IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Mary Cease, : Appellant : : v. : No. 519 C.D. 2019 : ARGUED: February 13, 2020 Housing Authority of Indiana County :

BEFORE: HONORABLE PATRICIA A. McCULLOUGH, Judge HONORABLE MICHAEL H. WOJCIK, Judge HONORABLE BONNIE BRIGANCE LEADBETTER, Senior Judge

OPINION BY SENIOR JUDGE LEADBETTER1 FILED: February 19, 2021

Mary Cease appeals from an order of the Court of Common Pleas of Indiana County that affirmed the decision of the Housing Authority of Indiana County (1) denying her application for housing assistance under the United States Department of Housing and Urban Development’s (HUD) Housing Choice Voucher Program, commonly referred to as Section 82 and (2) concluding that she was a new applicant to the program under Section 13661 of the Quality Housing and Work Responsibility Act (QHWRA), 42 U.S.C. § 13661. The Authority’s denial was based upon the statement in her application for admission that she used medical marijuana. We affirm the order to the extent that it determined that Cease was a new applicant to the Section 8 program, vacate it to the extent that it affirmed the Authority’s denial of Cease’s application, and remand this matter for the Authority to carry out its mandate under Section 13661 of QHWRA: (1) to establish standards comparable to what HUD offers qualified residents in metropolitan areas, HUD’s regulations do not govern the USDA’s program. (Id.) In November 2017, Cease submitted an “Initial Application for Housing Assistance – All Programs” to the Authority for Section 8 housing. (Nov. 30, 2017 Initial Application; Reproduced Record “R.R.” at 15a.) In its acknowledgment, the Authority advised Cease that it was placing her on a waiting list with an average waiting time of six months to one year and that “[t]he application process and requirements for eligibility are explained in the policies available for your review at our office.” (Nov. 30, 2017 Letter at 1; R.R. at 17a.) In April 2018, the Authority informed Cease that there was an opening in Section 8 housing and requested that she provide a full application to determine her eligibility. (Apr. 10, 2018 Letter at 1; R.R. at 19a.) Cease complied, including a copy of her Medical Marijuana Identification Card with the application. In denying the application, the Authority stated: “We must deny program participation as marijuana is still considered to be an illegal substance by the Federal government and costs associated with marijuana medical treatments cannot be considered in calculation of adjusted income.” (June 13, 2018 Letter at 1; R.R. at 37a) (emphasis in original). At Cease’s request, informal and formal hearings followed. Ultimately, the Authority upheld its denial based solely on the illegality of marijuana under federal law. (Sept. 26, 2018 Letter at 1; R.R. at 279a.) In so doing, the Authority agreed that Cease’s income was well below its “extremely low” threshold and conceded that she met the income standards for Section 8 housing.^[6] The Section 8 Coordinator for Indiana County, Holly Hall, testified that

6 Derived from Social Security benefits, Cease’s annual income was $9,240 and below the “extremely low” income level of $13,450. (Sept. 18, 2018 Hearing, Notes of Testimony “N.T.” at 20; R.R. at 58a.)

the Authority denied Cease admission based on the federal government’s classification of marijuana as an illegal drug and HUD’s memos regarding the use of medical marijuana. (Sept. 18, 2018 Hearing, Notes of Testimony “N.T.” at 49- 50; R.R. at 87a-88a.) In particular, Hall seemed to rely upon Exhibit 9, directed to all public housing agencies and specifically pertaining to the Section 8 program. In the 2011 memo, HUD sought to provide guidance regarding the use of medical marijuana in states that have enacted laws permitting the use of medical marijuana and stated that new admissions of medical marijuana users was prohibited. (Id., Ex. 9; R.R. at 4a.) Further, HUD stated that state laws legalizing medical marijuana directly conflict with the admission requirements set forth in QHWRA and are thus subject to federal preemption.^[7] (Id.) On appeal, the trial court took additional testimony confirming Cease’s status as a former Section 8 program participant in Luzerne County before moving to Indiana County. Following legal argument, it affirmed the Authority’s denial of Cease’s application for Section 8 housing and determination that she was a new applicant to the program. Cease’s appeal to this Court followed. Cease raises two issues, one with three subparts. In summary and reordered for ease of analysis, the first issue is whether Cease is a new applicant under Section 13661 of QHWRA or an existing participant under Section 13662.8 If Cease is a new applicant, then she poses the issue of whether Section 13661 requires that the Authority deny her housing based on legal medical marijuana use or whether

