95 F.Supp.3d 35 (D.Mass. 2015), C. A. 14-13425-WGY, DeCambre v. Brookline Hous. Auth.

Docket Nº:CIVIL ACTION 14-13425-WGY
Citation:95 F.Supp.3d 35
Opinion Judge:William G. Young, United States District Judge.
Attorney:CIVIL ACTION NO. 14-13425-WGY For Kimberly P. DeCambre, Plaintiff: J. Whitfield Larrabee, LEAD ATTORNEY, Attorney at Law, Brookline, MA. For Brookline Housing Authority, Matthew S. Baronas, Janice McNiff, Carole Brown, Defendants: Amy M. McCallen, John Egan, LEAD ATTORNEYS, Rubin & Rudman, LLP, B...
Case Date:March 25, 2015
Court:United States District Courts, 1st Circuit, District of Massachusetts

Page 35

95 F.Supp.3d 35 (D.Mass. 2015)





United States District Court, D. Massachusetts

March 25, 2015

For Kimberly P. DeCambre, Plaintiff: J. Whitfield Larrabee, LEAD ATTORNEY, Attorney at Law, Brookline, MA.

For Brookline Housing Authority, Matthew S. Baronas, Janice McNiff, Carole Brown, Defendants: Amy M. McCallen, John Egan, LEAD ATTORNEYS, Rubin & Rudman, LLP, Boston, MA.

Page 36


William G. Young, United States District Judge.


In a case involving a beneficiary's special needs trust and federal housing benefits, this Court is faced with determining whether such a trust, designed to prevent beneficiaries from losing their Medicaid and Social Security eligibility, should also protect beneficiaries from losing their income-based federal housing vouchers despite statutory language to the contrary. The issue before the Court turns on the interpretation of HUD regulations for calculating annual income for housing assistance eligibility purposes; specifically, whether income should include disbursements from a special needs trust that was funded by lump-sum settlements from a personal injury lawsuit. The plaintiff before the Court, Kimberly DeCambre (" DeCambre" ), a Brookline, Massachusetts resident and participant in the Section 8 Housing Choice Voucher Program (" Section 8" ), alleges that the Brookline Housing Authority (" BHA" ) unlawfully calculated

Page 37

her annual income in violation of the federal regulations pertaining to Section 8, as well as in violation of her substantive due process rights under the Fourteenth Amendment of the United States Constitution, 42 U.S.C. § 1983, 42 U.S.C. § 3604(c) (the Fair Housing Act), 29 U.S.C. § 701 (the Rehabilitation Act), and 42 U.S.C. § 12131 (the Americans with Disability Act). Her allegations of disability-based discrimination were also raised against three BHA employees: Matthew Baronas (Assistant Executive Director), Janice McNiff (Leased Housing Representative), and Carole Brown (Director of the Leased Housing Department) (collectively with BHA, " Defendants" ). DeCambre further requested a preliminary injunction against the BHA to stop it from including certain trust disbursements towards the calculation of her income for Section 8 eligibility. This Court heard oral arguments at a case stated hearing1 on September 19, 2014, which greatly assisted the Court in assessing the parties' claims. The Court, first, rules that DeCambre does not have a section 1983 claim because the BHA's income determination was not arbitrary and capricious, and further denies DeCambre's motion for a preliminary injunction, with an order that her case be remanded for reconsideration before the BHA. The Court's reasoning is laid out below as required by Federal Rule of Civil Procedure 52(a).


A. DeCambre's Disability Status

DeCambre is fifty-nine years old, and presently lives with her adult son in a Brookline, Massachusetts apartment. See First Am. Verified Compl. & Demand Trial Jury (" Compl." ) ¶ 11, ECF No. 9; see also Pl.'s Mem. Supp. Mot. Emergency Prelim. Inj. (" Pl.'s Mem." ), Ex. G, Aff. Kimberly P. DeCambre ¶ 2, ECF No. 5-7. Since 2005, DeCambre has been a recipient of housing vouchers through her participation in Section 8, which is administered locally by the BHA and directly funded by HUD. As described on its website, Section 8 provides housing vouchers to " low-income families, the elderly, and the disabled to afford decent, safe, and sanitary housing in the private market." Housing Choice Vouchers Fact Sheet, HUD.gov (Sept. 17, 2014), http://portal.hud.gov/hudportal/HUD?src=/topics/housing_choice_voucher_program_section_8; see also 42 U.S.C. § 1437(f) et seq. These vouchers are administered by local agencies and housing subsidies are paid directly to landlords by the agencies. See 42 U.S.C. § 1437(f) et seq. The amount of the rent subsidy typically is the amount of the gross rent, " minus 30 percent of monthly adjusted income." Id. The BHA, which issues these rent subsidies in vouchers, is a local housing authority pursuant to Massachusetts General Law, chapter 121B, section 3, and a recipient of federal funding for subsidizing rent for its participants through an Annual Contributions Contract with HUD. Compl. ¶ 3.

