City Not Required to Continue Rent Subsidy Program

Several organizations sued the city, seeking to bar the termination of a rent subsidy program run by the NYC Department of Homeless Services, even though federal and state funding were withdrawn as of April 2011. They argued that the city was still contractually obligated to continue the subsidies. The plaintiffs got a temporary restraining order, but were later denied a preliminary injunction to keep the subsidies in place pending the outcome of the case. They appealed, and the appeals court ordered the city to continue making the subsidy payments to landlords while the case was pending. Later, the trial court dismissed the case entirely, declaring that the city wasn't obligated to continue making the payments under the terms of the subsidy program documents. The appeals court then denied the appeal of the prior order denying the preliminary injunction and dissolved the injunction. The court refused to continue the injunction pending the plaintiffs' appeal of the trial court's final decision. The organizations then appealed to New York's highest court, which ruled that the city had no obligation to continue rent subsidies under the "Advantage" program now that state and federal assistance was no longer available. The program had paid up to $1,000 per month in rent subsidies for up to two years for 15,000 participants.

Zheng v. The City of New York: NYLJ, 6/27/12, p. 23, col. 1 (Ct. App.; Read, PJ, Graffeo, Smith, Pigott, JJ; dissent by Ciparick, Lippman, Jones, JJ)