CLOSED,TYPE−D
U.S. District Court District of Columbia (Washington, DC) CIVIL DOCKET FOR CASE #: 1:17−cv−02192−BAH

OPEN COMMUNITIES ALLIANCE et al v. CARSON et al Assigned to: Chief Judge Beryl A. Howell Cause: 05:551 Administrative Procedure Act
Plaintiff

Date Filed: 10/23/2017 Date Terminated: 08/16/2018 Jury Demand: None Nature of Suit: 899 Administrative Procedure Act/Review or Appeal of Agency Decision Jurisdiction: U.S. Government Defendant

OPEN COMMUNITIES ALLIANCE

represented by Ajmel A. Quereshi NAACP LEGAL DEFENSE AND EDUCATIONAL FUND, INC 700 14th Street NW Suite 600 Washington, DC 20005 (202) 216−5574 Fax: (202) 682−1312 Email: aquereshi@naacpldf.org LEAD ATTORNEY ATTORNEY TO BE NOTICED

Allison Marcy Zieve PUBLIC CITIZEN LITIGATION GROUP 1600 20th Street, NW Washington, DC 20009 (202) 588−1000 Fax: (202) 588−7795 Email: azieve@citizen.org LEAD ATTORNEY ATTORNEY TO BE NOTICED

Coty R. Montag NAACP LEGAL DEFENSE & EDUCATIONAL FUND, INC. 1444 I Street, NW 10th Floor Washington, DC 20005 202−682−1300 Email: cmontag@naacpldf.org LEAD ATTORNEY ATTORNEY TO BE NOTICED

Jon M. Greenbaum LAWYERS' COMMITTEE FOR CIVIL RIGHTS UNDER LAW 1500 K Street, NW Suite 900 Washington, DC 20005 (202) 662−8325 Email: jgreenbaum@lawyerscommittee.org LEAD ATTORNEY ATTORNEY TO BE NOTICED

Michael Gerhart Allen RELMAN, DANE & COLFAX PLLC 1225 19th Street, NW Suite 600 Washington, DC 20036

Plaintiff CRYSTAL CARTER

(202) 728−1888 ext. 603 Fax: (202) 728−0848 Email: mallen@relmanlaw.com LEAD ATTORNEY ATTORNEY TO BE NOTICED
Samuel Spital NAACP LEGAL DEFENSE & EDUCATIONAL FUND, INC. 40 Rector Street 5th Floor New York, NY 10006 (212) 965−2200 Email: sspital@naacpldf.org LEAD ATTORNEY ATTORNEY TO BE NOTICED
Sasha Samberg−Champion RELMAN, DANE & COLFAX PLLC 1225 19th Street, NW Suite 600 Washington, DC 20036 (202) 728−1888 Fax: (202) 728−0848 Email: ssamberg−champion@relmanlaw.com LEAD ATTORNEY PRO HAC VICE ATTORNEY TO BE NOTICED
represented by Ajmel A. Quereshi (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED
Allison Marcy Zieve (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED
Coty R. Montag (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED
Jon M. Greenbaum (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED
Michael Gerhart Allen (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED
Samuel Spital (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED
Sasha Samberg−Champion (See above for address) LEAD ATTORNEY PRO HAC VICE

Plaintiff TIARA MOORE
V. Defendant BEN S. CARSON, SR. Secretary of Housing and Urban Development, in his official capacity
Defendant U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT Amicus INSTITUTE FOR POLICY INTEGRITY

ATTORNEY TO BE NOTICED
represented by Ajmel A. Quereshi (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED
Allison Marcy Zieve (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED
Coty R. Montag (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED
Jon M. Greenbaum (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED
Michael Gerhart Allen (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED
Samuel Spital (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED
Sasha Samberg−Champion (See above for address) LEAD ATTORNEY PRO HAC VICE ATTORNEY TO BE NOTICED
represented by Johnny Hillary Walker , III U.S. ATTORNEY'S OFFICE FOR THE DISTRICT OF COLUMBIA 555 Fourth Street, NW Washington, DC 20530 (202) 252−2575 Fax: (202) 252−2599 Email: johnny.walker@usdoj.gov LEAD ATTORNEY ATTORNEY TO BE NOTICED
represented by Johnny Hillary Walker , III (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED
represented by Avi Benjamin Zevin INSTITUTE FOR POLICY INTEGRITY

139 MacDougal Street New York, NY 10012 (212) 992−8932 Fax: (212) 995−4592 Email: avi.zevin@nyu.edu LEAD ATTORNEY ATTORNEY TO BE NOTICED
Johnny Hillary Walker , III (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED

Date Filed 10/23/2017
10/23/2017 10/23/2017 10/23/2017 10/23/2017 10/23/2017 10/23/2017
10/23/2017
10/26/2017 10/26/2017 10/27/2017 10/27/2017 10/27/2017

# Docket Text
1 COMPLAINT against BEN S. CARSON, SR, U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT ( Filing fee $ 400 receipt number 0090−5170494) filed by OPEN COMMUNITIES ALLIANCE, TIARA MOORE, CRYSTAL CARTER. (Attachments: # 1 Civil Cover Sheet, # 2 Exhibit Exhibit A, # 3 Exhibit Exhibit B, # 4 Summons)(Samberg−Champion, Sasha) (Entered: 10/23/2017)
2 NOTICE of Appearance by Allison Marcy Zieve on behalf of All Plaintiffs (Zieve, Allison) (Entered: 10/23/2017)
3 NOTICE of Appearance by Michael Gerhart Allen on behalf of All Plaintiffs (Allen, Michael) (Entered: 10/23/2017)
4 NOTICE of Appearance by Jon M. Greenbaum on behalf of All Plaintiffs (Greenbaum, Jon) (Entered: 10/23/2017)
Case Assigned to Chief Judge Beryl A. Howell. (sth) (Entered: 10/23/2017)
SUMMONS Not Issued as to BEN S. CARSON, SR, U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (sth) (Entered: 10/23/2017)
5 REQUEST FOR SUMMONS TO ISSUE against Ben Carson re 1 Complaint, filed by OPEN COMMUNITIES ALLIANCE, TIARA MOORE, CRYSTAL CARTER. Related document: 1 Complaint, filed by CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE.(Samberg−Champion, Sasha) (Entered: 10/23/2017)
6 REQUEST FOR SUMMONS TO ISSUE against HUD re 1 Complaint, filed by OPEN COMMUNITIES ALLIANCE, TIARA MOORE, CRYSTAL CARTER. Related document: 1 Complaint, filed by CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE.(Samberg−Champion, Sasha) (Entered: 10/23/2017)
7 ENTERED IN ERROR.....NOTICE of Appearance by Samuel Spital on behalf of CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE (Spital, Samuel) Modified on 10/27/2017 (znmw). (Entered: 10/26/2017)
8 ENTERED IN ERROR.....STANDING ORDER. Signed by Chief Judge Beryl A. Howell on October 26, 2017. (lcbah1) Modified on 10/27/2017 (tg). (Entered: 10/26/2017)
NOTICE OF CORRECTED DOCKET ENTRY: ECF 8 Order was entered in error, the parties shall disregard the entry. A new corrected Standing Order will be posted in this case. (tg) (Entered: 10/27/2017)
9 STANDING ORDER. Signed by Chief Judge Beryl A. Howell on October 27, 2017. (lcbah1) (Entered: 10/27/2017)
NOTICE OF ERROR re 7 Notice of Appearance; emailed to sspital@naacpldf.org, cc'd 7 associated attorneys −− The PDF file you docketed contained errors: 1. Incorrect document/case, 2. Please refile document, 3. ENTERED IN ERROR: Appearance form is blank; Please refile. (znmw, ) (Entered: 10/27/2017)

10/27/2017 10/27/2017 10/27/2017 10/27/2017 10/27/2017 11/03/2017 11/08/2017
11/08/2017
11/08/2017 11/08/2017 11/08/2017
11/09/2017 11/13/2017 11/14/2017

10 NOTICE of Appearance by Samuel Spital on behalf of CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE (Spital, Samuel) (Entered: 10/27/2017)
11 SUMMONS (2) Issued Electronically as to BEN S. CARSON, SR, U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT. (Attachment: # 1 Notice and Consent)(jd) (Entered: 10/27/2017)
SUMMONS Not Issued as to U.S. Attorney General and U.S. Attorney for the District of Columbia.(jd) (Entered: 10/27/2017)
12 RETURN OF SERVICE/AFFIDAVIT of Summons and Complaint Executed BEN S. CARSON, SR served on 10/27/2017. (Samberg−Champion, Sasha) Modified party served on 10/30/2017; summons not issued to U.S. Attorney. (znmw). (Entered: 10/27/2017)
13 RETURN OF SERVICE/AFFIDAVIT of Summons and Complaint Executed. U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT served on 10/27/2017. (Samberg−Champion, Sasha) Modified party served on 10/30/2017; summons not issued to U.S. Attorney. (znmw). (Entered: 10/27/2017)
14 NOTICE of Appearance by Johnny Hillary Walker, III on behalf of All Defendants (Walker, Johnny) (Entered: 11/03/2017)
15 MOTION for Preliminary Injunction by CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE (Attachments: # 1 Memorandum in Support, # 2 Text of Proposed Order, # 3 Declaration, # 4 Declaration, # 5 Declaration, # 6 Declaration, # 7 Declaration, # 8 Declaration, # 9 Declaration)(Samberg−Champion, Sasha) (Entered: 11/08/2017)
16 DECLARATION OF SASHA SAMBERG−CHAMPION re 15 MOTION for Preliminary Injunction by CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C, # 4 Exhibit D, # 5 Exhibit E, # 6 Exhibit F, # 7 Exhibit G, # 8 Exhibit H, # 9 Exhibit I, # 10 Exhibit J)(Samberg−Champion, Sasha) Modified on 11/8/2017 (zrdj). Modified on 11/8/2017 (zrdj). (Entered: 11/08/2017)
17 NOTICE of Appearance by Coty R. Montag on behalf of CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE (Montag, Coty) (Entered: 11/08/2017)
18 NOTICE of Appearance by Ajmel A. Quereshi on behalf of CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE (Quereshi, Ajmel) (Entered: 11/08/2017)
MINUTE ORDER (paperless) ISSUING the following SCHEDULING ORDER to control the timing of proceedings in this matter: (1) by November 15, 2017, the defendants shall file any Opposition to the plaintiffs' 15 Motion for Preliminary Injunction, see LCvR 65.1(c); and (2) by November 22, 2017, the plaintiffs shall file any Reply to the defendants' Opposition. Signed by Chief Judge Beryl A. Howell on November 8, 2017. (lcbah1) (Entered: 11/08/2017)
19 Consent MOTION for Extension of Time to File Response/Reply as to 15 MOTION for Preliminary Injunction by BEN S. CARSON, SR, U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (Attachments: # 1 Text of Proposed Order)(Walker, Johnny) (Entered: 11/09/2017)
20 Unopposed MOTION for Leave to File Amicus Brief by INSTITUTE FOR POLICY INTEGRITY (Attachments: # 1 Exhibit Proposed Amicus Brief, # 2 Text of Proposed Order)(Zevin, Avi) (Entered: 11/13/2017)
MINUTE ORDER (paperless) GRANTING the parties' 19 Consent Motion for Extension of Time. Accordingly, the defendants shall file their opposition to the plaintiffs' 15 Motion for Preliminary Injunction by December 1, 2017, and the plaintiffs shall file their reply by December 11, 2017. Signed by Chief Judge Beryl A. Howell on November 14, 2017. (lcbah1) (Entered: 11/14/2017)

11/14/2017
11/14/2017 11/14/2017 11/15/2017 11/15/2017 12/01/2017 12/01/2017
12/11/2017 12/19/2017
12/21/2017 12/21/2017 12/22/2017 12/23/2017 12/23/2017 12/26/2017 12/28/2017

MINUTE ORDER (paperless) GRANTING Institute for Policy Integrity's 20 Unopposed Motion for Leave to File Brief as Amicus Curiae. The proposed brief attached to the motion as Exhibit 1 is hereby accepted and considered filed as of November 14, 2017. Signed by Chief Judge Beryl A. Howell on November 14, 2017. (lcbah1) (Entered: 11/14/2017)
Set/Reset Deadlines: Opposition to 15 Motion for Preliminary Injunction due by 12/1/2017; Reply due by 12/11/2017. (tg) (Entered: 11/14/2017)
21 AMICUS BRIEF by INSTITUTE FOR POLICY INTEGRITY. (jf) (Entered: 11/14/2017)
22 RETURN OF SERVICE/AFFIDAVIT of Summons and Complaint Executed. BEN S. CARSON, SR served on 11/3/2017; U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT served on 11/3/2017 (Samberg−Champion, Sasha) (Entered: 11/15/2017)
23 RETURN OF SERVICE/AFFIDAVIT of Summons and Complaint Executed on United States Attorney General. Date of Service Upon United States Attorney General 11/6/2017. (Samberg−Champion, Sasha) (Entered: 11/15/2017)
NOTICE of Hearing on Motion. The parties shall take notice that a hearing to hear oral argument on the plaintiffs' 15 Motion for Preliminary Injunction is scheduled for 12/19/2017, at 9:30 AM in Courtroom 22A before Chief Judge Beryl A. Howell. (tg) (Entered: 12/01/2017)
24 Memorandum in opposition to re 15 MOTION for Preliminary Injunction filed by BEN S. CARSON, SR, U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT. (Attachments: # 1 Declaration of Todd Richardson, # 2 Declaration of Aaron Santa Anna, # 3 Declaration of Marianne Nazzaro, # 4 Exhibit 1: Interim Report, # 5 Exhibit 2: Suspension Memorandum, # 6 Exhibit 3: Letter to PHAs, # 7 Exhibit 4: NAHRO Comment Letter)(Walker, Johnny) (Entered: 12/01/2017)
25 REPLY to opposition to motion re 15 MOTION for Preliminary Injunction filed by CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE. (Attachments: # 1 Declaration of Sasha Samberg−Champion)(Samberg−Champion, Sasha) (Entered: 12/11/2017)
Minute Entry for proceedings held before Chief Judge Beryl A. Howell: Motion Hearing held on 12/19/2017 regarding 15 MOTION for Preliminary Injunction filed by CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE. The Court reserved its decision; ruling forthcoming. (Court Reporter Elizabeth Saint−Loth.) (tg) (Entered: 12/19/2017)
26 MOTION for Extension of Time to File Answer by BEN S. CARSON, SR, U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (Attachments: # 1 Text of Proposed Order)(Walker, Johnny) (Entered: 12/21/2017)
27 RESPONSE re 26 MOTION for Extension of Time to File Answer filed by CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE. (Samberg−Champion, Sasha) (Entered: 12/21/2017)
MINUTE ORDER (paperless) GRANTING the defendants' 26 Motion for Extension of Time to File Answer. Signed by Chief Judge Beryl A. Howell on December 22, 2017. (lcbah1) (Entered: 12/22/2017)
28 ORDER GRANTING the plaintiffs' 15 Motion for Preliminary Injunction. See Order for further details. Signed by Chief Judge Beryl A. Howell on December 23, 2017. (lcbah1) (Entered: 12/23/2017)
29 MEMORANDUM OPINION regarding the plaintiffs' 15 Motion for Preliminary Injunction. Signed by Chief Judge Beryl A. Howell on December 23, 2017. (lcbah1) (Entered: 12/23/2017)
Set/Reset Deadlines: Defendants' answer due by 1/16/2018. (hmc) (Entered: 12/26/2017)
30 TRANSCRIPT OF MOTION HEARING, before Chief Judge Beryl A. Howell, held on 12−19−2017; Page Numbers: 1 − 39. Date of Issuance: 12−28−2017. Court

01/10/2018 01/11/2018 01/12/2018
01/12/2018 02/15/2018 02/16/2018 02/20/2018 03/15/2018
03/29/2018

Reporter/Transcriber: Elizabeth SaintLoth, Telephone number: 202−354−3242, Transcripts may be ordered by submitting the Transcript Order Form
For the first 90 days after this filing date, the transcript may be viewed at the courthouse at a public terminal or purchased from the court repo rter referenced above. After 90 days, the transcript may be accessed via PACER. Other transcript formats, (multi−page, condensed, CD or ASCII) may be purchased from the court reporter.
NOTICE RE REDACTION OF TRANSCRIPTS: The parties have twenty−one days to file with the court and the court reporter any request to redact personal identifiers from this transcript. If no such requests are filed, the transcript will be made available to the public via PACER without redaction after 90 days. The policy, which includes the five personal identifiers specifically covered, is located on our website at www.dcd.uscourts.gov.
Redaction Request due 1/18/2018. Redacted Transcript Deadline set for 1/28/2018. Release of Transcript Restriction set for 3/28/2018.(Saint−Loth, Elizabeth) (Entered: 12/28/2017)
31 Second MOTION for Extension of Time to File Answer by BEN S. CARSON, SR, U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (Attachments: # 1 Text of Proposed Order)(Walker, Johnny) (Entered: 01/10/2018)
32 RESPONSE re 31 Second MOTION for Extension of Time to File Answer filed by CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE. (Samberg−Champion, Sasha) (Entered: 01/11/2018)
MINUTE ORDER (paperless) GRANTING in part and DENYING in part the defendants' 31 Second Motion for Extension of Time to File Answer. The defendants, by February 15, 2018, shall file any answer to the plaintiffs' complaint. The defendants' February 15, 2018 deadline to file the certified list of the contents of the administrative record, however, remains unchanged. See LCvR 7(n)(1) ("In cases involving the judicial review of administrative agency actions, unless otherwise ordered by the Court, the agency must file a certified list of the contents of the administrative record with the Court within 30 days following service of the answer to the complaint or simultaneously with the filing of a dispositive motion, whichever occurs first."); Minute Order, dated December 22, 2017 (extending from December 26, 2017 to January 16, 2018 the defendants' deadline to file an answer). Signed by Chief Judge Beryl A. Howell on January 12, 2018. (lcbah1) (Entered: 01/12/2018)
Set/Reset Deadlines: Answer to the Complaint due by 2/15/2018. (tg) (Entered: 01/16/2018)
33 STIPULATION of Judgment and Proposed Order by BEN S. CARSON, SR, U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT. (Walker, Johnny) (Entered: 02/15/2018)
34 STIPULATED JUDGMENT AND ORDER. See Order for further details. Signed by Chief Judge Beryl A. Howell on February 16, 2018. (lcbah1) (Entered: 02/16/2018)
Set/Reset Deadlines: Plaintiffs' motion for attorney's fees and costs due due by 3/15/2018. (tg) (Entered: 02/20/2018)
35 MOTION for Attorney Fees by CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE (Attachments: # 1 Declaration of Erin Boggs, # 2 Declaration of Sasha Samberg−Champion, # 3 Exhibit A − RDC Rates (2017), # 4 Exhibit B − David Cynamon Decl., # 5 Exhibit C − John Devaney Decl., # 6 Exhibit D − Jeffrey Robinson Decl., # 7 Exhibit E − RDC Fees Detail, # 8 Exhibit F − LDF Fees, # 9 Exhibit G − Lawyers' Committee Fees, # 10 Exhibit H − PRRAC Fees, # 11 Exhibit I − Public Citizen Fees, # 12 Exhibit J − Expenses − Filing Fee, # 13 Exhibit K − Expenses − Online Research, # 14 Exhibit L − Expenses − Printing and Copying, # 15 Text of Proposed Order)(Samberg−Champion, Sasha) (Entered: 03/15/2018)
36 Memorandum in opposition to re 35 MOTION for Attorney Fees filed by BEN S. CARSON, SR, INSTITUTE FOR POLICY INTEGRITY, U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT. (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C, # 4 Exhibit D, # 5 Exhibit E)(Walker, Johnny) (Entered:

04/02/2018 04/03/2018 04/04/2018
04/05/2018 04/05/2018 04/12/2018 06/15/2018 06/18/2018 07/17/2018 08/15/2018

03/29/2018)
37 MOTION for Leave to File Supplement by BEN S. CARSON, SR, U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C, # 4 Exhibit D, # 5 Exhibit E, # 6 Text of Proposed Order)(Walker, Johnny) (Entered: 04/02/2018)
38 RESPONSE re 37 MOTION for Leave to File Supplement filed by CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE. (Attachments: # 1 Text of Proposed Order)(Samberg−Champion, Sasha) (Entered: 04/03/2018)
MINUTE ORDER (paperless) GRANTING, over the plaintiffs' opposition, the defendants' 37 Motion for Leave to Supplement Their Response to Plaintiffs' Motion for Attorney's Fees and Costs. By April 5, 2018, the defendants shall file any supplement to their response. By April 12, 2018, the plaintiffs shall file any reply to the defendants' response. Signed by Chief Judge Beryl A. Howell on April 4, 2018. (lcbah1) (Entered: 04/04/2018)
Set/Reset Deadlines: Defendants' supplemental memorandum due by 4/5/2018; plaintiffs' reply due by 4/12/2018. (tg) (Entered: 04/05/2018)
39 SUPPLEMENTAL MEMORANDUM to re 36 Memorandum in Opposition, filed by BEN S. CARSON, SR, U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT. (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C, # 4 Exhibit D, # 5 Exhibit E)(Walker, Johnny) (Entered: 04/05/2018)
40 REPLY to opposition to motion re 35 MOTION for Attorney Fees filed by CRYSTAL CARTER, TIARA MOORE, OPEN COMMUNITIES ALLIANCE. (Samberg−Champion, Sasha) (Entered: 04/12/2018)
41 MEMORANDUM OPINION AND ORDER granting the plaintiffs' 35 Motion for Attorneys' Fees. See Memorandum Opinion and Order for further details. Signed by Chief Judge Beryl A. Howell on June 15, 2018. (lcbah3) (Entered: 06/15/2018)
Set/Reset Deadlines: Payment of attorney fees to the plaintiffs by the defendant due by 8/14/2018, unless the parties reach an alternative mutually agreeable date. (tg) (Entered: 06/18/2018)
42 NOTICE of Compliance with Court Order by BEN S. CARSON, SR, U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT re 41 Order on Motion for Attorney Fees (Attachments: # 1 Exhibit 1)(Walker, Johnny) (Entered: 07/17/2018)
MINUTE ORDER (paperless) DIRECTING, in light of the 34 Stipulated Judgment and Order, the Clerk to close this case. Signed by Chief Judge Beryl A. Howell on August 15, 2018. (lcbah3) (Entered: 08/15/2018)

 
 Case 1:17-cv-02192 Document 1 Filed 10/23/17 Page 1 of 47

UNITED STATES DISTRICT COURT DISTRICT OF THE DISTRICT OF COLUMBIA

Open Communities Alliance, 75 Charter Oak Avenue, Suite 1-210, Hartford, CT 06106,

Crystal Carter, 47 Gilman Street, Hartford, CT 06114,
and

Civ. Action No. ______ COMPLAINT

Tiara Moore, 5841 W. Ohio Street, Chicago, IL 60644,

Plaintiffs,

v.

Ben Carson, Secretary of Housing and Urban Development, in his official capacity,
451 7th Street SW, Washington, DC 20410,

and

U.S. Department of Housing and Urban Development,
451 7th Street SW, Washington, DC 20410,

Defendants.