7 The memo lists fourteen states and the District of Columbia as having laws that legalize the use of medical marijuana. In 2011, Pennsylvania was not one of those states. Currently, there are at least thirty-three states and the District of Columbia that have legalized medical marijuana. 8 Implicit in this issue is the parties’ belief that Section 13662 of QHWRA affords a public housing agency discretion to terminate the tenancy or assistance to an existing participant who the agency or owner determines is illegally using a controlled substance.

it may exercise discretion. If the decision to deny housing on that basis is discretionary, then she poses the issue of whether the Authority should afford her accommodation for a disability under the Pennsylvania Human Relations Act (PHRA)9 and the Pennsylvania Medical Marijuana Act. Cease’s second issue is whether the lawful use of medical marijuana constitutes “illegally using a controlled substance” such that the use can form the basis for exclusion from the Section 8 program. Congress created the Section 8 program in 1974 for “the purpose of aiding low-income families in obtaining a decent place to live and of promoting economically mixed housing” by providing low-income families with assistance payments, or subsidies, to enable them to rent units in the private housing market. Section 8(a) of the Housing and Community Development Act of 1974, 42 U.S.C. § 1437f(a). Pursuant to the program, HUD funds and regulates state or local governmental public housing agencies by distributing federal funds to the agencies, which, in turn, distribute the funds by contracting with property owners to subsidize a portion of a program participant’s rent. See 42 U.S.C. § 1437f. In 1998, Congress enacted QHWRA, which, inter alia, amended the Housing and Community Development Act of 197410 by requiring public housing agencies to establish standards to consider when determining admission to and termination from the Section 8 program. See 42 U.S.C. §§ 13661-13664. Section 13661(b)(1)(A) of QHWRA, “Screening of applicants for federal assisted housing,” provides:

(b) Ineligibility of illegal drug users and alcohol abusers.

9 Act of October 27, 1955, P.L. 744, as amended, 43 P.S. §§ 951-963. 10 42 U.S.C. §§ 1401-1440.

(1) Notwithstanding any other provision of law, a public housing agency or an owner of federally assisted housing, as determined by the Secretary, shall establish standards that prohibit admission to the program or admission to federally assisted housing for any household with a member-- (A) who the public housing agency or owner determines is illegally using a controlled substance.

42 U.S.C. §13661(b)(1)(A) (emphasis added). Section 13662(a)(1) of the QHWRA, 42 U.S.C. § 13662(a)(1), “Termination of tenancy and assistance for illegal drug users and alcohol abusers in federally assisted housing,” provides:

(a) In general. Notwithstanding any other provision of law, a public housing agency or an owner of federally assisted housing (as applicable) shall establish standards or lease provisions for continued assistance or occupancy in federally assisted housing that allow the agency or owner (as applicable) to terminate the tenancy or assistance for any household with a member-- (1) who the public housing agency or owner determines is illegally using a controlled substance[.]

