Federal housing officials are investigating the city for possible fair housing violations after it revoked a permit for a homeless shelter on Winchester Road in 2012.
The Lexington Fair Housing Council, a nonprofit group, filed the complaint with the U.S. Department of Housing and Urban Development or HUD in September 2012 after a conditional use permit for the Community Inn on Winchester Road was revoked by the Board of Adjustments.
According to documents provided to the Herald-Leader, federal HUD investigators have accepted the complaint and opened an investigation that is ongoing. If the city is found guilty of violating federal fair housing laws or if the complaint is not settled, it might have to pay damages. The city could also be at risk for losing its federal housing funds, although that's rare, housing advocates say.
Susan Straub, a spokeswoman for Mayor Jim Gray, confirmed the investigation but said the city does not think it violated the federal fair housing laws that prohibit discrimination. When the city revoked the permit for the shelter, it was only enforcing zoning regulations. The city has not had recent contact with federal housing investigators, Straub said.
"To our knowledge, HUD had planned a fair housing monitoring visit in August, but that was canceled," Straub said. "It was unrelated to the Community Inn."
Art Crosby, the director of Lexington Fair Housing Council, said the city and backers of the Community Inn are trying to settle the complaint. Crosby said the investigation continues.
"Both sides are working in good faith to settle this," Crosby said. "Our interest in this issue stems from our concerns about the individuals who are currently living in the shelter. We are trying to make sure that those individuals have equal opportunities to live in Lexington's residential communities, even if they happen to have addictions or severe mental illness."
At issue is whether revoking of the conditional permit for the Community Inn violated federal fair housing laws that say people cannot be denied housing based on race, sex or disability. The complaint alleges that Community Inn's conditional use permit was denied because of neighbor's complaints. Some of Community Inn's clients have mental health and addiction problems — people who cannot be denied housing under the federal Fair Housing Act. Many of the people who use the Community Inn are also black but the neighborhood is mostly white, the complaint alleges.
City officials and members of the Board of Adjustment have said that during the permitting process they were not made aware of the inn's function as a shelter. City officials said they thought the Community Inn was going to function as a typical church, with two services on Sunday and special programming on Thursday.
Instead, the building houses as many as 75 men and women from 7 p.m. to 8 a.m. seven nights a week, providing basic needs including beds and showers.
That's why the conditional use permit was revoked, city officials argue.
Crosby said he could not say when the HUD investigation would be completed. Officials with HUD were not available for comment because of the ongoing shut down of the federal government.
Ginny Ramsey, co-founder of the Catholic Action Agency and the Community Inn, said she was interviewed for more than an hour by a HUD investigator about three weeks ago.
Ramsey wants to move the Catholic Action Agency and Community Inn to the Lorillard Lofts, a stalled condo development off Leestown and Price roads on the west side of downtown. Ramsey asked the city for money to buy the property and create a service center and shelter for the homeless. But those requests were denied earlier this summer because city officials said they wanted more information. Mayor Jim Gray announced Friday that after looking at the project, the city could not support it.
Straub said the city does not think that its denial of support for Lorillard Lofts will affect the federal housing investigation.
The federal housing investigation is just one part of a legal fight between the Community Inn and the city over whether it can operate the shelter at Winchester Road.
The Community Inn filed a lawsuit in Fayette Circuit Court in July after the board revoked its conditional use permit in June 2012. They argued that the board of violated the open meetings act by discussing the case outside of an open meeting. They also argued that operating a homeless shelter was part of the mission of the church and was protected as "freedom of religion." In September, Fayette Circuit Judge Pamela Goodwine ruled that the board did not violate the open meetings statue at its meeting. Goodwine has not yet ruled whether the city violated the group's religious freedom by revoking the permit.
While the legal cases are pending, Community Inn continues to operate on Winchester Road.
Beth Musgrave: (859)231-3204. Twitter:@HLCityhall