Judge James C. Chalfant, Case 22STCP04201 2023-02-07 Tentative Ruling

Petitioner Deborah Smith (“Deborah”) seeks a stay of the decision by Respondents City of Inglewood Housing Authority and Artie Fields (“Fields”) in his capacity as City Manager and Housing Authority Executive Director (collectively, ““HA”) (1) to terminate Deborah’s Section 8 voucher and (2) collect the overpayment HA has assessed against her.

The court has read and considered the moving papers, opposition, and reply,^{^[1]} and renders the following tentative decision.

Petitioner Deborah filed the Petition for writ of administrative mandamus on November 28, 2022. The Petition alleges in pertinent part as follows.

Deborah is a 61-year-old low-income resident who lives in the HA’s jurisdiction and is qualified for Section 8 assistance. She lives with her 37-year-old daughter (“Jessica”) and Jessica’s 14- and 15-year-old sons. Deborah’s monthly income is $1,100, all from SSI and SSDI.

On October 31, 2022, the HA terminated Deborah from the Section 8 program because Jessica failed to report all of her income during an annual recertification. Deborah has reported her own income and otherwise complied with HA rules.

The HA hearing panel issued a decision terminating Deborah from the Section 8 program effective November 30, 2022. HA also assessed an overpayment of $16,734 but will not let Deborah repay it.

Although the termination was effective November 30, HA stopped paying the Section 8 subsidy in September 2022. Deborah has had to pay her full unsubsidized rent from September 2022 thereafter.

Deborah seeks a writ of administrative mandate compelling the HA (1) to set aside the decision and reinstate her membership in the Section 8 program, (2) reimburse her for all months that HA did not pay rental assistance beginning September 2022, and (3) attorney’s fees and costs.

On November 30, 2022, the court denied Deborah’s ex parte application to stay Section 8 termination. The court ordered that if Deborah renews the application or makes a noticed motion for a stay, she must comply with 1008(b) except for its requirement that she show due diligence.

Pursuant to CCP section 1094.5(g), the court may stay the operation of the administrative order or decision pending judgment, or until the filing of a notice of appeal from the judgment or until the expiration of the time for filing the notice, whichever occurs first. A stay may not be granted if it would be against the public interest. Id.

In addition to CCP section 1094.5(g)’s requirement that a stay must not be against the public interest, the applicant must show both some prospect of success and irreparable harm to obtain a stay. The reason is that a stay is a form of preliminary injunction. In determining whether to issue a preliminary injunction, the trial court considers two factors: (1) the reasonable probability that the plaintiff will prevail on the merits at trial (CCP §526(a)(1)), and (2) a balancing of the “irreparable harm” that the plaintiff is likely to sustain if the injunction is denied compared to the harm that the defendant is likely to suffer if the court grants a preliminary injunction. CCP §526(a)(2); 14859 Moorpark Homeowner’s Assn. v. VRT Corp. (1998) 63 Cal.App.4th 1396, 1402; Pillsbury, Madison & Sutro v. Schectman (1997) 55 Cal.App.4th 1279, 1283.

Although no case has so held, the court believes that the reasonable probability of success on the merits is relaxed for purposes of a stay to a “colorable claim”, which is the standard in federal court. The required showing is a sliding scale; the stronger the showing of a colorable claim, the less irreparable harm is necessary. Both, however, must be present to some degree along with the public interest.

Thus, a request for a stay under CCP section 1094.5(g) presents three elements: (a) a colorable claim by the petitioner, (b) balancing of irreparable harms, and (c) the stay will not be against the public interest. The burden is on the petitioner to establish the criteria for a stay, and the decision is committed to the court’s discretion. The decision to grant any preliminary injunction generally lies within the sound discretion of the trial court and will not be disturbed on appeal absent an abuse of discretion. Thornton v. Carlson, (1992) 4 Cal.App.4th 1249, 1255.

A party who originally made an application for an order which was refused in whole or part, or granted conditionally or on terms, may make a subsequent application for the same order upon new or different facts, circumstances, or law, in which case it shall be shown by affidavit what application was made before, when and to what judge, what order or decisions were made, and what new or different facts, circumstances, or law are claimed to be shown. CCP §1008(b). For a failure to comply with this subdivision, any order made on a subsequent application may be revoked or set aside on ex parte motion. CCP §1008(b).