42 U.S.C. §13662(a)(1). As for which of the aforementioned provisions of QHWRA applies to Cease, we note that she was a participant in the USDA’s rural rent supplement program when she applied for Section 8 housing in Indiana County. In other words, she was neither an existing Section 8 participant nor a participant in any federally subsidized housing program administered by the Authority at the time of her Section 8 application. Consequently, we determine that the Authority properly treated Cease as a new applicant to the Section 8 program such that the screening provision in Section 13661 of QHWRA applied. We turn to an analysis of that provision. As noted above, Section 13661(b)(1)(A) of QHWRA provides that the Authority “shall establish standards that prohibit admission to the program[.]” 42 U.S.C. §13661(b)(1)(A). Notably, there is a difference between “shall establish standards that prohibit admission” and “shall prohibit admission.” Otherwise, the term “establish standards” is entirely meaningless. The object of statutory construction is to ascertain and to effectuate legislative intent. Section 1921(a) of the Statutory Construction Act of 1972, 1 Pa.C.S. § 1921(a). “[W]hen the words of a statute are clear and free from all ambiguity, the letter of it is not to be disregarded under the pretext of pursuing its spirit.” 1 Pa.C.S. § 1921(b). Generally, the best indication of legislative intent is the plain language of a statute. Malt Bevs. Distribs. Ass’n v. Pa. Liquor Control Bd., 974 A.2d 1144, 1149 (Pa. 2009). See also U.S. v. Gonzales, 520 U.S. ^[1], 6 (1997) (Where “[g]iven a straightforward statutory command, there is no reason to resort to legislative history.”). By way of contrast, Section 13663(a) of QHWRA, pertaining to sex offenders, provides that “[n]otwithstanding any other provision of law, an owner of federally assisted housing shall prohibit admission to such housing for any household that includes any individual who is subject to a lifetime registration requirement under a State sex offender registration program.” 42 U.S.C. § 13663(a) (emphasis added). Clearly, there is no discretion in prohibiting admission to such applicants. Accordingly, we construe the mandate in Section 13661(b)(1)(A) of QHWRA as allowing for flexibility to determine when and on what basis admission is prohibited, rather than mandating an outright prohibition. In other words, for purposes of Section 13661(b)(1)(A), the Authority must establish standards for determining when and on what basis admission is prohibited for a Section 8 housing applicant who the Authority determines is illegally using a controlled substance. See Nation v. Trump, 818 F. App’x 678, 679-80 (9th Cir. 2020) (“QHWRA requires that owners of federally-assisted housing establish certain occupancy standards pertaining to illegal drug use for residents. See generally 42 U.S.C. §§ 13661-62.”). Such standards must take into account factors such as the nature of the substance, i.e., whether it is clearly unlawful or in an unclear legal state such as that involved here; the reason for such use; whether it is being used in accordance with legal requirements; other factors concerning the applicant’s background, including behavior during any prior residence in federally subsidized housing; and the presence or absence of any prior criminal record. As for marijuana’s legal status, the federal Controlled Substances Act (CSA)11 classifies marijuana as a Schedule I controlled substance and it is unlawful for any person to knowingly or intentionally possess a controlled substance. Section 841(a)(1) of the federal CSA, 21 U.S.C. § 841(a)(1). Although there have been considerable efforts to reclassify marijuana under federal law, it has remained a Schedule I drug ever since its initial classification. Additionally, there has been resistance to efforts to make exceptions for the use of medical marijuana in federally- funded public housing. See Nation v. Trump, 395 F. Supp. 3d 1271 (N.D. Cal. 2019), aff’d, 818 F. App’x 678 (9th Cir. 2020) (where former HUD housing fund recipient claimed that HUD’s application of the federal CSA against medical marijuana was unconstitutional, court confirmed that QHWRA referred to the CSA to define the term “controlled substance,” that the CSA defined that term as a drug or other substance in one of its five schedules, and that marijuana was classified as a Schedule

11 21 U.S.C. §§ 801-971.

I drug under the CSA); Forest City Residential Mgmt. v. Beasley, 71 F. Supp. 3d 715 (E.D. Mich. 2014) (where Section 8 housing recipient was legally using medical marijuana under state law, court acknowledged that the CSA contained no provision allowing for the medical use of marijuana, held that the CSA preempted the Michigan Medical Marihuana Act,12 and determined that the Fair Housing Act13 did not require a federally assisted housing complex to grant the recipient a reasonable accommodation to use medical marijuana in such a complex). Nonetheless, we are not bound by decisions of lower federal courts in other jurisdictions. Cease possesses a valid Pennsylvania Medical Marijuana Identification Card authorizing her to legally obtain and use medical marijuana under medical supervision, and the Authority does not dispute that she has a valid medical basis for her use and that it is properly prescribed and supervised. Consequently, we find the term “illegally using a controlled substance” to be ambiguous here where her use is prohibited by the federal government but permitted under state law.14 Criminal law is primarily a matter for the states to determine

