Opinion
No. 0440-21
08-03-2022
14 N Highstreet, LLC, Petitioner, v. Norina Clowney, Any/All Other Occupants, Respondents (Tenants).
James G. Dibbini, Esq. Attorneys for Petitioner Barbara Reilly Esq., Legal Services of the Hudson Valley Attorneys for Respondent
James G. Dibbini, Esq. Attorneys for Petitioner
Barbara Reilly Esq., Legal Services of the Hudson Valley Attorneys for Respondent
Lyndon D. Williams, J.
Petitioner commenced this nonpayment proceeding in June 2021 seeking rental arrears in the amount of $10,672.52 for the period of September 2020 through May 2021. The petition states the monthly rent is $1,185.84. The apartment is subject to ETPA and the Section 8 regulations of CVR New York. Respondent applied for ERAP assistance on June 25, 2021. The ERAP application is pending review. Under the COVID-19 Emergency Rental Assistance Program (ERAP) (Part BB, Subpart A, section 8 of Chapter 56 of the Laws of 2021, as modified by L. 2021, c 417), tenants may apply for rental assistance to satisfy their rental arrears. Once a tenant files an application, an automatic stay is imposed on nonpayment and holdover evictions pending the approval/rejection of the ERAP application (L.2021, c. 417, Part A, § 4).
Petitioner now moves to vacate the ERAP stay.
Respondent opposes the motion.
In support of the motion to vacate the ERAP stay, petitioner's representative, Dan Hochstadt affirms that the premises from which removal is sought is a regulated multifamily residential building with five or more units. He states that respondent entered into possession under a month-to-month tenancy with a monthly rental agreement of $1,452.00 per month. He states per the agreement, respondent is responsible for paying $809.00 per month and the remaining balance of $643.00 is paid via a portable Section 8 voucher administered by CVR New York. Notably, this rental amount claimed differs from the monthly rent demanded in the petition and 14 day rent demand of $1,185.84 per month. Mr. Hochstadt states that respondent made a payment of $5,000.00 on March 12, 2022, however, $9,177.00 of respondents' portion of rent remains due and owing to petitioner. He further argues that respondent never lost her job and kept working throughout the pandemic at the same employer and thus, her share of responsibility for the rent did not change. He states that he has contacted OTDA several times to inquire about the status of the ERAP application but has been advised that there is no projected timeline for when this application will be processed. He affirms that petitioner has been unfairly prejudiced by this long delay.
Petitioner further argues that under ERAP's most recent guidance, applications from subsidized housing tenants, which includes Section 8, are currently not able to be paid and the law requires that applications for tenants with Section 8 be paid after all other eligible applicants have been reviewed and paid. Petitioner contends that respondent's application to ERAP was one of the first applications submitted since the inception of the program but will possibly never be paid due to the current regulations. Accordingly, the petitioner argues that an ERAP stay is futile and prejudicial.
In opposition to the motion, Respondent Norina Clowney affirms that she has resided at the premises since June 2008 and uses a Section 8 voucher to pay a portion of her rent. She resides at the premises with her two daughters. She states that during the pandemic her working hours changed, and as a result she had to pay a friend $600 per month to care for her children. This financial change, not part of the CVR assessment of household income and composition, caused her to fall behind in her rental payments. She states that her finances began to stabilize in March 2022 and she paid the landlord $5,000.00. She also states that she paid June 2022 rent. Ms. Clowney affirms that she is not relying on ERAP to dodge paying her rent but is relying on the ERAP program to help her pay outstanding rent incurred as a result of unexpected COVID-19 expenses. Respondent states that when ERAP was launched in June 2021, she applied immediately.
In reply, petitioner is not contesting respondent's eligibility. However, petitioner argues that respondent has had the benefit of an ERAP stay for over one year and that her application, based on the regulations, is futile and likely will never be paid out. Accordingly, petitioner maintains that the ERAP stay should be vacated.
The plain language of the ERAP law bars any pending eviction proceeding pending a determination of eligibility. ERAP (Part BB of Chapter 56, Laws of 2021) in pertinent part states:
Eviction proceedings for a holdover or expired lease, or nonpayment of rent or utilities that would be eligible for coverage under this program shall not be commenced against a household who has applied for this program... unless or until a determination of ineligibility is made.
If such eviction proceedings are commenced against a household who subsequently applies for benefits under this program, all proceedings shall be stayed pending determination of eligibility.
Also, under ERAP's most recent guidance, dated July 22, 2022:
"The 2022-23 State budget includes additional funds to support the Emergency Rental Assistance Program (ERAP). As a result of the additional funding, OTDA is actively reviewing and processing eligible ERAP applications submitted through June 30, 2022" (https://otda.ny.gov/programs/emergency-rental-assistance/#eligibility).
