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March 24, 1982


The opinion of the court was delivered by: Robert D. Morgan, Chief Judge.


Plaintiff, a tenant, seeks injunctive and declaratory relief to compel defendants to implement and administer the Rent Supplement Program, 12 U.S.C. § 1701s, at Cedar Point Apartments. Cedar Point Apartments is a housing development subsidized under section 236 of the National Housing Act. 12 U.S.C. § 1715z-1. Alternatively, plaintiff seeks injunctive and declaratory relief to compel the Department of Housing and Urban Development (HUD) to implement an alternative program of rent reduction, if HUD determines that such program would provide greater benefits than the Rent Supplement Program. E.g., 12 U.S.C. § 1715z-1(f)(2) and 42 U.S.C. § 1437f.

Further, plaintiff seeks an order compelling Southwest Development Company (Southwest) and certain officers of the Illinois Housing Development Authority (HDA) to contract with HUD to provide rent supplement or alternative rent subsidy payments on behalf of qualified tenants at Cedar Point.*fn1

The section 236 interest reduction contract for Cedar Point was executed on February 27, 1973, pursuant to a preliminary reservation of contract authority dated August 7, 1972. In January 1973, one month prior to the execution of the Cedar Point contract, HUD suspended section 236 and the Rent Supplement Program, 12 U.S.C. § 1701s, as well as other federal housing programs. See Commonwealth of Pennsylvania v. Lynn, 501 F.2d 848, 851 n. 6 (D.C. Cir. 1974). Apparently, sections 1701s and 1715z-1 are still suspended as concerns contracts for section 236 interest reduction after 1973. Allen v. Pierce, No. A-79-CA-279 (W.D.Tex., Oct. 15, 1981).

The focus of plaintiff's position is the contention that HUD has a mandatory duty under the National Housing Act of 1934, as amended, 12 U.S.C. § 1701 et seq., and the Housing and Urban Development Act of 1965, 12 U.S.C. § 1701s, to implement the Rent Supplement Program, or an alternative program, on behalf of eligible tenants at Cedar Point Apartments. The defendants deny that such a duty exists as pertains to them, respectively. The matter is before the court on cross-motions for summary judgment.

It appears that if the alternative programs specifically discussed by the parties are available or otherwise appropriate to the situation at Cedar Point, the plaintiff's case rises or falls on the single issue of whether assistance under any of the programs discussed is mandated. Thus, the court addresses the alternative programs first.

12 U.S.C. § 1715z-1(f)(2)

  The court is satisfied that the "deep subsidy" (Rental
Assistance Payments) program established in section
1715z-1(f)(2) is unavailable to plaintiff, as a tenant at Cedar
Point, on the basis of the facts. That section specifically
provides that the "deep subsidy" program is available to "any
project made subject to a contract under this section after
August 22, 1974. . . ." 12 U.S.C. § 1715z-1(f)(2). Plaintiff
concedes that the Cedar Point Apartments were constructed prior
to August 22, 1974. It is clear that, initially at least,
section 1715z-1(f)(2) could only be implemented for projects
constructed after August 22, 1974.*fn2 Abrams v. Hills,
547 F.2d 1062, 1067 (9th Cir. 1976); Sicuro v. Hills, 415 F. Supp. 553
 (C.D.Cal. 1976), rev'd on other grounds, 597 F.2d 1235

In 1979, HUD amended its regulations and made the deep subsidy payments available to section 236 projects that were completed prior to the August 1974 date. 24 C.F.R. § 236.701 (1981). While that regulation says that the "Secretary shall enter into Rental Assistance Contracts" with such projects, it does so only when those projects "are reprocessed with rental assistance pursuant to an Agreement between the sponsor, the State or local agency providing additional aid to the project, and the Secretary." 24 C.F.R. § 236.701 (1981). The court has seen no indication that Cedar Point has been "reprocessed with rental assistance pursuant to an Agreement" between the relevant parties. Further, the preamble to the regulation clearly states that Rental Assistance Payments for older section 236 projects was "at the discretion of the sponsors, state or local agencies financing the projects and the Secretary." 44 F.R. 61177 (10/24/79).

Thus, while Cedar Point technically may be eligible for section 1715z-1(f)(2)*fn3 assistance, the court is unaware of any facts that warrant a conclusion that the defendants have abused their discretion in this regard. The court cannot avoid the conclusion that it has no basis in law under the facts of this case to require implementation of section 1715z-1(f)(2) at Cedar Point Apartments, as an alternative to section 1701s.

42 U.S.C. § 1437f

As was true in the discussion above of the deep subsidy payments, plaintiff does not contend that implementation of section 1437f is mandated. Rather, plaintiff contends that section 1437 is one alternative to implementing a rent supplement program under 12 U.S.C. § 1701s. Thus, the court, for the purposes of this case, need only decide if section 1437f is a viable alternative to section 1701s.

Section 1437f provides, inter alia, as follows:

  "For the purpose of aiding lower-income families
  in obtaining a decent place to live and of
  promoting economically mixed housing,
  assistance payments may be made with respect to
  existing, newly constructed, and substantially
  rehabilitated housing in accordance with the

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