Island Park mayor: Federal housing case is not over

Officials say withdrawal is a procedural move


Island Park Mayor James Ruzicka said last week that the withdrawal of the decades-old lawsuit between the federal government and the village is not over, as reported in last week’s Herald. Rather, Ruzicka explained, the stipulation between the town’s attorney and federal officials was simply a way of stopping the clock to allow for more negotiations.

“The article is inaccurate,” Ruzicka said of last week’s front-page story, “I.P. housing scandal ends with a whimper.” “The writer was referring to a stipulation that has been filed many times relating to the appeals, which were filed years ago by both the village and the U.S. government. The withdrawing of the appeals is a technical process, which simply preserves each party’s rights while the village and the government continue to discuss a fair resolution to this longstanding matter. We continue those negotiations to obtain the best possible settlement for the citizens of Island Park.”

In 1982, the federal government allocated money to build affordable housing for minorities in communities that were mostly white and where land was available. Island Park became one of the targeted communities, 44 subsidized homes were quickly built, “qualified owners” were identified and the homes were bought and occupied.

In 1984, however, an audit by the federal Department of Housing and Urban Development, which had funded and built the homes, found that village officials rigged the distribution of the houses so that they went to “politically connected residents.”

In 1989, the federal government sued the village over the botched housing program. Ten years later, Steven Gold, a federal magistrate, ordered Island Park to pay a $5.4 million fine and to actively recruit minorities to move to the village.

Negotiations have been going on since then.

But on March 4, attorneys for both the Eastern District and the village signed a stipulation stating, “The undersigned counsel for the parties stipulate that the above-captioned case [USA v. Village of Island Park] is withdrawn without costs or attorney’s fees.”