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U.S. joins whistleblower lawsuit that accuses Los Angeles of misusing HUD money

City accused of not providing enough accessible housing

The federal government is joining a lawsuit that accuses the city of Los Angeles of misusing hundreds of millions of dollars from the Department of Housing and Urban Development that were earmarked for providing accessible housing for people with disabilities, the Department of Justice announced this week.

The lawsuit, which stems from a whistleblower complaint, alleges that the city of Los Angeles and the CRA/LA (formerly the Community Redevelopment Agency of the City of Los Angeles) falsely certified that they were in compliance with federal accessibility laws in connection with housing grants from HUD.

The lawsuit alleges that Los Angeles applied for “millions of dollars” in federal money, some of which it provided to the CRA/LA, for the development of affordable housing that is accessible for people with disabilities.

In order to receive the HUD funds, the city and the CRA/LA are required to comply with federal accessibility laws, including Section 504 of the Rehabilitation Act and the Fair Housing Act, and the duty to affirmatively further fair housing. These measures are meant to ensure that people with disabilities have fair and equal access to public housing.

As a condition of receiving the HUD funds, the city certified compliance with Section 504 and the Fair Housing Act, and certified that it satisfied its duty to affirmatively further fair housing each year.

The lawsuit alleges that the city and CRA/LA failed to operate their housing programs in compliance with the federal laws, which then resulted in public housing that was built without the minimum number of accessible units.

The city denies the allegations.

Per a Reuters report:

A spokesman for Democratic City Attorney Mike Feuer, Rob Wilcox, in a statement said Los Angeles would "vigorously fight" the lawsuit, which threatens to "divert tens of millions more from L.A. taxpayers to the federal treasury – without housing a single person. This abuse of power cannot stand."

The lawsuit also alleges that the city and the CRA/LA “neither monitored sub-recipients of HUD funds to ensure that they complied with federal accessibility laws nor maintained” an available list of accessible units.

“This case alleges that the City of Los Angeles repeatedly violated the law by falsely certifying that millions of federal dollars were being used to build housing that included units accessible to people with disabilities,” said Acting U.S. Attorney Sandra Brown for the Central District of California.

“While people with disabilities struggled to find accessible housing, the city and its agents denied them equal access to housing while falsely certifying the availability of such housing to keep the dollars flowing,” Brown continued. “The conduct alleged in this case is very troubling because of the impact on people who did not have access to housing that met their needs.”

The lawsuit was originally filed by Mei Ling, a resident of Los Angeles who uses a wheelchair, and the Fair Housing Council of San Fernando Valley, a nonprofit civil rights advocacy group.

The government is intervening in the lawsuit because it was filed under qui tam or whistleblower provisions of the False Claims Act, which allows for private parties to sue on behalf of the U.S. when they believe that a party submitted false claims for government funds, and to receive a share of any recovery.

“Recipients of federal housing funds must honor their commitments to accommodate people with disabilities,” said Acting Assistant Attorney General Chad Readler of the Justice Department’s Civil Division. “Denying people with disabilities equal access to public housing deprives one of the most disadvantaged groups in society of fair housing opportunities.”

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