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Community for Permanent Supported Housing v. Housing Authority of City of Dallas

United States District Court, N.D. Texas, Dallas Division

April 2, 2019




         Before the Court is Defendant Housing Authority of the City of Dallas, Texas' Motion to Dismiss Pursuant to Rule 12(b)(6) and Brief in Support (the “Motion”) (Doc. No. 19). The Court has considered the Motion, brief in support, response, reply, and applicable law. Because the Plaintiffs' claims are not yet ripe for judicial review, the Court GRANTS the Motion and DISMISSES without prejudice all of the Plaintiffs' claims within their Complaint (Doc. No. 1).

         I. Factual and Procedural Background

         The dispute at the center of this case involves a purported policy of Defendant Housing Authority of the City of Dallas, Texas (“DHA”) regarding the availability of a certain type of Section 8 housing voucher for individuals with intellectual and developmental disabilities (“I/DDs”). Plaintiffs Cynthia Curtis, Mary Hubbard, Irene Niemotka, Margaret (“Peggy”) Shadduck, and Kelly Waterman (collectively, the “Individual Plaintiffs”) are all mothers of adult children with I/DDs. Each of the Individual Plaintiffs desire a housing situation for their respective children that would allow these adult children to live more independently from their parents. More specifically, the Individual Plaintiffs would prefer a housing situation in which their children live in single-family homes with other individuals with similar I/DDs. These households would have a live-in aide who would help support the three or more residents with I/DDs.

         To provide and maintain a single-family home for adults with I/DDs, the Individual Plaintiffs would need some form of financial assistance. Project-based vouchers (“PBVs”) are one form of financial assistance that the Individual Plaintiffs considered. PBVs are a subset of “Section 8” housing vouchers. Whereas the more commonly known Section 8 housing vouchers provide subsidies to individuals that qualify for them, PBVs “attach” to specific properties. Owners of properties that qualify for PBVs can then in turn rent the property to qualifying individuals at a lower rate.

         Recognizing the benefit of PBVs for parents in situations similar to the situations of the Individual Plaintiffs, Plaintiff Community for Permanent Supported Housing (“CPSH”) began working with DHA in 2012 in an effort to convince DHA to provide PBVs for properties tailored for individuals with I/DDs. In July 2016, at CPSH's urging, DHA initiated a pilot program that would make available up to 50 PBVs for single-family homes that would house three or more individuals with I/DDs, as well as a live-in aide. DHA began this pilot program through a “request for proposals” (“RFP”), through which property owners and potential property owners could submit applications to receive a PBV for a property that satisfied the necessary requirements.

         An important aspect of this RFP was that in DHA's marketing of the RFP, DHA stated that a parent of an adult child with an I/DD could be the owner (and thus the landlord) of a property in which one of the residents was his or her adult child. Federal regulations generally prohibit such an arrangement, but DHA took the position that allowing such an arrangement for this RFP would be permissible as a “reasonable accommodation” to the general rule. See 24 C.F.R. § 983.251(a)(4) (2018). DHA took this position in an addendum to its RFP that it published in September 2016, and DHA also relayed this position at an informational meeting organized by CPSH.

         The parties dispute many of the following facts, but, because of the procedural posture of this case, the Court adopts the facts as pleaded in the Complaint. Early in 2017, prior to taking any action on an application for a PBV made in the RFP, DHA decided to cancel the pilot program that would provide up to 50 PBVs for properties housing individuals with I/DDs. DHA communicated this decision to CPSH in April 2017. In its communications to CPSH, DHA stated that it decided to cancel the pilot program because of guidance it received from the United States Department of Housing and Urban Development (“HUD”) regarding the effect of the regulations that generally prohibit parents from renting a PBV-subsidized property to their children. In HUD's guidance letter to DHA, which the Plaintiffs quote in their Complaint and DHA appends as an exhibit to its reply, HUD explains that a family-owned, PBV-subsidized property may be permissible as an exception to the general rule prohibiting such an arrangement under the theory that such an arrangement may be a “reasonable accommodation.” In this same guidance letter, HUD noted that there might be potential for concern in DHA's RFP if the RFP purported to limit the applicant pool to individuals with certain types of disabilities and excluded individuals with other disabilities that would otherwise qualify for housing assistance.

