Court Upholds Astorino’s Decision To End Money-Losing Contract

In an important victory for the Astorino administration, a state Supreme Court judge has upheld the county executive’s decision last year – over the objections of the Democratic majority on the Board of Legislators – to end a money-losing contract with New York State to administer the Section 8 Housing Choice Voucher Program.

Acting State Supreme Court Justice James W. Hubert threw out the lawsuit brought by the Civil Service Employees Association (CSEA) on behalf of 38 employees who lost their jobs when the contract was terminated at the end of last year.

In October of 2010, the county gave the state the required 60 day notice to terminate its contract to administer Section 8 vouchers for low-income individuals and families because it was losing $500,000 a year on the deal. At the time, Westchester was one of only four counties with such contracts with the state.

The judge ruled that the county executive had the right to end the contract and that the Board of Legislators could not restore the jobs of the 38 employees assigned to the program because it had failed to appropriate any money for their return.

Administering the Section 8 program cost the county $4.5 million a year, of which $4 million was reimbursed, leaving the county with a $500,000 loss. Since terminating the contract, the county has turned that loss into a gain because it is now leasing space to the state’s new administrator of the program. The deal will pay the county just over $1 million over the next five years.

Astorino said the net benefit to the taxpayers would have been more had the Board of Legislators followed his lead. Because the Board of Legislators took the side of the union in the case, the County Attorney had to recuse himself. This forced the county executive to hire outside legal counsel at a cost of about $55,000.

Following the termination of the Section 8 contract with the county, the state contracted with CVR Associates to administer the program. CVR is a national company certified by the U.S. General Services Administration to manage affordable housing programs, including housing choice voucher programs. Its clients include the Chicago Housing Authority and the Boston Housing Authority, among many others.

By leasing space to the state for the Section 8 program, Westchester County will get $1.1 million over the course of the five-year deal. Under the terms of the five-year-lease, the county will receive about $237,000 a year in rental income for almost 9,300 square feet of space at its building at 112. E. Post Road, White Plains.

In addition to the state’s Section 8 program now run by CVR, 13 local municipalities and public housing authorities across Westchester run their own Section 8 programs. Those agencies contract directly with the U.S. Department of Housing and Urban Development (HUD).

Portions of this article came from the County's website.