A motion for reconsideration constitutes the exclusive means for a party seeking modification, amendment or revocation of an order. Morite of Calif. v. Sup. Ct. (1993) 19 Cal.App.4th 485, 490. To be entitled to reconsideration, a party must show (1) new or different facts, and (2) a satisfactory explanation for failing to produce such evidence earlier. Kalivas v. Barry Controls Corp., (“Kalivas”) (1996) 49 Cal.App.4th 1152, 1160-61. The requirement of satisfactory explanation for failing to provide the evidence earlier can only be described as a strict requirement of diligence. Garcia v. Hejmadi, (“Garcia”) (1997) 58 Cal.App.4th 674, 690. A motion for reconsideration cannot be granted on the ground that the court misapplied the law in its initial ruling. Gilberd v. AC Transit (1995) 32 Cal.App.4th 1494, 1500.

The federal government provides rental assistance for low- and moderate-income families, the elderly, and the disabled through what is known as “the Section 8 program.” Congress added the Section 8 program to the United States Housing Act of 1937 in 1974 by enacting the Housing and Community Development Act of 1974, Pub.L. No. 93-333, §20 1(a), (codified as amended at 42 U.S.C. § 14370). The express purpose of the Section 8 program is “aiding low-income families in obtaining a decent place to live and promoting economically mixed housing.” 42 U.S.C. §1437f(a). The program is managed federally by the United States Department of Housing and Urban Development (“HUD”), and administered locally by public housing authorities (“PHA”).

HUD enters into annual contracts with its PHAs and provides the PHAs funds to subsidize rental payments to private landlords for eligible tenants. Administration of Respondent’s program is governed by Title 24 C.F.R. PHAs are required to adopt a written administrative plan that establishes local policies for administration of the program in accordance with HUD requirements. 24 C.F.R. § 982.54(a)-(b).

The PHA may admit only eligible families to the program. 24 C.F.R. §982.201(a). To be eligible, a family must be “income-eligible.” Id. Inter alia, to be income-eligible, the applicant family must be “low-income” and meet additional eligibility criteria specified in the PHA administrative plan. 24 C.F.R. §982.201(b)(iii); see also 42 U.S.C. §1437f(o)(4)(C). The annual income of an applicant family determines income eligibility. 24 C.F.R. §982.201(b)(3).

Section 8 tenants must sign a lease and pay a portion of their income toward rent. The remainder of the rent charge is paid by PHA pursuant to a housing assistance payment (“HAP”) contract between PHA and the owner, which mandates that a lease “shall be for a term of not less than [one] year” (42 U.S.C. § 1437f (o)(7XA)), shall “contain terms and conditions that are consistent with State and local law,” (42 U.S.C. §1437f(o)(7)(B)(ii)(I)), and “shall provide that during the term of the lease, the owner shall not terminate the tenancy except for serious or repeated violation of the terms and conditions of the lease, for violation of applicable Federal, State, or local law, or for other good cause.” 42 U.S.C. §1437f(o)(7)(C).

The participant’s voucher is portable. The participant/tenant may choose to live in any property if the landlord agrees to accept the voucher and comply with the applicable regulations. The government subsidy is limited to the difference between the amount the family is required to contribute and the payment standard established by PHA based on fair market rents for the area. 42 U.S.C. §1437f(o)(1)(B), (o)(2)(A)-(B).

HUD regulations identify the obligations of each Section 8 participant, referred to as “Family Obligations.” See 24 CFR §982.551. Included in the list of Family Obligations is the requirement that the family supply any information that the PHA or HUD determines is necessary in the administration of the program. 24 C.F.R. §982.551(b)(1); §982.551(k). Violation of any of the Family Obligations is grounds for termination of Section 8 benefits. 24 C.F.R. §982.552(c)(1)(i).

Participants are required to report a change of family composition immediately. 24 C.F.R. § 982.516(e); 982.551(h)(2). The amount of rental subsidy, which is paid by voucher, is based on the number of family members who will reside in the rental unit. Participants are required to report that a family member has left the household in writing within 30 days of the occurrence. The failure to do so is a basis to terminate Section 8 benefits.

The government’s rental assistance payment can be terminated for a variety of reasons. Among them are repeated violations of the lease (24 C.F.R. §982.55 1(a) & (e), §982.552(a)), failure to provide information to the PHA (24 C.F.R. § 982.551(b), 982.552(a)), and fraud. 24 C.F.R. §982.552(c)(1)(iv).