INTRODUCTION 1. This suit challenges the decision of the U.S. Department of Housing and Urban Development (HUD) to abruptly and unlawfully suspend implementation of its own promulgated rule, the Small Area Fair Market Rent Rule (Small Area FMR Rule). The rule provides that, as of January 1, 2018, tens of thousands of low-income families who participate in the Housing

Case 1:17-cv-02192 Document 1 Filed 10/23/17 Page 2 of 47
Choice Voucher (HCV) program—families who disproportionally are African-American, Latino, and other racial minorities—can use their housing vouchers to move from poor and racially segregated communities to areas that provide greater opportunity in education, jobs, and more. In doing so, the Small Area FMR Rule aligns the federal government’s primary rent subsidy program with HUD’s statutory mandates to ensure fair housing and avoid contributing to concentrated poverty.
2. HUD has announced that it is suspending this important rule, depriving thousands of families of housing choices, without following notice-and-comment requirements or providing adequate reasons. Plaintiffs—two HCV voucher holders who want to move to areas of greater opportunity but are being blocked by HUD’s action from doing so, along with an organization whose mission to foster such mobility is being frustrated—bring this action under the Administrative Procedure Act (APA) to require HUD to implement the Small Area FMR Rule on schedule.
3. The HCV program—formerly known as the Section 8 voucher program— provides a housing subsidy to more than two million households nationwide, enabling them to secure affordable, decent-quality housing in the private market. A participating household generally pays 30 percent of its monthly income towards rent. An HCV voucher covers the remainder of the total rent amount (including utilities), so long as the rent does not exceed an amount based primarily on what HUD determines is the “fair market rent,” or FMR, for a comparable dwelling in the area. By subsidizing housing through these vouchers, rather than through public housing projects, the HCV program aims to provide low-income families greater geographic choice in housing. A primary objective of the HCV program is to permit low-income families to settle throughout metropolitan areas, thereby avoiding the high concentrations of
2

Case 1:17-cv-02192 Document 1 Filed 10/23/17 Page 3 of 47
poverty and racial segregation that have been linked to significant adverse health, educational, and economic outcomes for children and adults.
4. In operation, however, the HCV program has not provided this meaningful choice to participating families, in large part because of how HUD calculates a voucher’s worth. HUD historically has calculated FMRs based on the average rent for entire metropolitan regions, without regard for the stark differences in housing costs from neighborhood to neighborhood within such regions. In low-rent (and low-opportunity) neighborhoods, these crudely calculated FMRs exceed what the market would bear, providing some landlords with a substantial windfall at taxpayer expense. Conversely, those same FMRs are too low for HCV households to use their vouchers in higher-rent neighborhoods with better schools, employment options, transportation, and other opportunities.
5. The Small Area FMR Rule, which HUD adopted in 2016 after years of community input and careful study and analysis, is a major step toward correcting this problem. The rule requires the public housing agencies (PHAs) that administer the HCV program locally to set voucher values in 24 metropolitan areas based on the prevailing private market rents for each distinct zip code within those regions. This revised methodology recognizes the existence of very different local rental markets within each metropolitan area and calibrates vouchers more finely to the amount needed to live in various neighborhoods. It thus enables voucher holders to access a wider range of housing, outside of voucher-concentrated, racially-segregated areas.
6. The experiences of Plaintiffs Crystal Carter and Tiara Moore illustrate how the Small Area FMR Rule transforms the FMR methodology from one that contributes to racial segregation and concentrated poverty to one that helps combat it. Ms. Carter and Ms. Moore are African-American women who want to use their HCV vouchers to move their families from poor
3

