The ongoing legal battle to invalidate Pittsburgh’s “source of income” (SOI) ordinancewill continue into another year, with the Pennsylvania Supreme Court ordering the Commonwealth Court to reconsider the case “in light of this Court’s decision in Pennsylvania Restaurant and Lodging Association v. City of Pittsburgh.” This case challenged the state’s Home Rule Law, which “prohibits a home rule municipality from ‘determin[ing] duties, responsibilities or requirements placed upon businesses, occupations and employers.”
As background, a local apartment association filed a complaint for equitable relief and request for declaratory judgment against the city in 2016 following passage of the source of income ordinance. In 2018, the trial court granted the plaintiff’s motion and declared the ordinance invalid and unenforceable. The City appealed, and the Commonwealth Court of Pennsylvania heard the case en banc in February 2019. On March 12, the appellate court issued its decision in which the court agreed that the SOI ordinance places affirmative duties and requirements on rental property owners and operators that are expressly prohibited by the state’s Home Rule Law
Following the state supreme court’s decision, the City filed its “remand” brief with the Commonwealth Court on November 20. The apartment association’s brief in response will be filed no later than Dec. 20, 2019, and arguments are expected to be scheduled in the Commonwealth Court in February 2020.
Local SOI protections, like the ordinance in Pittsburgh, effectively force property owners and operators to reluctantly participate in the program or risk potential liability. Unfortunately, SOI laws do not take in account that U.S. Department of Housing and Urban Development (HUD) and local Public Housing Authorities (PHAs) who administer the Housing Choice Voucher (HCV) program require participating owners and operators to adhere to additional regulatory requirements.
These requirements are otherwise not imposed in a standard apartment leasing transaction and include significant challenges stemming from inconsistency in service and interactions with PHAs. These ongoing issues create uncertainty in rental housing operations and often undermine the ability of owners to properly manage risk, leading to negative outcomes for owners and residents alike.
There are better options for improving the availability of rental housing for voucher holders than mandating participation in the HCV program, such as increasing funding and reducing the bureaucratic requirements associated with it. The demand for affordable housing cannot be met by government programs alone; eliminating onerous permitting and zoning requirements and other barriers to construction would increase the supply of rental housing and bring down rents for cost-burdened Americans.
The National Apartment Association (NAA) continues to work with its affiliates and members to oppose efforts to make voucher acceptance mandatory and engage HUD to offer solutions that would incentivize owners and operators in the private market to participate voluntarily, as Congress intended. For more information on this case or SOI policy in general, see NAA’s dedicated policy issue page or contact Jodie Applewhite, NAA’s Manager of Public Policy.