Federal Lawsuit Targets NYC Dept. of Homeless Services, Institute for Community Living, and Former Manhattan VA Homeless Services Director Over Veteran Care Failures

Timothy Pena • September 11, 2025

Borden Avenue veterans' program accused of violating federal law, denying services, and retaliating against veterans who speak out. 

New York, NY-A federal lawsuit has been filed against New York City’s Department of Homeless Services (DHS), the Institute for Community Living (ICL), and former Manhattan VA Homeless Services Director Karen Fuller, accusing them of unsafe shelter conditions, misuse of federal funds, and unlawful retaliation against veterans.

The case centers on the Borden Avenue Veterans Residence (BAVR) in Queens, the only federally funded Grant & Per Diem (GPD) program available to homeless veterans in New York City. The lawsuit claims the facility was mismanaged in violation of federal law, leaving veterans in degrading conditions instead of the recovery-oriented housing required by law.

Alleged Violations

According to the complaint, DHS and ICL operated BAVR under a MICA (Mentally Ill, Chemically Addicted) shelter model that tolerated drug use, violence, and untreated mental illness. This approach, it argues, contradicted Public Law 109-461 and 38 CFR § 61, which require federally funded veterans’ housing to be safe, sober, and supportive.

The lawsuit lists several failures:
• Lack of transportation to VA medical and mental health appointments.
• Nutritional neglect, falling below federal standards.
• Unsafe facilities without required sinks and toilets.
• Overcrowded conditions that denied veterans privacy and dignity.

Shifting Blame

Pena attacks the city’s definition of “success,” describing it as putting a veteran in a room with five doors, demanding they pick the right one, and then faulting them for choosing wrong. It argues that the system deliberately sets veterans up for failure, shifting responsibility away from mismanagement and onto those the program is supposed to serve.

Unlawful Barriers to Entry


One of the most serious charges is that DHS and ICL required veterans to have a mental health or substance-use diagnosis to enroll in the GPD program. The lawsuit emphasizes that federal law does not require such a condition—eligibility is based solely on being a VA-eligible veteran experiencing homelessness. By imposing this barrier, the defendants allegedly excluded veterans who did not fit a “MICA profile,” denying them housing and services funded by the VA.


Retaliation and Conflict of Interest


The filing further accuses Fuller of silencing dissent. After plaintiff Timothy Pena, a member of the NYC Veterans Task Force, sent a private email to fellow members describing a veteran and his combat canine being “kicked out” of BAVR, transferred to another shelter, and forced to sleep on the floor while 4th of July fireworks were going off overhead, Fuller allegedly responded by drafting an unlawful “Code of Conduct” to muzzle him.


That email, Pena notes, came only after months of appeals to task force members for assistance went unanswered. Fuller, who had personally brought Pena onto the task force as co-chair, then used her authority to restrict his speech. The complaint describes this as retaliation, a violation of the First Amendment and the Americans with Disabilities Act (ADA), and a profound conflict of interest.


Broader Failures


The lawsuit also faults DHS and ICL for failing to provide community engagement opportunities, such as housing processing, workshops, and activities designed to help veterans reintegrate. These programs are required under federal guidelines but allegedly absent at BAVR.


Call for Accountability


The filing cites violations of federal statutes, the ADA, and constitutional protections, and calls the defendants’ actions systemic mismanagement and misuse of federal funds. It demands that New York City stop accepting federal dollars while placing veterans in unsafe conditions.


DHS Lawsuit 20250911

Timothy Pena is a service-connected disabled Navy veteran for PTSD and has written about his experiences with mental health, homelessness, and the judicial system. Suffering mental illness, he initially visited NYC to collaborate on a documentary for veteran suicide but decided to stay after realizing he would rather be homeless in NYC than dead in Phoenix. He has been writing stories and blogs about his journey from “homeless to homeness” in the NYC Dept of Homeless Services system and possible corruption within DHS and Veterans Affairs Grant & Per Diem Transitional Program.