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areas of Hartford and Chicago, respectively, to the higher-rent (and predominantly white) suburbs outside those cities. They have been stymied from doing so by voucher rates too low to secure housing where they want to live. That situation is due to change on January 1, 2018, pursuant to the Small Area FMR Rule.
7. For example, Ms. Moore’s voucher currently allows her to rent a two-bedroom apartment for about $1,200 per month anywhere in the greater Chicago area. That amount proved inadequate when she searched for such an apartment in DuPage County, just outside the City of Chicago. Under the Small Area FMR Rule, her voucher would be worth as much as $1,770 per month for a two-bedroom apartment in DuPage County, allowing her to rent in this more expensive housing market.
8. On August 11, 2017, HUD abruptly announced that it would not require PHAs to implement the Small Area FMR Rule’s requirements in 23 of the 24 metropolitan areas subject to the rule. The only area where the Small Area FMR Rule was not suspended was Dallas, where HUD implemented small area FMRs pursuant to a fair housing settlement. Each of the 23 areas affected by HUD’s suspension of the small area FMR requirements encompasses multiple PHAs, with approximately 175 PHAs in all.
9. HUD announced it would suspend the requirement for two years (until January 1, 2020). It said it would entertain applications from PHAs wanting to use small area FMRs voluntarily in the meantime, but also made clear that it would not be assisting PHAs in implementing small area FMRs and indicated that PHAs would be unwise to do so. Because very few PHAs will implement small area FMRs voluntarily under these circumstances, HUD effectively has suspended the rule altogether. HUD made no attempt to follow notice-andcomment procedure in suspending a rule that will provide housing choice to thousands of low-
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income families; instead, it acted by writing letters to the PHAs and posting a notice on its website.
10. There is no legal basis for HUD’s suspension of the rule. The APA does not permit it to suspend a promulgated rule without notice-and-comment procedure. HUD purports to invoke a provision in the rule that authorizes a temporary suspension in a specific area because of area-specific and unforeseen “events,” such as a natural disaster. This provision does not authorize a wholesale suspension of the Small Area FMR Rule’s start date, and HUD pointed to no unforeseen “event” that would justify its invocation.
11. Nor are HUD’s stated justifications well-reasoned. HUD has pointed to (1) its own supposed failure to take preliminary steps towards implementation, which it contends left PHAs unprepared to implement small area FMRs; (2) a purported need to study the small area FMR issue yet further; and (3) comments filed in a rulemaking not devoted to small area FMRs that made arguments HUD already considered and rejected in promulgating the rule. None of these reasons can support HUD’s suspension of a duly promulgated rule.
12. HUD adopted the Small Area FMR Rule only after studying the issue for years, testing the use of small area FMRs in demonstration projects that spanned several jurisdictions, and conducting a lengthy rulemaking process that included multiple rounds of comments. And even after HUD published the final rule on November 16, 2016, it did not require PHAs in the 23 affected jurisdictions to begin using small area FMRs until January 1, 2018, thus building in sufficient time for PHAs to prepare for implementation. There is no evidence that further delay will accomplish anything but depriving voucher holders like Ms. Carter and Ms. Moore of longoverdue choice in housing.
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13. HUD also has claimed that its decision was based on a recently released study of the PHAs that are implementing small area FMRs as a demonstration project. That study does not, however, contain any information that undermines HUD’s conclusions when promulgating the rule or otherwise justifies suspending the rule. Rather, the demonstration project report indicates that small area FMRs, as intended, result in more families using vouchers in high opportunity areas.
14. HUD’s suspension of the Small Area FMR Rule will disproportionately hurt nonwhite families, who make up the majority of HCV voucher holders in most of the affected areas. In these areas, because of crudely calculated FMRs, the HCV voucher program has perpetuated, rather than ameliorated, racial segregation and concentrations of residential poverty. HCV families have for too long been effectively excluded from richer, whiter areas and consigned to poor, racially segregated neighborhoods, contrary to the Fair Housing Act’s mandate.
15. In taking the actions described herein, HUD is violating the APA in multiple ways, including by:
• suspending a deadline contained in its own promulgated rule without providing proper notice and opportunity to comment;
• purporting to suspend this regulatory requirement based on information that it had previously considered when promulgating the rule (and that, therefore, cannot constitute changed circumstances that support suspending the rule);
• improperly relying upon a narrow provision that authorizes a targeted suspension of the rule’s requirements in a discrete area upon extraordinary circumstances as authority for a wholesale suspension of the rule; and
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• violating the statutory mandates that underlie the Small Area FMR Rule, including HUD’s duty to ensure that federal funds are spent in a way that affirmatively furthers fair housing rather than perpetuating racial segregation and its duty to ensure that the Section 8 program promotes economically mixed housing rather than concentrating poverty.
16. HUD’s unlawful decision to postpone the requirement that affected PHAs begin implementing the Small Area FMR Rule is causing irreparable harm to Plaintiffs and tens of thousands of other voucher families. HUD is failing to take preliminary steps to assist the PHAs in implementing small area FMRs on January 1, 2018. It also is inducing the PHAs themselves to stop preparing for implementation by telling them they will not be required to comply on that date. Each day in which HUD takes no preparatory action itself and discourages the PHAs from taking such action makes it harder to implement the rule on schedule, depriving voucher families of the choice of housing to which they are entitled.
17. Plaintiffs seek preliminary and permanent injunctive relief requiring HUD to rescind its notice to PHAs that they will not be required to comply with the January 1, 2018 deadline and to take all other necessary steps to ensure that the timeline set forth in the Small Area FMR Rule is followed. The Small Area FMR Rule still can be implemented on time and in an orderly manner, but HUD will not do so without judicial intervention.
PARTIES 18. Plaintiff Open Communities Alliance (OCA) is a non-profit corporation headquartered in Hartford, Connecticut, one of the metropolitan areas affected by the Small Area FMR Rule. Its mission is to provide greater opportunities and more choices for people living in low-opportunity areas in Connecticut, including by furthering the ability of HCV voucher
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holders and others to move to higher opportunity areas should they wish to do so. As described further below, its mission is being frustrated by HUD’s decision to suspend the rule’s mandatory implementation, and it is diverting resources to remedy that frustration of its mission as a result.
19. Plaintiff Crystal Carter resides in Hartford, Connecticut, one of the areas where small area FMRs are scheduled to go into effect on January 1, 2018. She is an African-American woman who has sought to provide better opportunities for her children, including by using a regional school integration program to enroll them in a high-performing school district outside of Hartford. She lives in a four-bedroom apartment that she rents with the assistance of an HCV voucher. As described further below, she would like to use her voucher to secure housing in an area that would provide her family with better opportunities, but she is prevented from doing so by how HUD calculates FMRs.
20. Plaintiff Tiara Moore resides in Chicago, Illinois, one of the areas where small area FMRs are scheduled to go into effect on January 1, 2018. She is an African-American woman who lives with her 11-month-old daughter. She has been issued a voucher and would like to use it to secure housing outside Chicago, in a place that would provide better opportunities for herself and her daughter. As described further below, she is prevented from doing so by how HUD calculates FMRs.
21. Defendant U.S. Department of Housing and Urban Development (HUD) is an executive branch agency of the United States government. It is charged with administering a variety of federal housing programs, including the programs at issue in this Complaint.
22. Defendant Ben Carson is sued in his official capacity as the Secretary of HUD.
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JURISDICTION AND VENUE 23. This Court has jurisdiction over this matter under 28 U.S.C. § 1331 and 5 U.S.C. § 702. 24. Venue is proper in this District under 28 U.S.C. § 1391(b) and 5 U.S.C. § 703 because the claims arose in the District, Defendants reside in this District, and a substantial part of the events giving rise to this action occurred in the District.
FACTS Overview of the HCV Program and Fair Market Rents 25. The Housing Choice Voucher program is the federal government’s primary program for assisting very low-income families, the elderly, and people with disabilities in affording decent, safe, and sanitary housing in the private rental market. As the HCV program’s name indicates, providing housing choice is its touchstone goal. 26. The HCV program is part of the regulatory scheme colloquially known as “Section 8,” which was established by the Housing and Community Development Act of 1974, Pub. L. No. 93-383, Title II, § 201(a), 88 Stat. 633, now codified at 42 U.S.C. § 1437f. Congress has amended the relevant laws several times, including in the Housing Community Development Act of 1987, Pub. L. No. 100-242, § 143, 101 Stat. 1815, 1850 (1988), codified as amended at 42 U.S.C. § 1437f(o). As required by Congress, HUD has promulgated an extensive regulatory framework governing the HCV program. See 24 C.F.R. § 888.111 et seq.; 24 C.F.R. § 982.1 et seq. 27. Section 8 consists of the HCV program, a variety of project-based rental assistance programs, and other housing subsidy programs. It has two statutory purposes: (1)
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“aiding low-income families in obtaining a decent place to live” and (2) “promoting economically mixed housing.” 42 U.S.C. § 1437f(a).
28. This second aim—of “promoting economically mixed housing”—makes the HCV program different from pre-1974 federal housing programs, which focused on funding the construction and maintenance of large public housing facilities. Under that previous regime, federal funds facilitated the concentration of large numbers of people living in extreme poverty, often in racially segregated conditions. See Gautreaux v. Romney, 448 F.2d 731, 739 (7th Cir. 1971) (concluding that, in funding racially segregated housing projects, HUD’s “past actions constituted racially discriminatory conduct in their own right”).
29. In 1967, President Johnson commissioned the National Advisory Committee on Civil Disorders (generally known as the “Kerner Commission”) to study the causes of recent urban unrest and recommend solutions. The Kerner Commission’s report, released in February 1968, recommended, among other things, that “[f]ederal housing programs must be given a new thrust aimed at overcoming the prevailing patterns of racial segregation,” and must be “[r]eorient[ed]” to “place more low and moderate income housing outside of ghetto areas.” Report of the National Advisory Commission on Civil Disorders: Summary of Report, at 24 (1968), https://www.hsdl.org/?view&did=35837. Otherwise, it found, “those programs will continue to concentrate the most impoverished and dependent segments of the population into the central-city ghettos.” Id.
30. Congress first responded to the Kerner Commission’s Report by passing the Fair Housing Act of 1968 (FHA), Title VIII of the Civil Rights Act of 1968, 42 U.S.C. § 3601 et seq. See Tex. Dep’t of Hous. & Cmty. Affairs v. Inclusive Cmtys. Project, 576 U.S. ____, 135 S. Ct. 2507, 2515-16, 2525-26 (2015). The FHA barred discrimination in housing on the basis of race.
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It also imposed on HUD the “affirmative[]” obligation to ensure that federal housing programs further racial desegregation and the FHA’s other purposes, rather than contributing to racial segregation and concentrations of poverty. 42 U.S.C. § 3608(e)(5). As HUD regulations confirm, this requirement to “affirmatively further fair housing” requires recipients of federal housing funds (including PHAs) to take “meaningful actions” to “overcome the legacy of segregation, unequal treatment, and historic lack of opportunity in housing.” 24 C.F.R. § 5.152; see also Affirmatively Furthering Fair Housing, 80 Fed. Reg. 42,272 (Jul. 16, 2015).
31. As HUD Secretary George Romney immediately recognized, this obligation to overcome the legacy of racial segregation requires the coordinated efforts of multiple jurisdictions and PHAs, to ensure that residents of segregated metropolitan areas are not blocked at a city’s border by surrounding jurisdictions that want to keep them out. Secretary Romney stated: “[T]he impact of the concentration of the poor and minorities in the central city extends beyond the city boundaries to include the surrounding community. The City and the suburbs together make up what I call the ‘real city.’ To solve problems of the ‘real city,’ only metropolitan-wide solutions will do.” Gautreaux v. Chi. Hous. Auth., 503 F.2d 930, 937 (7th Cir. 1974) (quoting Statement by Secretary Romney, Appendix Z to HUD’s Memorandum to the court).
32. Then, in 1974, Congress revamped federal spending on low-income housing. It created the Section 8 program, which provides monthly rental subsidies to private owners who rent to people with low incomes, rather than housing those low-income people in governmentowned property.
33. The Section 8 program at first operated primarily through so-called “project based” funding, i.e., contracting with building owners who offer reduced rents to low-income
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households in exchange for subsidies. Over the years, it has been transformed such that the primary form of Section 8 subsidy is a “tenant-based” program that uses vouchers to subsidize rental payments tenants make to participating landlords. This program, now known as the Housing Choice Voucher program, gives low-income households more options and, when properly implemented, empowers them to move to places of greater opportunity. Congress and HUD over the years have added and expanded features such as “portability”—pursuant to which a voucher holder can move outside the jurisdiction of the PHA administering her voucher—in a continuing effort to expand voucher holders’ choices. As described below, however, those choices have been unnecessarily and unreasonably constrained by how HUD has calculated the amount that vouchers are worth.
HUD’s Calculation of Fair Market Rents 34. HUD oversees, implements, and regulates the HCV program. Among other things, it provides federal funding to and regulates PHAs, which administer the program locally by issuing vouchers to qualified individuals and families. 35. Households participating in the HCV program use vouchers to secure housing in the private rental market. Vouchers can be used for any housing that meets the program’s requirements (including housing quality and rent standards), subject to the PHA’s approval. 36. The voucher’s value is based largely on HUD’s determination of the “fair market rent” for the size and type of dwelling in question (e.g., two-bedroom home). The FMR represents the amount of money that is required “to rent standard quality housing throughout the geographic area in which rental housing units are in competition,” including “the cost of utilities, except telephone.” 24 C.F.R. § 888.113(a). HUD generally sets the FMR for a unit size at what it calls “the 40th percentile rent,” i.e., a dollar amount at which 40 percent of rentals for standard-
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quality units of that size (excluding newly built units, public housing units, and sub-standard quality units) are for a lower amount. Id.
37. HUD is required to annually calculate and publish FMRs for different unit sizes in each market area.1 42 U.S.C. § 1437f(c)(1)(B); 24 C.F.R. § 982.503(a)(1). These rates become effective on October 1 each year. 42 U.S.C. § 1437f(c)(1)(A). Any changes HUD proposes to make to the FMR calculation procedures must also be published in the Federal Register. 42 U.S.C. § 1437f(c)(1)(B).
38. PHAs, in turn, must use those FMRs to establish “payment standards” for each unit type, effectively setting a cap on permissible “gross rent” (which includes utilities). A PHA may set its payment standards between 90 and 110 percent of the HUD-calculated fair market rents. 24 C.F.R. § 982.503(b). Absent a “small-area FMR” designation (discussed below), a PHA may vary payment standards within its market area—that is, it may set payment standards at 90 percent of the FMR in one neighborhood and at 110 percent in another—but it must honor the “basic range” established by HUD. 24 C.F.R. §§ 982.503(a)(3), (b)(2). In practice, few PHAs exercise this discretionary authority; most, instead, set a single payment standard for any type of dwelling within their market areas. A PHA may only set payment standards higher than 110 percent of the regional FMR (generally up to 120 percent) with documented need and explicit HUD approval.
39. So long as a dwelling’s actual gross rent is at or below the relevant payment standard, the participating household usually pays the landlord 30 percent of its monthly income
1 In the past, HUD has published the fair market rents in the Federal Register. More recently, it has published a notice in the Federal Register alerting the public that updated FMRs are available on its website. FMRs for FY 2018—as well as previous years—can be found on HUD’s website at https://www.huduser.gov/portal/datasets/fmr.html.
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toward the rent, while the PHA pays the balance directly to the landlord. If, however, the actual rent for the apartment exceeds the payment standard, the participating household is usually responsible for the balance. See 24 C.F.R. § 982.1(a)(3). Participation in the HCV program is limited to low-income households, so this additional payment responsibility makes unaffordable to them dwellings where the actual rent substantially exceeds the payment standard.
40. The proper functioning of the HCV program thus depends on HUD setting FMRs that mirror as closely as possible the actual rents being charged in the relevant private markets.
Problems with Fair Market Rents Based on Broad Metropolitan Areas 41. In practice, HUD’s FMRs have not accurately reflected the actual rents charged in many neighborhoods within large metropolitan areas. That is because rents tend to vary widely within such regions—particularly those that are highly segregated by race, such as Chicago, Hartford, or Baltimore. Rents in more desirable, lower poverty (and, typically, whiter) communities far exceed the regional average, while rents in poorer neighborhoods are much lower. Without FMRs that account for these neighborhood differences, the practical result is that HCV families are relegated to poor, racially segregated neighborhoods, unable to use their vouchers to secure housing in higher opportunity areas. 42. HUD has been aware of this simple truth for decades. Indeed, from the outset of the Section 8 program, HUD has been criticized for failing to calculate accurate fair market rents that would permit families receiving Section 8 subsidies to live in all parts of metropolitan areas. 43. As early as 1977, a Comptroller General report to Congress noted that FMRs were “too low for program success” and that the calculation of FMRs by metropolitan area “ignores important distinctions between metropolitan central cities and suburban areas as well as among suburban areas.” Comptroller Gen. of the U.S., CED-77-19, Major Changes Are Needed in the
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New Leased-Housing Program, at 16, 21 (1977), http://www.gao.gov/assets/120/113728.pdf. The same point has been made many times since, yet until adoption of the Small Area FMR Rule, HUD failed to address it adequately.
44. HUD’s long-time failure to modify the program to address these concerns has had predictable results: a disproportionate number of HCV voucher holders end up living in areas of concentrated poverty.
45. In areas where HCV voucher holders disproportionately are racial minorities, this concentration of voucher holders in high-poverty neighborhoods also contributes to racial segregation. HUD’s Small Area FMR Rule focuses on precisely those areas: in 21 of the 24 metropolitan areas covered by the rule, at least two-thirds of HCV users are non-white. In such areas, African-American and Latino voucher holders are particularly likely to live in neighborhoods that are poor as well as racially segregated.
46. The greater Hartford area, home to plaintiffs OCA and Crystal Carter, illustrates this well. In that area, 80 percent of HCV voucher holders are non-white (50 percent Latino, 30 percent African-American), compared with only 31 percent of the overall population. With FMRs calculated for the entire area, this predominantly non-white population has been concentrated in poor, racially segregated neighborhoods.
47. As of 2016, 41 percent of voucher households in the greater Hartford area (the Hartford-West Hartford-East Hartford, CT HUD Metro FMR Area) live in high-poverty neighborhoods (census tracts with a poverty rate above 30 percent). By contrast, only 18 percent of voucher households in the area live in low-poverty neighborhoods (census tracts with a poverty rate below 10 percent). Sixty-seven percent of HCV households in the region live in majority-minority neighborhoods.
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Case 1:17-cv-02192 Document 1 Filed 10/23/17 Page 16 of 47 48. This concentration of voucher holders in the greater Hartford area in a few very poor areas—with many fewer voucher holders living in surrounding, low-poverty areas—is illustrated by the map below:
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Case 1:17-cv-02192 Document 1 Filed 10/23/17 Page 17 of 47 49. Similarly, the racial concentration map below illustrates the concentration of Hartford-area voucher holders—who are themselves almost all non-white—in the small number of neighborhoods in the region that are predominantly non-white:
50. The Hartford area is representative of how HCV voucher holders in the areas affected by the Small Area FMR Rule are concentrated in poor, racially segregated
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neighborhoods. To cite one more example, in the greater Atlanta area (Atlanta-Sandy SpringsRoswell, GA HUD Metro FMR Area), 96 percent of HCV voucher holders are non-white (92 percent African-American), compared with only 51 percent of the overall population. Eightyeight percent of these HCV households in the region live in majority-minority neighborhoods, while 43 percent live in high-poverty neighborhoods. Just 8 percent of HCV households in the greater Atlanta area live in low-poverty areas.
51. This concentration of predominantly minority voucher holders in low-income neighborhoods has lifelong negative consequences for those voucher holders and their children.2 Studies have found a link between neighborhood poverty and children’s emotional health, cognitive development, and educational achievement.3 Neighborhood location can also affect adults’ access to jobs, transportation, food, and other basic goods and services.4
52. Conversely, providing voucher holders the opportunity to move to high opportunity neighborhoods has demonstrated positive effects on both adults and children. In the 1990s, HUD conducted an experiment entitled “Moving to Opportunity,” which offered randomly selected families living in high-poverty housing projects vouchers that allowed them to move to lower-poverty neighborhoods. Several analyses of the experiment demonstrated that moving to lower-poverty areas greatly improved the mental health, physical health, and self-
2 See, e.g., Patrick Sharkey, Stuck in Place: Urban Neighborhoods and the End of Progress Toward Racial Equality (University of Chicago Press, 2013). 3 See, e.g., Jennifer Darrah & Stefanie DeLuca, “Living Here Has Changed My Whole Perspective”: How Escaping Inner-City Poverty Shapes Neighborhood and Housing Choice, 33(2) J. Pol’y Analysis Mgmt. 350 (2014); Greg J. Duncan & Katherine Magnuson, The Long Reach of Early Childhood Poverty, Pathways, Winter 2011, http://whsaonline.org/wpcontent/uploads/2013/10/PathwaysWinter11.pdf. 4 Barbara Sard & Douglas Rice, Realizing the Housing Voucher Program’s Potential to Enable Families to Move to Better Neighborhoods, Ctr. on Budget Pol’y Priorities (updated Jan. 12, 2016), https://www.cbpp.org/sites/default/files/atoms/files/11-9-15hous.pdf.
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reported well-being of adults.5 Another analysis, cited by HUD in its Regulatory Impact Analysis of the Small Area FMR Rule, showed that the experiment generated substantial gains for children who moved to lower-poverty neighborhoods when they were young. Raj Chetty, et al., The Effects of Exposure to Better Neighborhoods on Children: New Evidence from the Moving to Opportunity Project, 106(4) American Economic Review 855 (2016). For example, children who moved out of public housing to a low-poverty area at a young age were more likely to attend college and earn higher incomes. Id. at 857-59, 899.
53. In the preamble to the Small Area FMR Rule, HUD explained its determination that alternatives to the use of small area FMRs are inefficient and inadequate to address the voucher concentration created by area-wide fair market rent calculations.
54. For example, in 2000, HUD tried to address the issue of voucher concentration by raising rents across the board in the most concentrated regions. It did so by setting FMRs and payment standards based on the 50th percentile market rent, rather than the 40th percentile market rent, for certain geographic areas where such a change seemed appropriate. See, e.g., 65 Fed. Reg. 58,870 (Oct. 2, 2000); 66 Fed. Reg. 50,024 (Oct. 1, 2001) (implementing new rule and setting out affected areas). On average, this program resulted in an FMR increase of 7.3 percent. 80 Fed. Reg. 31,332, 31,334-35 (Jun. 2, 2015).
55. Concurrent with its adoption of the Small Area FMR Rule, HUD is now phasing out this 50th Percentile FMR program, after concluding that 50th percentile FMRs do not provide substantially increased opportunities for tenants or measurably reduce concentration of
5 See, e.g., Jens Ludwig, et al., Long-Term Neighborhood Effects on Low-Income Families: Evidence from Moving to Opportunity, 103(3) American Economic Review 226 (2013); Lawrence F. Katz, et al., Moving to Opportunity in Boston: Early Results of a Randomized Mobility Experiment, 116(2) Quarterly Journal of Economics 607 (2001).
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poverty. 80 Fed. Reg. 31,333. Instead, “much of the benefit . . . simply accrues to landlords in lower rent submarket areas.” 81 Fed. Reg. 80,567, 80,570 (Nov. 16, 2016). That is because 50th percentile FMRs result in payment standards that are still too low to provide access to higher opportunity neighborhoods, yet at the same time are too high elsewhere and thus “unnecessarily rais[e] subsidies in neighborhoods with lower rents.” 80 Fed. Reg. 31,335. In short, the 50th percentile FMR experiment simply reaffirmed the need for HUD to better align its FMRs to the varying rental markets within broad metropolitan areas.
HUD’s Experience with Small Area FMRs Prior to Its Rulemaking 56. By the time HUD completed the rulemaking at issue here, it had considerable experience with the results of using small area FMRs and the mechanics of implementing them. 57. In 2007, the Inclusive Communities Project (ICP) filed a lawsuit against HUD challenging its setting of a single FMR for the 12-county Dallas metropolitan region. ICP alleged that, by fashioning an FMR based on rent data from such a wide area, HUD was effectively steering voucher holders—who, in that area, are predominantly African-American—away from predominantly white areas (where the FMR was inadequate to meet neighborhood market rents) and into predominantly minority areas. ICP alleged that HUD thus violated the Fair Housing Act and the Housing and Community Development Act. Complaint at ¶¶ 25, 36-37, Inclusive Cmtys. Project, Inc. v. U.S. Dep’t of Hous. and Urban Dev., No. 3:07-CV-0945 (N.D. Tex. May 29, 2007). 58. HUD settled ICP’s lawsuit in 2010 by agreeing to institute Small Area FMRs calculated at the zip code level in Dallas. 59. Also in 2010, HUD announced plans for a demonstration project that would test the viability of a broader requirement that PHAs use small area FMRs. Section 8 Housing Choice
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Voucher Program, 75 Fed. Reg. 27,808, 27,811 (May 18, 2010). In 2012, five PHAs in five different states began using small area FMRs pursuant to this project. Meanwhile, pursuant to the ICP settlement, PHAs in Dallas also began using small area FMRs.
60. These pilot projects have proven that small area FMRs are both administratively feasible to implement and effective at accomplishing their goals.
61. For example, researchers Robert Collinson and Peter Ganong conducted an independent study of the use of small area FMRs in Dallas pursuant to the ICP settlement. They determined that this change resulted in many voucher recipients exiting the lowest-rent neighborhoods in the inner city and moving to higher-rent neighborhoods. Collinson & Ganong, The Incidence of Housing Voucher Generosity, at 15-16 (Apr. 2016), https://papers.ssrn.com/sol 3/papers.cfm?abstract_id=2255799. They found this effect to be “statistically large and economically significant” and determined that the program added no net cost to the government. Id., at 18-19.
62. The other demonstration project has had comparable results. By 2016, HUD had enough data from the demonstration project to state as part of its regulatory impact statement that, in the areas being studied, the average neighborhood poverty level of voucher holders declined, as did overall subsidy payments. That is, small area FMRs led to voucher holders moving out of impoverished neighborhoods and saved HUD money overall. Regulatory Impact Analysis: Establishing a More Effective Fair Market Rent System; Using Small Area Fair Market Rents in Housing Choice Voucher Program Instead of the Current 50th Percentile FMRs, at 19-21 (Nov. 11, 2016), https://www.regulations.gov/document?D=HUD-2016-0063-0117.
63. Since 2010, HUD has annually calculated small area FMRs by zip code for every metropolitan area in the U.S. These numbers, which are publicly available on HUD’s website,
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demonstrate concretely how small area FMRs can provide choice to HCV voucher holders— choice that HUD is denying them by suspending the requirement that PHAs put small area FMRs into effect.
64. For example, in the Chicago area, payment standards based on HUD’s small area FMRs would allow a voucher holder to secure a two-bedroom apartment in high-opportunity DuPage County—where plaintiff Tiara Moore wishes to live—renting for $1,300-$1,770 per month in most zip codes in the county.6 By contrast, without the use of small area FMRs, a twobedroom apartment in any of the same zip codes would have an FMR of only $1,180.7 As Tiara Moore has found, it is considerably harder to rent a two-bedroom apartment in DuPage County for that amount than it is for the higher amount that results from application of small area FMRs.
65. The situation is similar in the Hartford area, where plaintiff Crystal Carter would like to move from the city of Hartford to Simsbury, CT (zip code 06070), a predominantly white, low-poverty, high-opportunity community outside of the city. Payment standards based on HUD’s small area FMRs would allow her to secure a four-bedroom apartment or house renting for up to $1,940.8 By contrast, an FMR based on average rents across the broad Hartford region is only $1,620 for a four-bedroom apartment or house.9 Again, that amount is inadequate to
6 See U.S. Department of Housing and Urban Development, FY 2018 Hypothetical Small Area FMRs for Chicago-Joliet-Naperville, IL HUD Metro FMR Area. All 2018 Small Area FMRs can be accessed at https://www.huduser.gov/portal/datasets/fmr/fmrs/FY2018_code/select_geograph y sa.odn. 7 See FY 2018 Fair Market Rent Documentation System for Chicago-Joliet-Naperville, IL HUD Metro FMR Area. All 2018 FMRs (that is, those not based on small areas) can be accessed at https://www.huduser.gov/portal/datasets/fmr/fmrs/FY2018_code/select_Geography.odn. 8 See FY 2018 Hypothetical Small Area FMRs for Hartford-West Hartford-East Hartford, CT Metro FMR Area. 9 See FY 2018 Fair Market Rent Documentation System for Hartford-West Hartford-East Hartford, CT HUD Metro FMR Area.
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permit a voucher holder such as Ms. Carter the housing choice that the HCV voucher program is supposed to provide.
66. Similar patterns exist in each of the other metropolitan areas subject to the mandatory Small Area FMR rule. Indeed, these areas were selected in part because they are areas where HCVs are exceptionally concentrated, and where implementing small area FMRs would give low-income HCV voucher families the practical ability to move to lower poverty, less racially segregated neighborhoods.
67. Thus, by the time it completed the rulemaking at issue here in 2016, HUD had years of experience working with various PHAs to implement small area FMRs in different parts of the country. That experience made it clear both that small area FMRs work and that their implementation is quite feasible. It also helped HUD to select those areas where implementation would do the most to bring HUD’s administration of the HCV program into alignment with HUD’s statutory requirements.
HUD Rulemaking 68. Having laid the groundwork for a larger roll-out of small area FMRs, HUD engaged in an intensive, year-and-a-half-long rulemaking process, with multiple opportunities for public comment, culminating in the Small Area FMR Rule. 69. On June 2, 2015, HUD announced its intention to promulgate a rule pursuant to which some FMRs would be implemented by zip code rather than broader area. 80 Fed. Reg. 31,332. HUD stated that its “experience with the SAFMR demonstration” suggested that broader use of small area FMRs “could provide HCV tenants greater access to higher opportunity, lower poverty neighborhoods.” 80 Fed. Reg. 31,333.
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70. HUD sought comment on a variety of questions, including how broadly the program should be applied and the criteria it should use for selecting areas. In particular, HUD sought comment regarding the experiences of PHAs currently using small area FMRs, in the demonstration areas and in Dallas. 80 Fed. Reg. 31,336. HUD received 78 comments in response, including several that urged it not to take any further action until the demonstration project was completed.
71. With the benefit of that input, on June 16, 2016, HUD published a proposed rule that would make small area FMRs mandatory only in select jurisdictions meeting certain criteria, including a high level of voucher concentration and market conditions that would make small area FMRs particularly effective in ameliorating that concentration. 81 Fed. Reg. 39,218.
72. HUD considered and rejected the suggestion that it wait for full results from the demonstration project before promulgating a rule. The agency agreed that implementation of small area FMRs nationwide would be premature. It explained, however, that its rule covered only specified areas where use of small area FMRs would be particularly appropriate. 81 Fed. Reg. 39,223. HUD further committed to closely study implementation results and facilitate specific research over the next five years. 81 Fed. Reg. 39,226.
73. HUD also considered and rejected a proposal to make implementation of small area FMRs voluntary rather than mandatory for PHAs within the affected areas. It observed that the purpose of small area FMRs is to provide voucher holders the effective ability to choose housing throughout the larger area, and allowing some PHAs within that area to opt out of the rule would be inconsistent with that goal. 81 Fed. Reg. 39,224.
74. In the notice of proposed rulemaking, HUD sought comment on a variety of additional questions about specific implementation issues, including how to reduce the
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administrative burden on PHAs and simplify the transition to small area FMRs, and it invited further comment more generally. It received 113 comments in response.
75. On November 16, 2016, HUD published the final Small Area FMR Rule. The rule requires that PHAs in 24 designated metropolitan areas use payment standards based on small area FMRs beginning on January 1, 2018. See Final Rule: Establishing a More Effective Fair Market Rent System, 81 Fed. Reg. 80,567 (Nov. 16, 2016). It thus extends Small Area FMR implementation to an additional 230,000 voucher households (about 10 percent of all HCV voucher holders) spread across 175 PHAs.
76. HUD explained that the Small Area FMR Rule is intended to reduce “the number of voucher families that reside in areas of high poverty concentration.” 81 Fed. Reg. at 80,567. HUD found that its former policies had “not proven effective in addressing the problem of concentrated poverty and economic and racial segregation in neighborhoods.” Id. The Small Area FMR Rule, HUD found, was necessary to give voucher holders “a subsidy that is adequate to cover rents” in “areas of high opportunity.” Id.
77. Consistent with its statements in the proposed rulemaking, HUD limited the Small Area FMR Rule’s application to metropolitan areas where it would be particularly effective based on local housing conditions. It determined that the rule should apply to areas with at least 2,500 vouchers in use that have both (1) “significant voucher concentration challenges” and (2) rental market conditions, such as a sufficiently high vacancy rate, making it likely that higher vouchers could actually be used effectively in high opportunity areas. 81 Fed. Reg. 80,568-69; see also 81 Fed. Reg. 80,576 (explaining that markets with low vacancy rates are not as good candidates for immediate implementation). HUD set objective criteria for determining which
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areas qualify, with the coverage determination to be made at the beginning of each federal fiscal
year. 81 Fed. Reg. 80,568.
78. For areas covered by the Small Area FMR Rule, fair market rents are to be
determined for each zip code. Zip codes, HUD found, “are small enough to reflect neighborhood
differences” and provide for easy and objective administration. 81 Fed. Reg. 80,568.
79. The Small Area FMR Rule provides that PHAs have three months to update their
payment standards to be based on small area FMRs once the latest FMRs are published and
become effective at the start of the new fiscal year, on October 1, 2017. Thus, PHAs have until
January 1, 2018 to update their payment standards. 81 Fed. Reg. 80,569.
80. In the final rule, HUD added language empowering it to temporarily suspend a
small area FMR designation in unusual circumstances. That provision, 24 C.F.R.
§ 888.113(c)(4), states:
HUD will designate Small Area FMR areas at the beginning of a Federal fiscal year, such designations will be permanent, and will make new area designations every 5 years thereafter as new data becomes available. HUD may suspend a Small Area FMR designation from a metropolitan area, or may temporarily exempt a PHA in a Small Area FMR metropolitan area from use of the Small Area FMRs, when HUD by notice makes a documented determination that such action is warranted. Actions that may serve as the basis of a suspension of Small Area FMRs are: (i) A Presidentially declared disaster area that results in the loss of a
substantial number of housing units; (ii) A sudden influx of displaced households needing permanent housing; or (iii) Other events as determined by the Secretary.
81. The description of § 888.113(c)(4) in the rule’s preamble confirms that HUD may
suspend a designation only for “events,” such as a natural disaster, that affect housing conditions
in a specific area:
Provides HUD may suspend a Small Area FMR designation for a metropolitan area, including at the request of a PHA, where HUD determines such action is warranted based on a documented finding of adverse rental housing market
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conditions that will be set out by notice (for example, the metropolitan area experiences a significant loss of housing units as a result of a natural disaster). 81 Fed. Reg. 80,569. 82. In the final rule, HUD made other changes to ameliorate concerns expressed in comments. For example, some comments expressed concern that lowered payment standards in lower-rent neighborhoods could hurt voucher holders in those neighborhoods with existing leases based on the previous, higher standards. In response, HUD authorized PHAs to “hold harmless” for an extended time such households. 81 Fed. Reg. 80,572. 83. HUD also made changes to reduce the administrative burden on PHAs. For example, the Small Area FMR Rule relaxes HUD’s preexisting requirement that PHAs conduct a new “rent reasonableness review” for voucher-supported leases when the relevant FMRs decline. Whereas previously PHAs were required to make a new determination of whether the rent charged remains reasonable when FMRs dropped five percent, now they only must do so upon a ten percent drop. 81 Fed. Reg. 80,575. 84. HUD acknowledged the possibility of “administrative expenses associated with implementation on the part of PHAs,” but determined that this cost was outweighed by the benefits of the rule. 81 Fed. Reg. 80,569. 85. HUD once again considered and rejected the argument that the rule’s promulgation should await final results from the demonstration project. The agency concluded that “it is not premature to implement Small Area FMRs on this limited basis in those areas where it has the potential to address significant voucher concentration concerns.” 81 Fed. Reg. 80,579. 86. In announcing the Small Area FMR Rule’s promulgation and summarizing the rule’s requirements, HUD also stated its intention to take a variety of preliminary steps to
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facilitate implementation. These steps included providing guidance and support to PHAs implementing small area FMRs; webinars to share lessons learned and best practices from PHAs already implementing small Area FMRs; and exploration of a mobile application to enable tenants to confirm a particular unit’s payment standard by entering the address. Key Aspects of HUD’s Final Rule on Small Area Fair Market Rents, http://www.huduser.gov/portal/datasets/fmr /fmr2016f/SAFMR-Key-Aspects-of-Final-Rule.pdf.
87. The Small Area FMR Rule became effective on January 17, 2017. Evidence of Small Area FMRs Working
88. Since promulgating the Small Area FMR Rule, HUD has received further evidence regarding the effectiveness of small area FMRs in its demonstration projects. HUD commissioned an extensive report, termed the Interim Evaluation, and released it publicly on August 15, 2017. The Interim Evaluation examines changes in the demonstration areas between 2010 and 2015, and thus compares their trends pre- and post-use of small area FMRs. It also compares findings in the demonstration sites against those for a group of 138 agencies not using small area FMRs. The Evaluation confirms the viability and importance of small area FMRs. Small Area Fair Market Rent Demonstration Evaluation, Interim Report (Aug. 2017), http://www.huduser.gov/portal/sites/default/files/pdf/SAFMR-Interim-Report.pdf.
89. The Interim Evaluation found that, in demonstration sites where PHAs used small area FMRs, significantly more voucher holders moved to high-opportunity neighborhoods, even as overall housing subsidy costs fell. By contrast, the same beneficial effects were not seen for comparable PHAs not subject to the demonstration project. Interim Evaluation at viii-x; 37-38.
90. Although the Interim Evaluation found some adverse impacts for tenants at some of the PHAs studied, it concluded that the Small Area FMR Rule anticipated these problems and
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made changes to prevent them from recurring. For example, the Interim Evaluation found that some voucher holders paid somewhat more in out-of-pocket rent in the demonstration sites (Interim Evaluation at vii-viii; 94-96), but the FMR Rule contains several provisions to protect tenants from such increases. 81 Fed. Reg. 80,572. Similarly, the Interim Evaluation found that, when some but not all PHAs within the same metropolitan area switch to small area FMRs, the result within those jurisdictions can be a reduction in the total units that are offered for rent at or below the revised FMRs (Interim Evaluation at vii-viii; 32-36). The Small Area FMR Rule addresses this problem by making small area FMRs mandatory for all PHAs within specified regions, such that even if fewer units are available in some places, such losses will be offset by gains elsewhere. That is, this finding in the Interim Evaluation supports the Small Area FMR Rule’s mandatory implementation for PHAs, not HUD’s suspension of that requirement.
91. The Interim Evaluation also found modest increases in administrative costs for PHAs, most of them of a one-time nature. For example, PHAs implementing small area FMRs for the first time had to adjust computer software systems and amend client briefing materials. Interim Evaluation at x-xi; 68-84. However, these costs largely were not recurring, and they were more than offset by cost savings from implementing the small area FMRs. Id. They also could be further ameliorated by HUD issuing guidance and providing technical assistance where needed, drawing on the lessons of the demonstration project to reduce costs and administrative burden for later PHAs.
HUD Suspension of the PHAs’ Requirements Under the Small Area FMR Rule 92. To date, HUD has not taken any of the steps that it publicly stated it would take to help PHAs implement the rule. For example, it has not provided affected PHAs with any guidance as to implementation.
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93. Instead, HUD has announced that it is suspending for two years the requirement that PHAs affected by the Small Area FMR Rule must implement payment standards based on small area FMRs on January 1, 2018. HUD has not published a notice of this decision in the Federal Register and has not solicited public comment on it. Nor has it sought to amend the Small Area FMR Rule.
94. According to HUD, its decision is based in part on comments it received in a proceeding not devoted to the Small Area FMR Rule.
95. On May 15, 2017, HUD published a notice in the Federal Register soliciting comments on which existing HUD regulations it should consider repealing, replacing, or modifying. See Notice and Request for Comment: Reducing Regulatory Burden; Enforcing the Regulatory Reform Agenda Under Executive Order 13777, 82 Fed. Reg. 22,344, 22,344-45 (May 15, 2017). This document did not specifically mention the Small Area FMR Rule; nor did most of the comments HUD received in response.
96. The National Association of Housing and Redevelopment Officials (NAHRO), a group that characterizes itself as “a leader in the deregulation of programs and the design of programs which provide the maximum flexibility at the local level,” used this opportunity to ask HUD to suspend the Small Area FMR Rule’s requirements for PHAs. NAHRO.org, History (accessed Oct. 20, 2017), http://www.nahro.org/nahro-history. Prior to the May 15 notice, NAHRO had sent HUD an unsolicited letter making this request, and it incorporated that letter into its comments to the May 15 notice. NAHRO asserted that HUD, by filing a notice in the Federal Register invoking 24 C.F.R. § 888.113(c)(4)(iii), could make compliance with the rule voluntary for all affected PHAs.
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97. On August 11, 2017—before the Interim Evaluation was publicly released—HUD announced the suspension of the requirement that PHAs implement payment standards based on small area FMRs. It did so by sending identical letters to PHAs in 23 of the 24 areas governed by the Rule. Each letter stated that HUD would not require the PHA to begin using small area FMRs on January 1, 2018, and instead would suspend that requirement for two years, until January 1, 2020. See Exhibit A. The only PHAs not to receive such a letter were the ones serving DallasPlano-Irving, Texas, which had been using small area FMRs pursuant to settlement of the ICP case described above.
98. HUD has not published a notice of this decision in the Federal Register and has not solicited public comment on it.
99. In its letter to PHAs, HUD stated that its action should not be treated as “a suspension of the Small Area Final Rule or a regulatory waiver.” Exhibit A, at 3. Rather, as NAHRO had suggested, HUD relied solely on its purported authority under 24 C.F.R. § 888.113(c)(4) to suspend the rule’s application separately for each affected area. Id. HUD did not point to any area-specific event to justify its action with respect to any of the affected areas.
100. HUD stated that its action was based, first, on its internal review of the Interim Evaluation’s findings from the small area FMR demonstration project—findings that were not yet available to the public. These interim findings, HUD stated, “suggest the need for further analysis of the benefits and costs of Small Area FMR, particularly with respect to the impact on rent burdens on participating families and the availability of units in the metropolitan area.” Exhibit A, at 1. HUD did not explain which data from the Interim Evaluation supported this conclusion or how the Interim Evaluation’s findings were inconsistent with information available at the time of the Small Area FMR Rule’s promulgation. HUD further stated, without
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elaboration, that “a policy change of this magnitude should be fully informed by the final report on the completed demonstration,” expected in July 2018. Id. It did not attempt to reconcile this statement with its express rejection of the same argument in the published Small Area FMR Rule, at which time the report was well underway.
101. Second, HUD stated that, in response to its May 15 invitation for comments on regulatory change, “several PHA industry groups” had expressed “concerns about the Small Area FMR final rule and the timeline for implementation.” Exhibit A, at 2. It stated that its action would allow it “to be informed by the public comments on reducing regulatory burden for the HCV program” as well as its own decision as to whether to “implement changes to reduce the regulatory burden on the HCV program.” Id.
102. Finally, HUD pointed to its own failure to take preliminary steps to assist PHAs in complying with their obligations under the Small Area FMR Rule. It admitted that it had begun “developing guidance and planning to provide technical assistance to assist PHAs that must implement the use of the Small Area FMRs as a result of the final rule” but decided not to continue. Exhibit A, at 2. Instead of meeting its obligations under law, HUD stated, it chose to “focus[] on soliciting input and feedback from PHAs and other stakeholders on a variety of regulations and policies, including the Small Area FMR Final Rule.” Id. As justification for its deliberate choice not to take preliminary steps to best implement the rule, HUD repeated that (1) it was waiting for the 2018 final report on the small area demonstration project and (2) it might decide to alter the rule.
103. After advising PHAs that it would be unwise to proceed with small area FMRs, and suspending the requirement that they do so by January 1, 2018, HUD said it would entertain applications from PHAs that nonetheless wished to use small area FMRs voluntarily.
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104. On August 15, 2017, HUD published its Interim Evaluation. It still did not, however, explain how that document supported its decision to suspend PHAs’ requirements under the Small Area FMR Rule.
105. On August 25, 2017, Todd M. Richardson, HUD’s Acting General Deputy Assistant Secretary for Policy Development and Research, made a public statement, posted on HUD’s website.
106. Mr. Richardson stated that the decision to delay PHAs’ obligations was for the benefit of the affected PHAs, which he contended were not ready to proceed and “needed more time to integrate this big change into their voucher programs.” He further stated that the delay would allow PHAs to review the findings of the demonstration project and “make sure their programs are informed by the lessons learned by these early adopters.” See Exhibit B.
107. Mr. Richardson cited the Interim Evaluation as influencing these conclusions, but did not explain what in that report justified them. And he stated that the Interim Evaluation “confirms that Small Area FMRs do open up previously inaccessible neighborhoods for voucher tenants” and that “with good planning, it is possible to have a successful program that does not break the bank.”
108. HUD has provided no further explanation for its actions. Irreparable Injury to Plaintiffs and Others Caused by HUD’s Actions
109. HUD’s decision not to require PHAs to implement the Small Area FMR Rule on schedule is causing, and will continue to cause, irreparable injury to Plaintiffs and others.
110. As HUD has repeatedly acknowledged, FMRs calculated by averaging privatemarket rents across broad metropolitan areas restrict voucher holders’ housing options. In the absence of the Small Area FMR Rule’s adjustments to HUD’s methodology, voucher holders in
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23 of the 24 affected areas (not those in the Dallas area, where small area FMRs continue pursuant to the ICP settlement) will continue to be artificially concentrated in poorer, low-rent, and often racially segregated areas, because their vouchers are insufficient for them to rent in areas of greater opportunity.
111. HUD has repeatedly found that small area FMRs mitigate those effects and, in Mr. Richardson’s recent words, “open up previously inaccessible neighborhoods for voucher tenants.”
112. HUD nonetheless has suspended PHAs’ obligation to use payment standards based on small area FMRs beginning on January 1, 2018. This action deprives voucher holders— who, in most of the affected areas, are predominantly non-white and are concentrated in predominantly non-white areas—of equal opportunity to rent throughout those geographic areas beginning on that date. That is to say, it deprives voucher holders like Ms. Moore and Ms. Carter of precisely the benefit that the Small Area FMR Rule was meant to confer upon them.
113. Not only has HUD made adoption of small area FMRs voluntary for PHAs, it is actively discouraging them from exercising their discretion to adopt small area FMRs. HUD is refusing to provide PHAs with guidance and other support in adopting small area FMRs. It also has stated that, in the absence of such guidance and support, PHAs are unprepared to use small area FMRs. And it has stated—contrary to the actual evidence—that PHAs that do wish to use small area FMRs face formidable administrative and other hurdles in doing so. All of this has the effect and purpose of not simply making use of small area FMRs “voluntary,” but putting a heavy thumb on the scale with respect to PHA decision-making.
114. Most of the PHAs that the Small Area FMR Rule requires to use small area FMRs will not do so under these circumstances. To the extent that some PHAs do, it will be because
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organizations like OCA divert their resources to advocating for the use of small area FMRs and helping PHAs with implementing them in the absence of support from HUD.
115. Ms. Carter is directly harmed by HUD’s action and will continue to be harmed unless HUD’s action is enjoined.
116. Ms. Carter is an African-American HCV voucher holder who currently lives in a four-bedroom apartment at 47 Gilman Street in Hartford, Connecticut, with her five dependent children. She currently works as a home health care aide. The rent for Ms. Carter’s current apartment is $1,375 per month. She pays that rent with assistance from a voucher administered by the Hartford Housing Authority. The FMR for a four-bedroom dwelling in the greater Harford region is $1,620. Use of small area FMRs would reduce the FMR for Ms. Carter’s zip code to $1,540—still easily enough for her to afford her current apartment, should she want to remain there.
117. Ms. Carter has worked hard to find the best educational opportunities for her children. Taking advantage of an “Open Choice” regional school integration program, she has enrolled her three youngest children in school in Simsbury, Connecticut. Simsbury, a predominantly white town, has high-performing schools and very little poverty—only 3.4 percent.
118. To maintain her children’s enrollment in Simsbury, Ms. Carter can only live in Simsbury or in Hartford. She would like to move to Simsbury, both to be closer to her children’s schools and to provide a safer and healthier environment for her children. The zip code in Hartford where Ms. Carter now lives has a 32.2 percent poverty rate. Every zip code in Simsbury has much lower poverty.
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119. Ms. Carter has not been able to find suitable housing in Simsbury, in large part because of the way FMRs are calculated. As described above in paragraph 65, FMRs calculated based on the entire greater Hartford area are inadequate for Simsbury, where Ms. Carter would like to live. Under the small area FMR system, Ms. Carter’s voucher could be used for a 4bedroom dwelling in Simsbury renting for up to $1,940, instead of the $1,620 that applies to the entire greater Harford area under the current system. That increase in the FMR would make it possible for Ms. Carter to rent the housing she wants in Simsbury.
120. HUD’s action thus is directly harming Ms. Carter by preventing her voucher from having the purchasing power necessary to secure housing in Simsbury.
121. Tiara Moore, too, is directly harmed by HUD’s action and will continue to be harmed unless HUD’s action is enjoined.
122. Ms. Moore is a 32-year-old African-American woman. She lives at 5841 W. Ohio Street in Chicago with her 11-month-old daughter and her uncle. Ms. Moore works as a bus aide for the Chicago Public Schools and has a monthly gross income of $1,500.
123. Ms. Moore currently pays $400 per month in rent, which is all she can afford based on her income. She lives in the Austin neighborhood of Chicago. More than a third (33.8 percent) of households in her zip code are in poverty. Her neighborhood also has very high crime.
124. On July 28, 2017, Ms. Moore was issued a housing voucher by the Chicago Housing Authority, which she would like to use to find better housing for herself and her daughter. That voucher has a value of $1,207 for a two-bedroom apartment. She must use it to find housing by December 17, 2017, or it will expire.
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125. Ms. Moore does not want to use her voucher to find a new place in the City of Chicago. She wants to live instead in nearby DuPage County, where her mother lives. That area has better schools and provides other opportunities not present in Ms. Moore’s current location.
126. When Ms. Moore looked for an apartment in DuPage County, however, she could not find suitable housing for the value of her voucher.
127. If the Small Area FMRs go into effect on January 1, 2018, Ms. Moore’s voucher will have a substantially higher value in most zip codes in DuPage County, reflecting the fact that (as Ms. Moore herself experienced) $1,207 is insufficient to rent a two-bedroom apartment there. Under the Small Area FMR Rule, the fair market rent for a two-bedroom dwelling in most DuPage County zip codes would be more than $1,300; in some places, it would be as high as $1,770. If Ms. Moore and her landlord had assurance her voucher would soon be worth that much, she would be able to use her voucher to get housing in DuPage County.
128. With an approaching deadline to find housing and the apparent futility of finding appropriate housing in DuPage County for her current voucher amount, Ms. Moore has given up looking in DuPage County. She has refocused her energies on finding an apartment in Chicago for $1,200 or less before her voucher expires in December.
129. If HUD’s action were to be enjoined, Ms. Moore would have reason to seek an extension of her December 17 deadline from the Chicago Housing Authority. With small area FMRs going into effect at the beginning at the year, she would have a real chance at finding the housing she desires in DuPage County.
130. HUD’s suspension of the small area FMR requirement has harmed and continues to harm the Open Communities Alliance. The OCA, a non-profit organization based in Hartford, Connecticut, seeks to remedy Connecticut’s residential racial segregation and the
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disproportionate isolation from opportunities—in education, employment, housing, and otherwise—that the state’s African-American and Latino families face as a result.
131. Much of OCA’s work pertains to enabling HCV families to move to areas of higher opportunity, including the suburbs of Hartford, and otherwise addressing the concentration of voucher households (which are predominantly non-white in the Hartford area) in high-poverty, segregated areas.
132. For example, OCA works with the Connecticut Department of Housing and mobility counseling agencies to advise on the design and implementation of programs that help voucher households move to areas of greater opportunity. It also researches the impact of government policies (at the federal, state, and local level) on voucher concentration and the availability of affordable housing where vouchers can be used; develops best practices and policy recommendations; advocates for those policies with agency and legislative staff; engages in education and outreach to build public support for those best practices; and holds related meetings and trainings.
133. OCA also has projects to expand the supply of rental housing that low-income households can afford outside of racially segregated and resource-poor areas. For example, it is currently partnering with the National Housing Trust, a nonprofit developer, on a project to acquire market-rate rental properties in high-opportunity Hartford suburbs and convert them to properties suitable for rent to, among other people, HCV voucher families. OCA also works with other private developers to encourage and help them to engage in similar conversions. This project is directly imperiled by HUD’s decision not to require PHAs to implement small area FMRs.
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134. The financial viability of a rental property that intends to offer many units to HCV voucher families depends on those vouchers paying for rent that is actually commensurate with area fair market rents. Without the use of small area FMRs, voucher rent levels do not reflect the local market rents and so the anticipated income from renting to voucher holder is much lower. This makes it much harder for the OCA-National Housing Trust project and for other private developers to obtain the financing necessary to fund these conversions and create badly needed affordable housing in more expensive parts of the greater Hartford area that provide safer, healthier environments for voucher families.
135. OCA has devoted considerable resources to advocating for, and then helping prepare for, the rollout of small area FMRs in the Hartford area. In response to HUD’s action, OCA already has begun diverting its scarce resources away from previously planned projects to remedying the harm HUD is causing it, and it will have to continue doing so.
136. For example, in order to assist implementation of the rule and help voucher holders and those who work with them understand newly available options, OCA planned to produce a Small Area Fair Market Rent web portal which would have included (a) an analysis of the difference between small area FMRs and FMRs across the state, (b) an explanation of small area FMRs, (c) data on the current location of voucher holders, and (d) the results of a time consuming rent study that highlighted the additional units that would become available under the new rent calculation formula. Because HUD’s action makes it uncertain which (if any) of these additional units actually will be available to voucher holders, OCA is now revising the content of this portal and will instead produce an article, based on the same data, explaining to the public why HUD’s program freeze is detrimental and what steps should be taken to counteract the effects of HUD’s actions.
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137. OCA also has determined that, as a consequence of HUD’s actions, it must spend considerable time and resources on a sustained effort to convince each individual Hartford-area PHA to implement small area FMRs voluntarily. This project, which OCA already is preparing to start, would be entirely unnecessary if not for HUD’s unlawful decision to suspend its regulation requiring those PHAs to implement small area FMRs.
138. This project may prove futile with respect to many or most of the PHAs in the Hartford area. Even to the extent it succeeds, it will do no more than restore OCA to the position it would be in if not for HUD’s action, at the cost of considerable expenditure of OCA’s time and resources.
139. OCA already has taken or is about to take many specific actions as part of this project to remedy the effects of HUD’s suspension of the rule. Such actions include:
• Writing advocacy pieces, assembling a web portal, and otherwise engaging in sustained public education (including with the state of Connecticut and area PHAs) about why the use of small area FMRs is beneficial;
• Holding conversations, collecting affidavits, and otherwise gathering information about the effect of HUD’s action on voucher holders; and
• Notifying other affected parties, including area non-profits that serve many voucher holders, of HUD’s action and its likely effect, and convening discussions with them about advocacy efforts and other next steps. OCA’s partners expected and relied upon small area FMRs going into effect on January 1, 2018, and OCA now must spend time ensuring that they are aware that their expectations have been unsettled and know how to proceed under these changed circumstances.
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140. OCA will have to take many similar actions in the next two years if HUD’s action is not enjoined. It will have to divert much of its time and other resources to projects that, in various ways, counteract the damage that HUD’s action is doing to its ability to further its mission. OCA would not have to divert its resources in this way but for HUD’s action.
141. HUD’s announcement that it will suspend the January 1, 2018 deadline is already causing irreparable harm that worsens every day for each of these plaintiffs and others. Each day that HUD refuses to take the preliminary steps necessary to implement the rule on time, such as providing guidance and technical assistance to participating PHAs, makes implementation on schedule harder. Moreover, HUD’s announcement to PHAs that it will not hold them to their regulatory deadline is causing irreparable harm by inducing the PHAs not to prepare for implementation.
142. HUD has demonstrated that, absent injunctive relief, it will not conform its conduct to its own regulatory requirements or require PHAs to do so the same.
CAUSES OF ACTION First Cause of Action Administrative Procedure Act – Agency Action Without Observance of Procedure
Required by Law 143. The APA empowers this Court to hold unlawful and set aside agency actions taken “without observance of procedure required by law.” 5 U.S.C. § 706(2)(D). 144. HUD has announced that it is suspending for two years the Small Area FMR Rule’s requirement that affected PHAs begin using FMRs based on zip codes on January 1, 2018. HUD has informed affected PHAs of this purported change and has posted this action on its website. 145. HUD’s action materially alters the terms of the Small Area FMR Rule.
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146. HUD lacks legal authority to alter the date on which the Small Area FMR Rule requires affected PHAs to begin using FMRs based on zip codes without undertaking notice and comment rulemaking.
147. Although HUD purports to delay the January 1, 2018 deadline separately for PHAs in each of the 23 affected areas pursuant to 24 C.F.R. § 888.113(c)(4)(iii), it did not properly invoke that provision with respect to any of the affected areas by pointing to an areaspecific “event” that results in local housing conditions. Nor is that provision lawfully used to accomplish a wholesale suspension of the Small Area FMR Rule’s requirement without notice and comment.
148. By failing to engage in notice-and-comment rulemaking before suspending the rule, HUD failed to observe procedures required by law, in contravention of the APA.
Second Cause of Action Administrative Procedure Act – Agency Action that Is Arbitrary, Capricious, or an
Abuse of Discretion 149. The APA empowers this Court to “hold unlawful and set aside” agency action that is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A). 150. Even if HUD had authority, given sufficiently compelling reasons, to excuse PHAs from the requirement that they begin using small area FMRs on January 1, 2018, its stated reasons for the delay are unreasonable, arbitrary, and capricious. 151. HUD’s stated reasons for delaying the requirement’s effective date—the purported need for further study of the issue and inability of affected PHAs to adequately prepare—contradict findings that HUD made in promulgating the requirement. No new evidence supports its changing course. HUD has pointed to the Interim Evaluation in conclusory fashion
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but has not explained how that document supports its decision. Even if it had, such an explanation would be arbitrary and capricious, since the Interim Evaluation demonstrates that small area FMRs work as intended and do not impose unmanageable administrative burden.
152. HUD does not claim that it has changed its view of the evidence that was before it when it promulgated the rule. Any such claim would be arbitrary and capricious in any event.
153. HUD has not provided a reasoned explanation for disregarding the facts and circumstances that underlay the Small Area FMR Rule, including but not limited to its original findings regarding the rule’s benefits for voucher holders and the necessity of making small area FMRs mandatory rather than voluntary in affected areas.
154. HUD does claim that its decision is based in part on comments submitted by industry groups in a proceeding not devoted to this matter. It has not explained how those comments support its decision, and any such explanation would be arbitrary and capricious. Moreover, HUD has not given others the opportunity to weigh in on the decision.
155. In delaying the requirement that PHAs implement small area FMRs, HUD relies in part on its own failure to adequately prepare PHAs. It is arbitrary and capricious for an agency to bootstrap its own failure to act in accordance with its legal obligations into a reason to continue not to act.
156. The final rule makes clear that mandatory rather than voluntary compliance by all PHAs in the covered areas is essential to the rule’s success. HUD has not explained why it now believes otherwise, and any such explanation would be arbitrary and capricious.
157. The rationale underlying HUD’s delay of the rule is arbitrary, capricious, or an abuse of discretion, in contravention of the APA.
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Third Cause of Action Administrative Procedure Act –Action Contrary to Statute 158. The APA empowers this Court set aside an agency action that is “not in accordance with law.” 5 U.S.C. § 706(2)(A). 159. In promulgating the Small Area FMR Rule, HUD brought its practices—and the PHAs’—into closer compliance with its relevant authorizing statutes, the Fair Housing Act of 1968, as amended, and the Housing and Community Development Act of 1974, as amended. Its attempt to suspend PHAs’ obligation under the FMR Rule violates both Acts. 160. In promulgating the Small Area FMR Rule, HUD found that fair market rents calculated across large metropolitan areas limit HCV voucher families—who, in most of the areas affected by the rule, are predominantly non-white—to less wealthy neighborhoods that tend to be predominantly African-American and Latino. HUD found that its previous practices had “not proven effective in addressing the problem of concentrated poverty and economic and racial segregation in neighborhoods.” 81 Fed. Reg. 80,567. Instead, the HCV voucher program was improperly distributing federal funds in a way that perpetuated racial segregation and artificially limited the housing choices of families that are disproportionately African-American and Latino. HUD made no contrary finding in suspending the Small Area FMR Rule. 161. HUD has an affirmative obligation under the FHA to ensure that federal housing programs are administered, and federal housing funds spent, in a manner that furthers racial desegregation and combats the related problem of concentration of poverty where possible. 42 U.S.C. §§ 3608(d), (e)(5). In suspending its requirement that selected PHAs act in accordance with the Small Area FMR rule, HUD is affirmatively choosing to distribute federal housing funds in a manner that it has found perpetuates racial segregation and does not provide the
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opportunity to rent standard quality housing throughout the geographic areas in question. As HUD itself has stated:
[I]n areas with a history of segregation, if a program participant has the ability to create opportunities outside of the segregated, low-income areas but declines to do so . . . there could be a legitimate claim that HUD and its program participants were acting to preclude a choice of neighborhoods to historically segregated groups. Affirmatively Furthering Fair Housing, 80 Fed. Reg. 42,279 (Jul. 16, 2015). In suspending the requirements of its already finalized Small Area FMR Rule, HUD is doing exactly that. It also is acting in a way that has a significant, adverse disparate impact on African Americans and Latinos without any sufficient justification for doing so. 162. Similarly, HUD specifically found in promulgating the Small Area FMR Rule that its former practices failed to result in rental rates that provided opportunities to rent “throughout the geographic area,” contrary to the Housing and Community Development Act’s requirement that the Section 8 program promote “economically mixed housing” rather than concentrated poverty. 42 U.S.C. § 1437f(a). It made no contrary finding in deciding to suspend PHAs’ regulatory obligations. 163. HUD’s suspension of the Small Area FMR Rule thus violates the Fair Housing Act of 1968, as amended, and the Housing and Community Development Act of 1974, as amended, in contravention of the APA.
PRAYER FOR RELIEF WHEREFORE, Plaintiffs pray that this Court: (a) enter a declaratory judgment that the decision of the U.S. Department of Housing and Urban Development to suspend the requirement that PHAs in 23 metropolitan areas begin using payment standards based on small area FMRs on January 1, 2018 violates the
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Administrative Procedure Act, 5 U.S.C. § 706, because it is arbitrary, capricious, an abuse of discretion, or contrary to law, and without observance of procedure required by law;
(b) issue temporary and permanent injunctions requiring the U.S. Department of Housing and Urban Development to timely implement and enforce all the requirements of its Small Area FMR Rule, including but not limited to the requirement that PHAs in the areas subject to that rule begin using payment standards based on small area FMRs on January 1, 2018;
(c) direct HUD to take all affirmative steps necessary to remedy the effects of the illegal conduct described herein and to prevent similar occurrences in the future;
(d) award plaintiffs their reasonable attorneys’ fees and costs; and (e) order such other relief as this Court deems just and equitable.

