California Court Upholds State Preservation Law in Preemption Challenge

This NHLP Housing Law Bulletin article from Feb.-Mar. 2004 describes a case in which a California state court rejected an owner’s claim that federal law expressly preempts a state law requiring specified notice prior to an assisted housing owner's withdrawal from federal subsidy programs. In the case of College Gardens Preservation Committee v. Eugene Burger Management Corp., the court concluded that Congress did not intend LIHPRHA’s preemption provision to displace state or local requirements. The decision is especially notable because the court disagreed with or distinguished the reasoning of two federal appellate panels on a question of federal law. It thus supports the authority of many state and local governments to regulate those HUD-subsidized mortgage prepayments currently occurring outside of LIHPRHA, as well as other federal assisted housing conversions.