Title: Fairhaven Housing Authority v. Commonwealth
Citation: N/A
Docket Number: SJC-13412
State: Massachusetts
Issuer: Massachusetts Supreme Court
Date: November 6, 2023

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SJC-13412 
 
FAIRHAVEN HOUSING AUTHORITY & others1  vs.  COMMONWEALTH & 
another.2 
 
 
 
Suffolk.     October 2, 2023. - November 6, 2023. 
 
Present:  Budd, C.J., Gaziano, Lowy, Kafker, Wendlandt, 
& Georges, JJ. 
 
 
Department of Housing and Community Development.  Housing 
Authority.  Contract, Employment.  Statute, Construction, 
Amendment.  Declaratory Relief.  Practice, Civil, 
Declaratory proceeding, Motion to dismiss.  Administrative 
Law, Agency's authority. 
 
 
 
 
Civil action commenced in the Superior Court Department on 
January 9, 2020. 
 
 
A motion to dismiss was heard by Rosemary Connolly, J. 
 
 
The Supreme Judicial Court on its own initiative 
transferred the case from the Appeals Court. 
 
 
 
 
1 Lawrence Housing Authority, Medford Housing Authority, 
Nantucket Housing Authority, Provincetown Housing Authority, 
Stoneham Housing Authority, Sudbury Housing Authority, Renee H. 
Ceely, Kristin Hatch, Efrain Rolon, Sharon Wilkins, Brian 
Costello, and the Massachusetts Chapter of the National 
Association of Housing and Redevelopment Officials. 
 
 
2 Department of Housing and Community Development. 
2 
 
Michele Randazzo for the plaintiffs. 
Eric A. Haskell, Assistant Attorney General, for the 
defendants. 
Frank A. Flynn, for Southeastern Massachusetts Executive 
Directors Association & others, amici curiae, submitted a brief. 
 
 
 
WENDLANDT, J.  This case presents the question whether 
G. L. c. 121B, § 7A, grants the Department of Housing and 
Community Development (DHCD)3 the authority to decline to approve 
employment contracts between local housing authorities (LHAs) 
and their executive directors where those contracts fail to 
conform to DHCD's guidelines.  Concluding that it does, we 
affirm the well-reasoned decision of the Superior Court judge 
dismissing the declaratory judgment complaint.4 
 
1.  Background.  "We summarize the factual allegations set 
forth in the complaint and in the undisputed documents 
incorporated by reference in the complaint."  Osborne-Trussell 
v. Children's Hosp. Corp., 488 Mass. 248, 250 (2021).  We 
"accept[] as true all well-pleaded facts alleged in the 
 
 
3 In 2023, DHCD changed its name to the Executive Office of 
Housing and Livable Communities and became a cabinet-level 
secretariat.  In the past DHCD was referred to as the Department 
of Community Affairs.  In keeping with the complaint and briefs, 
we refer to the agency as DHCD. 
 
 
4 We acknowledge the brief of amici curiae Southeastern 
Massachusetts Executive Directors Association, Central Executive 
Directors Association, North Shore Executive Directors 
Association, Small Housing Authority Directors Organization, and 
Western Massachusetts Housing Authority Executive Directors 
Association. 
3 
 
complaint."  Id. at 253, quoting Ryan v. Mary Ann Morse 
Healthcare Corp., 483 Mass. 612, 614 (2019). 
 
The plaintiffs are LHAs of various cities and towns in the 
Commonwealth, current and former executive directors of LHAs, 
and the Massachusetts chapter of the National Association of 
Housing and Redevelopment Officials, a membership association of 
LHAs, community development agencies, and housing and 
redevelopment officials.  At the time of the complaint, DHCD was 
a department within the Commonwealth's Executive Office of 
Housing and Economic Development and, as "supervisor" of LHAs, 
had the "power to oversee most phases of the operations of" 
them.  West Broadway Task Force, Inc. v. Commissioner of the 
Dep't of Community Affairs, 363 Mass. 745, 748 (1973). 
The plaintiffs allege that DHCD has exceeded its authority 
under G. L. c. 121B, § 7A, by promulgating guidelines, referred 
to as public housing notices (PHNs), that govern contracts 
between an LHA and its executive director in a manner that 
interferes with the authority of the LHA to "determine [the] 
qualifications, duties and compensation" of its executive 
directors as provided by G. L. c. 121B, § 7. Among other things, 
DHCD's guidelines require that contracts between an LHA and an 
executive director be in writing and be approved by DHCD.  See 
Department of Housing and Community Development, PHN No. 2017-21 
at 2-3 (Sept. 7, 2017).  The guidelines set forth an executive 
4 
 
