Westchester County Legislators Bring Legal Action Against HUD to Recover $17 Million in Grant Funding

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On Monday March 16, 2015 at a Special Meeting of the Board of Legislators legislation was passed that enabled County Attorney Robert Meehan to amend the legal proceedings against the federal Department of Housing and Urban Development (HUD). The vote was unanimous. The court action is an attempt to recover approximately $17 million in Community Development Block Grants (CDBG) that were earmarked for Westchester County but reallocated outside of Westchester by HUD.

HUD had informed County Executive Rob Astorino that it would reallocate the CDBG funds because the County Executive had not submitted an “Analysis of Impediments (AI) acceptable to HUD

On behalf of the County Executive, the County Attorney petitioned Judge Denise Cote, who is presiding over the completion of the settlement, to overturn HUD’s decision to reallocate the CDBG funds. Judge Cote had ruled that HUD’s actions are not subject to judicial review. The County Executive and HUD have remained at an impasse regarding the AI.


“It is unfortunate that we have to go these lengths to try and recuperate funds that HUD had no right to withhold in the first place. The Court of Appeals decision that led us to this vote confirmed what the County Executive has been saying all along, HUD does not have the right to act with impunity. The reallocation of these funds from the communities and people that need them most was an arbitrary and capricious decision” – Legislator John G. Testa, Minority Leader.


On February 18, 2015 the U.S. Court of Appeals for the Second District ruled on Westchester’s appeal that HUD’s actions were in fact, subject to judicial review. That ruling was the impetus for the legislation that was passed by the BOL on Monday.

BOL Chairman Michael Kaplowitz (D) Somers, has tried to mediate a resolution to the impasse between the County Executive and HUD. This past year Chairman Kaplowitz was successful in getting HUD to delay the reallocation of the CDBG funds. Chairman Kaplowitz also appealed to Westchester’s Congressional Representatives and proposed to HUD that the CDBG funds be distributed to Westchester municipalities by New York State. On February 9th, Congresswoman Nita Lowey announced that HUD would release approximately $5 million in CDBG funds to the state, earmarked for Westchester communities. The state is working out the details of a competitive application process for those funds.

Following the vote, Chairman Kaplowitz said, “An important objective in dealing with HUD on the Affordable Housing Settlement has been to prevent the loss of the CDBG funds that are owed to Westchester County. While we have been successful in saving about $5 million that the State will administer, I am hopeful that the legislation we passed today will secure the release of additional CDBG funds meant for Westchester.” Kaplowitz added, “The recent ruling from the Court of Appeals provides Westchester County with an opportunity to petition the courts for our lost CDBG monies but more importantly, it is an opportunity for the County Executive and HUD to finally sit down and work out a compromise that will produce an acceptable AI. Losing the HUD funding is certainly something we want to avoid but remaining in a protracted standoff with HUD risks far greater penalties for Westchester County.”

Minority Leader, Legislator John Testa (R) Peekskill, Cortlandt, Yorktown, said, “The Republican caucus was happy to vote for this legislation. It is unfortunate that we have to go these lengths to try and recuperate funds that HUD had no right to withhold in the first place. The Court of Appeals decision that led us to this vote confirmed what the County Executive has been saying all along, HUD does not have the right to act with impunity. The reallocation of these funds from the communities and people that need them most was an arbitrary and capricious decision. Many of the municipalities that HUD sought to punish by reallocating the funds, like my hometown of Peekskill, aren’t even subject to the affordable housing settlement.”

About Legislator John G. Testa

John G. Testa, a life-long resident of Peekskill, began his first term on the Westchester County Legislature in January 2010. Prior to his successful run for the District 1 Legislative seat, he served 3 terms as Mayor of Peekskill from January 2002 until December 2007. Before becoming mayor he also served a four-year term as a Councilman. From his first days in office Testa worked tirelessly to set the City on the path of economic stability. Peekskill flourished under this plan, increasing the city fund balance to its highest in history. During John’s tenure in office, the NY State Comptroller’s Office named Peekskill one of the most fiscally sound municipalities in the State; independent auditors proclaimed Peekskill as being in its best fiscal condition in over 30 years; and Moody’s Investor Service agreed to upgrade its bond rating, resulting in further savings. The plan he put in place was so successful that it enabled the City of Peekskill to pass three budgets in a row with a 0% tax increase. These fiscal skills will prove valuable to Testa as he works to put the brakes on what has been wildly escalating county spending and unchecked government growth. He has pledged his efforts to work to consolidate services, eliminate wasteful spending and improve efficiency. In addition to the fiscal conservatism that served Peekskill so well, Testa worked to promote the city, attracting investment, jobs and an increased tax base. Over $100 million of private investment came to Peekskill in the forms of new residential construction, retail space, and the redevelopment of historic structures. As Mayor, Testa led a successful battle to stop the unfair and unsafe plan to send sewage to the Peekskill plant from outside the sewage/water district. John’s roots are deep within the soil of Northern Westchester. His father’s family has lived here for more than a century and his mother’s family is nearing that mark. He is proud that he was born in Peekskill and has lived and worked here all his life and, with his wife Nancy raised their two children here.
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