         After DHA received this guidance letter, the Plaintiffs allege that DHA took two actions. First, as explained above, DHA cancelled the PBV pilot program that might have allowed the Individual Plaintiffs an opportunity to obtain a PBV for a property that would house their children. Prior to the cancellation of the pilot program, Plaintiff Mary Hubbard had submitted an application for a PBV, while the other Individual Plaintiffs had taken “affirmative steps” in anticipation of applying for a PBV. Second, DHA “effectively adopted [a] blanket ban” prohibiting PBV housing arrangements in which the parent was the owner of a single-family home where the adult child with an I/DD resided. This second alleged action by DHA forms the basis of the Plaintiffs' claims.

         DHA styles its Motion as one based upon Federal Rule of Civil Procedure 12(b)(6), but DHA's arguments stem from two separate theories. First, DHA argues that neither CPSH nor the Individual Plaintiffs have standing to bring their claims. Second, DHA argues that the Plaintiffs fail to state a claim under any of the statutes on which they based the claims in their Complaint. Because the Court's analysis in this Order focuses on issues of standing and ripeness, the Court does not address DHA's second theory in its Motion.

         In response to DHA's arguments regarding the Plaintiffs' standing, the Plaintiffs emphasize that DHA misunderstands the nature of the Plaintiffs' claims. Rather than base their Complaint solely on DHA's discontinuance of the PBV pilot program, the Plaintiffs base their claims on DHA's purported blanket ban prohibiting family-owned, PBV-subsidized properties for adult children with I/DDs. In other words, the Plaintiffs are not suing for reinstatement of the PBV pilot program or for the approval of any specific PBV application; the Plaintiffs instead are challenging DHA's per se rule prohibiting family-owned, PBV-subsidized properties even when such an arrangement might qualify as a “reasonable accommodation.” Understanding the Complaint in this manner, the Plaintiffs argue that the Individual Plaintiffs have standing because they are prohibited from ever benefitting from a PBV voucher. The Plaintiffs also argue that CPSH has standing because CPSH devoted time and resources in advertising the pilot program and educating interested individuals, like the Individual Plaintiffs, about how the PBVs would operate, and DHA injured CPSH by effectively discontinuing the pilot program through adopting a blanket ban prohibiting family-owned, PBV-subsidized properties.

         II. Applicable Law

         “The oft-repeated requirements of Article III standing are that the plaintiff ‘(1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision.'” Ecosystem Inv. Partners v. Crosby Dredging, L.L.C., 729 Fed.Appx. 287, 291 (5th Cir. 2018) (quoting Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1547 (2016)). A district court may dismiss a case for lack of standing “on any one of three separate bases: (1) the complaint alone; (2) the complaint supplemented by undisputed facts evidenced in the record; or (3) the complaint supplemented by undisputed facts plus the court's resolution of disputed facts.” Moore v. Bryant, 853 F.3d 245, 248 (5th Cir. 2017) (quoting Barrera- Montenegro v. United States, 74 F.3d 657, 659 (5th Cir. 1996)). A district court should dismiss a case for lack of constitutional standing under Rule 12(b)(1). Harold H. Huggins Realty, Inc. v. FNC, Inc., 634 F.3d 787, 795 n.2 (5th Cir. 2011). The district court may raise the issue of constitutional standing sua sponte at any time. See id.; Fed.R.Civ.P. 12(h)(3).

         “The justiciability doctrines of ripeness and standing often intersect . . . .” Prestage Farms, Inc. v. Bd. of Supervisors of Noxubee Cty., Miss., 205 F.3d 265, 268 n.7 (5th Cir. 2000). “Nonetheless, ripeness and standing serve separate and distinct purposes, and it is possible for claim [sic] to be unripe despite the existence of standing to raise that claim.” Roman Catholic Diocese of Dall. v. Sebelius, 927 F.Supp.2d 406, 423 (N.D. Tex. 2013) (Boyle, J.). “In general terms, standing is concerned with whether a proper party is bringing suit, while ripeness is concerned with whether the suit is being brought at the proper time.” Texas v. United States, 497 F.3d 491, 496 (5th Cir. 2007). A case that is not ripe is a case that “will be better decided later, ” not necessarily a case that lacks standing. See Roman Catholic Diocese of Dall., 927 F.Supp. 2d. at 424 (quoting Simmonds v. INS, 326 F.3d 351, 357 (2d Cir. 2003)). Cases that are not ripe are often too abstract or hypothetical for judicial resolution. Choice Inc. v. Greenstein, 691 F.3d 710, 715 (5th Cir. 2012). Similar to when a district court ...

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