Dated: October 23, 2017

Respectfully submitted,

s/Sasha Samberg-Champion___________ Sasha Samberg-Champion (DC Bar No. 981553) Sara Pratt (DC bar admission pending) Michael G. Allen (DC Bar No. 409068) RELMAN, DANE & COLFAX PLLC 1225 19th Street, NW, Suite 600 Washington, DC 20036 Phone: (202) 728-1888 Fax: (202) 728-0848 ssamberg-champion@relmanlaw.com
Sherrilyn Ifill (NY Bar No. 2221422) Janai Nelson (NY Bar No. 2851301) Samuel Spital (NY Bar No. 4334595) NAACP LEGAL DEFENSE AND EDUCATIONAL
FUND, INC. 40 Rector Street, 5th Floor New York, NY 10006 (212) 965-2200
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Case 1:17-cv-02192 Document 1 Filed 10/23/17 Page 47 of 47
sspital@naacpldf.org
Coty Montag (DC Bar No. 498357)* Ajmel Quereshi (DC Bar No. 1012205)* NAACP LEGAL DEFENSE AND EDUCATIONAL
FUND, INC. 1444 I Street, NW, 10th Floor Washington, DC 20005 (202) 682-1300 aquereshi@naacpldf.org
Philip Tegeler (DC Bar No. 1002526)* POVERTY & RACE RESEARCH ACTION
COUNCIL 740 15th Street NW, Suite 300 Washington, DC 20005 (202) 360-3906 ptegeler@prrac.org
Jon Greenbaum (DC Bar No. 489887) Joseph D. Rich (DC Bar No. 463885)* Thomas Silverstein (DC bar admission pending) LAWYERS’ COMMITTEE FOR CIVIL RIGHTS
UNDER LAW 1401 New York Ave., NW Washington, DC 20005 (202) 662-8331 jrich@lawyerscommittee.org
Allison M. Zieve (DC Bar No. 424786) PUBLIC CITIZEN LITIGATION GROUP 1600 20th Street, NW Washington, DC 20009 (202) 588-1000
Attorneys for Plaintiffs
* Application for admission to this Court pending
47

 
 Case 1:17-cv-02192-BAH Document 29 Filed 12/23/17 Page 1 of 47

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

OPEN COMMUNITIES ALLIANCE et al.,

Plaintiffs,
v.
BEN S. CARSON, SR., Secretary of Housing and Urban Development, in his official capacity, et al.,

Civil Action No. 17-2192 (BAH) Chief Judge Beryl A. Howell

Defendants.

MEMORANDUM OPINION

Section 8 of the Fair Housing Act of 1968 serves two statutory purposes: (1) “aiding lowincome families in obtaining a decent place to live” and (2) “promoting economically mixed housing.” 42 U.S.C. § 1437f(a). This case is not about what is good housing policy, however. This case is about the rule of law—whether an agency effectively may suspend a duly promulgated regulation without observing the procedures or identifying relevant factual criteria that the law requires to effect such a change. The U.S. Department of Housing and Urban Development (“HUD”), without notice and comment or particularized evidentiary findings, has delayed almost entirely by two years implementation of a rule requiring over 200 local Public Housing Authorities (“PHAs”) in 24 metropolitan areas, which HUD selected based on fixed, objective criteria, to calculate housing vouchers’ values based on local, rather than metropolitanwide, prevailing market rents. The plaintiffs, two voucher holders and a nonprofit organization devoted to providing housing opportunities for low-income people in Connecticut, move to preliminarily enjoin HUD to implement the rule on January 1, 2018, the rule’s effective date.

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Pls.’ Mot. Preliminary Injunction, ECF No. 15 (“Pls.’ Mot.”). For reasons this Memorandum Opinion explains in detail, the plaintiffs’ motion for a preliminary injunction is granted. I. FACTS
A. Overview of the Housing Choice Voucher Program and Fair Market Rents Congress enacted the Housing Act of 1937 to assist state and local governments “to remedy unsafe and insanitary housing conditions and the acute shortage of decent, safe, and sanitary dwellings for families of low income.” Pub. L. No. 75-412, § 1, 50 Stat. 888, 888 (1937) (codified at 42 U.S.C. § 1437(a)). The Housing and Community Development Act of 1974, enacted nearly 40 years later, amended the Housing Act to add Section 8, which authorized HUD to contract with PHAs to pay landlords rental subsidies on low-income tenants’ behalf. Pub. L. No. 93-383, § 8(a), 88 Stat. 633, 662 (codified at 42 U.S.C. § 1437f(a)). The Housing and Urban-Rural Recovery Act of 1983, Pub. L. No. 98-181, § 207, 97 Stat. 1153, 1181 (codified as amended at 42 U.S.C. § 1437f(o)), created the Housing Choice Voucher (“HCV”) program, which is HUD’s “major program for assisting very low-income families, the elderly, and the disabled to afford decent, safe, and sanitary housing in the private market.” Housing Choice Vouchers Fact Sheet, U.S. DEP’T HOUSING & URB. DEV., https://www.hud.gov/topics/housing_choice_voucher_program_section_8 (last visited Dec. 23, 2017) (“HCV Fact Sheet”).1 HUD oversees the HCV program, directing funds to PHAs to administer the program locally by issuing vouchers to qualified individuals and families, who use those vouchers to secure housing in the private rental market. Id. A voucher holder may use a voucher toward any housing that meets the HCV program’s requirements, subject to a PHA’s

1

Federal Rule of Evidence 201 allows a court to take judicial notice of “a fact that is not subject to

reasonable dispute becauseit . . . is generally known within the trial court’s territorial jurisdiction; or . . . can be

accurately and readily determined fromsources whose accuracy cannot reasonably be questioned.” FED. R. EVID.

201(b). Both of theseconditions apply to a description of the HCVprogramfound on HUD’s public website.

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approval. 24 C.F.R. § 982.1(a)(2). HCV participation is limited to low-income households, which typically cannot afford to rent dwellings for which the rent substantially exceeds the HCV program payment standard. See HCV Fact Sheet, supra; see, e.g., Pls.’ Mot., Attach. 9, Decl. of Tiara Moore (“Moore Decl.”) ¶¶ 3, 7, ECF No. 15-9.
A voucher’s value is calculated largely on the basis of HUD’s determination of the “fairmarket rent” (“FMR”) for a dwelling of a particular size and type (e.g., a two-bedroom home). 24 C.F.R. § 982.503(a)(1). An FMR represents the amount required “to rent standard quality housing throughout the geographic area in which rental housing units are in competition,” including “the cost of utilities, except telephone.” Id. § 888.113(a). HUD annually calculates and publishes in the Federal Register FMRs for different types of units in each market area as well as any proposed changes to FMR calculation procedures. 42 U.S.C. § 1437f(c)(1)(B); see also 24 C.F.R. § 982.503(a)(1). PHAs, in turn, use FMR calculations to establish “payment standard amounts” for each unit type. 24 C.F.R. § 982.503(a)(1).
A PHA generally sets a payment standard “between 90 percent and 110 percent of the published FMR for that unit size.” Id. § 982.503(b). A voucher holder typically pays a landlord 30 percent of her or his adjusted monthly income toward rent; the PHA pays the rent’s balance directly to the landlord, so long as a dwelling’s actual gross rent is at or below the relevant payment standard. Id. § 982.1(a)(3). If, however, a dwelling’s actual rent exceeds the payment standard, the voucher holder pays the balance. Id. A PHA may use the same payment standard amount for all areas within the PHA’s jurisdiction, or else “may establish a separate payment standard amount for each designated part of the FMR area.” Id. § 982.503(a)(3).
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B. Proble ms with FMR Calculations in Me tropolitan Are as FMRs often do not, in practice, accurately reflect rents actually charged in neighborhoods within a broad metropolitan area, as “rents can vary widely within a metropolitan area depending upon the size of the metropolitan area and the neighborhood in the metropolitan area within which one resides.” See Establishing a More Effective Fair Market Rent System; Using Small Area Fair Market Rents in the Housing Choice Voucher Program Instead of the Current 50th Percentile FMRs, 81 Fed. Reg. 80,567, 80,567 (Nov. 16, 2016) (“Final Rule”). Consequently, “[t]he result of determining rents on the basis of an entire metropolitan area is that a voucher subsidy . . . may be too low to cover market rent in a given neighborhood.” Id. FMRs calculated on metropolitan-wide bases may not enable voucher holders to afford rents in high-rent, highopportunity neighborhoods, consigning them to low-opportunity areas of concentrated poverty. See id.; Moore Decl. ¶¶ 5–7; Pls.’ Mot., Attach. 4, Decl. of Crystal Carter (“Carter Decl.”) ¶¶ 6– 7, ECF No. 15-4. Calculating FMRs locally, in contrast, makes rents in high-opportunity areas more affordable. Prior to 2000, HUD generally calculated FMRs to reflect the 40th percentile rent in a given metropolitan area. See 24 C.F.R. § 888.113(a)–(b). In 2000, however, HUD published a new rule authorizing PHAs in areas meeting specified criteria to calculate payment standards based on FMRs reflecting the 50th percentile rent in a given area. See Fair Market Rents: Increased Fair Market Rents and Higher Payment Standards for Certain Areas, 65 Fed. Reg. 58,870, 58,870 (Oct. 2, 2000). This new policy was “designed to achieve two fundamental program objectives: (1) Ensuring that low-income families are successful in finding and leasing decent and affordable housing; and (2) ensuring that low-income families have access to a broad range of housing opportunities throughout a metropolitan area.” Id. Consistent with these goals,
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the 50th Percentile Rule authorized PHAs to calculate payment standards using a 50th percentile FMR under two circumstances: where “families are having difficulty using housing vouchers to find and lease decent and affordable housing” and “a FMR increase is most needed to promote residential choice, help families move closer to areas of job growth, and deconcentrate poverty.” Id. FMR calculation would revert to a 40th percentile basis, however, in PHAs that experienced no or an insufficient decrease in concentration of voucher holders after three years. Id. at 58,871.
HUD has concluded, based on recent research, that the 50th Percentile Rule is “not an effective tool” for “increasing HCV tenant moves from areas of low opportunity to higher opportunity areas.” Final Rule, 81 Fed. Reg. at 80,570. Rather, HUD has found that “much of the benefit of increased FMRs simply accrues to landlords in lower rent submarket areas in the form of higher rents rather than creating an incentive for tenants to move to units in communities with more and/or better opportunities.” Id. HUD also observed that a “large number of areas have been disqualified from the 50th percentile program for failure to show measurable reduction in voucher concentration of HCV tenants since 2001 when the program started, which strongly suggests that the deconcentration objective is not being met.” Id.
C. The Small Are a FMR De monstration Proje ct In the wake of the 50th Percentile Rule’s apparent failure, HUD considered alternative ways to expand housing opportunities for voucher holders. See id. Using census data collected through the American Community Survey, HUD developed “Small Area FMRs” (“SAFMRs”), which reflect fair-market rents in individual ZIP codes, rather than in broad metropolitan areas. Id. HUD’s goal in applying this new, more targeted methodology was to “create more effective means for HCV tenants to move into higher opportunity, lower poverty areas by providing them
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with subsidy adequate to make such areas accessible and to thereby reduce the number of voucher families that reside in areas of high poverty concentration.” Id.2
HUD undertook a demonstration project to test SAFMRs’ effectiveness. Section 8 Housing Choice Voucher Program Demonstration Project of Small Area Fair Market Rents in Certain Metropolitan Areas for Fiscal Year 2011, 75 Fed. Reg. 27,808, 27,809 (May 18, 2010) (“Proposed Demonstration Project”). Notably, HUD recognized, in announcing the project, that “[t]he small area FMR demonstration project will not be effective unless the PHAs that operate voucher programs covering the vast majority of voucher tenants in a metropolitan area agree to participate and abide by the small area rents.” Id. at 27,811. In a subsequent notice describing the project in more detail, HUD explained that SAFMRs “represent a fundamentally different way of operating the voucher program in metropolitan areas,” and that the project would help HUD “to better understand the programmatic impacts of changing the way voucher payment standards are set.” Final Fair Market Rents for the Housing Choice Voucher Program for Small Area Fair Market Rent Demonstration Program Participants; Fiscal Year 2013, 77 Fed. Reg. 69,651, 69,652 (Nov. 20, 2012) (“Demonstration Project”). HUD identified two purposes that the demonstration project would serve: to (1) “evaluate [SAFMRs] in terms of effectiveness in meeting the primary goal of improving tenants’ housing choices in areas of opportunity while also assessing the impact on tenants in areas with SAFMRs below the metropolitan-wide FMR”

2

Although SAFMRs are a recent innovation, HUD recognized the shortcomings of FMR schedules based on

metropolitan area-wide, rather than more localized, rent levels as early as 1977. See COMPTROLLER GEN. OF THE

U.S., CED-77-19, MAJOR CHANGES ARE NEEDED IN THE NEW LEASED-HOUSING PROGRAM 21 (1977) (“HUD’s

decision to prepare single FMR schedules for entire SMSAs [Standard Metropolitan Statistical Areas] or for

counties grouped into areas totaling 250,000 population is questionable. This approach ignores important

distinctions between metropolitan central cities and suburban areas as well as among suburban areas within SMSAs,

and it does not adequately consider the economic and demographic differences among non-SMSA counties. For

example, the San Francisco-Oakland, California, SMSA had identical FMRs for the counties of Alameda, Contra

Costa, Marin, San Francisco, and San Mateo. HUD field office officials said that each of these counties’ actual

market rents could vary by 30 to 40 percent.”).

