FILED: NEW YORK COUNTY CLERK 08/23/2013

NYSCEF DOC. NO. 9

INDEX NO. 156382/2013 RECEIVED NYSCEF: 08/23/2013

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK NEIGHBORHOOD IN THE NINETIES, INC., Plaintiff, -againstTHE CITY OF NEW YORK (NYC); MICHELE OVESEY, Commissioner for the Department of Homeless Services for NYC (DHS); JOHN C. LIU, Comptroller of the City of New York, and AGUILA, INC.; Defendants. Plaintiff Neighborhood in the Nineties, Inc, (Plaintiff or N90) by and through its counsel Tane Waterman & Wurtzel, P.C., with offices at 120 Broadway, Suite 948, New York, New York 10271 hereby respectfully alleges and offers as and for its verified petition as follows: Index No.156382/2013 COMPLAINT

PRELIMINARY STATEMENT 1. This is an action seeking a declaratory judgment that Defendants City of New

York, Michelle Ovesey as Commissioner for the Department of Homeless Services and Aguila, Inc. are required to comply with multiple provisions of the City Charter and the Administrative Code and not add to the over concentration of homeless shelters and other supportive living facilities on the upper west side of Manhattan in violation of the City Charter requirements that no neighborhood shall bear more than its fair share of City services. Plaintiff seeks to enjoin the Comptroller of the City of New York from registering contract number 1427016 (the Contract) between the City of New York Department of Homeless Services (DHS) and Respondent Aguila, Inc. (Aguila) for the operation of transitional shelter services for homeless families at 316 West 95th and 330 West 95th St. (collectively, the Premises) known as Freedom House (the Freedom House Shelter or the Shelter) because a) the placement of the Shelter violates the Page 1 of 19

New York City Charter Fair Share requirements and also Administrative Code 21-312 which limits the size of a shelter to 200 persons; b) DHS ignored all of its legal obligations and made material misrepresentations to the Community and the Mayor before allowing Aguila to commence and/or continue operations under the emergency and proposed permanent contract; c) the manner in which the Shelter is and has been operated will continue to constitute a nuisance to the residents of the neighborhood, and d) the unreasonable expenditure per person constitutes waste under the General Municipal Law. For the same reasons, as well as the fact that during its operation on an emergency basis, its operation constituted a nuisance in the neighborhood, Plaintiff seeks to enjoin the continued operation of the shelter on either a temporary or permanent basis.

PLAINTIFF 2. Neighborhood for the Nineties, Inc. is a not for profit corporation formed to speak

as a coalition on behalf of block associations, residents, retailers and property owners situated between West 90th and West 97th Street between Riverside Drive and Amsterdam Avenue and represent its interest in connection with the placement of City facilities in the neighborhood. The neighborhood is part of Community District 7 (CD7).

3.

Plaintiffs members include, but are not limited to, the boards of directors and

boards of managers of cooperatives and condominiums located within a few blocks of the Shelter, businesses that are located within a few blocks of the Shelter, SRO residents of the Premises in which the Shelter is located, and other individuals or business either residing or working within a few blocks of the Shelter.

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4.

DEFENDANTS AGUILA, Inc. is a domestic not-for-profit corporation registered to do business

within the State of New York with its principal place of business in the County of the Bronx. It is a provider of homeless services in the Bronx and New York counties.

5.

THE CITY OF NEW YORK (NYC) was and is a municipal corporation duly

organized and existing by virtue of the laws of the State of New York.

6.

Michelle Ovesey is Commissioner for the Department of Homeless Services for

NYC (DHS). DHS is a mayoral agency of NYC responsible for enforcing and administering provisions of the City Charter and the Administrative Code as they apply to the provision of services for the homeless.

7.

John Liu as Comptroller of the City of New York is an elected official and Chief

Financial Officer of the City of New York. It is the duty of the Comptroller to review all contracts to determine whether they should be registered.

