The Federal Court of Appeals for the 7th Circuit has fully affirmed the federal district court’s summary judgment dismissal of all claims against Kutak Rock client Wisconsin Housing and Economic Development Authority (WHEDA) by project owners with respect to Section 8 annual rent adjustments. 

In a detailed opinion, the Court held that WHEDA did not breach the Section 8 HAP contracts by requiring rent comparability studies or applying the 1% reduction for non-turnover units. The Court also rejected the owner’s forfeiture argument as an excuse for failing to request rent increases. In non-binding language, the Court noted that “the United States would be obligated to reimburse the state housing authority for rent increases” – a claim HUD has vigorously resisted in all prior litigation.

Kutak Rock was special litigation counsel to WHEDA in both the federal district court and Court of Appeals actions.

To read the Court's decision, please click on the file below.