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January 11, 1979

Frank L. RIZZO et al.

The opinion of the court was delivered by: BRODERICK

On December 21, 1978, the City Council of Philadelphia considered Bill No. 1706, entitled "An ordinance approving the redevelopment contract of the Redevelopment Authority of the City of Philadelphia for the redevelopment and urban renewal of a portion of Whitman Urban Renewal Area . . .". Bill No. 1706 failed to receive sufficient affirmative votes. On the same day, City Council passed a resolution "Requesting the Redevelopment Authority of Philadelphia to prepare plans and select a redeveloper for the development of not less than 250 dwelling units on scattered sites within the Whitman Urban Renewal Area under certain terms and conditions." This Court has considered plaintiffs' motion requesting, among other things, that this Court order the defendants, Philadelphia Housing Authority (PHA) and Philadelphia Redevelopment Authority (RDA), to execute by January 15, 1979 all necessary contracts and agreements with A & R Development Corp./The Waterford Group, Inc. The Department of Housing and Urban Development (HUD) joined the plaintiffs in requesting such an Order. The defendant, City of Philadelphia, has opposed this motion and requests the Court to change the judgment order of November 5, 1976 to provide for scattered site housing instead of the townhouses. For the reasons hereinafter set forth, this Court has determined that plaintiffs' motion shall be granted and the motion of the defendant, City of Philadelphia, shall be denied. This means that the execution of the contract with the selected redeveloper, and all other steps necessary for the construction of the townhouses as planned, shall proceed immediately.


 The history of this litigation has been recited in detail in prior opinions of this Court. A summary at this juncture should be helpful, however, in clarifying the issues, since a review of the transcript of the proceedings before City Council indicates that the real issues were somewhat clouded by the rhetoric of the hearing.

 On November 5, 1976, this Court entered an order directing the PHA, the RDA and HUD to proceed immediately to construct the townhouses on the Whitman site. The Third Circuit Court of Appeals affirmed the order on August 31, 1977 and certiorari was denied by the United States Supreme Court on February 27, 1978. Resident Advisory Board (RAB) v. Rizzo, 425 F. Supp. 987 (E.D.Pa.1976), Aff'd in relevant part, 564 F.2d 126 (3d Cir. 1977), Cert. denied, 435 U.S. 908, 98 S. Ct. 1457, 55 L. Ed. 2d 499, 98 S. Ct. 1458 (1978); Sworob v. Harris, 451 F. Supp. 96 (E.D.Pa.1978), Aff'd, 578 F.2d 1376, Cert. denied, 439 U.S. 1089, 99 S. Ct. 871, 59 L. Ed. 2d 55 (1979).

 This litigation, which commenced in 1971, has been protracted and vigorously contested. The trial consumed 57 days, finally ending on January 21, 1976. Planning for this low income housing development commenced more than 20 years ago. The first of many public hearings took place on June 4, 1956. At this hearing, various sites were considered, and after hearing the views of the community, the Whitman site at Front and Oregon was selected and the site was approved by the Philadelphia City Planning Commission.

 On February 18, 1957, HUD gave tentative approval to the Whitman site for the redevelopment of a public housing project. An annual contributions contract was executed by HUD on December 6, 1957, in the amount of $ 8,607,793, approving a development program for Whitman of 476 units and authorizing PHA to begin planning the Whitman project. Drawings for a high-rise public housing project at the Whitman site were submitted to HUD by PHA and were approved by HUD on August 29, 1959. Condemnation and acquisition of the site by PHA took place during 1959 and 1960, culminating with the award of demolition contracts on June 26, 1960. Local opposition developed to the placing of high-rise public housing in Whitman.

 On October 27, 1963, RDA executed an application to establish the Whitman Urban Renewal Area. The application sought a federal grant of $ 3,311,024 and a temporary loan of $ 5,545,524 (totaling $ 8,856,548) to carry out the land acquisition, relocation of site residents, demolition and site clearance, site preparation, and rehabilitation or conservation required for the proposed Whitman Urban Renewal Area. The plan included clearing 130 homes, none of which were at the Whitman public housing site, and rehabilitating 2,500 other structures. The land use map for the Whitman Urban Renewal Area provided for public housing only on the Whitman site. The total amount of all governmental funds expended through RDA in the Whitman Urban Renewal Area from 1963 through 1975 has been $ 11,178,210.43; of this amount $ 6,682,686.92 has constituted federal funds from HUD. Between 1969 and 1973, 109 new homes were privately developed and sold for between $ 25,000 and $ 30,000, all of which were eligible for FHA-insured mortgages. From January 1, 1966 until May 1, 1975, Whitman residents, through RDA and with the aid of federal funds, have obtained $ 2,718,278 in loans and grants to rehabilitate their own homes. A total of 1,123 households, more than 25% Of all houses in the Whitman area, have received funds from this program.