THE CONTRACT 8. The proposed Contract between DHS and Aguila is for a term beginning on

February 6, 2013 for a period of Five (5) years, four (4) months, Seventeen (17) days, through June 30, 2018 (extendable at the Citys option for an additional 4 years) and provides for a minimum payment to Aguila of $47 million.

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9.

Under the terms of the Contract, Aguila is to operate Freedom House so as to

provide temporary emergency shelter for homeless adult families without children with a capacity of 200 units, which would raise the total number of persons occupying the facility to 400 people.

10.

Occupancy by 400 people violates Administrative Code 21-312 (c) which

provides that no shelter for adults shall be operated with a census of more than two hundred persons.

11.

The Premises had been used as a Shelter on a temporary basis pursuant to a

declaration of emergency since August 2012 pursuant to an emergency contract which expired in February 2013.

12.

Notwithstanding the expiration of the emergency contract, the shelter continued to

operate on an emergency basis and without a contract registered by the Comptroller.

13.

Pursuant to the City Charter and the Administrative Code, DHS was obligated to

provide a fair share report before the Premises began being used as a temporary shelter.

14.

DHS failed to provide a fair share report before the Premises was used as a shelter

on an emergency basis.

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15.

Further, before awarding the Contract to Aguila, DHS was obligated to provide a

Fair Share Report and conduct its analysis consistent with the obligations set forth in the New York City Administrative Code and City Charter.

16.

By letter dated February 4, 2013, DHS submitted a Fair Share Analysis to the

Mayor (hereinafter the Fair Share Analysis).

17.

At the time the Fair Share Analysis was presented to the Mayor, the Contract had

already been submitted to the Mayors Office of Contract Services.

18.

The Fair Share Analysis was factually inaccurate and misleading and failed to

comport with the obligations of the Administrative Code.

19.

For example, DHS alleged that there are only 7 shelters within a half mile radius

of Freedom House.

20.

However, within CD7, there are over thirty facilities, including faith based

shelters and rehabilitative facilities, which include over 2000 units of supportive housing.

21.

Most of the above referenced facilities and supportive housing units are

concentrated within the half mile radius of the Freedom House Shelter.

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22.

DHS alleged that there are no other shelters within 400 feet of Freedom House; in

fact, the St. Louis is located on the same city block immediately behind and adjacent to the Premises. It houses approximately 120 individuals.

23.

Although DHS claimed in the Fair Share Analysis that a Community Advisory

Board committee (CAB) had been formed and meetings conducted (including supposedly on August 15 and December 12, 2012), in fact, a CAB was never formed and a CAB meeting was never held at any time through the date of this action.

24.

Upon information and belief, in an attempt to subvert any negative comments to

the placement of the Shelter, DHS intentionally and purposely failed to advise the Borough Presidents office or Gale Brewer, the district City Councilwoman, as to when meetings would be scheduled.

25.

4.1 (a) of the Fair Share criteria discourages the placement of facilities on sites

where they would be incompatible with surrounding uses, and encourages the proximity of facilities that would enhance each others service delivery.

26.

Here, placement of the Shelter on the same block as an elementary school is not

compatible with the surrounding uses.

27.

4.1 (c) of the Fair Share criteria requires the City to detail its alternate site

analysis. The criteria require the analysis to indicate why other sites did not satisfy the siting

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criteria listed in the statement of needs or the 30 day notice to the borough president. The reasons for rejection of each such site should be clearly stated.

28.

The Fair Share Analysis failed to specify the alternate sites considered and failed

to clearly state why each such site was rejected.

29.

In fact, DHS eliminated at least one other site because of its proximity to existing

shelter facilities.

30.

Given the Freedom House Shelters proximity to existing facilities in the

immediate area, including the St. Louis supportive housing facility on the adjacent block, this site should have been eliminated as well.

31.

Section 4.2 (b) of the Fair Share criteria requires the Agency to consider any

comments received from the community board or borough president.

32.