A PHA has the authority to deny or terminate admission of an applicant family if the family violates any Family Obligations pursuant to 24 C.F.R. section 982.551. 24 C.F.R. §982.552(c)(1)(i). This includes a failure to provide true and complete information to the PHA. 24 C.F.R. §§ 982.551(b), 982.552(a). A PHA also has authority to deny admission if a member of the family has committed fraud or any other corrupt act in connection with any federal housing program. 24 C.F.R. §982.552(c)(1)(iv).

In determining whether to deny assistance because of actions by members of the family, the PHA may consider all relevant circumstances such as the seriousness of the case, the extent of participation or culpability of individual family members, and the effects of denial or termination of assistance on other family members who were not involved in the action or failure. 24 C.F.R. §982.552(c)(2)(i). PHAs have a duty to consider whether a reasonable accommodation is required with regard to a termination decision when the family includes a person with disabilities. 24 CFR §982.552(c)(2)(iv).

Deborah is 61 years old and has several disabilities. Deborah Decl., ¶2. She has received Section 8 federal rental assistance since 1995. Deborah Decl., ¶2. Her disabilities include sciatica, back pain down her legs, arthritis, asthma, and hypertension. Deborah Reply Decl., ¶2. She has reported all her income and has always complied with HA Family Obligations and program requirements. Deborah Decl., ¶5.

Deborah lives with her 37-year-old daughter Jessica and Jessica’s two sons, aged 14 and 15. Deborah Decl., ¶2. Deborah has two In Home Supportive Services (“IHSS”) workers, one of whom is Jessica. Deborah Decl., ¶2.

Deborah’s sole income is $1,100 per month from SSDI and SSI. Deborah Decl., ¶2. Her rent is $2,035 per month, $448 of which she paid while her Section 8 voucher was active. Deborah Decl., ¶3. She cannot afford the full rent if HA terminates her assistance, and the landlord will evict her. Deborah Decl., ¶3. She does not have any family to move in with and believes that she would be homeless upon eviction. Deborah Decl., ¶3.

Because of her worsening condition, Deborah has relied on Jessica since at least 2018 to fill out the annual Section 8 recertification paperwork as one of her IHSS workers. Deborah Decl., ¶4; Deborah Reply Decl., ¶¶ 3-4; Jessica Decl., ¶3. When Jessica first started doing this, she did not know that she needed to report her own income. Jessica Decl., ¶4. When the HA told her this, Deborah and Jessica entered into a repayment plan and repaid the excess benefits to HA. Jessica Decl., ¶4.

In April and May 2021, Jessica submitted reports about changes to her IHSS work hours and her temporary disability status. Jessica Decl., ¶5. Later that year, a Los Angeles Healthcare employee recruited her to her new job. Jessica Decl., ¶5. Jessica therefore assumed that she was working for LA Healthcare, but she later learned that her employer was Molina Healthcare, Inc. (“Molina”). Jessica Decl., ¶6. This confusion meanwhile led her to file a police report because she thought her identity was stolen. Jessica Decl., ¶9.

Jessica works as a Molina Customer Service Agent from home 40 hours a week for $17.68 per hour. Jessica Decl., ¶6. Her pay stub lists her start date as August 1, 2021. Jessica Decl., ¶7, Ex. C. It also shows that as of December 17, 2022, her Year-to-Date gross wages totaled $31,020.40, and net payment totaled $26,740.02. Jessica Decl., ¶7, Ex. C. She only failed to report this income because she was overwhelmed with family responsibilities. Jessica Decl., ¶8.

Jessica has space within the home to manage her own life. Deborah Reply Decl., ¶6. Deborah did not know that Jessica was employed and had unreported income, and she did not notice changes to Jessica’s routine. Deborah Reply Decl., ¶5. When HA asked Deborah if Jessica was employed other than as her IHSS, Deborah answered “No” because she had no information to the contrary. Deborah Reply Decl., ¶5. She never intended to misrepresent Jessica’s employment or withhold information from HA. Deborah Reply Decl., ¶9.

Deborah trusted Jessica to complete recertification forms correctly so she could sign off on them afterwards. Deborah Reply Decl., ¶4. Deborah does not know why Jessica failed to report her own income on the forms. Deborah Decl., ¶4. No one disputes that Deborah fulfilled her duty to report her own income. Deborah Decl., ¶5.

On August 3, 2022, HA sent Deborah a letter that proposed termination of her Section 8 participation. Deborah Reply Decl., ¶7, Ex. B. It explained that Family Obligations include (1) to report earned and unearned income from all sources; (2) not commit any fraud in connection with the Section 8 program. Deborah Reply Decl., ¶7, Ex. B.

