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May 26, 1976

COUNTY OF CHESTER; THEODORE S. A. RUBINO, MONROE L. NUTE and LEO D. McDERMOTT, in their capacity as Commissioners of Chester County; WILLISTOWN TOWNSHIP: JOSEPH EWING, WILLIAM REESIDE and ARTHUR WREAN, in their capacity as Supervisors of the Township of Willistown; CLARA A. HILLS, in her capacity as Secretary of the Department of Housing and Urban Development; W. RUSSEL G. BYERS, in his capacity as Acting Regional Administrator of the Department of Housing and Urban Development; PAUL T. CAIN, in his capacity as Area Director of the Department of Housing and Urban Development; and THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

The opinion of the court was delivered by: LUONGO

 This is an action under the Housing and Community Development Act of 1974, 42 U.S.C. § 5301, et seq. (Supp. 1976) (hereinafter HCDA), the Fair Housing Act of 1968, 42 U.S.C. § 3601, et seq., the Civil Rights Act of 1964, 42 U.S.C. § 2000d, et seq., the Civil Rights Act of 1866, 1870 and 1871, 42 U.S.C. §§ 1981, 1982, 1983, and the Fifth and Fourteenth Amendments to the United States Constitution.

 Plaintiffs, low income and non-white citizens of Chester County, Pennsylvania (County), seek a declaration that a grant of federal funds to County violates their rights under the above-cited statutes and the Constitution of the United States and they seek to enjoin transfer of such of the federal funds to County as are earmarked for Willistown Township, a political subdivision of County. Non-federal defendants are the public entities, Chester County and Willistown Township, together with the individual members of the Board of Commissioners of Chester County and the Supervisors of Willistown Township. Federal defendants are the Department of Housing and Urban Development (HUD), and the Secretary, the Regional Administrator and the Area Director of HUD.

 The case is before me on plaintiffs' motion for preliminary injunction and motions to dismiss filed by the non-federal defendants.

 To further an understanding of the present action, it is helpful to outline the scheme of the HCDA. The passage and approval of the Act was the congressional response to the increasing deterioration of the nation's urban centers. The paramount objective of the Act "is the development of viable urban communities, by providing decent housing and a suitable living environment and expanding economic opportunities, principally for persons of low and moderate income." 42 U.S.C. § 5301(c). To that end, the Secretary of HUD is empowered to make grants to the States and their political sub-divisions to finance community development programs for a sum not to exceed 8.4 billion dollars prior to the end of fiscal year 1977. 42 U.S.C. § 5303.

 The provisions of the HCDA most relevant to the present action are §§ 5304, 5309, and 5311.

 Section 5304 sets forth the specific requirements and obligations of the applicant and the Secretary. Compliance with these provisions is mandatory in that no grant may be made unless the requirements are met. *fn1" These requirements include: (a) a summary of the particular development plan which identifies the community needs, discloses a "comprehensive strategy" to accomplish these needs, and specifies short and long term development objectives consistent with area wide planning and urban policies. 42 U.S.C. § 5304(a)(1); (b) formulation of a program which includes the activities to be undertaken and the costs and location thereof, alternative sources available to meet community needs and objectives, and considers environmental factors. 42 U.S.C. § 5304(a)(2); (c) the description of a program geared to eliminate and prevent urban deterioration and provide essential public services where needed. 42 U.S.C. § 5304(a)(3); (d) the submission of a housing plan which assesses the conditions and needs of lower income, elderly and handicapped families, specifies realistic goals for meeting these needs in terms of construction, indicates the location of this housing with the objectives of revitalization, restoration and avoidance of undue concentration of assisted persons in areas having a high proportion of low income families, and assures the existence of adequate public services. 42 U.S.C. § 5304(a)(4); (e) assurances that the program will be conducted and administered in conformity with Title VI of the Civil Rights Act of 1964 and Title VIII of the Fair Housing Act of 1968. 42 U.S.C. § 5304(a)(5); (f) assurances of adequate citizen participation in the application for the plan. 42 U.S.C. § 5304(a)(6); and (g) a certification, to the satisfaction of the Secretary, that the community development plan will primarily benefit low or moderate income families, or aid in the prevention or elimination of urban slums. The applicant may also certify that the program is designed to meet other needs of "particular urgency." 42 U.S.C. § 5304(b)(2).

 Once the applicant has complied with the above requirements, the role of the Secretary comes into focus under § 5304(c). This section provides that an application must be approved unless the Secretary determines: (a) that the applicant's description of its needs and objectives is "plainly inconsistent" on the basis of generally available facts or data, 42 U.S.C. § 5304(c)(1); (b) that the planned activities are "plainly inappropriate" to meeting the specified needs and objectives, 42 U.S.C. § 5304(c)(2); or (c) the application does not comply with the requirements of the Act or other applicable law or proposes ineligible activities, 42 U.S.C. § 5304(c)(3).