DHS failed to consider the comments of Community Board 7 and the community

was in fact ignored.

33.

Section 6.1 (b) of the Fair Share criteria requires the Agency to examine the

distribution of the facilities throughout the city and to promote an equitable distribution of such facilities.

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34.

The Fair Share analysis failed to do so and the placement of another shelter in

CD7 was made notwithstanding that such a siting would not result in an equitable distribution of city facilities.

35.

Section 6.3 of the Fair Share criteria requires the creation of a facility monitoring

committee or a community board committee.

36.

Although the Fair Share Analysis claims that such a committee was formed and

meetings held, no such committee was formed or ever met.

37.

Section 6.5.1 of the Fair Share criteria required the city to avoid undue

concentration of clustering or concentration of facilities providing similar services in residential areas.

38.

There are 30 facilities in the surrounding square half mile from Freedom House

which thereby constitutes an undue concentration of facilities that was ignored by the City.

39.

Section 6.5.2 of the Fair Share criteria requires the Agency to conduct an analysis

as to whether sufficient support services exist in the neighborhood.

40.

The Agency has failed to do so especially since the opening of the shelter on an

emergency basis, local churches and food pantries have struggled to meet the tripling of demand.

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41.

In addition, the 24th police precinct, already stretched thin, does not have the

resources to address the increase in crime and quality of life complaints detailed in Paragraphs 44 to 50, below which have taken place since the shelter's opening.

42.

Notwithstanding all of the shortcomings in its Fair Share Analysis, on June 6,

2013, DHS presented the Aguila contract to the City Comptroller for registration.

43.

On July 3, 2013, the comptrollers office rejected the Contract questioning DHS

compliance with law since the size of the Shelter exceeded the Administrative Code limits and the Certificate of Occupancy also limited the number of people that can be placed in the Shelter.

44.

DHS immediately submitted the Contract for re-registration and the City,

subsequent to the commencement of this action, commenced its own action against Defendant Liu to compel registration of the Contract.

THE SHELTER AS A NUISANCE 45. Since the Shelter has been operating on a temporary basis, the adverse impact on

the Community has been substantial and constitutes a nuisance.

46.

People who miss the curfew at the Shelter have been sleeping in the elementary

school playground, Joan of Arc Island and in Riverside Park.

47.

Food and garbage have been hurled from the Shelter window.

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48.

The streets surrounding the Shelter are littered with more trash and are dirtier.

49.

Since the Shelter commenced emergency operations, there has been an increase in

felony and misdemeanor assaults, petit larcenies and rapes in the 24th Police precinct.

50.

Upon information and belief, since the Shelter commenced emergency operations,

there has also been an increase in knifepoint robberies, break ins and other violent crimes.

51.

Upon information and belief, since the Shelter commenced emergency operations,

there has also been an increase in quality of life crimes such as public urination, public drug and alcohol use, loitering and trespassing.

52.

Unreasonable noises such as screaming, yelling, loud music have all occurred

regularly from the Shelter disturbing the tranquility of the neighborhood and disturbing its residents.

53.

Plaintiff has no adequate remedy at law unless the Citys unlawful conduct is

enjoined as demanded below.

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THE EXPENDITURE AS WASTE 54. Upon information and belief, DHS and/or the City will pay to Aguila

approximately $3,700 per month or $122 per day for use of a single occupancy room without private kitchen or bathroom facilities.

55.

The exorbitant cost being paid by the City per person is wasteful.

56.

In addition, Aguila was the subject of an audit by defendant Comptroller of the

City of New York released November 4, 2011 which recommended that the City recoup over $900,000 in payments made to Aguila and to further investigate additional Aguila expenditures totaling $9.1 million.

57.

The audit also found that DHS did not effectively monitor Aguilas operational

performance to ensure that Aguila housed clients in safe and sanitary conditions and transitioned its client to permanent housing in a timely manner.

58.

In February, 2013, the City Comptroller announced it was conducting yet another

audit of Aquilas practices.