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and (2) “understand and evaluate the administrative and budget impacts of converting and operating the tenant-based voucher program using SAFMRs.” Id. In selecting pilot PHAs to participate in the demonstration project, HUD used seven fixed, objective criteria to define an initial pool of eligible PHAs, then “randomly selected” pilot areas “from stratified sets of eligible PHAs.” Id. HUD ultimately selected five pilot PHAs from this pool: the (1) Chattanooga (Tenn.) Housing Authority, (2) Housing Authority of the City of Laredo (Tex.), (3) Housing Authority of the City of Long Beach (Cal.), (4) Housing Authority of the County of Cook (Ill.), and (5) Town of Mamaroneck (N.Y.) Public Housing Agency. Id. HUD also included all Dallas, Texas, metropolitan area PHAs, which since 2010 had implemented SAFMRs pursuant to a settlement agreement, in the demonstration project. Id. at 69,652 n.2; Proposed Fair Market Rents for the Housing Choice Voucher Program and Moderate Rehabilitation Single Room Occupancy Program Fiscal Year 2011, 75 Fed. Reg. 46,958, 46,962 (Aug. 4, 2010).
D. The SAFMR Rule Before the demonstration project’s completion, HUD published advance notice of proposed rulemaking announcing the agency’s intent to require several other metropolitan areas meeting certain criteria to implement SAFMRs. See Establishing a More Effective Fair Market Rent (FMR) System; Using Small Area Fair Mark et Rents (SAFMRs) in Housing Choice Voucher Program Instead of the Current 50th Percentile FMRs; Advanced Notice of Proposed Rulemaking, 80 Fed. Reg. 31,332 (June 2, 2015). HUD cited in this advance notice “research and experience with the SAFMR demonstration” indicating “that amending its current FMR regulation to enable adoption of the SAFMR methodology could provide HCV tenants greater access to higher opportunity, lower poverty neighborhoods.” Id. at 31,333. As part of the
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advance notice, HUD also announced that the new Rule “would eliminate the use of 50th percentile FMRs as a means to reduce HCV tenant concentration.” Id.
One year later, on June 16, 2016, HUD published a notice of the proposed new rule. See Establishing a More Effective Fair Market Rent System; Using Small Area Fair Market Rents in Housing Choice Voucher Program Instead of the Current 50th Percentile FMRs, 81 Fed. Reg. 39,218 (June 16, 2016) (“NPRM”). In doing so, HUD acknowledged that “[i]n order for Small Area FMRs to work in expanding choice for voucher holders within designated metropolitan areas, all PHAs operating in the FMR area would be required to use Small Area FMRs.” Id. at 39,224. The proposed rule addressed concerns raised in response to the advance notice and sought additional comments on specific issues, including policies HUD should adopt to “mitigate the impact of significant and abrupt decreases in the FMRs for certain ZIP code areas on families . . . in those impacted areas” and whether “this policy change would be particularly burdensome” to any “specific groups within the general population of voucher holders.” Id. at 39,225.
HUD published a final rule on November 16, 2016. Final Rule, 81 Fed. Reg. 80,567. Calculating payment standards based on SAFMRs, HUD said, would “provid[e] . . . a subsidy adequate to make such [high-opportunity, low-poverty] areas accessible and, consequently, help reduce the number of voucher families that reside in areas of high poverty concentration.” Id. at 80,567. “ZIP codes,” HUD reasoned, “are small enough to reflect neighborhood differences and provide an easier method of comparing rents within one ZIP code to another ZIP code area within a metropolitan area.” Id. at 80,568. The rule contained several provisions to address concerns about SAFMRs’ potential adverse impacts on voucher holders in low-rent ZIP codes. Id. at 80,572. Particularly relevant here, the rule authorized HUD to “suspend a Small Area FMR designation for a metropolitan area . . . where HUD determines such action is warranted
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based on a documented finding of adverse rental housing market conditions that will be set out by notice,” id. at 80,569, enumerating three circumstances that could warrant a designation’s suspension or PHA’s exemption from the SAFMR mandate, 24 C.F.R. § 888.113(c)(4). HUD provided by notice that the new rule would go into effect on October 1, 2017, requiring affected PHAs to implement the rule by January 1, 2018, Final Rule, 81 Fed. Reg. at 81,569; 24 C.F.R. § 982.503(b)(1), and designated 24 metropolitan areas, which covered over 200 PHAs in total, subject to the Rule based on five fixed, objective criteria, see Small Area Fair Market Rents in Housing Choice Voucher Program Values for Selection Criteria and Metropolitan Areas Subject to Small Area Fair Market Rents, 81 Fed. Reg. 80,678, 80,679 (Nov. 16, 2016) (“SAFMR Area Designations”); Defs.’ Opp’n Pls.’ Mot. (“Defs.’ Opp’n”), Attach. 1, Decl. of Todd Richardson, Acting Gen. Deputy Assistant Sec’y for Pol’y Dev. & Research (“HUD Decl.”) ¶ 5, ECF No. 241. In so doing, HUD required all PHAs within affected metropolitan areas to implement SAFMRs. These metropolitan areas included the Dallas, Texas area, SAFMR Area Designations, 81 Fed. Reg. at 80,679, in which PHAs, pursuant to the earlier-referenced settlement agreement, already had implemented SAFMRs, see NPRM, 81 Fed. Reg. at 39,221.
E. The Interim Report’s Preliminary Findings After HUD announced the Rule’s promulgation, but before the Rule was set to go into effect, HUD received preliminary findings from the demonstration project in the form of an Interim Report titled Small Area Fair Market Rent Demonstration Evaluation. Defs.’ Opp’n, Ex. 1 (“Interim Report”), ECF No. 24-4. This report contained good news on SAFMRs efficacy to achieve Section 8’s statutory goals, with mixed results for some demonstration project PHAs. Specifically, the Interim Report found that SAFMRs in the pilot PHAs make “the availability of units [] much more evenly distributed across different types of neighborhoods,
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leading to increased availability in high-rent ZIP Codes and reduced availability in low-rent ZIP Codes.” Interim Report at vii; see also id. at viii (“Because SAFMRs increase access to highrent ZIP Codes and reduce access to low-rent ZIP Codes, we found not unexpectedly that the transition to SAFMRs led to an increase in units potentially available to HCV holders in higheropportunity areas under SAFMRs compared with FMRs and fewer units in lower opportunity areas.”). As a result, “[f]ollowing the implementation of SAFMRs, HCV holders in the demonstration sites are slightly more likely to live in high-rent ZIP Codes than they were prior to the demonstration,” while no such change was observed in “comparison PHAs.” Id. at viii. Further, “[t]he slight changes in rents among the SAFMR PHAs also translate into slight changes in opportunity.” Id.; see also id. at ix (finding that “[a]cross all evaluation PHAs . . . changes in rents are also reflected in changes in access to opportunity.”). Moreover, Housing Assistance Payment (“HAP”) costs, which “are the subsidy costs that PHAs incur on behalf of HCV holders for rent and utilities,” “declined in real terms per unit between 2010 and 2015 in SAFMR PHAs,” while “[r]ents paid to landlords remained nearly flat in real terms between 2010 and 2015 but varied by rent category.” Id. at x. The report states, “[i]n summary, it appears that Small Area Fair Market Rents are working as intended—increasing access to units in higheropportunity areas and decreasing access in lower-opportunity areas.” Id. at 61.
At the same time, the Interim Report troublingly found that “the gain in units with rents below the applicable FMR in high-rent ZIP Codes does not offset the decrease in the number of units in the low-rent and moderate-rent ZIP Codes, resulting in a net loss of units potentially available to HCV holders overall.” Id. at vii. The net effect of SAFMR implementation across the pilot PHAs, the Interim Report found, was “a loss of over 22,000 units (3.4 percent) that might otherwise be affordable to HCV holders.” Id. In addition, the Interim Report noted that
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average payment standard amounts declined by about 11 percent in inflation-adjusted terms in pilot PHAs, resulting in average rent burden increases for HCV voucher holders of about 16 percent overall and 22 percent in low-income ZIP codes. Id. at ix–x. In contrast, payment standard amounts relying on metropolitan area-wide FMRs declined by only about 2 percent, resulting in an average rent burden increase of 9 percent. Id.
The Interim Report’s findings related only to Phase 1 of the demonstration project. Id. at xi. In 2018, HUD will receive a Final Report combining and synthesizing data collected in Phases 1 and 2, the latter of which will (1) update the Interim Report’s empirical analyses with new housing data, and (2) use qualitative interviews of tenants and landlords to determine how SAFMRs have affected or could affect housing decisions. Id. at xi, 98.
F. HUD’s Two-Ye ar De lay of the SAFMR Rule On August 10, 2017, HUD issued a memorandum delaying SAFMR designations for 23 of the 24 metropolitan areas subject to the Rule (excluding Dallas), requiring PHAs in affected areas to implement the Rule in 2020 rather than in 2018. Defs.’ Opp’n, Ex. 2, Suspension of Small Area Fair Market Rent (FMR) Designations (“Suspension Mem.”) at 2, ECF No. 24-5. The Suspension Memo expressly noted, however, that “any PHA operating in the covered metropolitan areas” could still “voluntarily implement[] the use of Small Area FMRs prior to . . . 2019,” and that PHAs in the Dallas metropolitan area would continue to implement SAFMRs pursuant to the settlement agreement. Id. at 1, 3. On August 11, 2017, HUD sent over 200 affected PHAs a letter informing those PHAs that their metropolitan areas’ mandatory SAFMR designations were suspended until 2020. Defs.’ Opp’n, Ex. 3, Letter from Dominique Blom, Gen. Deputy Assistant Sec’y for Public & Indian Housing, HUD, to PHA Exec. Dirs. (“Letter to PHAs”) (Aug. 11, 2017), ECF No. 24-6; HUD Decl. ¶ 12.
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The Suspension Memo identified “several findings” in the Interim Report “that are worrisome and where further research is needed to address a number of critical questions with respect to the potential harm to HCV families (both participants and applicants) in areas transitioning to Small Area FMRs.” Id. at 5. “[F]indings of the interim report that are of most concern to HUD,” the Suspension Memo stated, “relate to the availability of units and the impact of Small Area FMRs on voucher success rates and utilization, and to rent burdens among assisted households.” Id. Specifically, the Suspension Memo stated that “[o]ne of the findings of concern from the interim report is that the gain in units with rents below the applicable FMR in high-rent ZIP codes did not offset the decrease in the number of units in the low-rent and moderate-rent ZIP codes.” Id. The Suspension Memo acknowledged that, by contrast to the operation of SAFMRs in the pilot PHAs, the Rule capped any SAFMR decrease to 10 percent per year, but concluded that this provision “may only slow the pace of the loss of units, as opposed to preventing the overall decline in the number of units available to HCV families in the metropolitan area.” Id. at 5–6. The Suspension Memo also recounted the Interim Report’s findings that SAFMRs have potential to increase voucher holders’ rent burdens. Id. at 6. The Suspension Memo again acknowledged that, by contrast to the operation of SAFMRs in the pilot PHAs, the Rule allows PHAs to hold nonmoving families harmless from payment standard amount decreases, but noted that “there is no protection for families that must move to a new unit or for applicant families off the waiting list who are trying to lease a unit on the program for the first time.” Id. at 7.
The Suspension Memo identified two other concerns with respect to implementing the Rule. The first concern was that “several PHA industry groups have [expressed] concerns about the Small Area FMR final rule and the timeline for implementation” in response to a separate
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Federal Register notice on reducing regulatory burdens. Id. (citing Reducing Regulatory Burden; Enforcing the Regulatory Reform Agenda Under Executive Order 13777, 82 Fed. Reg. 22,344 (May 15, 2017)). The Suspension Memo recognized that “HUD has not yet completed its analysis of these public comments,” but asserted that “[t]emporarily suspending the Small Area FMR designation until FY 2020 will allow HUD to be informed by the public comments on reducing regulatory burden for the HCV program as well as the Final Report . . . before the use of Small Area FMRs is required.” Id. The second concern was that developing and issuing “guidance and planning to provide technical assistance to assist PHAs that must implement” SAFMRs “without fully understanding and incorporating the lessons learned from the Demonstration will result in a product that does not adequately assist those PHAs that must make this [] transition.” Id. at 8. Relatedly, HUD noted that “[i]mplementing comprehensive guidance that may become quickly outdated as the result of related regulatory burden reduction and reform efforts is likewise problematic.” Id.
G. The Plaintiffs The plaintiffs are two African-American women living in metropolitan areas the Rule would affect, as well as Open Communities Alliance (“OCA”), a nonprofit organization devoted to providing social and economic opportunities for low-income people. Compl. ¶¶ 18–20, ECF No. 1. Plaintiff Crystal Carter is a voucher holder who would like to move from Hartford, Connecticut, to nearby Simsbury, Connecticut, to be near her children’s schools and to provide her family a safer home and better opportunities. Carter Decl. ¶¶ 6–7. Hartford’s voucher holders, who are disproportionately nonwhite, are concentrated in poor, racially segregated neighborhoods. Pls.’ Mot., Attach. 6, Decl. of Will Fischer, Sr. Pol’y Analyst, Ctr. on Budget & Pol’y Priorities (“CBPP Decl.”) ¶ 11, ECF No. 15-6. As of 2016, 41 percent of voucher holders
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in the greater Hartford metropolitan area lived in high-poverty neighborhoods, while only 18 percent of voucher holders in the area lived in low-poverty neighborhoods. Id. Ms. Carter cannot move her family to Simsbury, however, as the metropolitan area FMR is too low for her to participate in Simsbury’s rental market. Carter Decl. ¶ 7. She asserts that she would be able to afford Simsbury rents if the Rule were implemented and claims that HUD’s delay of the Rule’s implementation thus harms her directly. Id.
Plaintiff Tiara Moore, much like Ms. Carter, would like to move from Chicago, Illinois to the high-opportunity area of DuPage County, Illinois, to provide a safer neighborhood and better opportunities for her daughter. Moore Decl. ¶¶ 5–6. Not only does DuPage County have better schools than Chicago, Ms. Moore’s mother lives in DuPage County and could provide childcare while Ms. Moore works. Id. ¶ 6. The metropolitan area FMR, however, is too low for Ms. Moore to afford DuPage County rents, which would be affordable were the Rule implemented. Id. ¶¶ 7, 9. Ms. Moore, like Ms. Carter, asserts that HUD’s delay of the Rule’s implementation thus harms her directly. Id.
H. The Instant Litigation On October 23, 2017, the plaintiffs filed a complaint challenging the Rule’s delay, see Compl., and, on November 8, 2017, moved for a preliminary injunction that would require HUD to implement the Rule without delay or modification by January 1, 2018, Pls.’ Mot. After the parties’ briefing on this motion was completed, on December 11, 2017, the Court held a hearing on December 19, 2017. See Minute Entry, dated Dec. 19, 2017.3

3

Under Local Rule of Civil Procedure 65.1(d), “[o]n request of themoving party together with a statement

of the facts which make expedition essential, a hearing on an application for preliminary injunction shall be set by

the Court no later than 21 days after its filing, unless theCourt earlier decides the motion on the papers or makes a

finding that a later hearing date will not prejudice theparties.” LCvR 65.1(d). The plaintiffs did not request an

expedited hearing, and in any event, theCourt finds that theparties’ consent to modification of the original

scheduling order, see MinuteOrder, dated Nov. 8, 2017, which moved briefing’s conclusion back to December 11,

2017, obviates any concern regarding prejudice to the parties occasioned by the hearing date.

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II. LEGAL STANDARD The Administrative Procedure Act (“APA”) authorizes any “person suffering legal wrong
because of agency action, or adversely affected or aggrieved by agency action” to seek “judicia l review thereof.” 5 U.S.C. § 702. Actions subject to review include “final agency action for which there is no other adequate remedy in a court.” Id. § 704. A “reviewing court shall decide all relevant questions of law . . . and determine the meaning or applicability of the terms of an agency action.” Id. § 706. An agency’s “interpretation of its own regulations ‘controls unless plainly erroneous or inconsistent with the regulation.’” Press Commc’ns LLC v. FCC, 875 F.3d 1117, 1121 (D.C. Cir. 2017) (quoting Auer v. Robbins, 519 U.S. 452, 461 (1997) (alterations omitted)); accord Safari Club Int’l & NRA of Am. v. Zinke, Nos. 16-5358 & 16-5362, 2017 U.S. App. LEXIS 26317, at *18 (D.C. Cir. Dec. 22, 2017) (same). The “court shall [] compel agency action unlawfully withheld or unreasonably delayed; and [] hold unlawful and set aside agency action, findings, and conclusions found to be,” inter alia, “arbitrary, capricious, . . . or otherwise not in accordance with law,” or “without observance of procedure required by law.” Id. § 706(1)–(2)(A), (D).
“Agency action is arbitrary and capricious ‘if the agency has relied on factors which [law] has not intended it to consider, entirely failed to consider an important aspect of the problem, or offered an explanation for its decision that runs counter to the evidence before the agency.’” Mayo v. Reynolds, 875 F.3d 11, 19 (D.C. Cir. 2017) (quoting Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983) (alterations omitted)); see also Safari Club Int’l, 2017 U.S. App. LEXIS 26317, at *16 (noting that “[a] disputed action also may be set aside as arbitrary and capricious if the agency has acted ‘without observance of procedure required by law.’” (citing 5 U.S.C. § 706(2)(D))). A court engaged in arbitrary and
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capricious review “must not substitute its own judgment for that of the agency,” and “ordinarily uphold[s] an agency’s decision so long as the agency ‘examined the relevant data and articulated a satisfactory explanation for its action, including a rational connection between the facts found and the choice made.’” Animal Legal Def. Fund, Inc. v. Perdue, 872 F.3d 602, 611 (D.C. Cir. 2017) (quoting State Farm, 463 U.S. at 43 (alterations and internal quotation marks omitted)).
“A party seeking a preliminary injunction must make a ‘clear showing that four factors, taken together, warrant relief: likely success on the merits, likely irreparable harm in the absence of preliminary relief, a balance of the equities in its favor, and accord with the public interest.’” League of Women Voters of U.S. v. Newby, 838 F.3d 1, 6 (D.C. Cir. 2016) (quoting Pursuing Am.’s Greatness v. FEC, 831 F.3d 500, 505 (D.C. Cir. 2016)). Whether a plaintiff must show each of the four factors independently, or else may make a sufficiently “strong showing on one factor [to] make up for a weaker showing on another,” remains an open question in the D.C. Circuit. Id. at 7 (quoting Sherley v. Sebelius, 644 F.3d 388, 392 (D.C. Cir. 2011)).4 III. DISCUSSION

4

The Supreme Court, in Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7 (2008), has

suggested that a plaintiff seeking a preliminary injunction must show each factor separately. Winter referred to the

four factors conjunctively, holding that such a plaintiff “must establish that he is likely to succeed on the merits, that

he is likely to suffer irreparable harmin the absence of preliminary relief, that the balanceof equities tips in his

favor, and that an injunction is in the public interest.” 555 U.S. at 20. Winter also rejected the contention that

“when a plaintiff demonstrates a strong likelihood of prevailing on the merits, a preliminary injunction may be

entered based only on a ‘possibility’ of irreparable harm,” holding that “plaintiffs seeking preliminary relief [must]

demonstratethat irreparable injury is likely in the absence of an injunction.” Id. at 21–22 (emphasis in original).

The D.C. Circuit repeatedly has observed that “the so-called ‘sliding-scale’ approach to weighing the four

preliminary injunction factors” may no longer be viable post-Winter, but has never resolved this question oneway or

the other. Leagueof Women Voters, 883 F.3d at 7; see also Pursuing Am.’s Greatness, 831 F.3d at 505 n.1 (“We

need not resolve here any tension in the case law regarding the showing required on the merits for a preliminary

injunction.”); Aamer v. Obama, 742 F.3d 1023, 1043 (D.C. Cir. 2014) (“[I]t remains an open question whether the

‘likelihood of success’ factor is ‘an independent, free-standing requirement,’ or whether, in cases wherethe other

three factors strongly favor issuing an injunction, a plaintiff need only raise a ‘serious legal question’ on the merits. .

. . But we have no need to resolve this question here because the remaining factors do not, in any event, weigh in

petitioners’ favor.”); Sherley, 644 F.3d at 392–93 (“[W]e read Winter at least to suggest if not to hold that a

likelihood of success is an independent, free-standing requirement for a preliminary injunction.” (internal quotation

marks omitted)).

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The plaintiffs seek a preliminary injunction requiring HUD to implement the Rule on its effective date of January 1, 2018. Pls.’ Mot. Their motion challenges the lawfulness of HUD’s two-year delay of the Rule’s implementation in ways relating to claims in the complaint.5 First, the plaintiffs argue that HUD failed to adhere to the requirements of notice and comment procedure in delaying the Rule’s implementation. Pls.’ Mem. at 22–27; see Compl. ¶ 143–48. The defendants acknowledge HUD delayed the Rule’s implementation without notice or comment, but argue that HUD had authority under a promulgated regulation, 24 C.F.R. § 888.113(c)(4), to suspend SAFMR designations and exempt PHAs without resort to notice and comment, Defs.’ Opp’n at 21–27. The plaintiffs dispute that this regulation conferred such authority upon HUD. Pls.’ Mem. at 24–27. Second, the plaintiffs argue that HUD’s delay of the Rule’s implementation was arbitrary and capricious because HUD failed to provide an adequate explanation for the delay. Id. at 28–34; see Compl. ¶¶ 149–57. The plaintiffs contend that the Rule’s delayed implementation will irreparably harm them, and that both the balance of equities and consideration of the public interest weigh in favor of issuing a preliminary injunction. Pls.’ Mem. at 34–43. Here, for reasons explained in further detail below, the plaintiffs have carried their burdens of demonstrating all four factors, and so merit a preliminary injunction under either the “independent factors” or “sliding scale” approach.
A. Likelihood of Success on the Merits The plaintiffs’ (1) notice and comment and (2) arbitrary and capricious claims boil down to a common issue—whether HUD identified adverse rental housing market conditions local to the particular PHAs as to which HUD delayed the Rule’s implementation. For reasons explained

5

The complaint also raises a third claim, asserting that HUD acted contrary to statutein delaying the Rule’s

implementation by distributing housing funds in a manner that perpetuates racial segregation and does not provide

opportunity to rent quality housing throughout a metropolitan area. Compl. ¶¶ 158–163. The plaintiffs’ motion

does not address this argument, and the defendants do not respond to it. See generally Pls.’ Mot.; Defs.’ Opp’n.

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below, HUD did not. HUD’s failure to connect the Rule’s delayed implementation in specific PHAs by reference to local conditions means 24 C.F.R. § 888.113(c)(4) gave the agency no authority to act without notice and comment, and also that HUD’s decision-making was arbitrary and capricious. The plaintiffs thus have shown likely success on their claims’ merits.
1. HUD Lacked Authority to Delay the Rule’s Implementation. The plaintiffs argue that they likely will succeed on the merits of their claim that HUD’s delay of the Rule is procedurally defective because HUD did not observe the requirements of notice and comment. Pls.’ Mem. at 22–27. HUD, invoking a provision of the Rule, argues unsuccessfully that the Secretary has broad authority to delay the Rule’s implementation wholesale whenever the Secretary determines he has reason to do so. Defs.’ Opp’n at 21–27; Hr’g Tr. (Dec. 19, 2017) at 30.6 The plaintiffs, relying on the same Rule provision, argue that the Secretary’s authority is more circumscribed, and does not reach HUD’s action here. Hr’g Tr. at 7. “To choose between those competing [constructions], we look to the context in which the words appear.” McDonnell v. United States, 136 S. Ct. 2355, 2368 (2016). The Court concludes that although HUD may suspend an SAFMR designation or exempt a PHA within such a designated area under circumstances in which SAFMRs may adversely impact the area or PHA’s rental housing unit supply, HUD has made no such area-specific showing with respect to the 23 metropolitan areas as to which the agency delayed the Rule’s implementation. As such, the plaintiffs have demonstrated likely success on the merits on their notice and comment claim.7

6

All citations to the December 19, 2017 hearing transcript cite to a rough draft of the transcript. A final

draft of the transcript is forthcoming and will be made available on this case’s docket. Discrepancies between the

rough and final transcript drafts regarding page numbers may exist.

7

The defendants’ argument that HUD soon will rescind theRule through notice and comment and thus moot

the plaintiffs’ noticeand comment claim, see Defs.’ Opp’n at 31, only underscores that HUD has not yet invoked

notice and comment, and thus, that the plaintiffs’ claimis not moot. The issue of whether HUD’s planned action

would moot the plaintiffs’ claimis not yet ripe for review.

