Can a Virginia local or regional housing authority operate statewide without going through § 36-23's locality-by-locality approval process?

Plain-English summary

The Director of Virginia's Department of Housing and Community Development asked whether a local, regional, or consolidated housing authority organized under the Housing Authorities Law could operate throughout Virginia without satisfying Va. Code § 36-23. The question came up because the Department and the Virginia Housing Development Authority were preparing to apply to HUD to serve as Performance-Based Contract Administrator for project-based Section 8 housing assistance, and HUD's Notice of Funding Availability required applicants to have legal authority to operate statewide.

The AG said no. Under the Housing Authorities Law, every locality has a housing authority created as a political subdivision. But the authority can only transact business after the locality's voters approve it in a referendum, and it is generally granted powers to act only within its "area of operation," which is coextensive with the boundaries of the locality within which it was created.

To act outside that area, a housing authority has to comply with § 36-23, which includes receiving the approval of the governing body of each locality in which the authority is requesting to act.

The result for the HUD application was that a single existing local, regional, or consolidated housing authority could not just declare itself statewide. Virginia's Dillon Rule confined housing authorities to expressly granted powers, and the express grant was tied to the area of operation. As the opinion put it, if the power cannot be found, the inquiry is at an end.

Currency note

This opinion was issued in 2012. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

What is an "area of operation"?
The opinion describes it as coextensive with the boundaries of the locality within which the housing authority was created. The authority's enumerated powers are generally tied to acting within that area.

Could a statewide consolidated authority be created instead?
The opinion didn't analyze that pathway. It focused on whether an existing local/regional/consolidated authority could expand to statewide reach using its existing structure. Whether the General Assembly could create a statewide entity by statute, or whether HUD could be satisfied by an entity like the Virginia Housing Development Authority, was outside the question presented.

What does § 36-23 actually require?
The opinion says compliance with § 36-23 includes receiving the approval of the governing body of each locality in which the authority is requesting to act. The opinion did not spell out further procedural detail.

Why is this so locality-by-locality?
Because housing authorities in Virginia are local entities whose express powers are tied to their area of operation. The Dillon Rule reinforces it: when the express grant of power is tied to the area of operation, there is no implied authority to act beyond it.

Did the AG say anything about the HUD application path forward?
Not really. The opinion answered the legal question and stopped. It did not propose a workaround or suggest specific statutory amendments.

Background and statutory framework

The Housing Authorities Law creates a housing authority in each locality as a political subdivision of the Commonwealth. The authority cannot transact business or exercise its powers until the qualified voters of the locality approve it by majority vote in a referendum.

The law generally grants a housing authority enumerated powers to act within its "area of operation," which is coextensive with the boundaries of the locality within which it was created.

Section 36-23 is the gateway for acting outside the area. A housing authority may exercise any of its powers outside its area of operation only upon compliance with § 36-23, which includes receiving the approval of the governing body of each locality in which the authority is requesting to act.

Virginia's Dillon Rule restricts local powers to those expressly granted, fairly implied, or essential and indispensable, and any doubt is resolved against the locality. The opinion adds that the Dillon Rule applies in the first instance to determine whether a power exists at all; if the power cannot be found, the inquiry is at an end.

Citations

• Va. Code § 2.2-505 (Attorney General opinions)
• Va. Code § 36-23 (extraterritorial operation procedure)

Source

• Landing page: https://www.oag.state.va.us/annual-reports-opinions/official-opinions
• Original PDF: https://www.oag.state.va.us/files/Opinions/2012/12-042_Shelton.pdf

Original opinion text

COMMONWEALTH of VIRGINIA
Office of the Attorney General
Kenneth T. Cuccinelli, II
Attorney General

June 1, 2012

Mr. William C. Shelton
Director, Virginia Department of Housing and Community Development
Main Street Centre
600 East Main Street, Suite 300
Richmond, Virginia 23219

Dear Mr. Shelton:
I am responding to your request for an official advisory opinion in accordance with § 2.2-505 of the Code of Virginia.

Issue Presented
You inquire whether a local, regional or consolidated housing authority organized pursuant to the Housing Authorities Law is authorized to operate throughout the entire Commonwealth without first meeting the requirements of § 36-23.

Response
It is my opinion that a local, regional or consolidated housing authority may not operate throughout the entire Commonwealth without first meeting the requirements of § 36-23.

Background
You relate that the Virginia Department of Housing and Community Development and the Virginia Housing Development Authority are currently preparing an application to the federal Department of Housing and Urban Development ("HUD") to serve as the Performance-Based Contract Administrator for project-based Section 8 housing assistance in Virginia. You indicate that the Notice of Funding Availability issued by HUD for this program sets forth certain eligibility criteria for applicants, including a requirement that the applicant have the legal authority to operate throughout the entire state for which it is applying for funds.

Applicable Law and Discussion
Virginia follows the Dillon Rule of strict construction that provides that municipal corporations have "only those powers which are expressly granted by the state legislature, those powers fairly or necessarily implied from expressly granted powers, and those powers which are essential and indispensable." Moreover, "the Dillon Rule is applicable to determine in the first instance, from express words or by implication, whether a power exists at all. If the power cannot be found, the inquiry is at an end."

The Housing Authorities Law creates "[i]n each locality" a housing authority as a political subdivision of the Commonwealth. Any such local housing authority, however, may transact business and exercise its powers only after having received the affirmative approval of the qualified voters "of such locality" by a majority vote of such qualified voters voting in a referendum. A housing authority is generally granted enumerated powers to act within its "area of operation," which is coextensive with the boundaries of the locality within which it was created.

A housing authority may exercise any of its powers outside of its area of operation only upon compliance with the procedures for authorization of such actions as set forth in § 36-23, which includes receiving the approval of the governing body of each locality in which the housing authority is requesting to act.

Conclusion
Accordingly, it is my opinion that a local, regional or consolidated housing authority organized pursuant to the Housing Authorities Law is not authorized to operate throughout the entire Commonwealth without first meeting the requirements of § 36-23.

With kindest regards, I am
Very truly yours,

Kenneth T. Cuccinelli, II
Attorney General