59.

To date, that audit report has not been released.

60.

Upon information and belief, in order to house more homeless individuals, the

owner of the property has been driving out SRO tenants from the Premises.

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61.

Local businesses including members of Plaintiff, have suffered financial loss as a

result of the outflux of the SRO tenants.

FIRST CAUSE OF ACTION 62. Plaintiff repeats and realleges each and every allegation set forth above as if fully

set forth herein.

63.

NYC Administrative Code Section 21-312 (c) provides that no shelter for adults

shall be operated with a census of more than two hundred persons.

64.

In violation of the Administrative Code, DHS and Aguila have proposed to

operate a shelter that will house up to 400 individuals, a number in excess of the lawful number of persons allowed under the Administrative Code.

65.

Accordingly, Plaintiff is entitled to a declaration and a judgment permanently

enjoining Defendant Liu from registering the Contract and Defendants Aguila, DHS and City of New York from operating the Freedom House Shelter as it fails to comply with the 200 person occupancy restriction imposed on shelters, or, alternately, for a judgment permanently enjoining Defendants Aguila, DHS and the City of New York from operating the Freedom House shelter with any more than 200 persons.

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SECOND CAUSE OF ACTION 66. Plaintiff repeats and realleges each and every allegation set forth above as if fully

set forth herein.

67.

DHS and the City have failed to properly account for the various Fair Share

requirements set forth in the Administrative Code and City Charter Section 203.

68.

As a result, Plaintiff is entitled to an order enjoining Defendant Liu from

registering the Contract and Defendants Aguila, Liu and City of New York from operating the proposed Freedom House Shelter until a full and proper Fair Share analysis has been made, and a determination has been made by this Court, that operation of the Freedom House Shelters at the proposed location would not violate the Fair Share criteria.

THIRD CAUSE OF ACTION 69. Plaintiff repeats and realleges each and every allegation set forth above as if fully

set forth herein.

70.

This Court should determine as a matter of law that Community District 7 already

has its fair share of City services and enjoin the City from locating any further homeless shelters in the District, including the Freedom House shelter, or any other shelter on an emergency basis, until such time as the Citys other Community Districts have received their fair share of city services.

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71.

Plaintiff is entitled to a declaratory judgment against defendants DHS and City of

New York determining that CD7 already has its fair share of City shelters and enjoining further placement of any shelters until all other community districts have received their fair share of city services.

FOURTH CAUSE OF ACTION 72. Plaintiff repeats and realleges each and every allegation set forth above as if fully

set forth herein.

73.

Aguila presented its proposal to the City for the operation of Freedom House to

the City pursuant to the Citys open request for proposals process (RFP).

74.

The RFP process is governed by Chapter 13, entitled procurement, Sections 311

et seq. of the Charter of the City of New York.

75.

Pursuant to the Charter, the Procurement Policy Board has passed on the RFP

process and promulgated regulations to affect Chapter 13s purpose.

76.

This process permits entities, such as Aguila to offer the City of New York,

through its agencies, sites for consideration.

77.

The City then chooses amongst those sites offered by the providers and enters into

contracts with the provider to operate the Shelters on the Citys behalf.

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78.

The Citys sole reliance on the RFP for the location of homeless shelters violates

its obligations under the Fair Share criteria as a matter of law as the City has conceded that it has no control over the properties that are presented to it for consideration.

79.

Because of economic factors, the properties that are presented to the City under

RFPs are typically clustered in select neighborhoods and do not represent a fair allocation of neighborhoods throughout the City.

80.

The Citys and DHS policy of accepting Open Request for Proposals violates, on

its face, the Citys obligation to comply with the Fair Share requirements of the City Charter as the City has the means and ability other than reliance on RFPs to obtain locations for shelter placements which are not clustered in select neighborhoods.

81.

As a result, Plaintiff is entitled to a declaratory judgment against defendants City

of NY and DHS determining that their reliance on the RFP process as the primary means for siting additional shelter locations violates the City Charter and the Administrative Code as it fails to adequately provide for a fair distribution of City services.

