Opinion
No. A03-1702.
Filed February 15, 2005.
Appeal from the Dakota County Community Development Authority.
Debra Blumer, Eagan, Mn, (pro se relator)
Mary G. Dobbins, Mary G. Dobbins Associates, Edina, Mn, (for respondent)
Considered and decided by Shumaker, Presiding Judge, Randall, Judge, and Halbrooks, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2004).
UNPUBLISHED OPINION
On appeal in this Section 8 housing dispute, pro se relator argues that her Section 8 benefits should not have been cancelled where (1) respondent did not prove that relator's failure to comply with the Section 8 registration requirements was "willful," (2) relator was not given notice of income-reporting mistakes on her registration or ten days to correct those mistakes, (3) the cancellation of relator's Section 8 benefits was retaliatory, and (4) respondent did not allow relator to contest the cancellation. Because there is no requirement that a failure to comply with Section 8 registration procedures be willful or that an applicant be given an opportunity to correct mistakes in reported income and because relator was provided with an opportunity to contest the cancellation of her benefits, we affirm. Because the question of retaliation was not raised before the hearing officer, we do not address that issue.
FACTS
Relator Debra Blumer challenges the decision of a hearing officer upholding the termination of her Section 8 benefits based on her failure to report household income. Blumer has received Section 8 assistance since 1981.
Steven Barnstead moved in with Blumer in July 2001. Blumer states that in May 2002, she and Barnstead applied for the family townhome program (program) run by the Dakota County Community Development Agency (CDA). Blumer and Barnstead assert that at this time they disclosed to Ellen Stark, a CDA employee, that Barnstead was receiving social-security income. One month later, Blumer and Barnstead again met with Stark, this time to complete Blumer's annual Section 8 recertification application. According to Blumer, at this second meeting Stark only inquired about Blumer's social-security income, and she and Barnstead did not believe that they needed to mention his social-security income because they had disclosed it to Stark in their previous meeting. On June 3, 2003, Blumer and Barnstead met with Mary Beth Fischer to complete another annual recertification application. Once again, they did not mention Barnstead's social-security income. The parties disagree over whether Fisher specifically asked about such income.
Barnstead was officially added to Blumer's household by the CDA in October 2002, the recertification date for her Section 8 assistance.
Blumer submitted separate applications dated March 22, 2001 to the program from her and Barnstead. The record contains no application from May 2002, either individual or joint; however, the CDA appears to accept that a 2002 application was submitted.
At this time, Stark worked half-time for the townhome program and half-time for the Section 8 program.
On June 24, 2003, the CDA received a social-security monthly income-discrepancy report and a benefit-history report from the Department of Housing and Urban Development. These reports indicated that Barnstead had begun to receive social-security payments in June 2001. He continued to get benefits through June 2003, but he failed to report such income to the CDA on either the 2002 or 2003 Section 8 recertification applications. Because of the failure to report, the CDA notified Blumer that her Section 8 assistance would be terminated. Blumer subsequently requested a hearing on the matter. The hearing officer upheld the decision of the CDA. This appeal follows.
DECISION
Blumer argues that the hearing officer erred in upholding the CDA's decision to terminate her Section 8 benefits because the CDA did not prove that her failure to report Barnstead's social-security income was willful. Our standard of review in cases such as this is deferential to the agency. Carter v. Olmsted County Hous. Redevelopment Auth., 574 N.W.725, 729 (Minn.App. 1998). Accordingly, we are bound to uphold the hearing officer's decision if there is any evidence in the record to rationally support that decision. Id.
When taking evidence and hearing testimony, an agency is acting in a quasi-judicial capacity. Id. This court must uphold an agency's quasi-judicial decisions unless they are "unconstitutional, outside the agency's jurisdiction, procedurally defective, based on an erroneous legal theory, unsupported by substantial evidence, or arbitrary and capricious." Id. "[An] agency's conclusions are not arbitrary and capricious so long as a rational connection between the facts found and the choice made has been articulated." In re Excess Surplus Status of Blue Cross Blue Shield of Minn., 624 N.W.2d 264, 277 (Minn. 2001) (quotation omitted). Agency decisions are presumed correct and a reviewing court must defer to an agency's conclusions regarding conflicts in testimony and the inferences drawn from such testimony. Id. at 278. A party challenging agency findings bears the burden of demonstrating that those findings are unsupported in light of the evidence considered as a whole. In re Petition of Hyman Freightways, Inc., 488 N.W.2d 503, 504 (Minn.App. 1992).
