Rodriguez v. Cuomo
| Decision Date | 07 January 1992 |
| Docket Number | D,No. 1260,1260 |
| Citation | 953 F.2d 33 |
| Parties | Balbina RODRIGUEZ; Susan Riley; Teresa Gonzales; Ana Fernandez; Donna Wade; Mary Harvey, on behalf of themselves and all others similarly situated, Plaintiffs-Appellees, v. Mario CUOMO, individually and as Governor of the State of New York; Cesar Perales, individually and as Commissioner of the New York State Department of Social Services, Defendants-Appellants. ocket 90-9092. |
| Court | U.S. Court of Appeals — Second Circuit |
Lawrence S. Kahn, Deputy Sol. Gen., New York City , for defendants-appellants.
John T. Hand, White Plains, N.Y. (Michael D. Hampden, Westchester Legal Services, Inc., White Plains, N.Y., Steven Telzak, Glennia R. Campbell, Bronx Legal Services, Inc., New York City, of counsel), for plaintiffs-appellees.
Before CARDAMONE and MAHONEY, Circuit Judges, and PARKER, District Judge. *
Any time analysis is undertaken of a federal assistance program we inevitably are faced with a legislative morass, created by complex statutes and regulations that spawn confusing and esoteric arguments. Yet, the complicated nature of the legal problems presented should not obscure the harsh choices at the human level that they represent. On this appeal we must construe a federal aid program designed to help low-income households pay for heating their homes. At issue is a New York State regulation which effectively ruled that one group of the poor is more in need of assistance than another. The question is whether in light of the limited federal funds available may aid be given to those the state deems most in need, even though this results in others also in need not being provided for? In the best of all possible worlds the needs of all would be met. Unfortunately, we do not rule in such a world and, as a consequence, think the answer to the question is "yes."
The assistance program at issue began in 1981 when Congress revamped a 1980 emergency home energy aid bill and established in its place a block grant program of federal aid. The Low-Income Home Energy Assistance Act of 1981 (Low-Income Energy Act or Act), 42 U.S.C. §§ 8621 et seq., makes grants to the states, which distribute these funds (Home Energy Assistance Program or "HEAP" funds) to eligible households. New York State participates in this program, see N.Y.Soc.Serv.Law § 97 (McKinney Supp.1990), and must assure the federal government annually that it will administer the HEAP funds it receives in accordance with the conditions set forth in 42 U.S.C. § 8624(b), which provides:
As part of the annual application required by subsection (a) of this section, the chief executive officer of each State shall certify that the State agrees to--
(1) use the funds available under this subchapter for the purposes described in section 8621(a) of this title and otherwise in accordance with the requirements of this subchapter, and agrees not to use such funds for any payments other than payments specified in this section;
(2) make payments under this subchapter only with respect to--
(A) households in which 1 or more individuals are receiving [AFDC, supplemental Social Security, food stamps, or veterans benefits]; or
(B) households with incomes which do not exceed the greater of--
(i) an amount equal to 150 percent of the poverty level for such State; or
(ii) an amount equal to 60 percent of the State median income;
except that no household may be excluded from eligibility under this subclause for payments under this subchapter ... if the household has an income which is less than 110 percent of the poverty level for such State for [the] fiscal year....
(5) provide, in a timely manner, that the highest level of assistance will be furnished to those households which have the lowest incomes and the highest energy costs in relation to income, taking into account family size, except that the State may not differentiate in implementing this section between the households described in clause (2)(A) and (2)(B) of this subsection....
(8) provide assurances that (A) the State will not exclude households described in clause (2)(B) of this subsection from receiving home energy assistance benefits under clause (2), and (B) the State will treat owners and renters equitably under the program assisted under this subchapter....
The Act defines "household" as "any individual or group of individuals who are living together as one economic unit for whom residential energy is customarily purchased in common or who make undesignated payments for energy in the form of rent." Id. at § 8622(2) (emphasis added). So long as minimal requirements established under the Act are met, the states are free to design their own programs. One such requirement is that the annual plan the states submit to the federal government must describe "the eligibility requirements to be used by the State" distributing HEAP Funds. Id. at § 8624(c)(1)(A).