It is undisputed that DeCambre is disabled as she is currently a recipient of Medicaid and Social Security benefits. Stipulated Factual R.: Case Stated (" Stip. Factual R." ) ¶ 8, ECF No. 16. She currently

Page 38

receives Supplemental Security Income (" SSI" ) in the amount of $835.39 per month from the Social Security Administration, which provides supplemental income for " aged, blind, or disabled individual[s]." 42 U.S.C. § § 1382c(a)(1), (a)(3); see Pl.'s Mem. 2. She also receives Medicaid administered by MassHealth. Id. at 5. DeCambre's " major disabilities" stem from kidney disease, which her treating physician describes as " recurrent kidney stones, severe hypokalemia (low potassium) requiring high dose daily potassium supplements, which is thought due to medullary sponge disease and/or Gitelman's syndrome." Pl.'s Mem., Ex. C2, Dr. Hsiao Letter, ECF No. 5-1. Her physician also stated that DeCambre suffered from " unusual skin patterns, which is presumed to be primary/secondary erythromelalgia," id., while a second physician noted that DeCambre required " access to heat and central air conditioning to ensure temperature regulation" due to her " numerous medical conditions," Pl.'s Mem., Ex. C2, Dr. Crombie Letter, ECF No. 5-3. In her complaint, DeCambre further elaborates on her ailments as also including post traumatic stress disorder, fibromyalgia, arthritis, torn labrum in the hips, shoulder and elbow injuries, and a history of depression. See State Ct. R., Ex. A, Verified Compl. & Demand Trial Jury 5, ECF No. 12.

B. Special Needs Trust

DeCambre is the beneficiary of an irrevocable Special Needs Trust (" Trust" ) under 42 U.S.C. § 1396p(d)(4)(A) and (C), which is defined as a trust " containing the assets of an individual under age 65 who is disabled . . . and which is established for the benefit of such individual by . . . a court." Pl.'s Mem. 2. As an irrevocable trust under section 1396p(d)(4)(C), DeCambre has no control over the Trust corpus, and the Trust itself earns " little or no interest." Id. The Trust was funded entirely from a series of lump-sum settlements from a personal injury and property damage lawsuit, and created by the Suffolk Superior Court for DeCambre in 2010. Id. at 3; see also Defs.' Opp'n Pl.'s Mot. Prelim. Inj. (" Defs.' Mem." ) 3, ECF No. 10. The total amount of the settlement is estimated to be $330,000. Stip. Factual R. ¶ 7. DeCambre's counsel in this case, J. Whitfield Larrabee (" Larrabee" ), is also the trustee of the Trust. Pl.'s Mem., Ex. C1, Letter to Joseph, ECF No. 5-3. Based on an expenses chart submitted by DeCambre, principal from the Trust has been used to pay for administrative trustee fees; cell phone, cable, and internet bills; veterinary care for cats; dental and medical costs; and travel expenses. See Pl.'s Mem., Ex. F, Kimberly DeCambre Supplemental Needs Trust Payments 12-1-2012 to 11-04-2013 (" Trust Expenses" ), ECF No. 5-6.

C. DeCambre's Section 8 Eligibility

DeCambre has been a participant in the Section 8 housing assistance program since 2005, and effective December 1, 2012, her monthly rental payment for her apartment was $312.00. Pl.'s Mem., Ex. A, Notice Rent Adjustment 2012, ECF No. 5-1. The fair market or contract rent totaled $1,595.00 per month, and she received $1,283.00 in housing assistance program payments. Id. On October 28, 2013, the BHA adjusted DeCambre's rent to $435 per month, explaining that certain disbursements from her Trust could not be classified as exempt medical expenses. Stip. Factual R., Ex. 4, Notice Rent Adjustment 2013, ECF No. 16-4. Upon request for the submission of statements from the Trust for their annual re-certification process, Stip. Factual R., Ex. 5, Letter from Lea Luz Rios, ECF No. 16-5, DeCambre submitted various trust-related documents to the BHA on November 12,

Page 39

2013, Stip. Factual R., Ex. 6, Letter from Larrabee to Dalia Joseph, ECF No. 16-6.

Upon conducting their annual recertification in the fall of 2013, the BHA determined that DeCambre was no longer eligible to receive housing assistance because her income was too high. Defs.' Mem. 3. DeCambre self-reported her gross annual income to include $2,004 from food stamps, $9,748.68 from social security, $200 from her son's earnings, and $445 from ABCD Fuel Assistance, totaling $12,397.68 for 2013. Stipulated Factual R., Ex. 3, Appl. for Continued Occupancy, Sept. 10, 2013, ECF No. 16-3. The BHA, however, based on submitted income tax returns from DeCambre's attorney, found that DeCambre received approximately $200,000 in distributions from the Trust between 2011 and 2013, and that her 2011 income tax return reported an income of $108,322. Defs.' Mem. 4. Further, the BHA found that the Trust disbursements totaled $31,749.01 in 2012 and totaled $62,828.99 between January and November 2013 -- which they determined should have been reported as income for purposes of recertification. Id. The BHA's yearly gross household income limit for a two-person household is $22,600. Section 8 -- Housing Choice Vouchers, Brookline Housing Authority (Oct. 31, 2014), http://www.brooklinehousing.org/sect8.html. As a result, DeCambre was notified in a letter dated December 18, 2013, that effective February 1, 2014, she would be responsible for the full amount of her contract rent...

To continue reading