HA alleged that Deborah failed to report income for Jessica from Molina. Deborah Reply Decl., ¶7, Ex. B. HA learned about this income because (1) the Electronic Income Verification (“EIV”) system detected it, and (2) Deborah’s housing specialist discovered it while she was processing the landlord’s rent increase request. Deborah Reply Decl., ¶7, Ex. B. When HA sent a third party verification form to Molina, Molina sent it back. Deborah Reply Decl., ¶7, Ex. B. HA calculated that based on the unreported income, it had made excess Housing Assistance Payments that totaled $16,734. Deborah Reply Decl., ¶7, Ex. B.

Deborah was not eligible to enter into a repayment agreement for this amount because she entered into an overpayment agreement after a previous failure to report income. Deborah Reply Decl., ¶7, Ex. B. Citing to 24 CFR section 982.552(a)(5), HA recommended termination from Section 8 in 30 days unless Deborah requested a hearing or appointment to address the allegations within 10 days. Deborah Reply Decl., ¶7, Ex. B. If HA terminated her participation, she would be liable for the full contact rent of her home. Deborah Reply Decl., ¶7, Ex. B.

On November 2, 2022, HA issued a decision terminating Deborah’s assistance, effective November 30, 2022. Pallack Decl., ¶2, Ex. 1. The decision explained that Deborah violated her Family Obligations for (1) failure to report income from all sources, (2) failure to report all changes to income immediately as they occur, (3) committing fraud in connection to the Section 8 program, and (4) knowingly and willingly making false or fraudulent statements to a federal agency, per 18 U.S.C. section 1001. Pallack Decl., ¶2, Ex. 1.

The decision stated that Jessica’s income began on January 1, 2019. Pallack Decl., ¶2, Ex. 1. Deborah did not report it until a HA specialist discovered it during an annual recertification appointment on November 1, 2020. Pallack Decl., ¶2, Ex. 1. On March 30, 2021, Deborah entered into a repayment agreement for the $2,830 that HA had overpaid because of Jessica’s income. Pallack Decl., ¶2, Ex. 1.

On June 13, 2022, Deborah’s landlord requested a rent increase. Pallack Decl., ¶2, Ex. 1. When the HA generated an EIV for Deborah, it showed that Jessica had income as an employee of Molina. Pallack Decl., ¶2, Ex. 1. On July 11, 2022, HA received third-party verification that Molina (1) hired Jessica on August 2, 2021, (2) paid her $35,920.63 in 2021, and (3) paid her $36,874.17 from January 1, 2022 to June 29, 2022. Pallack Decl., ¶2, Ex. 1.

During a Proposed Termination Mandatory Meeting on August 17, 2022, Deborah presented Jessica’s police report and alleged that this was a case of identity theft. Pallack Decl., ¶2, Ex. 1. Jessica stated that she does not work for Molina, has never worked for Molina, and she did not disclose that she was working for any other company. Pallack Decl., ¶2, Ex. 1.

HA requested verification of employment from Molina. Pallack Decl., ¶2, Ex. 1. On August 23, 2022, Molina confirmed that the driver’s licenses and other information it had on file for Jessica matched what HA sent. Pallack Decl., ¶2, Ex. 1. HA decided to proceed with program termination. Pallack Decl., ¶2, Ex. 1.

At the hearing, Jessica admitted that she worked for Molina but claimed she did not know it was the same company as LA Healthcare which hired her. Pallack Decl., ¶2, Ex. 1.

HA calculated that it overpaid Deborah $16,734 because it did not know about Jessica’s income from Molina. Pallack Decl., ¶2, Ex. 1. Deborah was not eligible to enter into a repayment agreement for this amount because she has entered an overpayment agreement previously. Pallack Decl., ¶2, Ex. 1.

The decision does not discuss mitigating factors before it imposes discipline. Pallack Decl., ¶2, Ex. 1.

As a reasonable accommodation, Deborah requested that the HA restore her eligibility by either (1) allowing her to repay the overpayment in reasonable installments or (2) having Jessica move out so that Deborah can move into a one-bedroom rental unit without Jessica as part of the household. Deborah Decl., ¶6. Deborah claimed that (1) disabilities prevented her from finding adequate affordable housing without her voucher; (2) only Jessica was responsible for violations of the Family Obligations; and (3) both facts are also mitigating circumstances, which the HA must consider but did not do so in its decision. Deborah Decl., ¶6, Ex. 2.