12 Mich. Comp. Laws §§ 333.26421 - 333.26430. 13 42 U.S.C. §§ 3601-3631. 14 Of course, even in the Commonwealth’s body of laws, there are statutory conflicts and/or legislative failures to act with respect to accommodations for users of medical marijuana. In Harrisburg Area Community College v. Pennsylvania Human Relations Commission, ___ A.3d ___ (Pa. Cmwlth., No. 654 C.D. 2019, filed October 29, 2020) (“HACC”), this Court considered the effect of HACC’s drug-testing requirement for candidates in its nursing program on a nursing student lawfully using medical marijuana under the Pennsylvania Medical Marijuana Act. We addressed the issue of whether the anti-discrimination provisions of the PHRA and the Pennsylvania Fair Educational Opportunities Act (PFEOA), Act of July 17, 1961, P.L. 776, as amended, 24 P.S. §§ 5001-2010, required accommodation of the student’s lawful use of medical marijuana. We held that the legalization of medical marijuana in Pennsylvania in the Pennsylvania Medical Marijuana Act did not require an accommodation for its use under either Section 5(i)(1) of the PHRA, 43 P.S. § 955(i)(1), or Section 4(a)(3) of the PFEOA, 24 P.S. § 5004(a)(3), noting that the General Assembly could have amended the language of those acts to require (Footnote continued on next page…) within their own jurisdictions. “Federalism, central to the constitutional design, adopts the principle that both the National and State Governments have elements of sovereignty the other is bound to respect.” Arizona v. United States, 567 U.S. 387, 398 (2012). As the Pennsylvania Supreme Court recently observed:

[T]he core principle of federalism recogniz[es] dual sovereignty between the tiers of government.” See United States v. Davis, 906 F.2d 829, 832 (2d Cir. 1990) (“The states and the national government are distinct political communities, drawing their separate sovereign power from different sources, each from the organic law that established it. Each has the power, inherent in any sovereign, independently to determine what shall be an offense against its authority and to punish such offenses.”). In enacting the [Pennsylvania Medical Marijuana Act], the Pennsylvania Legislature proceeded pursuant to its independent power to define state criminal law and promote the health and welfare of the citizenry.

Gass v. 52nd Jud. Dist., 232 A.3d 706, 714 (Pa. 2020). Consequently, “while possession and use of marijuana remains illegal under federal law even for medical purposes, . . . the federal [CSA] does not (and could not) require states to enforce it.” Id. at 714. In Gass, our Supreme Court unanimously declared that the Lebanon County Court of Common Pleas, 52nd Judicial District’s “Medical Marijuana

accommodation but chose not to do so. Id. at ___, slip op. at 13 and 15. In her concurring opinion, Judge Covey urged the General Assembly to amend both the PHRA and the PFEOA so the benefits it created in the Pennsylvania Medical Marijuana Act “for the citizens of this Commonwealth are not illusory or applicable only in limited circumstances; thereby, creating an egregious result as is demonstrated in the instant case.” HACC, ___ A.3d at ___ (Covey, J. concurring), slip op. at 1. Judge Covey opined that “[t]he conflict among these statutes has created an absurd result in requiring Pennsylvania citizens to choose the benefits of medical marijuana or the protections of the PHRA and the PFEOA.” Id. at ___ (Covey, J. concurring), slip op. at 2-3.

Policy” prohibiting the active use of medical marijuana by individuals under court supervision, such as probationers, was, in both its original and amended forms, contrary to the immunity afforded under the Pennsylvania Medical Marijuana Act and, therefore, could not be enforced. In other words, the Court determined that a local policy could not usurp a state law simply by reference to a federal law such as the federal CSA. Id. Accordingly, the Gass Court held: “While the circumstances are certainly uneasy -- since possession and use of medical marijuana remains a federal crime -- we find that the [52nd Judicial] District cannot require state-level adherence to the federal prohibition, where the General Assembly has specifically undertaken to legalize the use of medical marijuana for enumerated therapeutic purposes.” Id. We believe the same is true of the Authority.15 Moreover, the pertinent provisions of QHWRA are based on the obsolete and scientifically flawed premise that marijuana “has no currently accepted medical use in treatment in the United States” and that “there is a lack of accepted safety for use of marijuana under medical supervision.” Section 812(b)(1)(A-C) of the federal CSA, 21 U.S.C. § 812(b)(1)(A-C). See also U.S. v. Oakland Cannabis Buyers’ Coop., 532 U.S. 483 (2001) (recognizing that there is no medical necessity