director's maximum allowable salary based on a formula and a 
schedule for executive director salary, including a capped 
maximum salary amount.5  See Department of Housing and Community 
Development, PHN No. 2019-21 at 3-4 (Sept. 16, 2019). 
The guidelines also include a template agreement6 and 
require use of a cover sheet.  See Department of Housing and 
Community Development, PHN No. 2017-25 at 2-4 (Oct. 31, 2017).  
DHCD's guidelines require contracts to include limitations on 
the numbers of hours for which the executive director may be 
compensated, a provision for binding arbitration for dispute 
resolution, and a "for cause" termination7 provision.  Id. at 8, 
10, 13.  An LHA executive director's benefits must be governed 
 
 
5 Four versions of the schedule have been published since 
the passage of G. L. c. 121B, § 7A.  See Department of Housing 
and Community Development, PHN No. 2015-17 (July 1, 2015); 
Department of Housing and Community Development, PHN No. 2018-
01; Department of Housing and Community Development, PHN No. 
2019-21 (Sept. 16, 2019); Department of Housing and Community, 
PHN No. 2022-02 (Jan. 26, 2022). 
 
 
6 While DHCD does not make the template agreement mandatory, 
it "highly recommends use of this contract template in order to 
facilitate its prompt review and approval, and will provide 
expedited review for housing authorities utilizing the contract 
template."  Department of Housing and Community Development, PHN 
No. 2017-25 at 2 (Oct. 31, 2017).  According to the plaintiff's 
complaint, DHCD has rejected "virtually all" contracts that do 
not follow its template agreement. 
 
 
7 Under this provision, the LHA "may and, under certain 
circumstances . . . , shall terminate" the employment contract 
of its executive director for "any lawful reason in good faith 
relied upon by the [LHA]."  PHN No. 2017-25, supra at 10. 
5 
 
by an LHA personnel policy approved by DHCD.8  Department of 
Housing and Community Development, PHN No. 2019-29 at 1 (Dec. 
11, 2019).  The guidelines prohibit contracts that include 
provisions for longevity payments,9 automatic contract renewals 
or extensions, or indemnification of the executive director.  
PHN No. 2017-25, supra at 15. 
DHCD has withheld funding and budget approvals when 
contracts depart from the guidelines.  Several executive 
directors have accepted reduced compensation as a result of 
DHCD's approval process. 
 
2.  Procedural history.  The plaintiffs filed a complaint 
pursuant to G. L. c. 231A, § 1, seeking a judgment declaring 
that DHCD exceeded its authority by promulgating guidelines for 
contracts between LHAs and executive directors and making 
 
 
8 DHCD's guidelines require that executive director benefits 
may not exceed the "benefits available to DHCD's administrative 
union . . . employees."  Department of Housing and Community 
Development, PHN No. 2019-29 at 1 (Dec. 11, 2019).  However, 
"DHCD will review and consider a request for deviation from 
[state employee union benefit] standards so long as it can be 
demonstrated that the deviation is reasonable . . . and that the 
contract terms will not negatively impact either the financial 
condition of the [L]HA or the [L]HA's staff and coverage 
availability."  Id. at 2. 
 
 
9 Longevity payments refer to "increased compensation on the 
basis of increased years of service."  PHN No. 2017-25, supra at 
15.  DHCD began allowing such payments as "bonuses" in 2022, but 
the bonus cannot be used in calculating an executive director's 
retirement benefits.  Department of Housing and Community 
Development, PHN No. 2022-16 (Sept. 21, 2022) at 3. 
6 
 
compliance with the guidelines a requirement to obtain 
contractual approval from DHCD.  A Superior Court judge allowed 
DHCD's motion to dismiss the complaint under Mass. R. Civ. P. 
12 (b) (6), 365 Mass. 754 (1974).10  The plaintiffs timely 
appealed, and we transferred the case to this court on our own 
motion. 
 
