Articles

On January 7, 2025, the Texas Court in Smith v. United States Department of the Treasury, No. 6:24-cv-336-JDK (E.D. Texas, Tyler Div. 2025), signed a nationwide injunction and issued an opinion stating that the CTA was likely unconstitutional in its application. The Department of Justice filed an appeal with the Court requesting emergency relief from the nationwide injunction. On February 18, 2025, the Court agreed to stay its January 7, 2025, order until the appeal is completed. Given this decision, FinCEN’s regulations implementing the BOI reporting requirements of the CTA are no longer stayed. Thus, subject to any applicable court orders, BOI reporting is now mandatory, but FinCEN is providing additional time for companies to report. The deadline for compliance is extended to March 21, 2025, which comes days before the Fifth Circuit hears oral argument on the constitutionality of the CTA in the Texas Top Cop Shop, Inc., case.

In response to the number of evictions for non-payment after the COVID lockdowns, HUD issued an interim rule requiring certain housing program recipients to issue a 30-day notice for non-payment instead of the 14-day notice of non-payment. The interim rule became a proposed rule published on December 1, 2023 and was to remain in effect until such time as HUD issued a final rule. On December 13, 2024, HUD released its final rule regarding the provision of a 30-day notice for non-payment of monthly housing charges for select federally subsidized projects with an effective date of January 13, 2025 despite its required application in the interim.

In the waning hours of 2024, the Biden-era Justice Department filed an emergency application with the U.S. Supreme Court to stay (put on hold) the nationwide preliminary injunction of the Corporate Transparency Act (CTA), its reporting deadlines and enforcement ordered by the U.S. District Court for the Eastern District of Texas in Texas Top Cop Shop on Dec. 3, 2024.

A nationwide preliminary injunctive order issued by Judge Amos Mazzant on December 3rd, 2024 in the Eastern District of Texas (ECF No. 24), that applies to all reporting companies, including all housing cooperatives nationwide was appealed by the Federal Government. In its Emergency Motion for Stay Pending Appeal, the Government pleaded with the Fifth Circuit Court to grant an immediate stay of the nationwide injunction. On December 23, 2024, the Fifth Circuit Court Motions Panel granted the Government’s request and entered an Order staying the District Court’s nationwide injunction.

A nationwide preliminary injunctive order issued by Judge Amos Mazzant on December 3, 2024 in the Eastern District of Texas (ECF No. 24), that applies to all reporting companies, including all housing cooperatives nationwide was appealed by the Federal Government. In its Emergency Motion for Stay Pending Appeal, the Government pleaded with the Fifth Circuit Court to grant an immediate stay of the nationwide injunction. On December 23, 2024, the Fifth Circuit Court Motions Panel granted the Government’s request and entered an Order staying the District Court’s nationwide injunction.

In response to the number of evictions for non-payment after the COVID lockdowns, HUD issued an interim rule requiring certain housing program recipients to issue a 30-day notice for non-payment instead of the 14-day notice of non-payment. The interim rule became a proposed rule published on December 1, 2023 and was to remain in effect until such time as HUD issued a final rule. On December 13, 2023, HUD released its final rule regarding the provision of a 30-day notice for non-payment of rent for select federally subsidized projects with an effective date of January 13, 2025 despite its required application in the interim.

As the January 1, 2025 deadline for registering with FinCen under the newly enacted Corporate Transparency Act (CTA) approaches for hundreds of Michigan cooperative board members, many remain in the dark as to the Act’s application to them. Others remain unsure as to what information is required and how that information is filed to avoid steep fines. Others may not even be aware that even if they are not a board member, they could still be considered a beneficial owner in their cooperative, subject to FinCen filing requirements under the CTA.

Housing providers such as cooperatives, wear many hats. They may be employers and have employees. They provide housing to their members. Their business offices may also be open to the general public to answer questions and receive applications. What happens when a disabled person asks for an accommodation? They may want a designated parking space for their disability. They may want an assistance animal for their disability. Is the person an employee, a member, or simply a member of the public? The answers to these questions will decide what laws apply and guide the cooperative along the way toward successful compliance.

Legal disputes over assistance animals continue to make inroads in the cooperative housing community. In a recent case, a cooperative Board apparently didn’t think a parrot qualified as an emotional support animal. It denied a member’s accommodation request to keep the parrot because of the member’s disability. The member filed a complaint with HUD. The cooperative retaliated. The U.S. Attorney got involved. As a result, the mistake cost the cooperative $750,000.