 Section 5304(d) provides for the submission of annual reports to the Secretary. These reports must contain: (a) a performance evaluation regarding the activities carried out pursuant to the grant; and (b) an assessment as to whether the activities conform to the objectives of the Act as well as the grantee's stated needs and objectives. Further, this section requires the Secretary to make such reviews and audits as are necessary to determine whether the grantee is administering and conducting its development program as set forth in the application, whether that program is in conformity with the Act and other applicable laws, and whether the grantee retains the capacity to carry out the approved program of development. The Secretary is then empowered to make whatever adjustments are appropriate in the amount of the annual grants in light of the findings made pursuant to the review and audit.

 Section 5304(f) provides that any application subject to the Secretary's approval under subsection (c), is deemed approved upon the passage of 75 days unless the Secretary acts affirmatively to disapprove by notifying the applicant of the specific reasons for disapproval.

 Section 5304(g) empowers the Government Accounting Office to audit the financial transactions of recipients insofar as they relate to the funds provided under the Act.

 Section 5309(a) contains a non-discrimination clause applicable to any programs or benefits funded under this Act. Section 5309(b) provides that if the Secretary should determine that any recipient of assistance under the Act has failed to comply with subsection (a), the Secretary is to notify the chief executive officer of the state or unit of local government in an attempt to secure compliance. If such compliance is not forthcoming in sixty days, the Secretary is authorized to recommend to the Attorney General of the United States that an appropriate civil action be instituted, or to exercise such other powers or functions as provided by law.

 Section 5311(a) empowers the Secretary to terminate, reduce or limit payments made to recipients under this Act if the Secretary finds that the grantee has failed to comply with any provisions of the Act. Subsection (b) permits the Secretary to refer the matter to the Attorney General if the Secretary has reason to believe that the recipient has failed to comply "substantially" with any provisions of the Act. Subsection (c) provides the basis for judicial review to any recipient who receives notice of any action taken by the Secretary pursuant to subsection (a).

 The scheme of the Act, in short, contemplates a continuing relationship and "dialogue" between HUD and the grantee during the three year tenure of a given community development project. Knoxville Progressive Christian Coalition v. Testerman, 404 F. Supp. 783, 789 (E.D. Tenn. 1975).

 Resort to the legislative history of the Housing and Community Development Act reinforces this conclusion. In adopting requirements for application and review, the stated congressional purpose was to:

". . . streamline the existing procedures of the categorical programs; to expand the role and responsibility of local governments in implementing community development programs, and to reduce the considerable processing burden now borne by HUD." 3 U.S. Code Cong. & Admin. News p. 4324 (1974).

 As to the role of the Secretary, the legislative history reveals that:

"The Secretary's review should be limited in its scope, but should include both substantive and legal aspects. The Secretary, before approving applications, should be satisfied that the purposes of the chapter, as well as other Federal Laws related to development, such as contained in the Equal Opportunities, Environmental Protection, and the A-95 Programs, are being met. The Committee anticipates that the Secretary, in establishing review procedures, would incorporate a reasonable review of the available information related to local needs; of projected program benefits in relation to the community's needs; of the consistency and comprehensiveness of the program in light of the objectives of the bill; and of the actual progress achieved with the Federal assistance provided. The Committee, however, intends to reduce significantly the unnecessary '"second-guessing by Washington' that has been criticized under existing programs. It believes that the shift from project to program review will accomplish this, in large measure. The statute would eliminate many of the determinations that the Secretary must now make under the categorical programs. At the same time, the statute would strengthen some provisions for statutory review in order to assure an active and effective administration of the program." 3 U.S.C. Cong. & Admin. News p. 4325 (1974).

 Furthermore, regarding the Secretary's role in approval of an application, it was noted that:

"It is intended that the Secretary administer these requirements in a manner which gives communities a reasonable benefit of the doubt in marginal cases. These requirements do not specifically forbid approval of a pending application if the community's proposed program . . . appears to lack compliance with obligations. However, the Committee clearly expects that when the Secretary has substantial reason to believe that a requirement of the bill will not be fulfilled, he will disapprove the pending application, at least partially, until the problem is resolved." 3 U.S.C. Cong. & Admin. News p. 4328 (1974).

 Having set forth the statutory scheme and legislative intent for HCDA, I will now turn to the facts of the matter before me.

 As before noted, the Act provides that applications are deemed approved unless the Secretary affirmatively disapproves within 75 days of receipt of the application. 42 U.S.C. § 5304(f). County's application had been received on May 30, 1975. On July 28, 1975, approximately two weeks before the expiration of the 75 day period, plaintiffs' counsel informed the HUD Regional Office that, because certain zoning regulations of Willistown Township had been held to be unconstitutionally exclusionary, HUD's approval of the grant of funds to that Township constituted, in counsel's opinion, a violation of HUD's statutory duties. In spite of receipt of that notification, HUD approved the grant of the first year's funds on August 12, 1975. This suit was instituted December 30, 1975.

