The city is not at risk of losing federal funding or being sued by the U.S. Department of Housing and Urban Development if it proceeds with a plan to eliminate 1,008 Section 8 Housing Choice Vouchers over the next five years — at least not right now, said Community Revitalization Director Doug Adkins.

“You’re at no risk right this minute,” Adkins told Middletown City Council at the board’s Tuesday meeting. “Zero.”

Adkins presented council members with five options for responding to a Dec. 21 letter the city received from HUD about its plan to cut Section 8 vouchers. In the letter, HUD officials told city officials that they needed to either fill Middletown’s available vouchers, transfer the city’s voucher program to the Butler Metropolitan Housing Agency or face possible legal action.

Adkins told council he disagreed with characterizations of HUD’s letter as being “strongly worded.” He said he thought the letter was “diplomatically written” given each side’s differing point of view on the matter.

“No fair housing or civil rights threats were made, no regulatory violations were cited,” said Adkins, a former attorney with the U.S. Labor Department. “We have been politely asked if we would like to walk away and give our program to Butler Metro… As an attorney, I’m looking for, where’s the hammer?”

Adkins said there is nothing in HUD’s regulations that says Middletown can’t cut vouchers. He said he’s “100 percent comfortable moving forward” with the city’s plan because HUD needs to cite the city before they can say any federal funding would be in jeopardy.

Still, Adkins said city staff would research and make a detailed presentation to council in two weeks about five ways they could respond to HUD’s letter. The options include:

• Transferring the program to BMHA as requested. Adkins said while it gets the city out of the public housing business and attention can be redirected to other issues, the city would “lose all the controls and safeguards that we have built into the program over the last three years and the vouchers will continue to stay concentrated in Middletown.”
• Negotiating a transfer the program with conditions. BMHA would take over the program with the city’s standards, which includes honoring the city’s barred landlord list and adopting rent usefulness and payment standards to de-concentrate high poverty census tracts.
• Transferring just the 1,008 vouchers to BMHA and continuing MPHA operations with the proposed 654 vouchers.
• Keeping vouchers and negotiating to reduce other subsidized housing units, though Adkins said this option is the least likely HUD would consider.
• To “politely decline” and move forward with what the city has proposed.

The city must respond to HUD’s letter by Jan. 31, however, Adkins told council he has asked for an extension until March so that the city could thoroughly review its options.

The proposal city leaders sent to HUD, which was approved by the Middletown Public Housing Agency on Oct. 16, reduces the city’s total subsidize housing to 10 percent of the city’s total housing stock. It also places the city in compliance for HUD regulations to have 95 percent of its vouchers filled. With more than 1,600 vouchers issued, the city only had about 82 percent of them filled.

Staff proposed and the MPHA board, which consists of all seven members of city council, approved the plan to reduce the vouchers to 654 and transfer the remaining 1,008 vouchers to another housing authority or back to HUD.

Jeff Faulkner, of Wilbraham Road and a Section 8 landlord, said he felt HUD’s letter was clear: comply by filling the available vouchers or risk losing the program and local control. Faulkner said he’s “fed up” with the process and the way the city is “beating up” Section 8 landlords with its strenuous property inspections.

Faulkner has sued the city in small claims court on Dec. 28 for boarding up his rental property at 2108 Winona Drive four years ago, and alleges it cost him potential income and thousands of dollars in repairs. He is seeking $3,000 plus interest from the city.

“This program now is getting a bad reputation of not being landlord friendly,” Faulkner said. “It’s all about the landlords. We’re the vendors, we’re the ones that own the homes, we make them available for people who need them.”

Councilman Joshua Laubach assured Faulkner that council wasn’t “unfairly going after or targeting landlords or Section 8 owners.” Laubach said the city’s plan is about maintaining local control of how Middletown looks demographically and not being governed by outside federal dollars.

But other council members expressed concerns about challenging HUD.

“My concern is the same as the vice mayor’s, that we run the risk of losing a lot of what we built over the last three years that I’ve been here,” Councilman A. J. Smith said.

If HUD comes back and says the city did violate some regulation, Adkins said City Council will have time to regroup and reassess its position because “they have to cite us with something, they have to find that we have broken something.” Then they have to allow the city to have an action plan to regain compliance.