Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, June 12, 1990                   TAG: 9006120499
SECTION: VIRGINIA                    PAGE: B1   EDITION: EVENING 
SOURCE: JOEL TURNER MUNICIPAL WRITER
DATELINE:                                 LENGTH: Medium

REFUND LAWSUIT SETTLED

The U.S. Department of Housing and Urban Development has agreed to provide the money for both the refunds for the tenants and the attorneys' fees, according to Herbert McBride, executive director of the city's Redevelopment and Housing Authority.

The authority's Board of Commissioners voted Monday to ask the federal agency to provide an additional operating subsidy to cover the cost of the settlement. The board's formal vote requesting the money was required to complete the legal paperwork for the agency to provide the funds, McBride said.

The refunds will total $216,000 under an agreement that was approved earlier this year by Judge James Turk in U.S. District Court in Roanoke.

McBride said the legal fees were about $165,000 - about $67,000 for the Legal Aid Society of the Roanoke Valley, which represented the tenants, and $98,000 for the authority's attorneys.

McBride said he expects it will take the federal agency about 90 days to process the housing authority's request for the money.

Once the funds are received, McBride said the authority will publish a legal advertisement notifying tenants and former tenants they can file a claim for a refund.

In some cases, former tenants may not receive a refund if they moved out of a public housing unit with unpaid rent or other debts owed to the authority.

"If they have unpaid balances, this must be paid before they can receive a refund," McBride said.

The refunds are expected to vary from several dollars to $500, depending on the amount of the original overcharges to individual tenants.

The lawsuit, filed eight years ago on behalf of 1,100 families in the city's public housing projects, claimed that the housing authority acted improperly when it imposed surcharges for electricity in excess of a monthly allowance.

The tenants accused the authority of improperly computing electricity needs and then overcharging them by adding surcharges from 1981 to 1984. They claimed that an allowance imposed by the authority was not enough to meet their basic needs.

Turk originally threw out the lawsuit, ruling that the tenants had no right to sue in federal court over alleged violations of housing regulations.

The 4th U.S. Circuit Court of Appeals agreed and the Legal Aid Society appealed to the U.S. Supreme Court. In 1987, the high court ruled 5-4 that the tenants had a right to sue - sending the case back to Roanoke and leading to the settlement.