Monica Hilton Sussman and Stephen J. Wallace have been cornerstones of the affordable housing industry.
Attorneys at the Nixon Peabody firm, they have been guiding developers through complex housing issues for decades. They have helped interpret housing policies, advocated for owners, and mentored a new generation of industry leaders.
After a combined 61 years at Nixon Peabody, the longtime colleagues will retire soon. For their contributions to the industry, Sussman and Wallace are being inducted into the Affordable Housing Hall of Fame.
Both began their careers on a similar path—Sussman as legislative counsel in the New York governor’s office in Washington, D.C., and Wallace in a comparable role for former U.S. Sen. Alfonse M. D’Amato.
“They said, ‘You’re going to do housing,’” recalls Sussman. “I knew nothing about housing.”
Soon, she was immersed in the Section 236 rental assistance program, including getting state offices to fight a Department of Housing and Urban Development (HUD) proposal that would use excess income mostly generated by the state noninsured properties to fund a new flexible subsidy program only for Federal Housing Administration (FHA)-insured properties.
Sussman later served as HUD’s deputy general counsel during the early years of the Clinton administration. Her focus included handling legal and regulatory matters primarily around the Section 8 and FHA programs.
She then joined Nixon Peabody as a partner in 1996, representing developers and management companies, including assisting them to close on early HOPE VI, Rental Assistance Demonstration, and Mark-to-Market transactions. Sussman has been particularly skilled in navigating Section 8 housing matters and worked with HUD to develop new policies to assist residents and owners, including fine-tuning the ability for property owners to split a Housing Assistance Payment contract among multiple properties.
“Ask Monica” is a common refrain throughout the country whenever there’s a question about a HUD program, according to her colleagues.
Denise Muha, executive director of the National Leased Housing Association (NLHA), teases that the attorney is like Cher—no last name necessary.
Muha has worked with both Sussman and Wallace over the years, first getting to know Sussman and quickly bonding. “She is one of those people that you meet once and you feel like you have known forever,” Muha says. “Monica is dogged about making sure that HUD considers all potential avenues, and her work has forged some creative transactions that have resulted in the preservation of many assisted housing properties.”
Sussman, now senior counsel, says one of her greatest accomplishments has been building the affordable housing team at Nixon Peabody, which has grown from about 10 when she started to 30 today.
Her leadership has been felt industrywide. She’s served as president of the National Housing Conference and been active in several affordable housing organizations.
“I love it,” she says about the industry. “It’s the people and the challenge.”
Sussman plans to retire at the end of the year. She and her husband have two children and five grandchildren.
Wallace Shapes Preservation Policy
Wallace’s expertise focuses on the preservation of the federal affordable housing portfolio.
As a law student, Wallace expected he would work in local politics or banking, but that soon changed.
After serving as a legislative counsel for D’Amato, he joined a law office that merged with Lane and Edson, a firm with deep affordable housing experience, which opened opportunities in legislative and regulatory work concentrated in housing, including lobbying for the Low-Income Housing Preservation and Resident Homeownership Act of 1990 (LIHPRHA).
From there, Wallace evolved as an expert in the preservation of the federal affordable housing portfolio, assisting owners and buyers of older HUD-assisted properties like Sections 8, 236, and 221(d)(3) developments with regulatory and transactional issues.
He was one of the architects of the Section 236 decoupling transaction, which allowed an owner to retain the interest reduction payment (IRP) subsidy stream when the underlying Section 236 loan was prepaid. At the time, this was critical when approximately 15 years of the IRP subsidy remained on a property and an owner could request HUD to use the remaining subsidy to offset the debt service on new financing.
When Section 236 decouplings became codified in 2000, it led to a surge of these older properties being acquired, recapitalized, and preserved.
“Federal resources for affordable housing are always scarce, so we wanted to focus on retaining any existing subsidy for the benefit of preserving these properties,” says Wallace, who plans to retire in January.
In the early days of their careers, he and Muha spent a lot of time walking the halls of Congress to build support for affordable housing. Wallace’s work on LIHPRHA and individual transactions has revitalized thousands of units of low- and moderate-income housing, she says.
He, along with Sussman, recently worked to include a provision allowing Mark-to-Market properties to seek budget-based rent adjustments in the fiscal 2023 appropriations bill. As a result, owners will have an opportunity to address deferred maintenance and operating shortfalls at these communities.
Wallace, senior counsel, served as practice group leader of Nixon Peabody's Affordable Housing Group from 2006 to 2018, during which time this group’s growth surged. He has served on multiple industry boards and taught a class on affordable housing at Georgetown University School of Law.
His son, Peter, works in affordable housing development and preservation in California.
“When you get involved in the public policy aspects of affordable housing, you can see, feel, and touch the real estate and the impact that it has on the residents,” Wallace says. “To be able to make an impact resonated with me and the goals I had for my career.”