 The complaint alleges that on July 18, 1975, the Pennsylvania Supreme Court declared the Willistown Township zoning ordinance to be unconstitutionally exclusionary because it tended to produce a pattern of "selective admission" into the Township; *fn4" that this exclusionary pattern existed at the time the Block Grant application was received and was acted upon by HUD; and that defendants knew or should have known of this pattern. *fn5"

 The complaint is in six counts. Count I charges that the federal defendants' failure to consider the legal issues raised by plaintiffs' letter of July 24, 1975, constitutes arbitrary and capricious action, and an abuse of discretion in violation of § 5304(c)(3) of the HCDA and § 706(2) of the Administrative Procedures Act. Count II charges that the non-federal defendants' assurances and certification made pursuant to § 5304(a)(5) are invalid, and that the federal defendants' acceptance thereof was arbitrary and capricious, and an abuse of discretion in violation of § 5304(a)(5), (b)(4) and (c)(3) of the HCDA, and § 706(2) of the APA. Count III charges all defendants with a general violation of the HCDA and the regulations promulgated thereunder. Count IV charges that the non-federal defendants' planned usage, and the federal defendants' approval, of the disputed portion of the Chester County application constitutes a violation of § 3608(d)(5) of the Fair Housing Act of 1968, which requires the Secretary of HUD to promote the national policy of "fair housing" in the administration of programs relating to housing and urban development. Count V charges that the non-federal defendants' planned usage, and federal defendants' approval, of the disputed portion of the Chester County application violates § 2000d of the Civil Rights Act of 1964 which proscribes discrimination in any federally-assisted programs. Count VI charges all defendants with violation of §§ 1981, 1982, and 1983 of the Civil Rights Acts of 1866, 1870 and 1871, as well as violation of the Fifth and Fourteenth Amendments to the Constitution of the United States.


 The non-federal defendants have moved to dismiss the action pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. Federal defendants filed briefs in opposition to plaintiffs' motion for preliminary injunction in which they argued that the court lacks jurisdiction of the subject matter. Although federal defendants did not file a motion to dismiss, Rule 12(h)(3) requires dismissal of an action whenever it appears that jurisdiction is lacking. Mansfield, Coldwater & Lake Michigan Ry. Co. v. Swan, 111 U.S. 379, 28 L. Ed. 462, 4 S. Ct. 510 (1884).

 Plaintiffs have advanced numerous grounds for federal jurisdiction, but they have failed to observe the admonition of Rule 8(a) that "a pleading which sets forth a claim for relief . . . shall contain (1) a short and plain statement of the grounds upon which the court's jurisdiction depends," leaving it to the court to mix and match the appropriate jurisdictional grounds with the respective claims advanced.

 Administrative Procedure Act

 Plaintiffs contend that there is jurisdiction for this suit under § 10 of the APA, 5 U.S.C. §§ 701-706. Although the precise question has not been decided by the Supreme Court, and lower federal court decisions are in conflict, *fn6" the cases decided in the Third Circuit are in agreement that § 10 does not provide an independent grant of jurisdiction to review agency action. Getty Oil Co. v. Ruckelshaus, 467 F.2d 349 (3d Cir. 1972), cert. denied, 409 U.S. 1125, 35 L. Ed. 2d 256, 93 S. Ct. 937 (1973); Zimmerman v. United States, 422 F.2d 326 (3d Cir.), cert. denied, 399 U.S. 911, 26 L. Ed. 2d 565, 90 S. Ct. 2200 (1970); Operating Engineers Local 542 v. NLRB, 328 F.2d 850 (3d Cir.), cert. denied, 379 U.S. 826, 13 L. Ed. 2d 35, 85 S. Ct. 52 (1964); Bucks Co. Board of Commissioners v. Interstate Energy Co., 403 F. Supp. 805 (E.D. Pa. 1975); Raitport v. National Bureau of Standards, 378 F. Supp. 380 (E.D. Pa. 1974).

 Declaratory Judgment Act

 Plaintiffs further assert that the Declaratory Judgment Act, 28 U.S.C. §§ 2201-2202, is a source of jurisdiction for this suit. The question whether the Declaratory Judgment Act furnishes the District Courts with jurisdiction is not a novel one. Under the predecessor statute, 28 U.S.C. § 400, the Supreme Court held that the Act was "procedural only." Aetna Life Ins. Co. v. Haworth, 300 U.S. 227, 240, 81 L. Ed. 617, 57 S. Ct. 461 (1937). The identical issue was raised shortly after the passage of the present statute. Mr. Justice Frankfurter, speaking for the Court in Skelly Oil Co. v. Phillips Petroleum Co., 339 U.S. 667, 671, 94 L. Ed. 1194, 70 S. Ct. 876 (1950), reiterated:

"Congress enlarged the range of remedies available in the federal courts but did not extend their jurisdiction. . . . [Jurisdiction] means the kinds of issues which give right to entrance to federal courts. Jurisdiction in this sense was not altered by the Declaratory Judgment Act."

 In short, absent an independent basis upon which jurisdiction may rest, plaintiffs may not rely upon the provisions of the Declaratory Judgment Act. Thompson v. Groshens, 342 F. Supp. 516 (E.D. Pa. 1972), aff'd on other grounds, 475 F.2d 127 (3d Cir.), ...

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