15 In Beasley, 71 F. Supp. 3d 715, the United States District Court for the Eastern District of Michigan considered how much deference to afford a January 2011 memorandum opinion issued by HUD to the Office of Fair Housing and Equal Opportunity regarding the medical use of marijuana and reasonable accommodation in federal public and assisted housing. Concluding that the HUD memorandum was not a statute, regulation, or formal judicial interpretation, the federal district court rejected the higher level of deference set forth in Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984). Instead, the federal district court concluded that the HUD memorandum was a more informal medium not intended to have the force of law and, therefore, afforded it the lesser level of deference set forth in Skidmore v. Swift & Company, 323 U.S. 134, 140 (1944). Accordingly, the federal district court, per Skidmore, gave weight to “HUD’s conclusion that a medical marijuana accommodation [was] not reasonable under the Fair Housing Act because it would constitute a fundamental alteration in the nature of a [public housing agency] or owner’s operations.” Beasley, 71 F. Supp. 3d at 730.

exception to the federal prohibition against manufacturing and distributing marijuana). In contrast, the General Assembly in Section 102(1) of the Pennsylvania Medical Marijuana Act declared: “Scientific evidence suggests that medical marijuana is one potential therapy that may mitigate suffering in some patients and also enhance quality of life.” 35 P.S. § 10231.102(1). Consequently, given the current circumstances regarding the medically accepted use and ambiguous status of medical marijuana, establishment of fair and reasonable standards regarding the use of that substance under medical supervision is particularly called for here. Accordingly, we affirm the trial court’s order to the extent that it determined that Cease was a new applicant but vacate the order to the extent that it affirmed the Authority’s denial of Cease’s application. We remand this matter to the trial court with directions to remand to the Authority to do what QHWRA mandates and establish fair and reasonable standards for determining in what circumstances admission to Section 8 housing is prohibited for an applicant who is legally using medical marijuana under state law, and to apply those standards with respect to Cease’s individual circumstances when determining Cease’s eligibility for the Section 8 program.

_____________________________________ BONNIE BRIGANCE LEADBETTER, President Judge Emerita

IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Mary Cease, : Appellant : : v. : No. 519 C.D. 2019 : Housing Authority of Indiana County :

ORDER

AND NOW, this 19th day of February, 2021, we hereby AFFIRM the order of the Court of Common Pleas of Indiana County, in part, VACATE the order, in part, and REMAND this matter to the trial court with directions to remand to the Housing Authority of Indiana County in accordance with the foregoing opinion. Jurisdiction relinquished.

_____________________________________ BONNIE BRIGANCE LEADBETTER, President Judge Emerita IN THE COMMONWEALTH COURT OF PENNSYLVANIA Mary Cease, : Appellant : : No. 519 C.D. 2019 v. : : Argued: February 13, 2020 Housing Authority of Indiana County : BEFORE: HONORABLE PATRICIA A. McCULLOUGH, Judge HONORABLE MICHAEL H. WOJCIK, Judge HONORABLE BONNIE BRIGANCE LEADBETTER, Senior Judge DISSENTING OPINION BY JUDGE McCULLOUGH FILED: February 19, 2021 I must respectfully dissent. The Majority goes to great lengths to explain why Congress’s use of the phrase “shall establish standards that prohibit” in section 13361 of the federal Quality Housing and Work Responsibility Act (QHWRA),1 means a Public Housing Authority (PHA) has “flexibility” to decide whether to admit an illegal drug user (as defined in the federal Controlled Substance Act2 (CSA)) into a Section 8 housing program.^[3] By avoiding the rules of statutory 1 42 U.S.C. §13661. 2 21 U.S.C. §§801-971.