 125, 129 (1st Dept.2011)(affirming decision where no abuse of discretion existed). Finally, the purpose of a preliminary injunction “is to maintain the status quo and to prevent any conduct which might impair the ability of the court to render final judgment.” Putter v. City of New York, 27 A.D.3d 250, 253 811 N.Y.S.2d 29, 31 (1st Dept.2006). Plaintiffs should not seek a preliminary injunction as a means of obtaining “the ultimate relief in their action.” Id.
After careful consideration, the Court denies the application for a preliminary injunction. Due to the defendants' vigilant attempts to resolve the problems that plaintiffs describe in the complaint—in particular, their efforts to increase staffing, expedite the processing of applications, take down the names of all applicants turned away to protect the interests or those applicants, and triage incoming applications—the exigencies that initially existed have, at the least, diminished. In addition, by keeping track of the date of the putative class members' first attempts to apply for relief, and waiving FEPS limits whenever the limits are exceeded due to defendants' delays, defendants essentially have rendered one prong of the proposed injunctive relief moot. Moreover, through their triage system, they are handling applications in a manner designed to keep the applicants in their homes. Therefore, the danger of irreparable harm has been reduced to a large extent.
As for likelihood of success on the merits, this issue cannot be resolved at present. It appears from all parties' statements that fundamental problems with the processing of FEPS claims exist. Ideally, defendants rather than the Court will resolve these problems, as they are the parties charged with this duty. Indeed, based on their representations in their court papers, at oral argument, and in their supplemental submission concerning their proposed plan, it appears that defendants want to resolve them and have some viable solutions. Moreover, plaintiffs agree that defendants' plans are promising. Defendants' efforts are at a germinal stage, however, and therefore it is unclear whether their proposed changes to the FEPS program will render this action moot. Though defendants do not propose to hold appointments on the day of first application and to process applications within one day of their receipt—the relief plaintiffs seek in their lawsuit and in the order to show cause—they have proposed remedial measures which theoretically will accelerate the processing of claims substantially and pursuant to a schedule of which plaintiffs in many respects approve. Defendants also have represented to the Court that they have begun setting up an improved system which will provide the reasonable and timely access to FEPS that plaintiffs demand.
Despite their agreement with many components of defendants' plans, plaintiffs express concern about the treatment of those who aren't about to be evicted within seven days and also ask whether FEPS limits will be waived for applicants who were turned away before the City defendants started to keep lists of these applicants. However, as stated, defendants assert that they will waive the existing FEPS limits to anyone who can establish that he or she sought out and did not receive an appointment, and that the triage process will extend to all applicants, not just those about to be evicted. The City defendants also indicated, at oral argument and in response to another concern of plaintiffs, that when a FEPS application has been approved they notify the landlord involved in the Housing Court litigation; once the landlord knows the arrears and rental supplements are forthcoming, the eviction proceeding generally will not go forward.
The Court notes that, as to defendants' first point, applicants who did not receive appointments when they first sought FEPS assistance may have difficulties establishing precisely when they were turned away. However, this problem of proof exists regardless of whether an injunction issues to protect them. Therefore, it does not change the balance of the equities.
As for plaintiffs' request in their supplemental submission that defendants be compelled, by Court order, to allocate their staffing and funding resources in a specific way, the Court agrees with the City defendants that, at least in this respect, such an order would overstep the bounds of the judiciary, involving it too intimately in the State and City defendants' affairs. See Roberts v. Health and Hosp. Corp., 87 A.D.3d 311, 313–14, 928 N.Y.S.2d 236, 239 (1st Dept.)(in evaluating issue of justiciability), lv denied,17 NY3d 717, 935 N.Y.S.2d 287 (2011)(table). The Court notes that plaintiffs' general request—that defendants come up with a reasonable and adequate system for processing FEPS applications—is proper for judicial consideration. As the State defendants note, some of plaintiffs' supplemental requests, especially those having to do with notice and outreach, go beyond the scope of what they seek in the order to show cause. Therefore, though the parties may decide to discuss these issues, the Court shall not address them in this order.
Finally on this issue, the Court notes that, as the State defendants argue, the proposed injunction does not preserve the status quo. Instead, as with its request that all applications be processed within one day, plaintiffs seek a large portion of the ultimate relief. For this reason as well, it is not proper to award the injunction. See Putter, 27 A.D.3d at 253, 811 N.Y.S.2d at 31.
II. Class Certification
In order to obtain class certification, a putative class must show that the class is so numerous that it is impractical to join all its members; common questions of law or fact predominate over the questions that only affect individuals; the representative parties' claims are typical of the claims of all members; the representatives can fairly, adequately protect the interests of all class members; and a class action is the best means of fairly, efficiently adjudicating the controversy. CPLR § 901(a); see City of New York v. Maul, 14 N.Y.3d 499, 508, 903 N.Y.S.2d 304, 310, 929 N.E.2d 366 (2010) ( Maul )(setting forth these five factors). As with the issue of injunctive relief, the trial court is vested with discretion and its decision will not be overturned unless that discretion is abused. Maul, 14 N.Y.3d at 509, 903 N.Y.S.2d at 310, 929 N.E.2d 366 (finding that class certification was not an abuse of discretion, in lawsuit initiated by City of New York against Commissioner of State agency).