"Applications from subsidized housing tenants whose rent is limited to a certain percentage of income (including public housing, section 8 and FHEPS) are not currently able to be paid. State law requires that these applications be paid after all other eligible applicants have been reviewed and paid. Therefore, at this time, none of the subsidized housing applications can be paid regardless of the date their application was submitted." (https://otda.ny.gov/programs/emergency-rental-assistance/)
"Any household whose rent is limited to a percentage of household income may apply for assistance, but their application will not be assessed for eligibility until all other applications have been considered. The impacted types of housing include tenants receiving a Section 8 Housing Choice voucher, a project based Section 8 voucher or those who reside in public housing or other housing situations where rent cannot be more than 30 percent of their income" (https://otda.ny.gov/programs/emergency-rental-assistance/faq.asp#faq-benefits-q20 ).
This Court is asked to decide whether the stay imposed by the Section 8 tenant's ERAP application is futile due to the current regulations that provide such applications will be reviewed after all applications from non-subsidized tenant's have been processed. In analyzing the ERAP statute and regulations, numerous courts had found vacatur of the ERAP stay is warranted under certain circumstances to avoid inequity, fraud or futile results. In 5th & 106th Assoc. LP v Hunt, 2022 NY Misc. LEXIS 2966; 2022 NY Slip Op 22205 [Civ Ct. New York Cty 2022], petitioner commenced a holdover proceeding seeking to evict a tenant residing in a HUD subsidized project based Section 8 unit. The tenant applied for ERAP assistance. The landlord moved to vacate the ERAP stay on the bases that the tenant was not income-eligible for ERAP and further, that the application was futile because she lives in subsidized housing which is a last priority under the statute. In vacating the ERAP stay, the court took judicial notice of the OTDA website notice dated June 24, 2022. The update stated in relevant part, "The following applications submitted to the ERAP portal will be denied. Households that have income over 80 percent of area media income" and "IMPORTANT NOTE: Applications from subsidized housing tenants whose rent is limited to a certain percentage of income are not currently eligible to be paid.... Therefore, at this time, none of the subsidized housing applications can be paid regardless of their application". The court found that the tenant, a retired school teacher with an income of $143,113, had failed to demonstrate a financial hardship during the COVID-19 period, had been paying her rent every month from March 2020 through June 2022, and her income was neither at or below the 80% AMI income limits as required by the original statute and ERAP eligibility guidelines. In Abuelafiya v Orena, 73 Misc.3d 576, 580, [NY Dist Ct 2021] the court found the tenants ineligible for ERAP funding as they were not experiencing housing instability by virtue of the fact that they owned a second house they could relocate to. Eligibility having been determined, the ERAP stay was vitiated; (Actie v Gregory, 74 Misc.3d 1213 [A] ([Civ Ct. Kings Cty 2022] [ERAP stay vacated where landlord sought to use unregulated apartment in home with four or few units for personal family use]; Joute v Hinds, 2022 NY Slip Op 22150 [Civ Ct. Kings Cty 2022] [ERAP Stay vacated in unregulated tenancy with no rental obligation]; Fed.Natl Mtge Assn. v Godette, 2022 NY Slip Op 22151 [City Ct. Mount Vernon 2022] (ERAP stay vacated in a post-foreclosure holdover proceeding upon a finding that respondent was not a tenant or lawful occupant since respondent had no contractual obligation to pay rent to petitioner).
These above cited cases are all distinguishable. Here petitioner commenced a nonpayment action and in its petition acknowledges that respondent is a tenant in a regulated subsidized Section 8 apartment. Petitioner alleges that respondent owes rental arrears and is not contesting the respondent's eligibility for ERAP assistance. An approval by the ERAP program would assist in preserving this tenancy. Unlike the Section 8 tenant in Hunt, this petitioner is not alleging that the respondent's income renders her ineligible for assistance. Moreover, the respondent has affirmed that she experienced financial hardship as a result of the pandemic, namely incurring unforeseen childcare expenses. Finally, the current regulations do not provide that applications from Section 8 tenants will never be paid, but that they will be processed after all other non-subsidized applications. The circumstances herein are similar to the holding in Robo LLC v Matos, 168 N.Y.S.3d 676; 2022 NY Slip Op 50468(U) [Civ Ct. Bronx Cty 2022], where the trial court found the Section 8/subsidized-housing tenant's ERAP application stayed the nonpayment proceeding until an eligibility determination was made. The court acknowledged that "respondent's application, which has been pending for almost a full calendar year, was, is and will continue to be at the back of the line, behind all other eligible applicants, no matter when they apply." But found that "whatever the wisdom of this choice, this is the policy choice the legislature has made" and its is not the role of the courts to pass upon the wisdom of the legislature's policy choice. (Id.) (citations omitted). The court held "Even if ERAP ultimately pays nothing or just a portion of what is owed, while pending, the application stays the proceeding."
For these reasons, this Court cannot find that the Respondent Clowney's ERAP application is futile.
Accordingly, the motion to vacate the ERAP stay is denied.
This constitutes the Decision and Order of this Court.
The court considered the following papers on this motion: Notice of Motion, dated June 13, 2022; Affirmation in Support of Motion, dated June 13, 2022; Affidavit; Exh. A-B. Affirmation in Opposition, dated July 1, 2022; Affidavit. Affirmation in Reply, dated July 11, 2022.