Resident Liable to PHA for Excess Rental Assistance
Facts: When a resident applied for Section 8 benefits, she reported that she worked for U.S. Bank and earned total weekly wages of $375. The resident showed the local housing authority a current pay stub. The application also included an affirmation that the contained information is true, correct, and complete, and that any changes in income must be reported in writing within 10 days from the date of occurrence. The resident received rental assistance based upon the information submitted to the housing authority.
Between March 2008 and March 2009, U.S. Bank's payroll records indicated that the resident earned gross wages of $41,231.21. As a result, the resident received $2,188 more in rental assistance in 2008 than she would have received had her actual income been reported. The resident claimed that the increased wages were issued to her through monthly bonuses, which were neither guaranteed nor reliable. In August 2009, the resident agreed to reimburse the housing authority for the excess rental subsidies she received in the total amount of $2,188, to be paid in 12 installments. After two installment payments, the resident filed for bankruptcy.
The housing authority asked the bankruptcy court not to discharge the debt for the excess rental assistance. The resident claimed that she was as honest as possible when she completed the application and that she included the housing authority as a creditor in her bankruptcy case because she can't afford to repay this debt.
Ruling: The Missouri bankruptcy court ruled in favor of the housing authority.
Reasoning: The court concluded that the personal declaration form submitted to the housing authority was materially false. The form required the resident to report any changes in her income, but she chose not to report her consistently higher income. The court concluded that the resident failed to report her additional income with the intent to deceive the housing authority. While the additional income was paid as monthly bonuses to the resident, she was required to report her total income so that the housing authority would be aware of the funds available to her in order to determine whether she qualified for rental assistance.
- Housing Authority of St. Louis County v. White, October 2011