Court Opinion

ID: 9460642
Source: CourtListenerOpinion
Date Created: 2023-08-04 21:56:53.337882+00
Date Added: 2024-06-11T17:36:43.355643
License: Public Domain

FAHY, Senior Circuit Judge,
dissenting:
The basic requirement that the rentals in the development projects involved *654shall be reasonable stems from section 207(b)(2) of the National Housing Act. The court accordingly holds in a companion case, Marshall v. Lynn, No. 71-1786, 162 U.S.App.D.C. -, 497 F.2d 643, that the tenants irt projects developed under section 221 of the Act, providing for low or moderate income housing, shall be afforded an opportunity through written statements to contest proposals for rental increases. Yet the court denies this opportunity to tenants in projects developed under section 220 of the Act, which have the purpose of rehabilitating blighted areas. The rentals in those projects are also required to be reasonable, and I find no legal basis for depriving their tenants of the same opportunity accorded tenants in projects developed under section 221. In both situations the reasonable standard of section 207(b)(2) is carried forward by regulations or agreed arrangements between the Administrator and the developer. The regulations or arrangements, as the case may be, are established under the authority granted to the Administrator, by section 220(d)(2) in a section 220 project, and by section 221(d) (3) in a section 221 project.
The distinction between the two situations drawn by the court, based on the difference in the purposes of the two types of projects, I think is not justified. In each instance the reasonable standard applies. What is reasonable in one case may be quite different from what is reasonable in the other, depending upon a number of factors, among them the ability to pay, but these different considerations must be judged, in their own settings, by the same prescribed standard of reasonableness. Therefore, as it seems to me, no legal distinction should be drawn which denies to one the opportunity granted to the other. Both are entitled to reasonable treatment with respect to their respective rentals.
While there is the need for assuring a fair return to the developer on his investment, it is not inconsistent with this need to permit tenants facing rental increases a limited amount of participation in the determination of their reasonableness. Even were the standard of reasonableness to be judged principally from the viewpoint of the need of the investor, those who pay rent should also be heard in some fashion by the public authorities. And those in more comfortable circumstances than others should not because of that be denied an opportunity to contest the reasonableness of their own rentals.