On December 2, 2022, HA issued a denial of the reasonable accommodation. Deborah Decl., ¶6, Ex. 2. HA explained that it could only grant an accommodation when the need is related to a person’s disability and when the accommodation is reasonable. Deborah Decl., ¶6, Ex. 2. An accommodation is not reasonable if it would (1) impose an undue financial or administrative burden; or (2) fundamentally alter the nature of HA operations, including the obligation to comply with HUD requirements and regulations. Deborah Decl., ¶6, Ex. 2. HA is permitted but not required to consider mitigating factors like culpability of individual family members, whether the Section 8 participant engaged in the disqualifying activity, the dollar amount of overpaid assistance, and whether the family signed a false certification. Deborah Decl., ¶6, Ex. 2.

Deborah has a history of violating Family Obligations for failure to report income. Deborah Decl., ¶6, Ex. 2. In July 2019, Deborah signed and submitted a Personal Declaration in which she failed to disclose IHSS income. Deborah Decl., ¶6, Ex. 2. She signed a counseling certification in March 2021 in which she agreed that if she failed to report household income in the future she would lose her Section 8 assistance. Deborah Decl., ¶6, Ex. 2. On March 30, 2021, Deborah signed a promissory note agreeing to repay the overpayment from unreported IHSS income. Ex. 2. Deborah’s annual Family Obligations certification also includes an agreement to report any changes in household income within ten days. Deborah Decl., ¶6, Ex. 2.

HA’s denial of a reasonable accommodation to reinstate her Section 8 assistance is based on (a) Deborah’s knowledge of her reporting responsibility and yet she signed multiple false certifications as to income, (b) her accommodation request failed to show that the behavior at issue -- failure to report income -- had any nexus with her disability, and (c) granting an accommodation to reinstate her Section 8 benefits on the ground that she is disabled does not meet the definition of reasonable accommodation and would set a precedent that fundamentally alters the Section 8 program. Deborah Decl., ¶6, Ex. 2. Anytime the HA identified fraud in a household, the household could then just remove the culpable member and avoid termination. Deborah Decl., ¶6, Ex. 2.

In case of family-caused errors or program abuses, the family will be required to repay the excess benefits but HA is not required to offer a repayment agreement. Deborah Decl., ¶6, Ex. 2.

Although HA’s decision was to terminate Section 8 assistance effective November 30, 2022, it stopped paying Deborah in September 2022. Deborah Decl., ¶4; Deborah Reply Decl., ¶8. Deborah had to borrow money to pay rent for September, October, and November 2022. Deborah Decl., ¶4; Deborah Reply Decl., ¶8. Landlord will not require her to pay rent for December 2022 and January 2023 until he returns from out of town. Deborah Decl., ¶4. Her counsel intends to ask Landlord to further defer her rent until the hearing on this motion. Pallack Decl., ¶6.

HA never engaged in an interactive process to see if there is a reasonable accommodation to which they parties can agree. Pallack Decl., ¶5. HA lists an annual budget of $25 million on its website, so keeping Deborah on Section 8 will not have a perceptible impact on it. Pallack Decl., ¶3. HA conceded this fact at a December 20, 2022 informal hearing on Deborah’s reasonable accommodation request. Pallack Decl., ¶3. The hearing officer has not yet issued a decision on the informal hearing. Pallack Decl., ¶5.

On November 30, 2022, the court heard Deborah’s ex parte application to stay Section 8 termination. Pallack Reply Decl., ¶2, Ex. 1. The court denied the application for lack of supporting evidence, which counsel attributed to the short time frame it had to prepare the application. Pallack Reply Decl., ¶2, Ex. 1. The court ordered that, if Deborah renews the application or makes a noticed motion for a stay, she must comply with 1008(b) except for its requirement that she show due diligence. Pallack Reply Decl., ¶2, Ex. 1. Both the moving papers and reply of this motion contain declarations and other evidence in support thereof that was not available at the time of the ex parte application. Pallack Reply Decl., ¶3.

Petitioner Deborah seeks a stay of HA’s decision’s termination of her Section 8 assistance, as well as HA’s order to repay the amounts she has been overpaid in housing assistance. HA asserts that the application fails both on its own merits and as a motion for reconsideration from the denial of the ex parte application for a stay. Opp. at 4-8.