3.  Discussion.  "We review the allowance of a motion to 
dismiss de novo, accepting as true all well-pleaded facts 
alleged in the complaint."  Osborne-Trussell, 488 Mass. at 253, 
quoting Ryan, 483 Mass. at 614.  "We draw all reasonable 
inferences in the plaintiff's favor, and determine whether the 
allegations plausibly suggest that the plaintiff is entitled to 
relief on that legal claim" (quotations omitted).  Osborne-
Trussell, supra, quoting Buffalo-Water 1, LLC v. Fidelity Real 
Estate Co., 481 Mass. 13, 17 (2018).  See Iannacchino v. Ford 
Motor Co., 451 Mass. 623, 636 (2008).  "To survive a motion to 
dismiss, the 'factual allegations must be enough to raise a 
right to relief above the speculative level based on the 
assumption that all the allegations in the complaint are true 
 
 
10 Contrary to the plaintiffs' contention, the judge did not 
convert the motion to dismiss into a motion for summary judgment 
by considering DHCD's guidelines referenced in the complaint.  
See Ryan, 483 Mass. at 614 n.5 (where "the complaint makes clear 
reference" to document and "neither party disputes [its] 
existence or terms," it may be considered in connection with 
motion to dismiss). 
7 
 
(even if doubtful in fact)'" (alterations omitted).  Osborne-
Trussell, supra, quoting Sudbury v. Massachusetts Bay Transp. 
Auth., 485 Mass. 774, 779 (2020).  "The facts alleged must 
plausibly suggest (not merely be consistent with) an entitlement 
to relief" (quotation, citation, and alteration omitted).  
Osborne-Trussell, supra. 
The complaint seeks a declaratory judgment regarding the 
scope of DHCD's authority under G. L. c. 121B, § 7A -- a 
question of statutory interpretation, which we review de novo.  
See Armstrong v. Secretary of Energy & Envtl. Affairs, 490 Mass. 
243, 247 (2022).  In deciding whether an agency is acting within 
its statutory authority, we use "conventional tools of statutory 
interpretation" to determine "whether the Legislature has spoken 
with certainty on the topic in question"; if the statute is 
unambiguous, "we give effect to the Legislature's intent."  Id., 
quoting Goldberg v. Board of Health of Granby, 444 Mass. 627, 
632-633 (2005). 
"[T]he general and familiar rule is that a statute must be 
interpreted according to the intent of the Legislature 
ascertained from all its words construed by the ordinary 
and approved usage of the language, considered in 
connection with the cause of its enactment, the mischief or 
imperfection to be remedied and the main object to be 
accomplished, to the end that the purpose of its framers 
may be effectuated." 
 
Reagan v. Commissioner of Revenue, 491 Mass. 446, 451 (2023), 
quoting Oracle USA, Inc. v. Commissioner of Revenue, 487 Mass. 
8 
 
518, 522 (2021).  Accordingly, we begin our analysis with the 
words of the statute.  "[O]rdinarily, where the language of a 
statute is plain and unambiguous, it is conclusive as to 
legislative intent" (citation omitted).  Osborne-Trussell, 488 
Mass. at 254. 
Adopted in the wake of a public scandal involving the 
executive director of a local housing authority,11 G. L. c. 121B, 
§ 7A, provides that: 
"[DHCD] shall promulgate guidelines for contracts to be 
executed by the housing authority and an executive 
director.  [DHCD] may review all contracts between the 
housing authorities and executive directors and all terms 
for payments or monetary remuneration relevant to state 
payments; provided, however, that [DHCD] shall review all 
contracts and all terms for payments or monetary 
remuneration worth more than $100,000 per annum.  [DHCD] 
may strike contract provisions that do not conform to the 
guidelines."  (Emphases added.) 
 
The complaint alleges that DHCD has exceeded its authority to 
issue "guidelines" by requiring contracts between LHAs and 
executive directors to comply with the guidelines.  
Specifically, the plaintiffs maintain that the Legislature's use 
of the term "guidelines" evinces an intent that DHCD issue broad 
parameters that lack the force of a mandate.  The term 
"guideline" does not support the plaintiffs' argument.  A 
"guideline" is "an indication or outline of policy or conduct."  
 
