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July 9, 1941

FAVORS et al.
RANDALL et al.

The opinion of the court was delivered by: GANEY

The complainants have asked for a preliminary injunction against the defendants praying that the defendants be restrained from certifying for occupancy, to what is known as the Tasker Street Project, certain tenants on the basis of color or race; that the defendants be compelled to modify the quota eligibility, of families selected for certification, where the income totally or partially is derived from public or private relief, and that the defendants be enjoined, during the pendency of this action, from certifying for occupancy any further tenants in the Tasker Street Project, as well as damages against the individuals above named.

The Philadelphia Housing Authority is a public corporation created pursuant to the Housing Authorities Law of Pennsylvania, Act of May 28, 1937, P.L. 955, 35 P.S.Pa. § 1541. The United States Housing Authority is a Federal corporation created by the United States Housing Act of 1937, Act of September 1, 1937, 42 U.S.C.A. § 1401.

 The purposes for which the Philadelphia Housing Authority was created was to effect the clearance of certain slum areas within the confines of the City of Philadelphia, and to provide in their place and stead, safe and sanitary dwelling accommodations for families of very low incomes. The purpose of the Housing Authority Law was to make certain loans to the various local housing authorities throughout the United States, or in effect to provide for annual subsidies by which dwelling accommodations could be erected at less than what has been termed the "economic rent", or in other words, the creation of housing facilities which could not otherwise be constructed by private capital for people in the very low income groups.

 The original program of the Philadelphia Housing Authority contemplated the erection of six projects within the city by which partial provision was to be made for persons in low income groups, by way of sanitary housing facilities, it being impossible to take care of everyone within these groups, who wished the facilities afforded, with only the six projects. The six projects contemplated were the Southwark Site, the Germantown Site, the Pennsylvania Hospital Site, the Glenwood Project, the Poplar Project and the Tasker Project. However, the first three projects had to be abandoned by reason of the council of the City of Philadelphia refusing to adopt proper legislation approving them, which left the latter three the only three projects available for the forementioned low income groups. The three projects consisted of twenty-eight hundred fifty-nine (2859) dwelling units, out of which five hundred thirty-five (535) are at Glenwood, one thousand (1,000) at Tasker and thirteen hundred twenty-four (1,324) at Poplar. The Glenwood project has been completed and is now occupied, the Poplar project is presently under construction and the Tasker Street Project is completed and families were at time of the beginning of this action, being certified for occupancy, as well as executing leases.

 The Philadelphia Housing Authority entered into a Loan and Annual Contributions Contract on November 30, 1940, with the United States Housing Authority. The contract included three projects, the Glenwood, the Poplar and the Tasker Street, and included the provisions and terms by which the loan for the annual subsidy was made. Part two (2) of the Loan and Annual Contributions Contract, known as "Terms, Covenants, and Conditions", provides in Section 4.04 that: "It (the local authority) will not discriminate in the selection of tenants because of religious, political, or other affiliations."

 Section 3.07(c) of a Management Resolution provided as follows: "There shall be no discrimination because of race, religious, political, personal or other affiliations, in the selection of tenants for admission."

 A Federal Census conducted in 1940 by the W.P.A. under a Real Property Survey, showed that within the city subject to the Philadelphia Housing Authority's jurisdiction, families in the income bracket who would be served by the Authority's program, that is, those who live in slum areas and under unsanitary living conditions, and who did not have the earning capacity to provide for themselves clean and healthful living accommodations, consisted of sixty percent (60%) white families and forty percent (40%) colored families. By reason of the shrunken program occasioned by the refusal of the City of Philadelphia to take care of the other three projects, the Authority contemplated Glenwood as virtually a negro project inasmuch as it was in a location surrounded by negro inhabitants and of the five hundred thirty-five (535) units available, five hundred (500) were allotted to negroes. Likewise the Poplar Street Project which is also surrounded by colored people, having a ninety percent (90%) perimeter of colored people, was also regarded by the Authority as a predominately colored unit. The area immediately surrounding the Tasker Project, covering a four block area as established by the 1940 Federal Census show that ten percent (10%) only of the families in this area are negro and ninety percent (90%) white.

 In view of this shrunken program the defendants, members of the Phila. Housing Authority labored with the question on policy as to the certification of white and negro occupants from December, 1940, until they adopted the following Resolution on April 24, 1941:

 "Resolved: That The Philadelphia Housing Authority hereby determines that in the selection of tenants for Tasker Homes, the existing neighborhood pattern be preserved as far as possible."

 The Tasker Street Project which is the project in which the complainants allege they have been discriminated against has one thousand (1,000) living units, for which there are four thousand, three hundred six (4,306) applicants, of which three thousand, two hundred sixty three (3,263) were white and ten hundred forty (1,040) colored. The tenants finally selected as of the date of the bill numbered seven hundred fifty eight (758), seven hundred and two (702) of which were white and fifty-six (56) colored. According to the census computation of 1940, if the policy of the Authority adopted in its Management Resolution of April 24, 1941, in selecting tenants in conformity with the neighborhood pattern is carried out on the three projects, which are the only ones presently available, there will be seventeen hundred (1,700) colored units occupied and eleven hundred fifty nine (1,159) white units occupied, which is the opposite of the need existing, as found by the census, since where the need shows forty percent (40%) colored, the supply of that need shows sixty percent (60%) colored, and where the need shows sixty percent (60%) for white persons, the supply shows only forty percent (40%) for them. The testimony further shows that if the Tasker Street Project would accept tenants on an even basis, fifty percent (50%) white and fifty percent (50%) colored, it would show a total on the three projects of twenty two hundred (2,200) colored units to six hundred fifty nine (659) white units, thus still throwing further out of balance the proportion of need as shown by the 1940 Census.

 There is definite indication on the record that from December 26, 1940, to April 24, 1941, white people were certified for occupancy over negro applicants, since as of December 26, 1940, there were seventy-seven (77) persons certified for occupancy, of whom sixty-two (62) were white and fifteen (15) were negro. From December 26, 1940, to April 24, 1941, only seven (7) colored persons were certified. The record further shows that on April 3, 1940, there were six hundred eighty-three (683) white families certified and ten (10) negro families certified. Therefore, as has been indicated, there can be no doubt but that the Authority certified white tenants who made application for occupancy and did not certify negroes.

 The defendants, after the complainants had offered all their testimony, without offering any defense made a motion to dismiss the complaint, pursuant to Rule 41(b) of the New Rules of Civil Procedure, 28 U.S.C.A. following section 723c, thereby averring that on the facts and the law the plaintiffs had shown no grounds for relief.

 It is the plaintiffs' contention that the action of the Housing Authority previous to April 24, 1941, and the adoption of the Management Resolution, setting a policy for the selection of tenants for the project, in conformity with the neighborhood pattern, is violative of the ...

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