The court denied Deborah’s ex parte application for a stay on November 30, 2022 because she failed to meet any of the required elements of a stay. The court ordered that, if Deborah renews her ex parte application or makes a noticed motion for a stay, she must comply with CCP section 1008(b) (“section 1008(b)”) except for its requirement that she show due diligence.

Respondents assert that Deborah fails to comply with section 1008(b) because she does not provide a complete administrative record, including documents that HA relied upon for its decision. Opp. at 4-5.

Respondents misunderstand the proof required for a stay. While the court will consider the full administrative record at trial, a stay only requires the evidence necessary to prove the elements. Satisfactory proof of these elements may or may not require the entire administrative record, but it is not a defect in a motion to reconsider that the record is not provided. See Reply at 5.

To renew a motion, the moving party must present an attorney declaration stating when the party previously appeared, who the judge was, how the judge ruled, and what new or different facts, circumstances, or law are claimed to be shown. §1008(b). The party must also provide a satisfactory explanation for failing to produce such evidence in the first application. Kalivas, supra, 49 Cal.App.4th at 1160-61. The requirement of satisfactory explanation for failing to provide the evidence earlier can only be described as a strict requirement of diligence. Garcia, supra, 58 Cal.App.4th at 690.

Deborah asserts in reply that she does not seek reconsideration of the court’s denial of her ex parte application for a stay. Reply at 5; Pallack Reply Decl., ¶3. She is correct. A motion to reconsider is made pursuant to section 1008(a) and has a ten-day deadline for filing. A renewed motion under section 1008(b) has no such deadline and is available any time an application was denied and then renewed. Deborah’s counsel provides the court’s order, which shows that the requirements of section 1008(b) were imposed for any noticed motion for a stay with the exception of the due diligence requirement. Pallack Reply Decl., ¶1, Ex. A.

Deborah’s moving papers completely failed to comply with the court’s order for section 1008(b). In reply, Deborah attempts to rectify this failure by providing an attorney declaration. Pallack Reply Decl. The declaration lists the hearing date of the ex parte application, notes that it was made to this court, and explains the court’s ruling. Pallack Reply Decl., ¶2. With respect to the requirement of setting forth new or different facts, circumstances, or law, the declaration merely states that Deborah has attached declarations and other evidence supporting the motion. Pallack Reply Decl., ¶3. This is not specific enough to satisfy section 1008(b). Nonetheless, the court will not deny the motion for this belated compliance.

Deborah cannot obtain a stay unless she shows a reasonable probability of success on the merits. For a stay of an agency decision, this court interprets the reasonable probability element to mean evidence of a colorable claim, a less demanding standard than for other preliminary injunctions.

Deborah asserts that Jessica completed the annual Section 8 recertification paperwork as one of her IHSS workers. Deborah Decl., ¶4. Deborah does not know why Jessica failed to report her income on the forms. Deborah Decl., ¶4. No one disputes that Deborah fulfilled her duty to report her own income. Deborah Decl., ¶5. Deborah asserts that under Civil Code section 3520, HA should not make her suffer for the acts of another. Mot. at 6.

Civil Code section 3520 does not apply. It only applies to a party entirely free from participation in the wrong. Hudson v. Von Hamm (1927), 85 Cal. App. 323, 325-26. Deborah had Jessica fill out the form on her behalf. Deborah signed a counseling certification in March 2021 that indicated she understood how to report family income after her last failure to do so. Opp. at 7; Deborah Decl., ¶6, Ex. 2. She also agreed that she would lose her Section 8 assistance if she failed to report income again. Deborah Decl., ¶6, Ex. 2. Deborah knew that no matter who filled the form for her household, the information had to be accurate.^{^[4]}

The annual Family Obligations certification also includes an agreement to report any changes in household income within ten days. Deborah Decl., ¶6, Ex. 2. Neither Jessica nor Deborah reported when Jessica had employment with Molina that increased her income. Opp. at 7-8. The HA decision explained that the failure to report changes to income as they occurred was itself a violation of Family Obligations. Pallack Decl., ¶2, Ex. 1.

The HA decision states that in an August 17, 2022 meeting with staff, Jessica submitted a police report and claimed that someone fraudulently stole her identity to work at Molina. Deborah stated that Jessica could not possibly work for Molina when she was home with Deborah every day. Opp. at 8; Pallack Decl., ¶2, Ex. 1. The decision found these statements to be lies, which Jessica subsequently admitted at a HA hearing on October 27, 2022. Deborah’s misrepresentations that Jessica did not have such income were an independent violation of Family Obligations to not commit fraud regarding Section 8. Pallack Decl., ¶2, Ex. 1.^{^[5]}

Deborah has not raised a colorable claim based on error in the HA’s decision to terminate her, outside of reasonable accommodation of her disability.

