NYC Is Requiring Landlords Set Aside Apartments For Voucher Tenants Under New Approach To Enforcing Human Rights Law

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For months, Elizabeth Elohim was living in a shelter with her daughter as she struggled to secure a permanent apartment with a Section 8 housing voucher. Getting the federally funded voucher alone took long enough, in part because she only became eligible once she lived in a shelter. She “hit the ground running” to find an apartment—but quickly realized it was nearly impossible to get a landlord or realtor to accept the voucher, a guaranteed source of payment for rent each month to help low-income families foot the bill.

“As soon as I mentioned that I had a Section 8 voucher, it would become an issue,” Elohim, a mother of a teenager in upper Manhattan who works as an aide to people with developmental disabilities. “I mean, it would be literally so rude to the point where as soon as I mentioned the Section 8 [voucher], sometimes I wouldn’t even get an answer. They would just hang up the phone on me.”

“It was such an emotional attack,” said Elohim, who was told at one point her income would have to be 40 times the rent, not including the voucher money. “At this point, you have something that is supposed to help you with finding housing, which is a necessity. It’s not a luxury. It’s something that is essential for you to be able to live a productive life.”

After repeated rejections, it “became extremely stressful, extremely exhausting.”

Landlords and brokers keeping low-income renters with vouchers out of housing is nothing new.

The city’s Commission on Human Rights has been investigating bad actors since 2008, when what’s known as “source of income discrimination” was added to the city’s human rights law. At the time, then-Councilmember Bill de Blasio spearheaded the legislation, which was blocked by then-Mayor Michael Bloomberg until the City Council overrode a mayoral veto.

Discriminating against tenants who seek to pay rent with a voucher is seen as a loophole for discrimination against protected classes like race or disability.

But in the years since the law changed, such investigations have evolved to include more than fining property management companies for damages for a single complainant. Through settlements, the commission is mandating companies accused of discrimination to set aside apartments in their buildings for people paying rent with vouchers.

The measure effectively creates new low-income housing—an approach the commission began this spring.

The settlements include a woman who alleged source of income discrimination in 2017 against Pinnacle Group, led by Joel Wiener—whose wealth surged to $1 billion in 2017 and also faced a legal battle with tenants in the 2000s that resulted in a $2.5 million settlement for tenants’ damages. A settlement finalized in May will now require the company to set aside four one- to two-bedrooms for housing unstable families, the commission says.

In an April settlement, a Bay Ridge building at 220 72nd Street is required to rent at least one-bedroom apartment to voucher-holding renters, and there is a prohibition on deposits from renters to “hold” an apartment. M&N Management Corporation must place four renters with income assistance in the next year in its buildings, as well as remove discriminatory language from rental applications and undergo human rights law training following an income discrimination allegation settlement in July.

Pinnacle and the Bay Ridge landlord are required to revise policies to comply with human rights laws and bar credit checks as a way to discriminate—like only requiring them if the tenants pay more than $50 in rent and taking into account reference letters, payment history, and the tenant’s portion of rent.

So far, the commission has settled in three cases, setting aside nine apartments. But the commission says there’s more to come under the restorative justice model.

“It’s a long battle, but I think we’re finally starting to make some headway there, especially since we’re getting more and more settlements with set-asides included,” said Katherine Carroll, the assistant commissioner of public-initiated housing and public accommodations cases at the NYC Commission on Human Rights. “It’s becoming more of a routine thing.”

Since 2018, 400 source of income discrimination allegations have resulted in tenants placed in permanent housing once the commission intervenes through its Source of Income Unit, which focuses on rapid intervention to secure someone an apartment before they lose the opportunity. Another 660 formal cases that have been filed since 2008 have been resolved, amounting in $1.3 million in civil penalties and damages to renters.

Renee Jackson, 66, is just one tenant who benefited from the commission’s restorative justice model.

Like Elohim, she faced repeated issues getting an apartment using a housing voucher administered through the NYC Human Resources Administration during her four-month search.

In one instance, she was looking at an apartment, but a realtor asked to take a photo of her. Half an hour later, he returned to say they only had one-bedrooms, no studios, and all were just out of her price range.