 In 1964, after opposition had developed to the high-rise design of the proposed Whitman project, a special Act of Congress was passed, known as the Barrett Amendment. Pursuant to the Barrett Amendment, the design of the proposed Whitman project was changed from high-rise to low-rise construction. The zoning of the Whitman site was changed by City Council in 1964 to permit the construction of low-rise public housing on the site. In late 1967, Hartsville Construction Company was chosen as the developer to build 114 units on the Whitman site. The community opposed certain aspects of the Hartsville plan and Hartsville refused to execute the contract. Because of the opposition to the Hartsville plan, a decision was made to look for a new developer.

 A HUD Equal Opportunity staff review of the Whitman site was conducted and approval of the site for low income public housing was recommended on June 4, 1968. The Whitman site was described as being located in a predominantly all-white area, *fn1" conducive in all respects to Equal Opportunity Housing. Thereafter, HUD approved the Whitman site. The next year HUD established the Whitman project as a "balance" for the Morton Addition, a project located in a black area of Philadelphia. The Morton Addition was completed, and is now occupied, pursuant to the agreement to build the Whitman townhouses.

 During the latter part of 1969, PHA and RDA advertised for developers for the Whitman site pursuant to all applicable regulations. Twelve developers responded, and on April 28, 1970, PHA chose Multicon as the developer, which choice was approved by HUD on May 20, 1970. The Multicon proposal was considered superior to all other proposals because it maintained existing street patterns and the housing was of the same design as the other houses in the Whitman area. The Whitman Park Townhouse Project was unique in design for public housing because each house was designed with street frontage and a separate entrance and could be individually plotted on a separate building lot. This design was in anticipation of a federal program called Turnkey III, which called for a lease-purchase agreement pursuant to which the public housing tenant could eventually become the owner of his own home.

 On July 14, 1970, RDA and Multicon entered into an agreement of sale to enable Multicon to obtain the land at Front and Oregon and build the Whitman Park Townhouse Project. On October 27, 1970, Mayor Tate signed an ordinance passed by City Council approving Multicon as the developer of the project. On October 29, 1970, based upon appropriate HUD approval of the project, PHA and Multicon entered into an agreement of sale whereby Multicon was to construct 120 townhouses on the Whitman site. On October 30, 1970, RDA conveyed title to the Whitman Park Townhouse Project site to Multicon.

 Prior to the signing of the contracts with Multicon, the community was involved in numerous meetings and correspondence with RDA, PHA and Multicon. On June 2, 1970, a meeting was held in the Whitman community attended by officials from RDA, PHA, Multicon and the Mayor's office. The meeting was held to give the community an opportunity to closely review the Multicon plans for the Whitman Park Townhouse Project. The community made several suggestions in connection with the building materials to be used in the project and fire safety for the completed townhouses. The suggestions were accepted and appropriate changes were made in the Whitman Park Townhouse Project plans. Also, the home ownership potential and the advantages thereof of a public housing development under Turnkey III were explained to the community. Community representatives stated after the June 2, 1970 meeting that the Whitman Park Townhouse Project plans "look excellent", that they were "very impressed with the plans" and felt that the houses would be "an asset to our community."

 Although a groundbreaking ceremony was conducted on December 16, 1970, actual construction did not commence until March of 1971. As a result of the activities by demonstrators at the site, the builder was unable to proceed with construction since requested police protection was not forthcoming. At a conference on April 30, 1971, the City Managing Director stated that Multicon would not receive police assistance.

 Shortly thereafter, there was a series of meetings and various changes in the Whitman Park Townhouse Project were proposed in order to settle the controversy, including opening a building in the project as a community recreation area, reserving 50% Of the units for persons who were displaced by the clearance for the Whitman project, raising the income levels of those persons who would be eligible for the project and setting up a screening committee, which would include Whitman residents, to assure that those living in the houses would be an asset to the community. On May 17, 1971, after full discussion and consideration of the settlement proposals, the community voted down the final settlement offer of PHA. On May 18, 1971, Mayor Rizzo was nominated as the candidate for Mayor. On May 20, 1971, the Managing Director of Philadelphia ...

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