82.

Plaintiff is entitled to enjoin the City and DHS from relying primarily on the RFP

process as a means of siting homeless shelters.

FIFTH CAUSE OF ACTION 83. Plaintiff repeats and realleges each and every allegation set forth above as if fully

set forth herein. Page 15 of 19

84.

The manner in which Aguila has operated the Freedom House Shelter on a

temporary emergency basis has constituted a nuisance to the community at large and to the Plaintiff herein.

85.

Such acts of nuisance include increased criminal activity, loitering, sleeping in

park, trespassing, loud playing of music and littering.

86.

Neither Aguila nor DHS have taken any steps to abate the nuisances even though

they have been notified of the offending conduct.

87.

In fact, DHS has received 300 complaints from local residents about individuals

trespassing or sleeping in the park and DHS has denied responsibility for every one of them.

88.

Plaintiff is entitled to an order compelling Defendants Aguila and DHS to abate

the nuisances that have been created by the occupants of Freedom House.

SIXTH CAUSE OF ACTION 89. Plaintiff repeats and realleges each and every allegation set forth above as if fully

set forth herein.

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90.

DHSs expenditure of over $3,700 per month for a unit in a single room

occupancy premises without individual kitchen or bathroom facilities constitutes waste under the General Municipal Law

91.

Further, awarding the contract to Aguila, Inc. given the improprieties found by the

NYC Comptroller in Aguilas performance of prior contracts also constitutes waste under the General Municipal Law.

92.

The waste committed by DHS and the City in its award of the Contract to Aguila

does not further the needs of the neighborhood or provide for appropriate care for the homeless.

93.

Plaintiff is entitled to a declaratory judgment that the awarding of the Contract to

Aguila constitutes waste and further permanently enjoining the registration of the Contract.

WHEREFORE, Plaintiff requests judgment against Defendants as follows: a) On its first cause of action, a declaration and a judgment permanently enjoining Defendant Liu from registering the Contract, and Defendants Aguila, DHS and City of New York from operating the Freedom House Shelter as it fails to comply with the 200 person occupancy restriction imposed on shelters, or, in the alternative, a declaration and a judgment permanently enjoining Defendants Aguila, DHS and the City of New York from operating the Freedom House shelter with any more than 200 persons;

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b) On its second cause of action, an order enjoining Defendants DHS, Aguila and City of New York from operating the proposed Freedom House Shelter until a full and proper Fair Share analysis has been made, and a determination has been made by this Court that operation of the Freedom House Shelters at the proposed location would not violate the Fair Share criteria;

c) On its third cause of action, judgment against DHS and the City of New York determining that CD7 already has its fair share of City shelters and enjoining further placement of any shelters until all other community districts have received their fair share of city services;

d) On its fourth cause of action, declaratory judgment determining that the City of New Yorks and DHSs reliance on the RFP process violates the City Charter and the Administrative Code as it fails to adequately provide for a fair distribution of City services;

e) On its fifth cause of action, for an order compelling Defendants Aguila and DHS to abate the nuisances that have been created by the occupants of Freedom House;

f) On its sixth cause of action, for an order declaring that awarding the Contract to Aguila Inc. constitutes waste and enjoining the registration of the Contract on that basis; and Page 18 of 19

VERIFICATION
STATE OF NEW YORK

)
).ss.

COLTNTY OF NEW YORK )

Aaron Biller, being duly swom, deposes and says:

I am an officer of Neighborhood in the Nineties, Inc., the Plaintiff herein. I have read the
foregoing complaint and know the contents thereof and that the same is true, except where
indicated upon information and belief. As to those matters indicated upon information and belief,

I believe them to be true. The grounds of deponent's belief are documents maintained by me and
research I have performed on the subject.

Aaron Biller

Sworn to before me this')! day of August, 20 1 3

Notary Public

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