Deborah asserts she can prevail because HA did not engage in the required interactive process for an appropriate accommodation. Mot. at 6. HA just issued the Accommodation Denial that rejected her request outright. Deborah Decl., ¶6, Ex. 2.

Deborah cites to Auburn Woods I Homeowners Ass'n v. Fair Employment and Housing Com'n, (“Auburn Woods”) (2004) 121 Cal.App.4th 1578, 1598, as the source of the duty to engage in the interactive process. Mot. at 6. Auburn Woods discusses reasonable accommodation under the Fair Employment and Housing Act (“FEHA”), finding that a comfort dog was a reasonable accommodation for a disability under the tenant’s lease. 121 Cal.App.4th at 1595-96. As part of its holding, the court stated that when a landlord receiving a request for an accommodation is skeptical of the alleged disability or of the ability to provide the accommodation, that party must request documentation or open a dialogue to exchange information and request the information it thinks it needs as part of the interactive process. Id. at 1598.

HA’s Accommodation Denial did not doubt that Deborah has a disability. The Accommodation Denial explained that this disability had no causal nexus with the failure to report Jessica’s income. Deborah Decl., ¶6, Ex. 2. Deborah does not explain in her motion why this is wrong. Opp. at 8.

Deborah’s request also failed because an accommodation cannot fundamentally alter the nature of HA operations. Deborah Decl., ¶6, Ex. 2. Whether through a payment plan or separation from Jessica, Deborah sought a way to stay in the Section 8 program. Deborah Decl., ¶6, Ex. 2. If HA permitted that to happen, it would alter the program and create precedent for a family with a disabled member to bypass eligibility requirements by removing a family member whenever the HA discovers that family member has committed fraud. Deborah Decl., ¶6, Ex. 2.

Deborah asserts in reply that HA did not consider that she, an elderly woman with painful ailments and lack of mobility, could reasonably delegate to her daughter filling out the recertification forms truthfully and accurately. Reply at 9. Granting permission for her to do so would fundamentally alter the program and still create incentive for participants to delegate recertification duties to another family member so they can disavow them to avoid penalty for wrongdoing when caught.

Deborah asserts that the remedy of removing Jessica from the family unit would not fundamentally alter the program because Section 8 Law allows it. Reply at 9. 24 C.F.R. section 982.552(c)(2)(ii) allows a PHA to impose, as a condition of continued assistance for other family members, a requirement that family members who participated in or were culpable for the action or failure will not reside in the unit. The language of this provision makes it clear that, as with Civil Code section 3520, this provision cannot apply when the eligible applicant is also culpable.^{^[6]}

Although Deborah complains that HA failed to engage in an interaction, she does not point to any form of interaction that could achieve a reasonable accommodation. HA did not need more information to decide that Deborah’s circumstance could not qualify for any accommodation.

Deborah asserts that HA’s decision is defective for failing to consider mitigating evidence that 1) Deborah will be evicted and will be homeless, (2) she complied with HA’s rules, and (3) only Jessica was responsible for violations of the Family Obligations. Mot. at 5-6.

In determining whether to deny assistance because of actions by members of the family, the PHA may consider all relevant circumstances such as the seriousness of the case, the extent of participation or culpability of individual family members, and the effects of denial or termination of assistance on other family members who were not involved in the action or failure. 24 C.F.R. §982.552(c)(2)(i). The regulations vest discretion in HA to consider these factors. See Costa v. Fall River Hous. Auth. (2009) 903 N.E.2d 1098, 1113.

Deborah fails to show that she was not at fault for the failure to report Jessica’s income. In fact, Respondents position is that Deborah participated in the fraud and lied to HA about Jessica’s work at Molina. The fact that Deborah will likely be evicted is not a mitigating factor. Firstly, it is a probable consequence for most or all Section 8 recipients who are disqualified. More important, Respondents point out that Deborah is ignoring her daughter’s income. Respondents assert that Deborah and Jessica have household income of more than $90,000.^{^[7]} It is unlikely that they will be unable to find housing at that income level. Opp. at 7. While Jessica’s paystub suggests that her income is less, there still is no suggestion that their level of family income will not allow them to find alternative housing.

