Before FEINBERG, Chief Judge, KAUFMAN, Circuit Judge, and ROSENN,*fn* Senior Circuit Judge.
These proceedings challenge a policy of the New York City Housing Authority (the Authority) of raising the rents of its public housing tenants to one of several maximum rent alternatives when they fail to certify their income and family composition in a timely manner.
The plaintiffs, tenants of the Authority whose rents were increased to more than thirty percent of their incomes pursuant to this policy, filed their complaint in the United States District Court for the Southern District of New York seeking injunctive and declaratory relief, as well as compensatory damages. They alleged that the challenged policy violated statutory, regulatory, constitutional, and contractual requirements.*fn1 On the basis of the Authority's answer to the complaint and to a Request for Admissions, and there being no disputed issues of material fact, the plaintiffs moved for partial summary judgment and the defendants cross-moved for summary judgment.*fn2 The district court granted plaintiffs' motion and the defendants appeal. 592 F. Supp. 785 . We reverse.
The Authority owns, operates, and manages 275 public housing developments in New York City, providing housing for approximately 500,000 low-income citizens. With respect to eighty-five percent of these housing developments, the Authority has contracted with the Department of Housing and Urban Development (HUD) for the receipt of operating subsidies totalling $275,000,000 in the year 1982 which, according to the defendants, are intended to make up the difference between the Authority's annual operating expenses and the annual rents collected from its tenants. These subsidies are conditioned on annual verification by the Authority of the income and family composition of each public housing tenant and the Authority's compliance with the federal housing Act and the regulations governing the federally-funded public housing program. The annual verification is required in order to assure that federal funds are received for persons in the economic categories intended by the Housing Act and to enable the Authority to make the annual certification to HUD.
The Brooke Amendment to the United States Housing Act of 1937 originally set limits on rental charges that a public housing agency may impose on tenants. As originally enacted in 1969, the amendment provided that rental charges set by the local public housing agency "may not exceed one-fourth of the family's income as defined by HUD." Pub.L. No. 91-152, 83 Stat. 379, 389 (1969).
In a general revision effected by the Housing and Community Development Act of 1974, Pub.L. No. 93-383, 88 Stat. 633, 654 (1974), this statutory scheme was superseded by provisions now codified at 42 U.S.C. § 1437a. After several amendments, the rental limitations in force on January 1, 1980, provided:
The rental for any dwelling unit shall not exceed that portion of the resident's family income which the Secretary [of HUD] establishes on the basis of the relative level of income of the family, but such rental shall not exceed 25 per centum of family income in the case of a very low income family or, in the case of other families, 30 per centum of such income.
Pub.L. No. 96-153, 93 Stat. 1101, 1106 (1979).
In June 1980, the Authority established a basic maximum or "economic" rent schedule to be applied in instances where tenants failed to make timely required recertifications of their income and family composition. These rents, which would allow the Authority to break even without the benefit of federal subsidies, were intended to enable the Authority to meet its budgetary demands when federal subsidies were withheld because of the failure to verify and recertify tenant income and family composition. The Authority based its "economic" schedule on apartment size, and rents ranged from $218 to $350 per month. As a consequence, for tenants who failed to certify, the Authority fixed their rents at the "economic rent" corresponding to their apartment size until such time as the delinquent household verified its income, "or otherwise came forward with extenuating circumstances beyond its control which justified the late submission of the necessary information." Affidavit of Raymond Hensen, Authority Director of Personnel and Policy Development, paragraph 7, in support of Defendant's Cross-Motion for Summary Judgment. This rent schedule remained in effect until May 1983 when it was modified as a result of Congressional legislation passed in 1981, the Omnibus Budget Reconciliation Act (OBRA) Pub.L. No. 97-35, 95 Stat. 357, 42 U.S.C. § 1437 (1981).
OBRA eliminated the discretion of public housing agencies in fixing rents and required that rents be set at: (1) 30% of the family's adjusted income, (2) 10% of the family's monthly income without adjustments, or (3) for public assistance recipients, the amount of money received as a shelter allowance. This legislation also required at least annual certification of tenants' incomes and family composition. HUD issued regulations in July 1982 to implement OBRA's requirements, 24 C.F.R. § 960.404(a) (1984), and the Authority, in turn, implemented these regulations in May 1983. The Authority also implemented a policy that all tenant households which timely failed to recertify their eligibility would be charged the amount of rent charged to families who earned the maximum eligible income. Tenants who do not pay this amount or who do not come forward with the required income certification may be subject to summary eviction.
The Authority's threshold argument is that the district court lacked jurisdiction over plaintiffs' claims under 42 U.S.C. § 1983 because according to cases it cites, no private right of action exists against the local authority under 42 U.S.C. § 1437a. Middlesex County Sewerage Authority v. National Sea Clammers Ass'n, 453 U.S. 1, 101 S. Ct. 2615, 69 L. Ed. 2d 435 (1981); Pennhurst State School & Hospital v. Halderman, 451 U.S. 1, 101 S. Ct. 1531, 67 L. Ed. 2d 694 (1981); Howard v. Pierce, 738 F.2d 722, 730 (6th Cir.1984). Defendant also argues that section ...