California has more homeless people than any other state, and Los Angeles has more than any other city. So concerns were expressed in 2004 when the Housing Authority of the City of Los Angeles (HACLA) reduced subsidies substantially for low-income, disabled, elderly people living on the edge with a notice to tenants that was “incomprehensible.”

The Los Angeles Coalition to End Hunger and Homelessness filed a class-action lawsuit in 2007 and this week a three-judge panel of the U.S. Ninth Circuit Court of Appeals unanimously agreed (pdf) that the rent increase for 20,000 poor people was illegal. Federal law (and common decency, perhaps) requires that people receiving Section 8 housing subsidies be given one-year notice of impending disaster.

The notice sent to tenants explaining the subsidy cut, which averaged $104 a month, was delivered in a timely fashion, but was flawed. “The flyer was, without doubt, entirely insufficient,” Judge Stephen Reinhardt wrote for the court. “In no respect does it reasonably inform its intended recipients of the changes to the payment standard, the meaning of those changes, or, most important, their effect upon the recipient.”

The flier sent to tenants precisely described the federal law requiring the Housing Authority to inform them of important changes, and then totally obscured the message, the court said. The notice referred to “payment standards” six times, but never explained what they were. There was no phone number listed to call for clarity.

Barrett Litt, lead attorney for the plaintiffs, told KPCC, “It was incomprehensible. It took half an hour for people to explain it to me.”

The flier did not tell the tenants what everyone else knew—Congress, Los Angeles city leaders and housing officials—45% of subsidy recipients were going to get hosed. Tenants didn’t really find out about the subsidy decrease until about a month before it hit when they received a second notice in plain speak. The subsidy was restored in 2006.

That was probably too late for some. “For those on a fixed income or those living paycheck to paycheck, any unexpected decrease in the subsidy can result in homelessness,” Judge Reinhardt wrote.

The Ninth Circuit’s ruling reversed a decision by the U.S. District Court in 2009. Judge George H. Wu may have sensed his decision was going to be overturned. He asked that the case not be remanded back to him to figure out damages and otherwise execute the reversed decision. And the judges obliged “the rare and extraordinary” request. 

The lawyer for the Housing Authority said he is recommending that the decision be appealed to the full appellate court and the U.S. Supreme Court, if necessary.

–Ken Broder

To Learn More:

Los Angeles May Have to Pay Millions to Section 8 Subsidized Housing Recipients (by Josie Huang, KPCC)

Section 8 Rent Increase Notice Found Lacking (by Nicholas Iovino, Courthouse News Service)

9th Circuit Says L.A. Broke the Law When It Cut Housing Subsidies for the Poor (by Maura Dolan, Los Angeles Times)

Chronic Homelessness up 55% in L.A. Area over Two Years (by Ken Broder, AllGov California)

Michael Nozzi et al v. Housing Authority of the City of Los Angeles (U.S. Ninth Circuit Court of Appeals) (pdf)