Federal regulations governing Section 8 assistance allow for the termination of benefits "[i]f the family violates any family obligations under the program." 24 C.F.R. § 982.552(c)(1)(i) (2004). A public housing authority (PHA) has discretion to determine when termination is an appropriate remedy. See Dep't of Hous. Urban Dev. v. Rucker, 535 U.S. 125, 136, 122 S. Ct. 1230, 1236 (2002) (upholding discretion to evict tenants for drug-related activities of household members); Minneapolis Pub. Hous. Auth. v. Lor, 591 N.W.2d 700, 703 (Minn. 1999) (discussing discretion of PHA to evict tenants for criminal activity). One family obligation is to provide complete and accurate information regarding household income. 24 C.F.R. § 982.551(b)(2) (2004).
Blumer does not contest that she and Barnstead failed to report his social-security income on the 2002 and 2003 Section 8 recertification applications. Instead, she argues that the CDA has not proven that this failure was "willful" and suggests that the CDA has a responsibility to investigate facts stated on the recertification applications, inform applicants of failures to properly report income, and give applicants ten days to correct any errors.
Contrary to Blumer's assertion, the regulations do not require that such failure be willful. The reference to willfulness pointed to by Blumer actually relates to potential criminal penalties for making false statements or misrepresentations. See 18 U.S.C. § 1001 (2004) (providing criminal penalties for "knowingly and willfully" making false statements or representations with respect to claims for payment from administrative agencies). Neither do the regulations contain any requirement that the CDA conduct a "due diligence" investigation or provide applicants with ten days to correct mistakes in reported income. Instead, the responsibility to provide true and complete information regarding income rests with the family. 24 C.F.R. § 982.551(b).
The record contains substantial evidence indicating that Barnstead began receiving social-security benefits in 2001 and continued to receive payments throughout the time during which he and Blumer competed the 2002 and 2003 recertification applications. Nonetheless, this income was not reported on either of these applications. For each of these years, both Blumer and Barnstead signed an "applicant/tenant certification and statement of tenant responsibilities," affirming that the information they were providing to the CDA regarding their income was "accurate and complete to the best of [their] knowledge and belief" and acknowledging that "false statements or information [were] grounds for termination of housing assistance and termination of tenancy."
Under federal regulations, the CDA has the discretionary authority to terminate Section 8 benefits for the failure to accurately and completely report income. 24 C.F.R. §§ 982.551(b), .552(c)(1)(i). Here, after considering the testimony and other evidence, the hearing officer concluded that the failure to report Barnstead's social-security income was intentional and affirmed the termination of Blumer's benefits. In support of her decision, the hearing officer noted that Blumer and Barnstead had a responsibility to correctly report household income and had signed statements affirming that they understood the repercussions of failing to do so. Nonetheless, they did not report Barnstead's social-security income for two years. The hearing officer placed special emphasis on this fact, stating "[h]ad it not been reported for one year, I could have considered that it was unintentional or oversight. To me, two years indicated intent." Thus, the hearing officer articulated a "rational connection between the facts found and the choice made." In re Blue Cross, 624 N.W.2d at 277 (quoting Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 168, 83 S. Ct. 239, 246 (1962)). Blumer has not met her burden of demonstrating that the hearing officer's decision is unsupported in light of the record considered as a whole.
Blumer contends that the real motivation for terminating her Section 8 benefits was retaliation for previous complaints by Barnstead alleging sex discrimination. But the record contains no indication that this issue was raised before the hearing officer. Failure to raise an issue in an administrative proceeding precludes review on appeal. In re REM-Canby, Inc. v. Minn. Dep't of Human Servs., 494 N.W.2d 71, 76-77 (Minn.App. 1992), review denied (Minn. Feb. 25, 1993). Thus, we do not address this question.
Blumer also argues that, in making her decision, the hearing officer ignored the fact that Blumer and Barnstead are "vulnerable adults." Although not completely clear, Blumer appears to argue that terminating her benefits violated her rights under the Americans with Disabilities Act (ADA). But such an argument is misplaced. Nothing in the ADA provides for preferential treatment with respect to Section 8 housing assistance or excludes disabled persons from the income-reporting requirements. See Americans with Disabilities Act of 1990, Pub.L. No. 101-336, 104 Stat. 327 (codified at 42 U.S.C. §§ 12101- 12213 (2004)). Accordingly, Blumer's rights under the ADA were not violated by the termination of her Section 8 benefits.
24 C.F.R. § 8.4 (2004) provides that participants in federally assisted housing programs who are otherwise qualified may not be discriminated against based solely on handicaps. No such discrimination was asserted in this case.
Finally, Blumer suggests that she was not given an opportunity to contest the termination of her assistance. This argument is without merit. The hearing from which Blumer appeals provided her with the requisite opportunity. See 24 C.F.R. § 982.555(a)(v) (2004) (stating that a participant family must be given the opportunity for an informal hearing regarding a "determination to terminate assistance for a participant family because of the family's action or failure to act" in accordance with family obligations).