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The APA generally requires a federal agency engaged in informal rulemaking to engage in notice and comment procedures. See 5 U.S.C. § 553(b)–(c). “[A]n agency issuing a legislative rule is itself bound by the rule until that rule is amended or revoked and may not alter such a rule without notice and comment. Clean Air Council v. Pruitt, 862 F.3d 1, 9 (D.C. Cir. 2017) (alterations and internal quotation marks omitted). “[A]n order delaying [a] rule’s effective date” is “tantamount to amending or revoking a rule.” Id. at 6; see also Nat. Res. Def. Council v. Abraham, 355 F.3d 179, 194 (2d Cir. 2004) (“[A]ltering the effective date of a duly promulgated standard could be, in substance, tantamount to an amendment or rescission of the standard[].”); Envt’l Def. Fund, Inc. v. EPA, 716 F.2d 915, 920 (D.C. Cir. 1983) (“[S]uspension or delayed implementation of a final regulation normally constitutes substantive rulemaking under APA § 553.”); Council of S. Mountains, Inc. v. Donovan, 653 F.2d 573, 580 n.28 (D.C. Cir. 1981) (concluding that an order “deferring the requirement that coal operators supply lifesaving equipment to miners, [that] had palpable effects upon the regulated industry and the public in general,” is “a substantive rule”); Nat. Res. Def. Council, Inc. v. U.S. EPA, 683 F.2d 752, 762 (3d Cir. 1982) (“If the effective date were not part of an agency statement such that material alterations in that date would be subject to the rulemaking provisions of the APA, . . . an agency could guide a future rule through the rulemaking process, promulgate a final rule, and then effectively repeal it, simply by indefinitely postponing its operative date.” (internal quotation marks omitted)).
The Rule, which requires PHAs administering the HCV program in select metropolitan areas to use, as of January 1, 2018, SAFMRs, unquestionably is a substantive regulation delay of which ordinarily would require notice and comment. HUD, however, did not delay the Rule’s implementation through notice and comment. Thus, HUD’s action was lawful only if another
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source of authority empowered HUD to delay the Rule’s implementation without notice or comment. HUD asserts that 24 C.F.R. § 888.113(c) conferred such authority. HUD is wrong.
a) Section 888.113(c)(4)’s Meaning HUD’s failure to use notice and comment means that the agency’s authority to delay the Rule’s implementation must flow, if at all, from § 888.113(c)(4). Section 888.113(c)(4) allows HUD to temporarily suspend a region’s SAFMR designation or exempt a PHA from use of SAFMRs under specified circumstances. The regulation provides, in relevant part: HUD may suspend a Small Area FMR designation from a metropolitan area, or may temporarily exempt a PHA in a Small Area FMR metropolitan area from use of the Small Area FMRs, when HUD by notice makes a documented determination that such action is warranted. Actions that may serve as the basis of a suspension of Small Area FMRs are: (i) A Presidentially declared disaster area that results in the loss of a substantial
number of housing units; (ii) A sudden influx of displaced households needing permanent housing; or (iii) Other events as determined by the Secretary. 24 C.F.R. § 888.113(c)(4). Section 888.133(c)(4)’s plain language makes clear that HUD may suspend an SAFMR designation or exempt a PHA only upon one of three enumerated actions’ occurrence. Further, under the canon of ejusdem generis, which “limits general terms which follow specific ones to matters similar to those specified,” Wallaesa v. FAA, 824 F.3d 1071, 1081 (D.C. Cir. 2016) (quoting Gooch v. United States, 297 U.S. 124, 128 (1936)), the third action must be construed to reach only events “of the same class as those listed” in the preceding exemplar actions, DeNaples v. Office of Comptroller of Currency, 706 F.3d 481, 490 n.5 (D.C. Cir. 2013) (quoting BLACK’S LAW DICTIONARY 594 (9th ed. 2009)). See also Yates v. United States, 135 S. Ct. 1074, 1086 (2015) (“[E]jusdem generis [] counsels: ‘Where general words follow specific words in a
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statutory enumeration, the general words are usually construed to embrace only objects similar in nature to those objects enumerated by the preceding specific words.’” (quoting Wash. State Dep’t of Soc. & Health Servs. v. Guardianship Estate of Keffeler, 537 U.S. 371, 384 (2003) (alterations omitted))); Hall St. Assocs., LLC v. Mattel, Inc., 552 U.S. 576, 586 (2008) (“Under th[e] rule [of ejusdem generis], when a statute sets out a series of specific items ending with a general term, that general term is confined to covering subjects comparable to the specifics it follows.”); Cole v. Burns Int’l Sec. Servs., 105 F.3d 1465, 1471 (D.C. Cir. 1997) (“[T]he rule of ejusdem generis . . . limits general terms which follow specific ones to matters similar to those specified.” (internal quotation marks omitted)).
Section 888.113(c)(4)’s first two enumerated actions each involve changes to local rental housing market conditions that drive rents up, to voucher holders’ detriment. The over-arching rationale for HUD’s suspension authority that the Rule’s preamble sets out confirms the enumerated examples’ focus on local rental housing conditions. There, the Rule states that an SAFMR designation’s suspension requires “a documented finding of adverse rental housing market conditions.” Final Rule, 81 Fed. Reg. at 80,569. “[L]anguage in the preamble of a regulation,” though “not controlling over the language of the regulation itself . . . is evidence of an agency’s contemporaneous understanding of its proposed rules.” Wyo. Outdoor Council v. U.S. Forest Serv., 165 F.3d 43, 53 (D.C. Cir. 1999). Were the third action—“Other events as determined by the Secretary”—intended to allow the Secretary unfettered discretion to suspend an SAFMR designation or exempt a PHA for any reason, the two other enumerated examples would be mere surplusage. As the Supreme Court has stressed in applying the canon of ejusdem generis, if the disputed phrase was intended to have such a broad meaning “it is hard to see why” the examples needed to be included at all. Begay v. United States, 553 U.S. 137, 142 (2008); see
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also CSX Transp., Inc. v. Ala. Dep’t of Revenue, 562 U.S. 277, 295 (2011) (“We typically use ejusdem generis to ensure that a general word will not render specific words meaningless.”).
The Supreme Court’s reasoning in Kucana v. Holder, 558 U.S. 233 (2010), is instructive. The Attorney General claimed broad, unreviewable discretion, under 8 U.S.C. § 1252(a)(2)(B), to act on a motion to reopen alien removal proceedings, but the Court held otherwise. 558 U.S. at 237. The Court examined the provision’s two clauses insulating from judicial review, in clause (i), certain discretionary administrative judgments authorized by specific statutes, and, in clause (ii), “any other decision . . . the authority for which is specified under this subchapter.” Id. at 246. Citing the “lead line” introducing both clauses, the “proximity of clauses (i) and (ii) and the words linking them—‘any other decision,’” the Supreme Court reasoned that “[t]he clause (i) enumeration . . . is instructive in determining the meaning of the clause (ii) catchall,” ultimately reasoning “that Congress had in mind decisions of the same genre,” namely, “that Congress barred court review of discretionary decisions only when Congress itself set out the Attorney General’s discretionary authority in the statute.” Id. at 24647. Consequently, the Court held, the judicial review bar encompassed only administrative decisions made discretionary by statute, not by regulation. Id. at 253–54. As with Kucana, the “lead line” in § 888.113(c)(4) is “Actions that may serve as the basis of a suspension of Small Area FMRs are . . . ,” which places all three enumerated actions that follow within the category of actions that justify an SAFMR suspension or PHA exemption. These actions’ proximity to the lead line and to one another, as well as the “[o]ther events” term linking the actions, shows that § 888.113(c)(4), “[r]ead harminously,” lets HUD suspend an SAFMR designation or exempt a PHA only for reasons “of the same genre” as those in the first two enumerated actions. Kucana, 558 at 246–47.
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Begay likewise is clarifying. The Armed Career Criminal Act imposes a sentencing enhancement on a defendant who violates 18 U.S.C. § 922(g) and has three prior convictions “for a violent felony,” defined in part to mean a felony that “is burglary, arson, or extortion, involves use of explosives, or otherwise involves conduct that presents a serious potential risk of physical injury to another.” 18 U.S.C. § 922(e)(2)(B)(ii). “[T]he provision’s listed examples,” Begay reasoned, “illustrate the kinds of crimes that fall within the statute’s scope” and “indicates that the statute covers only similar crimes, rather than every crime that presents a serious potential risk of physical injury to another.” 553 U.S. at 142 (internal quotation marks omitted). A Congress intending “the statute to be all encompassing” Begay said, likely would not “have needed to include the examples at all,” as the statute “would cover all crimes that present a serious potential risk of physical injury” absent the examples. Id. (internal quotation marks omitted). “These considerations taken together,” Begay concluded, “convince us that, to give effect to every clause and word of this statute, we should read the examples as limiting the crimes that [the statute] covers to crimes that are roughly similar, in kind as well as in degree of risk posed, to the examples themselves.” Id. at 143 (alterations and internal quotation marks omitted). Here, as in Begay, § 888.113(c)(4)’s “listed examples” limit the third action’s scope to actions “that are roughly similar” to the first two actions. Id. at 142–43. The third action thus is best construed to encompass only events that involve adverse rental housing market conditions.8
Finally, the Rule’s localist phrasing and the interrelation of the Rule’s provisions, viewed holistically, show that HUD may justify a particular SAFMR designation’s suspension or PHA’s exemption only through a localized determination that conditions in a particular affected area or

8

Johnson v. United States abrogated Begayby voiding the phrase “otherwise involves conduct that presents

a serious potential risk of physical injury to another,” known as § 922(e)(2)(B)(ii)’s “residual clause,” for vagueness.

135 S. Ct. 2551, 2563 (2015). Begay nonetheless persuasively illustrates the ejusdem generis canon’s application.

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PHA warrant such action. Section 888.113(c)(4)’s first sentence requires HUD to designate SAFMR areas each year, which “designations will be permanent.” 24 C.F.R. § 888.113(c)(4). Elsewhere, the Rule identifies (1) five fixed, objective “criteria used to determine those metropolitan areas” to receive designations and (2) precise, dynamic “selection values” for each criterion. Id. § 888.113(c)(1) (identifying selection criteria); SAFMR Area Designations, 81 Fed. Reg. at 80,679 (identifying selection values); see also infra Part III.A.2. Section 888.113(c)(4)’s second sentence allows HUD to suspend “a Small Area FMR designation from a metropolitan area” and to exempt “a PHA in a Small Area FMR metropolitan area” upon “a documented determination that such action is warranted.” Id. (emphasis added). Notably, this sentence does not authorize HUD to suspend, in wholesale fashion, “all SAFMR designations” or exempt “all affected PHAs” in “all metropolitan areas.” This language, rather, focuses HUD’s inquiry on individualized reasons for suspending a particular designation or exempting a particular PHA.
The third sentence cabins HUD’s discretion to suspend an SAFMR designation or exempt a PHA, enumerating three “[a]ctions” that “may serve as the basis of a suspension of Small Area FMRs.” Id.9 The first two actions—“A Presidentially declared disaster area that results in the loss of a substantial number of housing units” and “A sudden influx of displaced households needing permanent housing,” id. § 888.113(c)(4)(i)–(ii)—do not merely address free-floating policy concerns. Each action, by nature, affects discrete, particular geographic areas. Thus, § 888.113(c)(4), read as a whole and in concert with surrounding provisions, requires HUD to justify a particular SAFMR designation’s suspension or PHA’s exemption by reference to specific rental housing market conditions local to the affected area. HUD may not, in other

9

Notably, again, this sentencereferences “a suspension of [SA]FMRs.” 24 C.F.R. § 888.113(c)(4)

(emphasis added).

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words, suspend an SAFMR designation or exempt a PHA by citing abstract policy concerns or conclusions extrapolated from data with no or only tenuous relation to the specific affected PHA.
The plaintiffs and defendants read § 888.113(c)(4) differently. The plaintiffs understand HUD’s authority to suspend an SAFMR designation or exempt a PHA more narrowly, arguing that the term “events” reaches only “unexpected events resulting in a sudden change in localized rental market conditions.” Pls.’ Mem. at 26. “Whether market conditions have ‘negative impacts on voucher families,’” the plaintiffs argue, “has nothing to do with whether any area meets regulatory criteria for small area designation or whether its FMRs remain reliable.” Pls.’ Reply Mem. Supp. Mot. (“Pls.’ Reply”) at 9, ECF No. 25. Section 888.113(c)(4), however, by its plain terms authorizes HUD to suspend an SAFMR designation or exempt a PHA even when the conditions that triggered the SAFMR’s application to that metropolitan area or PHA still apply, so long as a qualifying event occurs. HUD could have written § 888.113(c)(4) in terms that would allow SAFMR suspensions or PHA exemptions only when a particular metropolitan area or PHA no longer satisfied the criteria for SAFMR designation in the first place, but HUD did not so limit the suspension/exemption authority that the regulation conferred. Cf. Wallaesa, 824 F.3d at 1083 (“If Congress had intended that narrow meaning, it knew how to say so.”). Moreover, to construe the term “events” to reach only adverse rental housing market condition changes that are “sudden” and “unexpected” has no basis in the regulatory text, is neither compelled by nor necessary to give effect to the two preceding actions, and would leave HUD powerless to suspend the Rule’s impact under circumstances that, though foreseen or gradual, negatively impact voucher holders. Construing “events” to reach any “adverse rental housing market conditions,” in contrast, finds support in the preambulatory text, gives effect to the two preceding exemplar actions, and leaves HUD flexibility to suspend an SAFMR designation or
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exempt a particular PHA under circumstances that, although either foreseen or gradual, nonetheless negatively impact voucher holders.
The defendants, in turn, contend that § 888.113(c)(4) vests HUD with virtually boundless authority to suspend SAFMR designations or exempt PHAs. The defendants specifically argue that (1) the three enumerated actions merely illustrate, rather than exhaust, the sort of actions that trigger HUD’s authority to suspend an SAFMR designation or exempt a PHA, and (2) the third action gives HUD unreviewable discretion to suspend an SAFMR designation or exempt a PHA for essentially any reason. Defs.’ Opp’n at 21–27. These arguments do not pass muster.
First, the defendants argue that § 888.113(c)(4) does not provide an exclusive list of actions that may justify suspending an SAFMR designation or exempting a PHA, but merely nonexclusive examples of such actions. Defs.’ Opp’n at 23–24. This construction is inconsistent with § 888.113(c)(4)’s phrasing, which provides, “Actions that may serve as the basis of a suspension of Small Area FMRs are,” then lists three specific actions. 24 C.F.R. § 888.113(c)(4) (emphasis added). Section 888.113(c)(4)’s use of the term “are” rather than “include” compels a conclusion that the enumerated examples constitute an exclusive, rather than merely illustrative, list of actions that may justify suspending an SAFMR designation or exempting a PHA. Had HUD wished to reserve to itself authority to suspend an SAFMR designation for reasons other than an enumerated action’s occurrence, HUD could have drafted § 888.113(c)(4) to provide that “Actions that may serve as the basis of a suspension of Small Area FMRs include” the three enumerated actions. HUD, however, did not do that; by drafting § 888.113(c)(4) to contain the term “are” rather than “include,” HUD limited its authority to suspend an SAFMR designation to the occurrence of an enumerated action. Cf. Wallaesa, 824 F.3d at 1083.
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Second, the defendants argue that even if HUD may suspend an SAFMR designation or exempt a PHA only upon an enumerated action’s occurrence, the third action is phrased so broadly as to give HUD essentially unreviewable discretion to suspend an SAFMR designation or exempt a PHA for any reason. Defs.’ Opp’n at 22–26. The ejusdem generis canon, the defendants say, is inapplicable because § 888.113(c)(4) contains no “general term which follows specific ones.” Defs.’ Opp’n at 24 (alterations and internal quotation marks omitted). This is incorrect. Section 888.113(c)(4) enumerates two specific actions—“A Presidentially declared disaster area that results in the loss of a substantial number of housing units” and “A sudden influx of displaced needing permanent housing”—followed by a third, more general action— “Other events as determined by the Secretary.” 24 C.F.R. § 888.113(c)(4).
The defendants contend that the Rule’s overall context shows that ejusdem generis does not apply, identifying three aspects of the Rule that the defendants characterize indicating “an intent to be expansive.” Defs.’ Opp’n at 24–25. Although “the ejusdem generis canon does not control when the whole context dictates a different conclusion,” Wallaesa, 824 F.3d at 1081 (alterations and internal quotation marks omitted), the defendants’ argument actually ignores the regulation’s pertinent context and precise language. The defendants observe that the regulation uses “self-contained, broadly permissive language.” Defs.’ Opp’n at 25. The ejusdem generis canon applies, however, to language that otherwise reads broadly. See Wallaesa, 824 F.3d at 1081. The defendants note that “the language introducing the enumerated examples contains no indication that those examples are meant to restrict the circumstances under which HUD may find a suspension warranted.” Defs.’ Opp’n at 25. The ejusdem generis canon, however, requires no clear statement that specific language limits general language’s scope. Indeed, to require such clarity would defeat the canon’s purpose of clarifying ambiguous statutes. Finally,
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the defendants observe that the third action’s wording “specifically states that the nature of the referenced ‘events’ are those that are ‘determined by the Secretary,’ not those that are similar in kind to the preceding examples,” which the defendants argue “forecloses the notion that the nature of the ‘events’ referenced therein is to be limited by the preceding examples.” Id. That HUD has some discretion to determine which events justify suspending an SAFMR designation is undisputed, however; the question is whether that discretion is bounded. Here, the sequence of two specifically-phrased actions followed by a generally-phrased third action indicates that the first two actions limit HUD discretion under the third action. To construe the third action as reaching any event the first two actions do not reach would defeat the purpose of enumerating an exclusive list of “[a]ctions that may serve as the basis of a suspension of Small Area FMRs.” 24 C.F.R. § 888.113(c)(4).
Nor would applying the ejusdem generis canon render the phrase “as determined by the Secretary” superfluous. This language, read in context, can be read to vest HUD with discretion to determine whether a qualifying event warrants an SAFMR designation’s suspension or a PHA’s exemption, such that HUD need not suspend a designation or exempt a PHA each time a designated area or PHA experiences a disaster. This language does not allow HUD to determine whether something qualifies as an “event” in the first place. In other words, § 888.113(c)(4)(iii) gives HUD discretion, but cabins that discretion by allowing its exercise only upon a qualifying “event[’s]” occurrence. The defendants compare the phrase “other events as determined by the Secretary” to the language of 49 U.S.C. § 44702(d)(2), which authorizes the Federal Aviation Administration to “rescind a delegation . . . at any time for any reason the [agency] considers appropriate”—language the D.C. Circuit held “very clearly commits the renewal/nonrenewal designation to agency discretion.” Steenholdt v. FAA, 314 F.3d 633, 638 (D.C. Cir. 2003). The
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phrase at issue here, however, is considerably narrower than § 44702(d)(2)’s language. Steeholdt, if anything, cuts against the defendants’ position by illustrating how an agency might draft a rule that confers the boundless discretion HUD claims to possess.
Finally, the defendants invoke the Auer doctrine to argue that their construction of the regulation is due deference even if the regulation’s meaning is not clear. Defs.’ Opp’n at 25–26. As explained in detail above, however, the defendants’ construction is “inconsistent with the regulation,” Press Commc’ns LLC, 875 F.3d at 1121, and thus due no deference.10
b) HUD Failed to Identify Local Adverse Rental Housing Market Conditions Whether HUD invoked a proper triggering “event” to justify delaying by two years the Rule’s implementation thus turns on whether HUD based the Rule’s delay on an event involving local “adverse rental housing market conditions.” The Suspension Memorandum presents three rationales for delaying the Rule’s implementation: (1) the Interim Report’s findings showing the Rule’s potentially negative impact on voucher holders; (2) comments received in response to the Reducing Regulatory Burden notice; and (3) HUD’s failure timely to create SAFMR guidance and technical assistance for affected PHAs. Suspension Mem. at 5–8. The latter two rationales have nothing to do with local rental housing market conditions in the 23 affected PHAs, and so cannot independently sustain HUD’s invocation of § 888.113(c)(4)’s third action. As to the Rule’s potential adverse impact on voucher holders, the Suspension Memorandum identified evidence from the Interim Report, which evaluated the demonstration project’s preliminary findings, that SAFMRs may decrease rental housing unit stock. Id. at 5–6. The demonstration

10

A conclusion that 24 C.F.R. § 888.113(c)(4) does not giveHUD essentially boundless discretion to suspend

an SAFMR designation or exempt a PHA for any reason, but rather provides meaningful standards by which a court

may evaluatethe lawfulness of HUD’s actions, necessarily also defeats the defendants’ contention that HUD’s delay

of the SAFMR Rule’s implementation is not reviewable. Defs.’ Opp’n at 19–21; see Codyv. Cox, 509 F.3d 606,

610 (D.C. Cir. 2007) (“[Re]but[ting] thepresumption that agency action is judicially reviewable”requires a

defendant to show that “the relevant statute is drawn so that a court would haveno meaningful standard against

which to judge the agency’s exercise of discretion.” (internal quotation marks omitted)).

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project’s 7 pilot PHAs and the 200+ Rule-affected PHAs essentially do not overlap, however, and HUD has identified no basis to conclude that any lessons on SAFMRs’ efficacy that can be extrapolated from the demonstration project findings apply to the Rule-affected PHAs, as material differences in the pilot and Rule-affected PHAs’ relevant characteristics exist. 11 Indeed, given that HUD selected the pilot and Rule-affected PHAs using entirely different criteria to serve entirely different purposes, any assumption that the pilot PHAs represent the Rule-affected PHAs, or vice versa, in relevant respects seems highly questionable. HUD thus has failed to identify adverse rental housing market conditions local to the 23 Rule-affected areas, and so cannot invoke the authority that § 888.113(c)(4) gives the agency to suspend an SAFMR designation or exempt a PHA without notice and comment.
The Suspension Memorandum primarily relied on the Interim Report’s findings that SAFMR use caused a net loss of units available to voucher holders in the pilot PHAs. The Interim Report stated that although the pilot PHAs’ use of SAFMRs
should increase the pool of units potentially available . . . in high-rent FMRs, while reducing the pool of units that are located in lower-rent ZIP codes . . . . the gain in units with rents below the applicable FMR in high-rent ZIP codes did not offset the decrease in the number of units in the low-rent and moderate-rent ZIP codes, resulting in a net loss of units that are potentially available to voucher families. Suspension Mem. at 5; see Interim Report at vii. The Suspension Memorandum concluded that “[t]he net effect across the 7 study PHAs is a loss of over 22,000 units (3.4 percent) that might otherwise have been affordable to voucher families.” Suspension Mem. at 5.

11

The one PHA that the demonstration project and Rule both affected is the Housing Authority of Cook

County, Illinois. Compare Demonstration Project, 77 Fed. Reg. at 69,652, with SAFMR Area Designations, 81 Fed.

Reg. at 80,679; see also Hr’g Tr. at 8. The Court, pursuant to Federal Rule of Evidence 201, judicially notices that

Cook County is in the Chicago-Joliet-Naperville, IL HUD Metro FMR Area. See Chicago, ENCYCLOPAEDIA

BRITANNICA, https://www.britannica.com/place/Chicago (last visited Dec. 23, 2017) (describing Chicago as the

“seat of Cook county”); Cook County Map Application, COOK CTY. GOV’T,

https://maps.cookcountyil.gov/cookviewer/mapViewer.html (last visited Dec. 23, 2017) (showing Chicago and

Cook County’s overlap overlap); FED. R. EVID. 201(b).

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The problem with HUD’s reliance on demonstration project data to justify the Rule’s delay is that HUD has failed to show that the pilot and Rule-affected PHAs share similar characteristics, such that any conclusions as to SAFMRs’ efficacy that can be extrapolated from the demonstration project’s findings apply to the Rule-affected PHAs. For example, in at least one significant way, the Long Beach pilot PHA did not demographically represent the Ruleaffected PHAs. Long Beach’s high-rent ZIP codes contained only 11 percent of the PHA’s rental housing units, a lower figure than for any other pilot PHA. Interim Report at 28 & tbl. 41. By contrast, high-rent ZIP codes in each Rule-affected area must, according to the selection criteria, contain at least 20 percent of the area’s total rental housing unit supply. See SAFMR Area Designations, 81 Fed. Reg. at 80,679; 24 C.F.R. § 888.113(c)(1). 12 This contrast is significant because SAFMRs increase rental unit affordability in high-rent ZIP codes and decrease rental unit affordability in low-rent ZIP codes, and thus reduce overall rental housing unit supply more dramatically in areas like Long Beach, which have relatively few high-rent units, than areas with more high-rent units. Interim Report at 32–34. “[I]f fewer rental units . . . are in high-rent ZIP Codes than in low-rent ZIP Codes . . . then the shift to SAFMRs will mean fewer units” available. Id. at 34.
Long Beach, though only one of the seven pilot PHAs, distorted the demonstration project’s findings because much of the net decrease in rental housing unit supply that the project attributed to SAFMRs occurred in Long Beach. The Interim Report found that decreases in rental housing unit supply largely were concentrated in Long Beach, which saw a greater than 10

12

The InterimReport defined a high-rent ZIP codeas a zip code with a “rent ratio”—theratio of a two-

bedroomSAFMR over a two-bedroommetropolitan areaFMR—of greater than 1.1, and a low-rent ZIP code as a

zip code with a rent ratio of below 0.9. Interim Report at 27.

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percent net loss of rental housing unit supply. Id. at vii.13 By contrast, two pilot PHAs—Laredo and Mamaroneck—saw “virtually no change in the overall number of units” available after implementing SAFMRs whatsoever. Id. at 33 & tbl. 4-5. Long Beach, an area demographically unrepresentative of the Rule-affected areas, thus skewed the demonstration project’s findings.
The pilot PHAs also did not represent Rule-affected areas with respect to the SAFMR mandate’s geographic scope within a metropolitan area. Only two of the seven pilot PHAs— Laredo and Mamaroneck—mandated SAFMR use throughout the entire metropolitan area. Id. at 33. Laredo and Mamaroneck were “unique among the SAFMR PHAs in that their jurisdictions are the same as the geographies for which their respective FMRs are calculated.” Id. Laredo and Mamaroneck, in other words, were the only PHAs in their respective metropolitan areas, and, as such, implementation of SAFMRs applied across those two PHAs’ entire metropolitan areas. Five of the seven pilot PHAs, however, did not make PHA use mandatory across an entire metropolitan area. Id. In contrast, all PHAs within each metropolitan area that the Rule affects use SAFMRs. 24 C.F.R. § 888.113(c)(3); Final Rule, 81 Fed. Reg. at 80,568. An SAFMR’s geographic scope within a metropolitan area matters because “[i]f only a few agencies within a metropolitan area use Small Area FMRs, voucher holders may have difficulty moving to highopportunity neighborhoods outside those agencies’ jurisdiction.” CBPP Decl. ¶ 7. “For example, if an urban agency adopts Small Area FMRs but the surrounding suburbs do not, then families will face the same cost hurdles that currently prevent them from moving to lowerpoverty, suburban neighborhoods.” Id. Indeed, HUD itself acknowledged this conclusion during both the demonstration project and the rulemaking period. See NPRM, 81 Fed. Reg. at 39,224; Proposed Demonstration Project, 75 Fed. Reg. at 27,811. When PHAs in low-rent ZIP codes,

13

The Dallas pilot PHA also saw a large decrease in number of rental housing units lost, but this loss

amounted to only 4% of the Dallas pilot PHA’s total rental housing unit supply. InterimReport at vii.