Over the years federal funds for the HEAP program were cut substantially. New York responded by promulgating the regulation challenged on this appeal, 18 N.Y.Comp.Codes R. & Regs. (NYCRR) § 393.4(c)(3)(i), effective as of February 27, 1989. It states that
(3) For purposes of the current HEAP State Plan ... households in the following living arrangements shall be ineligible to receive benefits under HEAP:
(i) tenants of government subsidized housing with heat included in their rent.
Under New York's HEAP plan subsidized housing is any housing that receives a subsidy based on income that reduces the household's monthly rental payment. This definition encompasses two types of subsidy: public housing and "Section 8" housing. There is also a Section 8 voucher program, but as none of the plaintiffs receives these vouchers it is unnecessary to describe that program.
The regular Section 8 program requires a tenant (not in public housing) who does not receive public assistance to pay as rent the greater of (1) 30 percent of the family's monthly adjusted income or (2) 10 percent of the family's monthly income. 42 U.S.C. § 1437a(a)(1)(A), (B); 24 C.F.R. § 813.107(a)(1), (2). The tenant who receives public assistance--but is not in public housing--pays the greater of either measure above or that part of the tenant's public assistance grant specifically allocated to shelter. 42 U.S.C. § 1437a(a)(1)(C); 24 C.F.R. § 813.107(a)(3). A tenant in New York on public assistance pays the latter amount because New York allocates a specific portion of the public assistance grant to shelter. 18 NYCRR § 352.3(a). The Public Housing Authority pays the remainder of the rent. See 24 C.F.R. § 813.102. Similar rules based on incomes or shelter allowances apply to the rent paid by tenants of public housing. See 24 C.F.R. § 913.107; 9 NYCRR § 1627-2.6(c)(5)(i); 18 NYCRR § 352.3(a), (d). The Public Housing Authority establishes a utility allowance for any utilities not included in the rent, which is then subtracted from the rent to be paid by the household. See 24 C.F.R. §§ 813.102, 913.102.
The six plaintiffs are residents of government subsidized housing who are not billed separately for heat but pay separately for non-heat related utilities. Each plaintiff is a beneficiary of a utility allowance for utilities other than heat. The challenged state regulation makes the plaintiffs ineligible for HEAP assistance, despite the fact that all have incomes that are less than 110 percent of the poverty level for New York State. The plaintiffs asked the United States District Court for the Southern District of New York (Broderick, J.), to declare that the New York regulation violates The Low-Income Energy Act and the Equal Protection and Due Process Clauses. In an order dated November 9, 1990 the district court held that the regulation violated clauses (b)(8) and (f)(1) of the Act, but did not reach or decide the constitutional claims. 751 F.Supp. 363 (S.D.N.Y.1990).
The Governor of New York State and the Commissioner of the New York State Department of Social Services appeal from that judgment. Meanwhile, the district court approved a stipulation partially staying its order, under which the state set aside $7.5 million to pay benefits, if payment is held to be required. Further, the state's obligation, if any, to pay these HEAP benefits has been stayed until 30 days following the disposition of this appeal. We now reverse.
For purposes of consistency and clarity 42 U.S.C. § 8624(b) will be referred to as a subsection, (b)(2) as a clause, and (b)(2)(B) as a subclause. The first question to be addressed is whether either clause (b)(2) or clause (b)(8) of the Act requires that all households described in subclause (2)(B) receive at least some HEAP benefits. The district court held that, "absent some other overriding clause, every household described in 42 U.S.C. § 8624(b)(2)(B) must receive some part of the federal funds ... [s]o long as [they] are ... paying, directly or indirectly, for some part of their heating costs." 751 F.Supp. at 365. In other words, as we read it, the trial court held that all households below 150 percent of the State poverty level or below 60 percent of the State median income must receive at least some aid. This is not what plaintiffs urge on appeal. Instead, they argue only that all households below 110 percent of the State poverty level must receive some assistance. We discuss the district court's view first, because if its holding is correct then argument respecting the 110 percent floor becomes irrelevant, since those families whose income is below 110 percent of the poverty level necessarily also fall below 150 percent of the poverty level.
The district court's legal conclusions on an appeal from a grant of summary or declaratory judgment are ordinarily reviewed de novo. Se...
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