The HA’s decision may not have mentioned these alleged mitigating factors, but it is not defective for failing to consider them.

As to Deborah’s harm, she asserts that her sole income is $1,100 per month from SSDI and SSI. Deborah Decl., ¶2. Her rent is $2,035 per month, $448 of which she paid while her Section 8 voucher was active. Deborah Decl., ¶3. After the HA terminated assistance in September 2022, she had to borrow money to pay rent for September, October, and November 2022. Deborah Decl., ¶4. She cannot afford the full rent if HA terminates her assistance, and the landlord will evict her. Deborah Decl., ¶3. She does not have any family to move in with. Deborah Decl., ¶3. Mot. at 5.

Deborah’s harm is overstated. Jessica has substantial income that she did not report, even if the precise amount is in dispute. Deborah does not explain why she and her daughter will not have sufficient rent money at her home or another apartment. Opp. at 7.

Deborah asserts that HA’s harm is minimal because its budget is over $25 million. Pallack Decl., ¶3. Deborah ignores the fact that there is a long list of persons seeking Section 8 assistance. If Deborah receives Section 8 assistance pursuant to a stay, some eligible person will not. HA is obligated to consider the interests of all its applicants and there will be harm to it from a stay.

Deborah’s moving papers do not separately address the public interest. In reply, Deborah argues that the public interest favors a stay because she did not commit a fraud, she reasonably relied on her daughter to report income, HA failed to consider her mitigating circumstances, and there will be no discernable financial impact on HA from a stay. Reply at 10.

It is not in the public interest to award Section 8 funds to a person who has misreported their income, whether or not that person participated in fraud as a result. The public interest works against a stay.

Deborah fails to meet the requirements for a stay of her termination from Section 8. The motion is denied.

^{^[1]} Respondents failed to lodge a courtesy copy of their opposition brief, and Deborah her reply brief, in violation of the Presiding Judge’s First Amended General Order for Electronic Filing. Counsel is admonished to lodge courtesy copies of all filings in this lawsuit.

The footnotes in Respondents’ opposition fail to comply with the 12-point type requirement of CRC 2.104 and have not been considered.

^{^[2]} In reply, Deborah attempts to object to “evidence” in the opposition. A party’s brief is not evidence and all of Deborah’s objections are overruled.

^{^[3]} With the exception of Jessica’s income (see post), the reply declarations of Deborah and Jessica should have been presented with the moving papers. As a result, they have not been considered. Regency Outdoor Advertising v. Carolina Lances, Inc., (1995) 31 Cal.App.4th 1323, 1333 (new evidence/issues raised for the first time in a reply brief are not properly presented to a trial court and may be disregarded).

^{^[4]} If the court were to consider the reply declarations, Deborah claims that she trusted Jessica to fill the information in correctly and sign off on it. Deborah Reply Decl., ¶4. This is only a mitigating circumstance and not a defense. Deborah had a duty to assure herself that the information was accurate. Jessica also cannot claim ignorance because she admits that she entered into the repayment plan with Deborah. Jessica Decl., ¶4.

^{^[5]} Deborah argues that she and Jessica did not commit fraud, which requires a knowingly false misrepresentation. Reply at 8. She again relies on the inadmissible reply declarations of Jessica and Deborah, who claim that they believed the claim of identity theft because Jessica was recruited by an LA Healthcare employee and so did not believe she worked for Molina. Jessica Reply Decl., ¶¶ 5-6, 9; Deborah Reply Decl., ¶5. These declarations ignore the finding that both Deborah and Jessica falsely told HA that Jessica was home with Deborah every day.

^{^[6]} The fact that HA could have exercised its discretion to impose a remedy of removing Jessica from the family unit does not mean that it abused its discretion by not doing so.

^{^[7]} Deborah presents evidence in reply that this is a gross overstatement. Reply at 7. HA calculated that it overpaid Deborah $16,734 because it did not know about Jessica’s income from Molina. Pallack Decl., ¶2, Ex. 1. The decision claims that, on July 11, 2022, HA received third-party verification that Molina (1) hired Jessica on August 2, 2021, (2) paid her $35,920.63 in 2021, and (3) paid her $36,874.17 from January 1, 2022 to June 29, 2022. Pallack Decl., ¶2, Ex. 1. Jessica’s Molina pay stub for 2022 shows Year-to-Date gross wages of $31,020.40 and net payment of $26,740.02. Jessica Reply Decl., ¶7, Ex. C.