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but not PHAs in high-rent ZIP codes, adopt SAFMRs, voucher holders will face rising rents in low-income areas but no commensurate decrease in rents in high-rent ZIP codes. SAFMRs’ success thus requires all PHAs within a metropolitan area to adopt SAFMRs. Laredo and Mamaroneck, the only two pilot PHAs that implemented SAFMRs throughout their entire metropolitan areas, significantly were the only pilot PHAs that saw virtually no decrease in rental housing unit supply. Interim Report at 33. The lack of any metropolitan area-wide SAFMR mandate in five of seven pilot PHAs’ respective metropolitan areas raises yet another question about the demonstration project findings’ applicability to the Rule-affected areas, which mandate SAFMR use throughout their entire metropolitan areas.
That the pilot PHAs were not representative of Rule-affected PHAs is unsurprising, as HUD used entirely different criteria to select these two groups. HUD used five fixed, objective “selection criteria” to determine which PHAs the Rule would cover: the (1) “number of vouchers under lease in the metropolitan FMR area;” (2) “percentage of the standard quality rental stock, within the metropolitan FMR area is in small areas (ZIP codes) where the Small Area FMR is more than 110 percent of the metropolitan FMR area;” (3) “percentage of voucher families living in concentrated low income areas;” (4) “percentage of voucher families living in concentrated low income areas relative to the percentage of all renters within these areas over the entire metropolitan area;” and (5) “vacancy rate for the metropolitan area.” 24 C.F.R. § 888.113(c)(1). HUD also, by notice published in the Federal Register, identified objective “selection values” for each criterion “to determine . . . metropolitan FMR areas subject to Small Area FMRs”: (1) “[t]here are at least 2,500 HCV under lease;” (2) “[a]t least 20 percent of the standard quality rental stock, within the metropolitan FMR area is in small areas (ZIP codes) where the Small Area FMR is more than 110 percent of the metropolitan FMR;” (3) “[t]he percentage of voucher
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families living in concentrated low income areas relative to all renters within the area must be at least 25 percent;” (4) “[t]he measure of the percentage of voucher holders living in concentrated low income areas relative to all renters within these areas over the entire metropolitan area exceeds 155 percent;” and (5) “[t]he vacancy rate for the metropolitan area is higher than 4 percent.” SAFMR Area Designations, 81 Fed. Reg. at 80,679.14
Entirely different criteria guided the pilot PHAs’ selection. HUD first constructed a pool of PHAs that met seven initial criteria, which were entirely different than the criteria HUD used to determine the Rule’s coverage. HUD included in the initial pool each PHA that: (1) “[h]ad at least 500 vouchers in use as of September 30, 2011;” (2) “[h]ad at least 10 housing choice voucher (HCV) tenants living in ZIP Codes where the SAFMR exceeded the metropolitan area Fair Market Rent (FMR) by more than 10 percent in fiscal year 2012;” (3) “[h]ad at least 10 HCV tenants living in ZIP Codes where the SAFMR was more than 10 percent less than the metropolitan area FMR;” (4) “[h]ad attained at least 95 percent HCV family reporting in Public and Indian Housing Information Center;” (5) “[w]as not troubled, as determined by the Section 8 Management Assessment Program;” (6) “[h]ad the administrative capacity to carry out the SAFMR program;” and (7) “[h]ad not been involved in litigation that would seriously impede its ability to administer the HCV program.” Demonstration Project, 77 Fed. Reg. at 69,652. These criteria produced a pool of 247 eligible PHAs, which HUD organized into eight selection clusters based on each PHA’s (1) number of vouchers (small or large), (2) metropolitan area twobedroom FMR (low or high), and (3) number of working-age heads of household (low or high

14

With respect to the fifth criterion, HUD defined a metropolitan area’s vacancy rateas “the number of

Vacant For Rent Units divided by the sumof the number of Vacant For Rent Units, the number of Renter Occupied

Units, and the number of Rented, not occupied units.” SAFMR Area Designations, 81 Fed. Reg. at 80,679. HUD

calculated thevacancy rate “using data fromthe 1-year American Community Survey (ACS) tabulations” by

averaging values “fromthe 3 most current ACS 1 year datasets available.” Id.

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percentage). Interim Report at 99 & tbl. A-1. HUD then randomly ordered PHAs within each cluster, and invited the PHA at the top of each cluster to participate in the demonstration project. Id. at 100. When a PHA declined to participate, HUD invited a cluster’s next ranking PHA. Id. After several rounds of invitations, five PHAs had agreed to participate in the demonstration project. Id. Finally, HUD included in the project two PHAs from the Dallas metropolitan area, which have used SAFMRs since 2011 pursuant to a settlement agreement. Id. at 3.
HUD’s decision to use different selection criteria for the pilot PHAs and Rule-affected areas reflects the different purposes HUD intended the demonstration project and Rule to serve. HUD “randomly selected five PHAs for the demonstration that differed across various characteristics” because HUD sought “[t]o test how SAFMRs may potentially affect a range of PHA types.” Interim Report at 2. In promulgating the Rule, however, HUD specifically targeted “those metropolitan areas . . . where establishing FMRs by ZIP code areas has the potential to significantly increase opportunities for voucher families.” Final Rule, 81 Fed. Reg. at 80,568. HUD’s different objectives in undertaking the demonstration project and promulgating the Rule further illustrate the inadequacy of HUD’s reliance on the demonstration project’s preliminary findings to justify the Rule’s delay.
Finally, HUD’s incorporation into the Rule of various provisions designed to protect against the very concerns that the demonstration project identified further undermines HUD’s reliance on demonstration project data to delay the Rule. Most significantly, as discussed above, the Rule requires all PHAs within an affected metropolitan area to use SAFMRs, addressing a crucial issue that the demonstration project uncovered. 24 C.F.R. § 888.113(c)(3); Final Rule, 81 Fed. Reg. at 80,568. The Rule also contains several other provisions to protect voucher holders against issues the demonstration project revealed, including (1) “limit[ing] the annual decrease in
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Small Area FMRs to no more than 10 percent of the area’s FMR in the prior fiscal year” and allowing PHAs to (2) “hold harmless those families remaining in place from payment standard reductions,” (3) “establish a new payment standard for families under HAP contract between the full ‘hold harmless’ option . . . and the new payment standard based on the Small Area FMR,” (4) “establish different policies regarding how decreases in payment standards will apply [to voucher holders] for designated areas within their jurisdiction,” and (5) “request and receive approval to establish an exception payment standard promptly for a ZIP Code area if necessary to react to rapidly changing market conditions or to ensure sufficient rental units are available for voucher families.” Final Rule, 81 Fed. Reg. at 80,572–74. HUD has discounted the importance of two of these five enumerated voucher holder protections incorporated into the Rule, noting that the 10 percent SAFMR cap “may only slow the pace of the loss of units, as opposed to preventing the overall decline in the number of units available to HCV families,” and that the “hold harmless” provision does not “protect[] families that must move to a new unit or [] applicant families off the waiting list who are trying to lease a unit on the program for the first time.” Suspension Mem. at 5–7. HUD seemingly has not, however, considered or addressed the Rule’s other voucher holder protection provisions.15
In sum, the significant differences between the (1) pilot and Rule-affected PHAs, (2) selection criteria HUD used to identify each group, and (3) purposes HUD sought the demonstration project and Rule to achieve impose on HUD a burden to show that any conclusions the Interim Report extrapolated from the demonstration project’s findings apply to

15

As the Institute for Policy Integrity at New York University School of Law, which filed a brief as amicus

curiae in support of plaintiffs’ motion for a preliminary injunction, observe, various provisions of the Rule are

“expressly designed to limit Rule-related increases in tenants’ rent burdens . . . . [b]ut HUD makes no mention of

these differences between the demonstration project and the Small Area Rule, even as it relies on the Interim

Evaluation of the demonstration projects as a justification for suspending implementation of the Rule.” Amicus Br.

at 8, ECF No. 21.

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the specific Rule-affected areas. Neither the Suspension Memo nor Letter to PHAs, however, even attempt to make such a showing. Nor, for that matter, does the defendants’ briefing. The plaintiffs thus have established likely success on the merits of their notice and comment claim.
2. HUD’s Delay of the Rule’s Implementation Was Arbitrary and Capricious The plaintiffs also argue that HUD’s delay of the Rule’s implementation was arbitrary and capricious. Pls.’ Mem at 28–34. According to the plaintiffs, HUD failed adequately to explain its reasons for delaying the Rule’s implementation. Id. at 28. As explained above, § 888.113(c)(4) required HUD to identify adverse rental housing market conditions local to a particular area or PHA to justify suspending an SAFMR designation or exempting a PHA in that area. HUD, as explained, did no such thing. Instead, HUD attempted to justify delaying the Rule’s implementation by two years by citing data based on a small number of pilot PHAs, which did not represent the Rule-affected areas in terms of demographics or scope and which HUD selected partially randomly (1) on the basis of entirely different criteria than those HUD used to select the Rule-affected areas and (2) for entirely different objectives than HUD sought to achieve through the Rule’s promulgation. HUD, in so doing, “relied on factors”—i.e., the demonstration project data—“which [law] ha[d] not intended it to consider” and “entirely failed to consider an important aspect of the problem”—i.e., local rental housing market conditions in the Rule-affected areas. Mayo, 875 F.3d at 19 (quoting State Farm, 463 U.S. at 43 (alterations omitted)). HUD’s two-year delay of the Rule’s implementation therefore was arbitrary and capricious. As such, the plaintiffs have demonstrated a likelihood of success on the merits as to their arbitrary and capricious claim, for essentially the same reasons they have shown likely success on the merits as to their notice and comment claim. B. Risk of Irreparable Harm
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The plaintiffs argue that they will suffer irreparable harm if HUD does not implement the Rule by January 1, 2018. “The party seeking a preliminary injunction must make two showings to demonstrate irreparable harm.” League of Women Voters, 838 F.3d at 7. “First, the harm must be ‘certain and great,’ ‘actual and not theoretical,’ and so ‘imminent that there is a clear and present need for equitable relief to prevent irreparable harm.’” Id. at 7–8 (quoting Chaplaincy of Full Gospel Churches v. England, 454 F.3d 290, 297 (D.C. Cir. 2006) (alterations omitted)). “Second, the harm ‘must be beyond remediation.’” Id. at 8 (quoting Chaplaincy, 454 F.3d at 297). Here, plaintiffs Crystal Carter, Tiana Moore, and OCA each have made a requisite showing of irreparable harm from the Rule’s delay.
1. Crystal Carter Plaintiff Crystal Carter has demonstrated a risk of irreparable injury sufficient to warrant a preliminary injunction. Ms. Carter and her five minor children currently use a Housing Choice Voucher to rent a four-bedroom house in the City of Hartford, Connecticut. Carter Decl. ¶ 1. Three of Ms. Carter’s children attend high-performing schools in the Simsbury School District through Hartford’s Open Choice school integration program. Id. ¶ 4. Ms. Carter wishes to use her voucher to move to the town of Simsbury in Hartford County, Connecticut, to be closer to those schools. Id. ¶ 6. Simsbury’s poverty rate of 3.4 percent, Decl. of Sasha SambergChampion (“Pls.’ Decl.”), Ex. I, Poverty Data for Simsbury Town, CT, ECF No. 16-9, is much lower than the poverty rate in Ms. Carter’s ZIP code, which is 32.2 percent, Pls.’ Decl., Ex. G, Poverty Data for 06114 ZIP Code, ECF No 16-7. Simsbury offers higher quality education and a safer living environment for Ms. Carter’s entire family than does Hartford. Carter Decl. ¶ 6. As the plaintiffs observe, “[l]iving close to her children’s schools has obvious benefits for any parent, including reducing the children’s commute times, giving them more opportunity to
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engage with their classmates out of school, and allowing the parent to be more involved with her children’s schools.” Pls.’ Mem. at 39.
The Rule’s implementation would enable Ms. Carter to move her family from Hartford to Simsbury; the Rule’s suspension deprives her of the Rule’s benefits. If the Rule goes into effect, the FMR for a four-bedroom unit in much of Simsbury will be $1,940 per month for Fiscal Year 2018. See Pls.’ Decl., Ex. F, 2018 Hartford SAFMRs at 2, ECF No. 16-6.16 Should the Rule’s implementation remain delayed, however, the FMR for a four-bedroom dwelling in Simsbury will be $1,620 per month, see Pls.’ Decl., Ex. E, 2018 Hartford FMRs at 5, ECF No. 16-5—an amount that Ms. Carter’s experience shows to be insufficient to find an appropriate in Simsbury. Carter Decl. ¶ 7. The fact that Ms. Carter’s PHA may implement SAFMRs voluntarily, see Suspension Mem. at 3; Letter to PHAs at 3, does not prevent Ms. Carter from showing irreparable harm. For the reasons explained above, SAFMRs fail to assist voucher holders to relocate to high-opportunity areas unless all or substantially all PHAs within a metropolitan area implement SAFMRs, meaning that a single PHA, such as Ms. Carter’s, likely will not implement SAFMRs voluntarily. Further, HUD’s counsel conceded at oral argument that no Rule-affected PHA has come forward to opt into the Rule voluntarily, Hr’g Tr. at 18–19, which likewise illustrates the unlikeliness that Ms. Carter’s PHA will implement SAFMRs voluntarily.
The defendants correctly observe that Ms. Carter’s children already attend school in Simsbury, Defs.’ Opp’n at 34, but do not dispute that Ms. Carter would enjoy the obvious benefits of “be[ing] closer to [her] children’s schools” and “liv[ing] in a safer and healthier neighborhood environment for [her] children” if she lived in Simsbury. Carter Decl. ¶ 6. The

16

The Court, relying on the United States Postal Service’s “Look Up A ZIP Code” tool, see Look Up A Zip

CodeTM, U.S. POSTAL SERV., https://tools.usps.com/go/ZipLookupAction!input.action?mode=2&refresh=true (last

visited Dec. 23, 2017), takes judicial notice that theZIP Code for much of Simsbury is 06070. FED. R. EVID. 201.

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defendants argue that “the mere possibility . . . that [Ms. Carter’s] school-age children may potentially earn a higher income in their mid-twenties if they move at some point to a lowerpoverty area is entirely speculative and in no way imminent.” Defs.’ Opp’n at 34. The plaintiffs, however, identify “robust evidence that children who moved to lower-poverty areas when they were young (below age 13) are more likely to attend college,” to “have substantially higher incomes as adults,” and to “live in better neighborhoods themselves as adults,” and are “less likely to become single parents.” Raj Chetty et al., The Effects of Exposure to Better Neighborhoods on Children: New Evidence from the Moving to Opportunity Experiment, 106 AM. ECON. REV. 855, 899 (2016); see also LORA ENGDAHL,POVERTY& RACE RES. ACTION COUNCIL, NEW NEIGHBORHOODS,NEW SCHOOLS: A PROGRESS REPORT ON THE BALTIM ORE HOUSING MOBILITYPROGRAM 27–28 (2009) (finding that relocation to low-poverty areas produces significant mental health benefits to Housing Choice Voucher holders); MARGERY AUSTIN TURNER & LYNETTE RAWLINGS, URBAN INST.,PROM OTING NEIGHBORHOOD DIVERSITY: BENEFITS, BARRIERS, AND STRATEGIES 2 (2009) (describing the myriad ways “[n]eighborhoods matter to the well-being of children and families.”). The weight of this research certainly indicates that Ms. Carter’s family may enjoy some additional benefits from living in Simsbury.
The defendants also argue that Ms. Carter has not “identified any imminent risk that she or her family will actually be subject to criminal activity in Hartford.” Defs.’ Opp’n at 34. This arguments set the bar too high. “[A]s a preliminary injunction requires only a likelihood of irreparable injury, . . . Damocles’s sword does not have to actually fall . . . before the court will issue an injunction.” League of Women Voters, 838 F.3d at 8–9. Irreparable harm can flow not only from actual criminal victimization, but also from “continued exposure to [a] high crime rate . . . and unsafe conditions of [one’s] present community.” Bronson v. Crestwood Lake Section 1
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Holding Corp., 724 F. Supp. 148, 153 (S.D.N.Y. 1989); see also ENGDAHL, supra, at 27 (“Families in disadvantaged neighborhoods are at higher risk for disease and earlier death likely due” in part to “the cumulative stress arising from living in unsafe neighborhoods with limited resources.”); TURNER & RAWLINGS, supra, at 3 (“Young people who live in high-crime areas are more likely to commit crimes themselves.”).
The defendants observe that Ms. Carter has not “alleged that she has applied for housing in Simsbury, that if she did apply she would be likely to be selected despite competition from other applicants, or that there are sufficient landlords in Simsbury participating in the HCV program and accepting voucher-holding tenants including, in particular, her.” Defs.’ Opp’n at 34. To apply for housing in Simsbury prior to the Rule’s implementation, however, would be futile—the Rule’s premise is that voucher holders such as Ms. Carter cannot obtain housing in high-income areas like Simsbury because current payment standards do not suffice to make such housing affordable. Ms. Carter has established that she intends to apply for and obtain such housing as soon as she possibly can. Carter Decl. ¶¶ 6–7. A landlord’s discrimination against voucher holders, moreover, would violate Connecticut law. See Con. Gen. Stat. § 46a-64c; Comm’n on Human Rights & Opportunities v. Sullivan Assocs., 739 A.2d 238, 241 (Conn. 1999). Furthermore, HUD’s own calculation, based on detailed housing market data, that an FMR of $1,940 will suffice to allow a voucher holder to rent a four-bedroom unit in Simsbury belies HUD’s speculative assertion that such units may be unavailable to Ms. Carter even under the Rule, see Defs.’ Opp’n at 34.
Finally, the defendants dispute that any expenses associated with Ms. Carter’s longer commute would be sufficiently burdensome to warrant injunctive relief. Id. This argument mischaracterizes the nature of the harm that Ms. Carter’s family would suffer from her commute.
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The relevant harm is not primarily an economic injury, but “the opportunity cost of spending hours on a bus instead of participating in after school activities, studying, and engaging in active play.” Pls.’ Reply at 21.
2. Tiara Moore Plaintiff Tiara Moore likewise has demonstrated a risk of irreparable injury sufficient to warrant a preliminary injunction. Ms. Moore and her minor child live in an apartment in the City of Chicago, Illinois. Moore Decl. ¶ 1. The Chicago Housing Authority has issued Ms. Moore a Housing Choice Voucher for $1,207 per month for a two-bedroom unit. Id. ¶¶ 4, 7. Ms. Moore wishes to move to DuPage County, Illinois, to live in a neighborhood that will afford her family greater employment opportunities, higher quality education, and a safer living environment, as well as to be nearer to Ms. Moore’s mother, who provides child care so that Ms. Moore can work. Id. ¶¶ 5–6. DuPage County’s poverty rate of 7.4 percent, Pls.’ Decl., Ex. J, Poverty Data for DuPage County, Ill., ECF No. 16-10, is also much lower than the poverty rate in Ms. Moore’s ZIP code, which is 33.8 percent, Pls.’ Decl., Ex. H, Poverty Data for 60644 ZIP Code, ECF No 16-8. Ms. Moore has not, however, been able to locate any two-bedroom rental units in DuPage County for $1,207 per month. Id. ¶ 7. The Rule would enable Ms. Moore to move her family from the City of Chicago to DuPage County. For fiscal year 2018, the FMR for a twobedroom unit in the broad Chicago metropolitan area, which includes DuPage County, would be $1,180 per month. Pls.’ Decl., Ex. C, Chicago FMRs at 1, ECF No. 16-3. In contrast, under the Rule, 41 of DuPage County’s ZIP codes would have SAFMRs exceeding $1,180 per month, with SAFMRs in the highest-cost ZIP codes reaching $1,770 per month. Pls.’ Decl., Ex. D, 2018 Chicago SAFMRs, ECF No. 16-4. This difference in voucher purchasing power throughout much of DuPage County would dramatically improve Ms. Moore’s ability to find suitable
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housing there. In addition, Ms. Moore will, absent the Rule’s implementation, continue to incur opportunity and transportation costs arising from her daily trips to bring her child to and from her mother’s house for child care. Moore Decl. ¶ 6.
The defendants argue that Ms. Moore will suffer no injury from the Rule’s delay, as the Rule would not benefit her in the first place. Defs.’ Opp’n at 35. The defendants observe that the Chicago Housing Authority is a Moving to Work PHA and so would be exempt from use of SAFMRs even if the Rule were implemented. See id., Attach. 3, Decl. of Marianne Nazzaro ¶¶ 2–3, ECF No. 24-3; Final Rule, 81 Fed. Reg. at 80,578. Ms. Moore, however, seeks to move to DuPage County, not to Chicago. Moore Decl. ¶¶ 5–6, 9. The DuPage County PHA, not the Chicago Housing Authority, sets payment standards for DuPage County, see 24 C.F.R. § 982.503(a)(1) (providing that PHAs set payment standards for their own jurisdictions), and, unlike the Chicago Housing Authority, is not a Moving to Work PHA, see Moving to Work (MTW) - Participating Sites, U.S. DEP’T HOUSING & URBAN DEV., https://www.hud.gov/program_offices/public_indian_housing/programs/ph/mtw/mtwsites (last visited Dec. 23, 2017). The Rule’s implementation thus would benefit Ms. Moore.17
3. OCA Finally, Plaintiff OCA has demonstrated a risk of irreparable injury sufficient to warrant a preliminary injunction. An organization, to show irreparable harm, must show first that “the ‘actions taken by the defendant have perceptibly impaired the organization’s programs.” League of Women Voters, 838 F.3d at 8 (quoting Fair Emp’t Council of Greater Wash., Inc. v. BMC Mktg. Corp., 28 F.3d 1268, 1276 (D.C. Cir. 1994)). “If so, the organization must then also show

17

The defendants also assert that their arguments as to why Ms. Carter has not shown irreparable harmapply

equally to Ms. Moore. Defs.’ Opp’n at 34–35. The defendants’ arguments fail as to Ms. Moore for the same reason

they fail as to Ms. Carter.

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that the defendant’s actions ‘directly conflict with the organization’s mission.” Id. (quoting Nat’l Treasury Emps. Union v. United States, 101 F.3d 1423, 1430 (D.C. Cir. 1996)). “[O]bstacles [that] unquestionably make it more difficult for [an organization] to accomplish [its] primary mission . . . provide injury for purposes [of] . . . irreparable harm.” Id. at 9. OCA works “to promote access to opportunity,” including educational, employment, and housing opportunity, “for all people, and specifically to address the disproportionate isolation from opportunity experienced by Blacks and Latinos in Connecticut due to residential segregation.” Pls.’ Mot., Attach. 5, Decl. of Erin Boggs, Exec. Dir., OCA (“OCA Decl.”) ¶ 2, ECF No. 15-5. “OCA’s central focus in this work is leveraging affordable and subsidized housing programs to enable low-income families to access housing outside of areas with concentrated poverty and segregation.” Id. Much of this work involves enabling families who receive housing vouchers to move to higher-opportunity areas and addressing the concentration of voucher holders (who, in the Hartford area, primarily are nonwhite) in high-poverty, segregated areas. Id. ¶¶ 4–9. For example, OCA works to improve housing mobility programs for voucher users and to increase the supply of rental housing suitable for voucher holders in high-opportunity neighborhoods. Id.
OCA has shown that the Rule’s delay will “perceptibly impair[]” OCA’s programs and “directly conflict with the organization’s mission.” League of Women Voters, 838 F.3d at 8. The Rule’s delay frustrates OCA’s ability to assist voucher holders gain access to greater opportunity in several ways. First, the delay frustrates OCA’s “engage[ment] with . . . developers to encourage the acquisition and construction of housing that is affordable to voucher holders in non-concentrated, high-opportunity areas in the Hartford metropolitan area,” because “[t]he anticipated income from voucher holders will not support financing of such development while [voucher] rents are being calculated on a metropolitan-wide basis, rather than with a small-area
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calculation.” OCA Decl. ¶ 8. OCA also has diverted scarce resources away from previously planned projects to address HUD’s delay of the Rule. Id. ¶¶ 10–12. “With the suspension in effect,” OCA explains, “OCA will need to spend significant resources on research, outreach, public education, and advocacy to implement small area market rents ‘voluntarily’ on a PHA-byPHA basis across the Hartford metropolitan area, a multi-year effort that may ultimately prove futile.” Id. ¶ 10. OCA has already changed its activities as a result of the Rule’s delay. For example, OCA “planned to produce a Small Area Fair Market Rent web portal which would have included (a) an analysis of the difference between SAFMRs and FMRs across the state, (b) an explanation of SAFMRs, (c) data on the current location of voucher holders, and (d) the results of a time consuming rent study that highlighted the additional units that would become available under the new rent calculation formula.” Id. ¶ 11. In light of the Rule’s delay, OCA is “now taking steps to revise the content of this portal and to instead produce an advocacy piece, based on this data, explaining why the program freeze is detrimental.” Id. Finally, the Rule’s delay has required OCA “to engage in further meetings and other communications with stakeholders to ensure that the impact of this policy suspension is fully understood” and to “spen[d] time conducting outreach to [OCA’s] coalition members to explain the freeze and its consequences for voucher holders.” Id. ¶ 12.
The defendants assert that plaintiffs must show that OCA’s claimed monetary loss “threatens the very existence of the movant’s business” to support OCA’s claims of irreparable economic injury. Defs.’ Opp’n at 36 (quoting Wisc. Gas Co. v. FERC, 758 F.2d 669, 674 (D.C. Cir. 1985)). The defendants misread the authority on which they rely. Wisconsin Gas Co. held that “[r]ecoverable monetary loss may constitute irreparable harm only where the loss threatens the very existence of the movant’s business.” 758 F.2d at 674. OCA’s monetary losses,
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however, are not recoverable, as the APA provides no damages remedy. See 5 U.S.C. § 702 (authorizing actions “seeking relief other than money damages”). Wisconsin Gas Go. thus is inapposite; to show irreparable harm, OCA need only show that HUD’s delay of the Rule will “perceptibly impair[]” OCA’s programs and “directly conflict with the organization’s mission.” League of Women Voters, 838 F.3d at 8. For the reasons given, OCA has made such a showing.
C. Balance of Equities and Public Interest The third and fourth factors that courts consider in determining whether a preliminary injunction is warranted are “a balance of the equities in [the plaintiffs’] favor, and accord with the public interest.” Id. at 6 (quoting Pursuing Am.’s Greatness v. FEC, 831 F.3d at 505). The harm the plaintiffs would suffer from the Rule’s delay is clear, for the reasons explained above. As HUD’s counsel acknowledged at oral argument, moreover, the Rule’s delay would leave in place the 50th Percentile Rule, which the defendants recognize has failed to serve Section 8’s goals. Hr’g Tr. at 17. The harms the defendants assert that voucher holders would suffer should HUD implement the Rule on schedule, in contrast, are wholly speculative because they presume the Interim Report’s findings apply to Rule-affected areas, which, also for reasons explained earlier, the defendants have failed to show. The defendants, moreover, “cannot suffer harm from an injunction that merely ends an unlawful practice.” Rodriguez v. Robbins, 715 F.3d 1127, 1145 (9th Cir. 2013); accord R.I.L-R v. Johnson, 80 F. Supp. 3d 164, 191 (D.D.C. 2015) (same). The balance of equities thus weighs in the plaintiffs’ favor. A preliminary injunction’s issuance also would serve the public interest. “There is generally no public interest in the perpetuation of unlawful agency action.” League of Women Voters, 838 F.3d at 12. “To the contrary, there is a substantial public interest in having governmental agencies abide by the federal laws”—such as the APA, as well as regulations such as § 888.113(c)(4)—“that govern their existence and
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Case 1:17-cv-02192-BAH Document 29 Filed 12/23/17 Page 47 of 47 operations.” Id. (internal quotation marks omitted); accord Gulf Coast Mar. Supply, Inc. v. United States, 218 F. Supp. 3d 92, 101 (D.D.C. 2016), aff’d, 867 F.3d 123 (D.C. Cir. 2017) (“The public interest is served both by ensuring that government agencies conform to the requirements of the APA.”). As such, the plaintiffs have met their burdens to show that the balance of equities and consideration of the public interest support the injunctive relief they seek. IV. CONCLUSION
For the foregoing reasons, the plaintiffs’ motion for preliminary injunction is granted. An appropriate Order accompanies this Memorandum Opinion.
Date: December 23, 2017 __________________________ BERYL A. HOWELL Chief Judge
47

 
 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

OPEN COMMUNITIES ALLIANCE et al.,
Plaintiffs,
v.
BEN S. CARSON, SR., Secretary of Housing and Urban Development, in his official capacity, et al.,
Defendants.