Here, “where governmental operations are involved, and where subsequent [plaintiffs] will be adequately protected under the principle of Stare decisis, ... class action relief is not necessary.” Martin v. Lavine, 39 N.Y.2d 72, 75, 382 N.Y.S.2d 956, 958, 346 N.E.2d 794 (1976) (citations and internal quotation marks omitted); see Legal Aid Soc. v. New York City Police Dept., 274 A.D.2d 207, 213, 713 N.Y.S.2d 3, 7 (1st Dept.2000). Courts retain the discretion to determine whether certification is proper where the government is involved. However, it must proceed cautiously before issuing an order which certifies a class. Ousmane v. City of New York, Index No. 402648/04 (Sup.Ct. N.Y. County April 13, 2005) (avail at 2005 WL 1004738 (N.Y.Sup.), at *9).
As plaintiffs note, factors which affect a court's determination on this issue include the financial means of the putative class members and the exigency of their circumstances. New York City Coalition to End Lead Poisoning v. Giuliani, 245 A.D.2d 49, 51, 668 N.Y.S.2d 1, 3 (1st Dept.1997) ( Coalition ). Here, as they note, the FEPS eligible families are, by definition, in dire financial need. The issue of eviction also weighs in favor of certification if defendants' changes do not resolve the problem. However, the system of triaging cases based on the imminence of the applicants' needs militates against certification at this juncture.
The reason the exigencies of this case have diminished is that, as stated, defendants have proposed a series of steps to protect the rights of the putative class members and fix the problems with the FEPS application system. As defendants note, in Coalition, upon which plaintiffs rely, the Appellate Division also considered and heavily weighed the fact that “the governmental entity has repeatedly failed to comply with court orders affecting the proposed class, rendering it doubtful that stare decisis will operate effectively....” Id. The First Department also noted that, in Coalition, the government entity did not “propose any form of relief that purport[ed] to protect the plaintiffs.” Id. In these two respects, for all the reasons this Court has discussed, Coalition is distinguishable. Where, on the other hand, “it has not been shown that the [entities have] flouted any previous court orders” relating to the problem before the court, certification is inappropriate or at best premature. See Legal Aid Soc., 274 A.D.2d at 213, 713 N.Y.S.2d at 7;accord Jamie B. v. Hernandez, 274 A.D.2d 335, 336–37, 712 N.Y.S.2d 91, 93 (1st Dept.2000).
In this case, rather than challenge the complaint, defendants concede that the FEPS application process is fraught with problems. In addition, as detailed above, before the oral argument for the order to show cause and in the ensuing weeks, they had begun to formulate plans to remediate these problems. Moreover, plaintiffs agree that many of the proposals are excellent. They simply have some remaining concerns about more discrete (though no less pressing) issues and about whether the proposals will be carried out as planned and will be as effective as anticipated. Given the particular facts of the case, the Court exercises its discretion and denies the application for certification without prejudice. It is appropriate to give defendants the opportunity to show that their plans work to resolve the FEPS problems successfully. If they fail to carry out these plans or if they are deficient, plaintiffs can renew their application.
Plaintiffs underscore one problem that remains: It may be difficult to address the concerns of those members of the proposed class who were turned away from the FEPS offices prior to the point at which the FEPS offices began keeping lists of those for whom they could not schedule appointments. At oral argument, defendants alluded to some ways they intended to help this subgroup of the putative class—for example, by notifying landlords once their applications are considered and approved, to avoid the danger of eviction. In their supplemental response, they also indicated that they would assist those who could show they were turned away previously—by, for example, waiving FEPS limits in applicable circumstances. The problem of establishing the dates these applicants were turned away remains, but it is not clear there is a judicial solution. The Court urges defendants' to work out a way to remedy the other harms these applicants might have suffered, including the loss of their housing due to the slow processing of their FEPS claims. It is possible that plaintiffs' counsel will be able to facilitate this process.
For the above reasons, and because it is too early to tell whether defendants' plans will remedy the other problems defendants admit exist in the FEPS process, dismissal of the complaint is premature.
Therefore, it is
ORDERED that the order to show cause is denied without prejudice on all issues, including the request for injunctive relief; and it is further
ORDERED that the cross-motion to dismiss also is denied without prejudice.
The Court further notes that in their opposition, the City defendants indicated their limited involvement in and control over the FEPS process, but made no application for affirmative relief. Finally, the Court notes that it has considered all the parties' arguments in the course of rendering this decision.