By Emma Whitford

Law360 (January 6, 2022, 3:18 PM EST ) A New York agency tasked with distributing federal rental aid must again accept applications across much of the state, a judge ordered Thursday, reinstating one significant pandemic-era eviction safeguard shortly before another is set to expire.

In a three-page preliminary injunction order, state Judge Lynn R. Kotler gave New York's Office of Temporary and Disability Assistance until early next week to reopen the application portal for the state's Emergency Rental Assistance Program, or ERAP, which stopped considering most new applications in mid-November as available funds dwindled.

Noting the impending Jan. 15 expiration of a state law that has stayed most eviction cases across New York for the past year, Judge Kotler said that ERAP applicants benefit from an automatic eviction stay while their paperwork is being processed.

"If respondent is not directed to accept petitioners' applications, petitioners may be evicted and the program will be of no use to them after that point," Judge Kotler wrote, adding that tenants should "at least … have the benefit of being able to apply for ERAP now and obtain their rightful place on a de facto waitlist."

The judge also rejected the state's argument that reopening the portal would give tenants a sense of "false hope" after the U.S. Treasury Department awarded just a fraction of New York's November request for additional funds.

A second tranche of federal rental assistance will be up for reallocation in March, she said, and accepting applications in the meantime will not be a burden.

"Logistically, all respondent need do is turn the appropriate functionality of its website on and perhaps … review applications for eligibility," Judge Kotler wrote.

The state agency acted irrationally in closing down the portal to most applicants, she continued, as "nowhere in the relevant legislation is respondent given parameters with which to stop accepting ERAP applications."

The Office of Temporary and Disability Assistance must fully reopen the portal as soon as possible, the order states, with a maximum buffer period of three business days.

"The court's ruling is under review and the agency will respond accordingly," an agency spokesperson told Law360 on Thursday.

Gov. Kathy Hochul's office did not immediately reply to requests for comment. The New York attorney general's office, which is representing the OTDA in the suit, declined to comment.

Individual tenants and their advocates filed the underlying suit in mid-December, arguing that it was arbitrary for New York to close the door to most ERAP applicants even as it sought additional federal funds.

"Due to respondent's unlawful action, families who otherwise could have applied for ERAP will be vulnerable to eviction as of January 15, even though federal funds may not yet have been fully allocated, much less distributed," the complaint said.

New York began administering one of the largest emergency rental assistance programs in the country in June, with more than $2 billion at its disposal to cover rent and utility arrears.

Tenants who met income requirements and experienced financial hardship during the pandemic could apply for up to 12 months of missed rent, as well as three months of future rent.

Hochul warned that funds were running low in late September, indicating that she planned to seek more money. The OTDA then requested nearly $1 billion from the Treasury Department to cover pending applications, but has since learned that just $27 million is forthcoming.

In an affidavit submitted earlier this week, OTDA Executive Deputy Commissioner Barbara Guinn said these funds will be "far from sufficient even to support all of the applications that already have been submitted to OTDA."

Ellen Davidson of the Legal Aid Society, co-counsel for the plaintiffs, celebrated Thursday's injunction order in comments to Law360.

"This is important while we're waiting for the additional funding from the federal government," she said. "Tenants will be able to stay in their homes, so they don't get evicted prior to getting their money."

Cea Weaver, an organizer with the statewide tenant coalition Housing Justice for All, agreed that the injunction is welcome, but added that renters will still have to navigate the application process to benefit and "it's been difficult to apply."

Additional funding is key, according to Jay Martin, director of the Community Housing Improvement Program, a landlord trade group that has echoed the call to accept more applications.

"The money needs to be there for this all to work," he said. "Delaying evictions doesn't stop the debt from accruing."

The plaintiffs are represented by Edward Josephson, Ellen Davidson and Alex MacDougall of the Legal Aid Society.

The Office of Temporary and Disability Assistance is represented by Assistant Attorneys General Noam Lerer and Celina Rogers.

The case is Maria Hidalgo et al. v. New York State Office of Temporary and Disability Assistance, case number 453931/2021, in the Supreme Court of the State of New York, County of New York.

--Editing by Bruce Goldman.

Update: This story has been updated with additional comments.

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