“I was being judged,” she said, telling Gothamist that, as a Black woman, she felt realtors were also discriminating against her for the color of her skin. “It’s a hurtful feeling. It’s very hurtful.”

Eventually, she was connected to Pinnacle through her case manager, landing an apartment in Inwood on March 1st.

“It was such a blessing from God, I really believe,” Jackson said. “It’s like a load off your back.”

Ken Fisher, a lawyer for Pinnacle, said he wasn’t aware of set-aside apartments prior to this settlement, but the agreement “aligned [with] our interests because it meant that vacant apartments were going to be rented with the government providing some or all of the rent, and therefore, there was no reason not to do it.”

The upper Manhattan mother, Elohim, ultimately filed a complaint in 2016 against Besen & Associates’ Steven Fuchs, the leasing administrator, alleging “unlawful discriminatory practices” violating the city’s human rights law.

The company denied the allegations, and settled under an agreement that requires Besen to implement policies against discrimination that could result in termination for brokers and agents who fail to comply. Minimum income requirements would no longer apply to tenants with government-funded subsidies—something Elohim says she faced that kept her from qualifying for housing—and tighter rules on credit checks for voucher-holders would be instituted under the agreement.

Fuchs did not respond to an emailed request for comment about the settlement.

But in the years since the frantic search for an apartment while living in a shelter, she’s lost the voucher, which expires if a renter doesn’t find housing within 60 to 120 days, with the option for an extension.

Now, she’s raising her teenage daughter in an upper Manhattan public housing apartment. She lives in a two-bedroom—a huge plus while raising a teen—but reminisces about a time when she envisioned purchasing a home through Section 8 homeownership programs.

Landlords are still finding “savvy” ways to flout the law, Carroll says.

They’ll issue credit checks or require a minimum income—measures that seem typical, but box out low-income tenants with the ability to pay rent, just with a nontypical source of income through public funds.

Among those loopholes was keeping renters from paying security deposits with subsidies, like with an HRA security voucher—recently made illegal under a state appeals court decision. In 2017, one woman alleged her application was pulled for a Sheepshead Bay apartment because security vouchers weren’t an accepted type of payment at the company, the LeFrak Organization, which owns thousands of apartments in NYC.

Three years later, after a legal battle spurred by the initial commission complaint, a panel of judges in New York State appeals court ruled vouchers are indeed a “lawful source of income” to use on security deposits.

“People who don’t have money to pay rent aren’t going to have a month-and-a-half, two months rent, laying around in their bank account to be able to get into housing in the first place,” Carroll said. “If you don’t include those things in ‘source of income,’ and people are allowed to discriminate on the basis of that, then, it really takes the teeth out of the source of income provision all together.”

A lawyer for LeFrak (under Estates NY Real Estate Services LLC) in the appeals case did not respond to an emailed request for comment.

A lawyer for M&N, Jared Newman of Herrick, Feinstein LLP, said the company denies “any discrimination or wrongdoing but decided to work with [the commission] to reach a resolution.”

An email sent to an address listed for an owner in buildings department records at the Bay Ridge building was not returned.

Enforcement beyond the commission is limited in the city and state; the latter made source of income discrimination illegal in April 2019.

New York’s Attorney General Letitia James launched a complaint portal to report allegations earlier this year, but her office says it has received just 52 complaints since then.

The state’s Division of Human Rights has gotten 120 complaints of source of income discrimination since the law changed—about one-fifth of all housing complaints at the division. About half are still under investigation or in the public hearing process, though the other half were dismissed. The division has started three investigations for alleged source of income discrimination as a part of efforts to “proactively seek out systemic patterns of discrimination.”

The city’s Human Resources Administration has a source of income unit to investigate complaints, and the agency filed two lawsuits on behalf of renters back in 2018 for telling potential tenants vouchers weren’t accepted at properties in Staten Island and the Bronx. The agency wasn’t able to provide information about other enforcement actions the unit has taken since then for this article.

The commission now hopes to close legal loopholes surrounding credit checks and minimum income requirements, rather than operating on a case-by-case basis under agreements after someone has already been discriminated against.

“That is the next frontier of cases that we’re taking on,” Carroll said.

Source: gothamist.com