Support for S.7297C / A.7636C - Codification of the HOPP Program
September 27, 2024
The Honorable Kathy Hochul
Governor of the State of New York
New York State Capitol Building
Albany, New York 12224
Dear Governor Hochul:
I write on behalf of the New York Legal Services Coalition to respectfully urge your approval of S.7297C (Kavanagh)/A.7636C (Solages), which will codify the Homeowner Protection Program (HOPP).
HOPP is the only statewide foreclosure prevention program and must be a key part of any comprehensive housing policy. The HOPP network of 89 nonprofits includes both legal service providers and housing counselors who help homeowners navigate the complex and ever-changing rules to prevent avoidable mortgage and property tax lien foreclosures and thus prevent homelessness, ensure family and community stability, and protect the creation and continuance of intergenerational wealth. Predictable and steady funding to maintain the HOPP network – and the expertise within it – is critical to protect homeownership throughout New York state.
As deed thefts and other scams have increased and evolved, there has – rightly – been attention paid to helping victims access justice. However, these laws provide redress after homeowners have been victimized. HOPP is the state’s only resource to protect homeowners and prevent the loss of homeownership to scams in the first place. Also, the success of existing legislative tools depends on HOPP advocates to ensure homeowners can avail themselves of these statutory protections and can navigate the complexities of the court system.
Moreover, the HOPP network steps in to assist with tax related foreclosure matters, which are generally rising due to reassessments and inflation. Many New Yorkers, especially seniors who have paid off their houses years ago, are at risk of losing their homes, and ultimately generational wealth, due to property tax arrears that accrue significant interest each month. Thankfully, the recent Tyler v. Hennepin Decision will ensure that the homeowner retains the home’s equity in the event of a foreclosure sale, but HOPP advocates are needed to help them navigate this complex legal landscape and more importantly, help preserve ownership in the first instance to avoid foreclosure altogether.
Given the pivotal and essential role HOPP plays in New York State’s nationally recognized response to preserving homeownership, we believe that now is the time for New York to codify the program and highlight it as a hallmark of our efforts to support homeowners and preserve affordable homeownership.
Furthermore, funding to support HOPP going forward must be consistent and must not come at the expense of other vital safety net programs. The “sweeping” of the Interest on Lawyer Account (“IOLA”) funds to support HOPP in the FY 2025 Enacted Budget must never be repeated and sets a dangerous precedent. It directly undermines the provision of civil legal aid to low-income New Yorkers at a time where our civil justice gap sits at over $1 billion. As a result of the unprecedented “sweep” in the current budget, there is now a net negative of $55 million that was statutorily earmarked to fill that gap.
This, understandably, gives our coalition members significant concern as we work to close the civil justice gap through the HOPP program and the many other areas of civil legal aid which we work.
IOLA’s sole purpose is to independently distribute funding generated from interest on accounts held by lawyers for their clients. It is specifically dedicated to the funding of civil legal services for New York’s low-income populations. If private lawyers lose their trust that the funds will be used as intended, they may stop using the accounts, which would lower balances and subsequent interest earnings available for distribution.
Sweeping IOLA funds to fund the HOPP is also not viable way to ensure stability of the program; interest rates are high now, which lead to the current fund totals, but with the Federal Reserve’s expected interest rate cut, IOLA earnings are projected to plummet.
In closing, the HOPP and IOLA programs work in unique and distinct ways towards meeting the overall civil justice need in our state. They therefore should retain their independence and both be fully funded, without any comingling of resources that may put the provision of services at risk at a time when the demand for civil legal aid is so great. Codifying the HOPP into NY Real Property Law would affirm this commitment and ensure that these protections are enshrined along with other statutory safeguards for at-risk homeowners.
Thank you for your kind attention to this bill that is a critical part of the civil legal aid fabric of New York State and will help preserve affordable homeownership. Please contact me (Kbrown@empirejustice.org) or the steering committee co-chairs Jessica Rose jrose@bka.org and Sal Curran scurran@vlpcny.org) with any questions or to schedule a meeting to discuss further.
Sincerely,
Kristin Brown, President
NY Legal Services Coalition
cc: Kathryn Garcia, Director of State Operations
Karen Persichilli Keogh, Secretary to the Governor
Angel Vasquez, Deputy Secretary for Legislative Affairs
Tania Dissanayake, Deputy Secretary for Housing
Roger Maldonado, Assistant Counsel
Blake Washington, NYS Budget Director
Jesse Olczak, Unit Chief, NYS Division of Budget