11 See Chelsea Hous. Auth. v. McLaughlin, 482 Mass. 579, 582 
(2019) (involving unreported compensation of executive director 
of Chelsea Housing Authority). 
9 
 
Merriam Webster Collegiate Dictionary 555 (11th ed. 2020).  This 
definition does not preclude such rules from being mandatory.  
Any ambiguity in this regard is clarified by the Legislature's 
granting DHCD the authority to "strike contract provisions that 
do not conform to the guidelines."  See Malloy v. Department of 
Correction, 487 Mass. 482, 496 (2021), quoting Pentucket Manor 
Chronic Hosp., Inc. v. Rate Setting Comm'n, 394 Mass. 233, 240 
(1985) ("we look not only to the specific words at issue but 
also to other sections [of the statute], and 'construe them 
together . . . so as to constitute an harmonious whole 
consistent with legislative purpose'"). 
We disagree with the plaintiffs' contention that this 
construction is at odds with the authority of LHAs, pursuant to 
G. L. c. 121B, § 7, to "determine [executive directors'] 
qualifications, duties and compensation."  "We assume that, when 
it enacts legislation, the Legislature is . . . aware of 
existing statutes."  Suliveres v. Commonwealth, 449 Mass. 112, 
116 (2007).  Pursuant to the statutory scheme governing the 
relationship between DHCD and LHAs, DHCD operates as "the 
administrative superior" of LHAs.  West Broadway Task Force, 
Inc., 363 Mass. at 748 & n.4, citing G. L. c. 121B, §§ 1, 11, 
29, 30-32, 34, 35, 37.  DHCD has the "power to oversee most 
phases of the operations of the local housing authorities, and 
to that end it is given various powers of approval and veto of 
10 
 
the activities of those authorities together with rule making 
power and power to demand reports and other information."12  West 
Broadway Task Force, Inc., supra at 748. 
Subject to DHCD's supervision, LHAs retain "operating 
responsibility and corresponding powers regarding the finances, 
construction, maintenance, and day-to-day management of housing 
projects in [their municipalities]."  Id.  In view of this 
framework, and against the backdrop of a public scandal, see 
note 11, supra, the Legislature enacted G. L. c. 121B, § 7A, to 
give DHCD further authority and oversight regarding the terms of 
executive director contracts with LHAs.13  Within those 
constraints and consistent with the oversight allowed to DHCD by 
G. L. c. 121B, § 7A, LHAs continue to have authority to hire 
 
12 See, e.g., G. L. c. 121B, § 3 (DHCD shall certify 
dissolution of housing authority), § 5 (DHCD shall appoint one 
member of each housing authority), § 26 (j) (renovation of 
existing housing project "shall be undertaken in accordance with 
rules and regulations promulgated by [DHCD]"), § 26 (k) (DHCD 
must approve demolition of existing project), § 26B (DHCD must 
establish performance-based monitoring program for all LHAs), 
§ 28A ("Each housing authority shall submit to [DHCD] an annual 
plan"), § 29 ("[DHCD] shall investigate the budgets, finances 
and other affairs of housing authorities and the housing 
authority's dealings, transactions and relationships"), § 31 ("A 
housing authority shall not undertake a low-rent housing project 
until it has submitted to [DHCD] the plans and description of 
the project . . ."). 
 
 
13 Section 7A was passed alongside G. L. c. 121B, § 26B, 
which requires LHAs to participate in a performance-based 
monitoring program established by DHCD and allows DHCD to 
designate a housing authority as "chronically poor performing."  
See St. 2014, c. 235, §§ 7, 8. 
11 
 
executive directors and "determine their qualifications, duties 
and compensation."14  G. L. c. 121B, § 7. 
Judgment affirmed. 
 
14 The plaintiffs also contend that DHCD's use of 
"guidelines" to mandate material terms of an executive 
director's contract effectively renders them "regulations" 
subject to the rulemaking provisions of the Administrative 
Procedure Act (APA), G. L. c. 30A, § 5, which require, inter 
alia, that proposed regulations be published and considered at a 
public hearing.  We disagree.  The term "regulation" as used in 
the APA excludes "regulations concerning only the internal 
management or discipline of the adopting agency or any other 
agency . . . not substantially affecting the rights of or the 
procedures available to the public or that portion of the public 
affected by the agency's activities."  G. L. c. 30A, § 1 (5).  
The guidelines promulgated pursuant to G. L. c. 121B, § 7A, 
concern the internal management of LHAs under the oversight of 
their supervisor, DHCD; they "do not purport directly to 
regulate public conduct."  Commonwealth v. Trumble, 396 Mass. 
81, 89 (1985).  Cf. Harborview Residents' Comm., Inc. v. Quincy 
Hous. Auth., 368 Mass. 425, 426-427 (1975) (concerning 
regulations governing public housing tenant leases and grievance 
procedures); Commissioner of the Dep't of Community Affairs v. 
Medford Hous. Auth., 363 Mass. 826, 828 (1973) (concerning 
regulations governing LHA's interaction with public housing 
tenants).