Civil Action No. 17-2192 (BAH) Chief Judge Beryl A. Howell

MEMORANDUM OPINION AND ORDER The plaintiffs, Open Communities Alliance and two individuals, prevailed in their suit to enjoin the defendants, the U.S. Department of Housing and Urban Development (“HUD”) and HUD Secretary Ben Carson, see Open Cmtys. All. v. Carson, 286 F. Supp. 3d 148 (D.D.C. 2017), from delaying for two years, “without notice and comment or particularized evidentiary findings,” id. at 152, the implementation of a final rule regarding the calculation of voucher subsidies. Now, following the entry of judgment in the plaintiffs’ favor, Stipulated Judgment and Order at 2, ECF No. 34, the plaintiffs seek a total award of $154,272.11 in attorneys’ fees and costs under the Equal Access to Justice Act (“EAJA”), 28 U.S.C. § 2412(d)(1)(A), see Pls.’ Mot. Atty’s’ Fees & Costs (“Pls.’ Mot.”), at 1, ECF No. 35, for their 700.3 hours of attorney time and 103 hours of paralegal time, plus costs, litigating this matter, id. at 8. The defendants do “not dispute that Plaintiffs are entitled to a fair and sizable award of attorneys’ fees,” and do not “contest their request for costs or [] the billing rate they employ.” Defs.’ Opp’n Pls.’ Mot. (“Defs.’ Opp’n”) at 3, ECF No. 36. The defendants dispute solely “whether the amount of fees that Plaintiffs request is reasonable and warranted,” id. at 3, and argue that the plaintiffs are

1

entitled only to two-thirds of their request amounting to $102,794.66, Defs.’ Suppl. Defs.’ Opp’n (“Defs.’ Suppl.”) at 2, ECF No. 39. For the reasons set out below, the plaintiffs’ motion is granted in full. I. BACKGROUND
As noted, the plaintiffs seek fees for 700.3 hours of attorney time, billed at $198 per hour, and 103 hours of paralegal time, billed at $140 per hour. Pls.’ Mot. at 8–10.1 The plaintiffs derive their attorney time calculation from timesheets submitted by each of five co-counsel organizations, which add up to 778.1 attorney hours and 114.4 paralegal hours—a total that the plaintiffs then voluntarily cut by 10 percent, or 77.8 attorney hours and 11.4 paralegal hours, in order “to account for any concerns that may arise regarding ‘block billing’ practices and to ensure that their bottom line figure is reasonable.” Id. at 11–13.
In addition to the timesheets from each co-counsel organization, see Pls.’ Mot., Exs. E–I, ECF Nos. 35-7–35-11, which include more than 430 individual entries, the plaintiffs submitted a detailed declaration that explains how the plaintiffs chose which hours to bill by “carefully review[ing] each time entry” and “exercis[ing] billing judgment to forego recovery of certain work so as to ensure that the fees requested are reasonable,” Pls.’ Mot., Attach. 2, Decl. of Sasha Samberg-Champion, Counsel, Relman, Dane & Colfax, PLLC (Mar. 15, 2018) (“Pls.’ Decl.”) ¶ 23, ECF No. 35-2. Specifically, the plaintiffs excluded from their request “all time expended by all attorneys except the primary ones assigned to this case for each organization; [] attorney or

1

The plaintiffs correctly point out that “the $198 figure is conservative and arguably undervalues Plaintiffs’

time,” Pls.’ Mot. at 9, particularly in light of the attorney’s fee matrix prepared by the U.S. Attorney’s Office for the

District of Columbia “for use in cases in which a fee-shifting statute permits the prevailing party to recover

‘reasonable’ attorney’s fees,” USAO ATTORNEY’S FEES MATRIX, 2015–2018, Explanatory Note 1, available at

https://www.justice.gov/usao-dc/file/796471/download. Under this matrix, which does not apply to cases such as

this one brought under 28 U.S.C. § 2412(d)(1)(A) “for judicial review of agency action,” lawyers with less than two

years of experience have a prevailing hourly rate in 2017–2018 of $302 per hour. USAO ATTORNEY’S FEES

MATRIX.

2

paralegal time spent on calls, at hearing preparation sessions, or at hearings for which that attorney or paralegal’s presence was not required;” time spent “on witnesses that ultimately were not used;” time spent “responding to press inquiries;” and “substantial” amounts of time spent on “co-counsel and client agreements.” Id. ¶ 24. In addition to then cutting their overall hours by ten percent “to account for any concerns regarding block billing or inefficiencies,” id. ¶ 27, the plaintiffs have not billed for any time worked after January 5, 2018, including time spent on the instant motion, id. ¶¶ 25–26. II. LEGAL STANDARD
The EAJA provides, in pertinent part, that “a court shall award to a prevailing party other than the United States fees and other expenses . . . incurred by that party in any civil action . . . including proceedings for judicial review of agency action,” 28 U.S.C. § 2412(d)(1)(A), with certain exceptions not relevant here, such as cases where the government’s position was “substantially justified” or “special circumstances make an award unjust.” As the Supreme Court has “often recognized, ‘the specific purpose of the EAJA is to eliminate for the average person the financial disincentive to challenge unreasonable governmental actions.’” Astrue v. Ratliff, 560 U.S. 586, 599 (2010) (Sotomayor, J., concurring) (quoting Commissioner v. Jean, 496 U.S. 154, 163 (1990)); see also Scarborough v. Principi, 541 U.S. 401, 406 (2004) (authorizing attorney’s fee awards against the Federal Government was intended “to eliminate the barriers that prohibit small businesses and individuals from securing vindication of their rights in civil actions and administrative proceedings brought by or against the Federal Government” (internal quotations and citation omitted)); Sullivan v. Hudson, 490 U.S. 877, 883 (1989) (the EAJA was designed to address the problem that “[f]or many citizens, the costs of
3

securing vindication of their rights and the inability to recover attorney fees preclude resort to the adjudicatory process” (internal quotations and citation omitted)).
The role of the district court is “to determine what fee is ‘reasonable.’” Wash. All. of Tech. Workers v. U.S. Dep’t of Homeland Sec., 857 F.3d 907, 910 (D.C. Cir. 2017) (quoting Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)); see also id. at 911 (fee awards under EAJA are reviewed for abuse of discretion). In making this determination, the district court reviews “[t]he number of hours reasonably expended on behalf of the prevailing party . . . by evaluating the total number of hours expended and disallowing unproductive time or time spent on unsuccessful claims” and excluding from the calculation “hours that are ‘excessive, redundant, or otherwise unnecessary.’” Murray v. Weinberger, 741 F.2d 1423, 1427 (D.C. Cir. 1984) (quoting Hensley, 461 U.S. at 434); Wash. All. of Tech. Workers, 857 F.3d at 910. Fee applications must “include contemporaneous time records of hours worked and rates claimed, plus a detailed description of the subject matter of the work with supporting documents, if any.” In re Donovan, 877 F.2d 982, 994 (D.C. Cir. 1989). III. DISCUSSION
The defendants contend that the plaintiffs’ requested fee award should be reduced by one-third because: (1) the plaintiffs’ use of block billing, including the improper billing of time for administrative or clerical work, is per se unreasonable, Defs.’ Opp’n at 10–15; and (2) the plaintiffs’ timesheet entries are vague and/or duplicative, id. at 4–10. Neither contention is persuasive.
A. The Plaintiffs’ Did Not Submit Improper Bills The defendants argue that the plaintiffs’ request “should be reduced as a result of the significant amount of block billing entries,” Defs.’ Opp’n at 10, citing 148 such entries, Defs.’
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Suppl., Exs. A–B, D, ECF Nos. 39-1, 39-2, 39-4, which the defendants posit prevent the Court from determining the reasonableness of the time spent on various tasks.2 Although block billing, where “time records lump together multiple tasks,” can “mak[e] it impossible to evaluate their reasonableness,” Role Models Am., Inc. v. Brownlee, 353 F.3d 962, 971 (D.C. Cir. 2004), contrary to the defendants’ view, such billing is not per se impermissible. Instead, a fee petition “need not present the exact number of minutes spent nor the precise activity to which each hour was devoted nor the specific attainments of each attorney.” Shaw v. Dist. of Columbia, 210 F. Supp. 3d 46, 52 (D.D.C. 2016) (quoting Nat’l Ass’n of Concerned Veterans v. Sec’y of Def., 675 F.2d 1319, 1327 (D.C. Cir. 1982)).
Block billing is even less concerning where the plaintiffs have prevailed on all of their claims, see DL v. Dist. of Columbia, 256 F.R.D. 239, 245 (D.D.C. 2009), rev’d on other grounds, 713 F.3d 120, 129 (D.C. Cir. 2013), or where the block billing does not “interfere[] with the [c]ourt’s ability to evaluate the reasonableness of billed hours spent on specific motions or filings,” Hernandez v. Chipotle Mexican Grill, Inc., 257 F. Supp. 3d 100, 112 (D.D.C. 2017) (citing Role Models, 353 F.3d at 970). Ultimately, the test of the plaintiffs’ timesheets is whether they are “of sufficient detail and probative value to enable the court to determine with a high degree of certainty that such hours were actually and reasonably expended.” Role Models, 353 F.3d at 970 (quoting In re Olson, 884 F.2d 1415, 1428 (D.C. Cir. 1989)).

2

The defendants supplemented their opposition brief with annotated timesheets showing which entries the

defendants viewed as block billed, Defs.’ Suppl. at 1, and “impermissible,” Defs.’ Opp’n at 1. Rather than seek

reduction of the fee award for the total amount allegedly block billed, the defendants propose reducing by 40 percent

the purportedly block billed entries. Defs.’ Suppl. at 1. This 40 percent reduction number appears to have been

conjured by defendants out of thin air, with no citation to any case law or even any proffered rationale. The

defendants’ suggested 50 percent reduction for “entries that were both block billed and contained some

noncompensable activities,” id., and proposed 30 percent reduction “for general excessiveness, duplication, and

vagueness,” id., appear similarly made-up.

5

The plaintiffs’ timesheets meet that standard. The defendants cite in their briefing three examples of block billing, Defs.’ Opp’n at 11–12, none of which poses any difficulty in evaluating reasonableness. Indeed, many of the 148 entries identified by the defendants as block billed simply provide significant detail about related tasks and the defendants “appear[] to conflate entries in which plaintiff[s’] counsel has provided greater detail with impermissible block billing.” Hernandez, 257 F. Supp. 3d at 112 (finding that “most of the entries listed by the defendant are simply not block billed”).
Specifically, the defendants criticize as examples of block billing (1) the 6.1 hours billed on November 2, 2017, for time spent “edit[ing]” different components of the plaintiffs’ preliminary injunction motion, Defs.’ Opp’n at 11; (2) the 7.2 hours billed on November 6, 2017, for editing and “compiling [the] final version” of the preliminary injunction brief, and “confer[ring]” with defendants’ counsel about the briefing schedule, id. at 12; and (3) the 13.7 hours billed on December 11, 2017, for time spent finalizing and then filing the plaintiffs’ reply brief, id.
Yet, these entries describe complementary tasks that would seamlessly occur and for which disaggregation would be difficult. Notably, however, the defendants do not contend that, irrespective of the granular breakdown, the 6.1 hours spent editing a preliminary injunction motion to be filed in federal court in a complex challenge to federal agency action is in any way unreasonable, or that any of the other two examples evidence an excessive number of hours for the tasks described.
Certainly, none of the entries challenged by the defendants “lump” together work on unrelated matters, Role Models, 353 F.3d at 971, in a manner that would be impermissible, and all relate to the plaintiffs’ successful litigation. Instead, the challenged entries provide details
6

about subsets of tasks, such as editing, where disaggregation of the entries would not be useful to the Court’s reasonableness evaluation. See Hernandez, 257 F. Supp. 3d at 112 (“Explaining the related tasks that went into drafting the closing statement, or in scheduling a conference call, or in drafting and researching a surreply is not block billing, but is detailing the specific tasks performed related to a larger overarching task.”). As the plaintiffs point out, the defendants’ proposed 40-percent reduction for all entries identified as block-billed, Defs.’ Suppl. at 1, “would penalize Plaintiffs’ counsel for providing too much detail about discrete but related tasks,” given that each of the three examples of alleged block billing cited by the defendants’ brief “could reasonably have been described as ‘Editing and preparing preliminary injunction and supporting documents,’” Pls.’ Reply Supp. Pls.’ Mot. (“Pls.’ Reply”) at 6, ECF No. 40.
In short, the plaintiffs’ thorough timesheet entries are “of sufficient detail and probative value,” Role Models, 353 F.3d at 970 (quoting In re Olson, 884 F.2d at 1428), to show that the time billed is reasonable.
In addition to accusing the plaintiffs of impermissible block billing, the defendants object to certain “entries that are non-compensable as a matter of law.” Defs.’ Opp’n at 12. First, the “numerous hours relating to the press” that the defendants claim are improperly billed, id. at 13, were not actually included in the plaintiffs’ final timesheets as filed with the Court, see Pls.’ Reply at 7 n.1; see also Pls.’ Decl. ¶ 24 (noting the plaintiffs did not bill for “time associated with responding to press inquiries”).
Second, the defendants complain that the plaintiffs “attempt to bill attorneys’ hours for tasks that could have been performed by a paralegal, and paralegals for time spent on clerical work.” Defs.’ Opp’n at 13. The sole example of the former, however, quotes only part of an entry for December 11, 2017, describing the final editing and proofing of the plaintiffs’ reply
7

brief—including “directing and reviewing paralegal work product,” Pls.’ Reply at 7—which is a reasonable task for an attorney. The defendants’ seven cited examples of entries “billing for clerical work,” Defs.’ Opp’n at 13–14, are likewise unconvincing. Although the defendants are correct that “purely clerical or secretarial tasks should not be billed at a paralegal rate,” Missouri v. Jenkins, 491 U.S. 274, 288 n.10 (1989), such tasks have been defined as including “‘delivering’ or ‘picking up’ various documents as well as photocopying,” In re Meese, 907 F.2d 1192, 1203 (D.C. Cir. 1990). The defendants cite no authority for their claim that “organiz[ing],” “draft[ing],” or “fil[ing]” documents, or “review[ing]” the Court’s standing order or local rules, Defs.’ Opp’n at 13–14, constitute “purely clerical” rather than paralegal tasks, and so this objection falls flat.
Next, the defendants object to the plaintiffs’ billing “relating to administrative matters such as client recruitment, ‘retainer agreements,’ ‘recruiting co-counsel,’ and ‘drafting cocounsel agreements.’” Defs.’ Opp’n at 14 (citing Role Models, 353 F.3d at 973 (“The government should not have to pay for administrative matters relating to the formal relationship between Role Models and its attorneys.”)). The plaintiff in Role Models, however, had a single attorney for its suit over the “disposi[tion] of excess military property,” 353 F.3d at 964; see also Role Models America, Inc. v. White, 193 F. Supp. 2d 76, 77 (D.D.C. 2002), whereas the instant plaintiffs were represented by “five co-counsel organizations,” Pls.’ Mot. at 11, in a far more complex suit challenging agency action relating to “200 local Public Housing Authorities . . . in 24 metropolitan areas,” Open Cmtys., 286 F. Supp. 3d at 152. Given the complexity of this case, and the fact that coordination between counsel for different civil rights organizations presents challenges beyond simply establishing “the formal relationship between” a single plaintiff and its attorneys, Role Models, 353 F.3d at 973, the instant plaintiffs’ billing is not barred by any
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binding precedent, nor is it unreasonable, especially given that the plaintiffs already excised from their request “substantial time associated with the formation of co-counsel and client agreements,” Pls.’ Decl. ¶ 24.
Finally, the defendants’ objection to billing entries for the time between when the preliminary injunction was granted on December 23, 2018, and when the stipulated judgment was entered on February 16, 2018, Defs.’ Opp’n at 14–15, is ill-founded. The defendants rely on a single case, Doe v. Rumsfeld, 501 F. Supp. 2d 186, 193 (D.D.C. 2007), but this case is inapposite. In Doe, the court excluded a reimbursement request for “work that occurred after [its] final judgment,” id. at 193, which is very clearly not the same as work undertaken between a preliminary injunction and a final stipulated judgment.3
In sum, the plaintiffs did not, as the defendants claim, improperly use block billing, nor did they bill for time that is non-compensable as a matter of law.
B. Entries are Not Unduly Excessive, Duplicative, or Vague The defendants argue separately that the plaintiffs’ timesheet entries are marked by “general excessiveness, duplication, and vagueness.” Defs.’ Suppl. at 1; Defs.’ Opp’n at 4–10. The Court disagrees. The defendants first point to the plaintiffs’ litigation team of “eleven attorneys and five paralegals” to argue this team was “unnecessary” and “its natural result is excessive billing.” Defs.’ Opp’n at 7. Although courts have reduced fee awards due to overstaffing, see, e.g., Am.

3

Although the plaintiffs chose not to seek recovery for time spent on this case after January 5, 2018, “on

matters within the scope of this litigation, including monitoring Defendants’ implementation and compliance with

the preliminary injunction; reviewing comments submitted to HUD regarding the suspension of the Small Area

FMR Rule; and negotiating the final judgment that this Court entered,” Pls.’ Mot. at 11, such time, as well as time

spent on the instant motion to collect a fee award, could have been recoverable, see Jean, 496 U.S. at 162–66. As

the plaintiffs note, the litigation did not end when the preliminary injunction was granted, and “[p]reparation for the

next step of litigation in a pending case is a necessary task of responsible lawyers,” particularly where “HUD did not

announce contemporaneously that it would comply with this Court’s order, how it would do so, whether it would

appeal, or even whether it would file a subsequent motion to dismiss.” Pls.’ Reply at 9.

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Immigration Council v. U.S. Dep’t of Homeland Sec., 82 F. Supp. 3d 396, 411–12 (D.D.C. 2015), the notion that multiple attorneys necessarily leads to excessive billing has been rejected by the D.C. Circuit. See, e.g., In re Cisneros, 454 F.3d 342, 349 (D.C. Cir. 2006) (declining to reduce attorneys’ fees where the non-moving party has objected to “two or more attorneys billing for the same task”); In re Madison Guar. Sav. & Loan (Marceca Fee Application), 366 F.3d 922, 928 (D.C. Cir. 2004) (reducing fee award on grounds other than that “certain tasks were performed by multiple attorneys”). The number of attorneys working on a case, by itself, simply “may not be a reason to eliminate hours,” Davis Cty. Solid Waste Mgmt. & Energy Recovery Special Serv. Dist. v. EPA, 169 F.3d 755, 761 (D.C. Cir. 1999), since “[t]he issue is not whether [a party] used too many attorneys, but whether the work performed was unnecessary,” Donnell v. United States, 682 F.2d 240, 250 n.27 (D.C. Cir. 1982). Indeed, the D.C. Circuit has held that attorneys’ fees may be awarded for time spent by multiple attorneys conferring about a matter because such communication can “ensure that a case is managed in an effective as well as efficient manner.” Nat’l Ass’n of Concerned Veterans v. Sec’y of Def., 675 F.2d 1319, 1337 (D.C. Cir. 1982); see also Petties v. Dist. of Columbia, Civ. No. 95-148, 2009 WL 8663462, at *8 (D.D.C. Oct. 20, 2009) (approving reasonableness of billing where “plaintiffs’ attorneys have divided among themselves the many complex matters involved in this case, [so] they must meet occasionally or talk on the phone or exchange e-mails to discuss these issues and to strategize”). In fact, to guard against excessive billing by multiple attorneys, the plaintiffs took the responsible step of excluding from their fee request “all time expended by all attorneys except the primary ones assigned to this case for each organization” and “attorney or paralegal time spent on calls, at hearing preparation sessions, or at hearings for which that attorney or paralegal’s presence was not required.” Pls.’ Decl. ¶ 24.
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To bolster their claim of excessive billing, the defendants also cite “the nature of this case,” which the defendants describe as “present[ing] no novel issue of law, no administrative record, no disputes of fact, involv[ing] no discovery and present[ing] a straightforward challenge to HUD’s alleged failure to comply with governing statutes and its own regulation.” Defs.’ Opp’n at 7. This argument is wholly unpersuasive, because the fact that this case was largely resolved at the preliminary injunction stage, and without a multiplicity of filings, does not mean that it was a simple matter. The plaintiffs note that they “did the work of collecting and analyzing what would have been the [administrative] record,” and filed “a lengthy, complicated complaint and papers in support of the motion for a preliminary injunction” which required “expert analysis of the lengthy Interim Report, fact-gathering,” and other research. Pls.’ Reply at 2. Although courts “must exclude from fee awards ‘hours that are excessive, redundant, or otherwise unnecessary,’” Precision Concrete v. NLRB, 362 F.3d 847, 853 (D.C. Cir. 2004) (quoting Hensley, 461 U.S. at 443), the plaintiffs’ billing 700.3 attorney hours is “not facially unreasonable,” Hernandez, 257 F. Supp. 3d at 107, in the context of the instant case.
The defendants’ general complaint that the numbers of hours spent on different phases of this litigation was facially unreasonable, is also unpersuasive. See Blackman v. Dist. of Columbia, 56 F. Supp. 3d 19, 28 (D.D.C. 2014) (“The Court will not reduce the overall award simply based on the [] general objection that the hours billed are excessive.”). Specifically, the defendants object to the 293.4 attorney hours spent on the complaint, 257.6 attorney hours spent “drafting the preliminary injunction,” 107.9 hours spent on the reply, and 29.3 hours spent preparing for oral argument. Defs.’ Opp’n at 8–9. In light of similar billings that other courts have found reasonable, however, along with the complexity of this case, these objections are entirely misplaced. See, e.g., Bennett v. Castro, 74 F. Supp. 3d 382, 403 (D.D.C. 2014) (finding
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reasonable 576 hours spent on “preliminary work”); Hernandez, 257 F. Supp. 3d at 107–08 (finding reasonable 255.8 hours spent on opposition to motion for summary judgment); Am. Petroleum Inst. v. EPA, 72 F.3d 907, 917 (D.C. Cir. 1996) (finding reasonable 80 hours of preparation for oral argument).
The defendants also specifically object to “forty-four entries totaling 51.7 hours for calls that do not state the subject matter of the call,” as well as other entries that do not “include a description of the subject matter.” Defs.’ Opp’n at 6. Although the entries the defendants cite, id., are not themselves particularly helpful, they do appear to align with more descriptive entries by other counsel for calls on those days. For instance, the August 30, 2017, entry for “litigation team call” for one of the plaintiffs’ attorneys, Pls.’ Mot., Ex. H, Timesheets for Phillip Tegeler and Megan Haberle, ECF No. 35-10 at 4, matches the August 30, 2017, entry including “confer w/ case team re: witness interview, drafting progress” for another of the attorneys, Pls.’ Mot. Ex. E, Timesheets for Sasha Samberg-Champion, ECF No. 35-7 at 1. The Court also relies on the representation by the plaintiffs’ lead counsel that he “carefully reviewed each time entry and description for each attorney and staff member for whom fees are sought and ha[s] exercised billing judgment to forego recovery of certain work so as to ensure that the fees requested are reasonable,” including with respect to “participants on conference calls.” Pls.’ Decl. ¶¶ 23–24. The plaintiffs’ declaration, and the context provided by reading their five timesheets together, effectively counter the defendants’ vagueness complaints.
Finally, the defendants’ concerns about excessive or duplicative billing are fully addressed by the “exercise of billing judgment” noted in the plaintiffs’ declaration, Pls.’ Decl. ¶ 24, and by the plaintiffs’ ten percent cut from their initial total of 778.1 attorney hours to 700.3 attorney hours in their fees request, see Ashraf-Hassan v. Embassy of Fr. in the U.S., 189 F.
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Supp. 3d 48, 58 (D.D.C. 2016) (finding the hours billed reasonable where “in an effort to reduce the fee amount, Plaintiff’s counsel regularly no charged duplicative or unnecessary time, reviewing the over five years of billing entries to delete or no charge additional entries with the benefit of hind-sight” (alterations adopted) (internal quotation marks omitted)).
In sum, the plaintiffs’ timesheets and declaration—taking into consideration the complexity and speed of this case, and bearing in mind that, in the pursuit of “rough justice” rather than “auditing perfection,” “trial courts need not, and indeed should not, become greeneyeshade accountants,” Fox v. Vice, 563 U.S. 826, 838 (2011)—demonstrate that the plaintiffs’ fee request is reasonable, and the defendants’ protestations to the contrary are unpersuasive. IV. CONCLUSION
Accordingly, for the foregoing reasons, upon consideration of the plaintiffs Open Communities Alliance, Crystal Carter, and Tiara Moore’s Motion for Attorneys’ Fees and Costs, ECF No. 35, the related legal memoranda in support of and opposition to this motion, the exhibits and affidavits attached thereto, and the entire record herein, it is hereby
ORDERED that the plaintiffs’ Motion for Attorneys’ Fees and Costs is GRANTED; and it is further
ORDERED that the defendant pay the plaintiffs’ attorneys’ fees in the amount of $154,272.11, by August 14, 2018, unless the parties reach an alternative mutually agreeable date.

Date: June 15, 2018

__________________________ BERYL A. HOWELL Chief Judge

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