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December 22, 1994

CHERYL SANDERS, CECILE WHITE, CHERYL ULRICH, MARTHA SURRATT, SARAH WILLIAMS, KELLY VICK, and CHRISTIANS FOR A BETTER COMMUNITY, INC., on their own behalf and on behalf of all others similarly situated, Plaintiffs,

The opinion of the court was delivered by: GUSTAVE DIAMOND



 On December 12, 1994, this court conducted a hearing to determine whether it should grant final approval of a consent decree offered as a resolution of this civil rights class action. At the conclusion of the hearing, the court (1) found that the consent decree was a fair, adequate and reasonable resolution of this litigation; (2) granted final approval of the consent decree pursuant to Fed.R.Civ.P. 23(e); and (3) entered the consent decree as an order of the court. This opinion will formalize and supplement the court's rulings made on the record in open court during the hearing.

 I. Background

 Plaintiffs filed this lawsuit in 1988 against the Department of Housing and Urban Development ("HUD"), the County of Allegheny (the "County"), the Allegheny County Housing Authority ("ACHA"), and the Redevelopment Authority of Allegheny County ("RAAC"), to remedy the alleged establishment of de jure racial segregation in public and other federally assisted housing in Allegheny County, Pennsylvania, and the alleged perpetuation of and failure to disestablish that segregation.

 On October 15, 1992, a plaintiff class was certified consisting of "all black current residents in, or applicants for, public housing assisted by the ACHA and/or HUD, who have been and continue to be denied decent, affordable, and racially integrated public housing opportunities." See Opinion and Order, October 15, 1992.

 In 1993, HUD admitted liability for failing to affirmatively further fair housing in the ACHA public housing program; a violation of Title VIII of the Civil Rights Act of 1968, 42 U.S.C. § 3608(e)(5). In January of 1994, HUD assembled a task force with expertise in all of the various programs at HUD, to develop a desegregation plan for Allegheny County. That effort resulted in a plan which served as the basis for the consent decree offered as the settlement of this litigation.

 The parties sought and obtained the court's preliminary approval of the consent decree on August 31, 1994. Notice of the consent decree, as approved by the court, was given to all class members, including those individuals with African American or bi-racial family members, by mailing notice by first-class mail to the last known available address of all current residents in ACHA public and Section 8 housing and all current applicants for ACHA public and Section 8 housing and by publishing such notice once each week for two weeks in the Pittsburgh Post Gazette and the New Pittsburgh Courier. Individual notice was mailed to 9,455 persons, approximately 5,000 of whom were members of the class.

 The class notice was designed to acquaint class members with the scope and nature of the consent decree in a concise and easily understood format. Rather than risk confusion by describing in detail the complicated and lengthy provisions, the notice emphasized major provisions and explained the character of the consent decree and its intended purpose. This summary was complimented by italicized warnings informing the reader that the notice was only a summary and that review of the consent decree was necessary to learn all of its terms. The notice also explained succinctly how interested persons could comment or object to the proposed consent decree, in writing, and if desired, at a fairness hearing to be conducted by the court.

 Written submissions in response to class notice of the consent decree were filed by five persons, three of whom were class members interested in the resolution of the litigation. Of a possible 5,000 class member responses, only one class member, Davida Brooks, stated that she had an objection to the consent decree. *fn1" The fairness hearing was held as provided for in the published notice on December 12, 1994. Counsel expressed their views in support of the consent decree. *fn2" All of those who wished to be heard were given the opportunity.

 II. The Consent Decree

 The objectives of the decree are to decrease the level of racial spacial separation in federally assisted housing programs and the private housing market in Allegheny County, and to increase desegregative housing choices and opportunities for class members and other low income persons.

 Section II of the decree, which defines significant terms within the decree, describes the creation of a "Task Force." The Task Force will consist of representatives or designees of the parties, a Fair Housing Services Center created under the terms of the decree, and community based organizations selected by the plaintiffs and HUD. The Task Force will be the entity to select sites for the development of new units and to implement certain critical community development provisions of the decree.

 Section III of the decree governs the siting of all replacement units in Allegheny County. This section provides for the construction of 100 units of public housing to replace those units demolished at Talbot Towers. These units and all other units will be developed as scattered site units, in clusters of between one and twelve units, and will be developed in defined areas of the county to provide class members with housing opportunities outside of racially identifiable and low income impacted communities.

 Section IV of the decree provides for physical improvements to public housing developments and the surrounding neighborhoods to reduce disparities and to facilitate desegregative housing choices. To determine what improvements should be made, HUD will prepare and administer a tenant survey, and HUD will list those amenities enjoyed by tenants at identifiably white developments. The decree requires the ACHA to establish priorities and provide these amenities according to those priorities. In addition, the decree requires the ACHA to eliminate any deficiencies in the enforcement of HUD's housing quality standards, and eliminate any disparities found by HUD and maintenance services among its developments.

 Section V of the decree requires the parties and the Task Force to use funds provided under the decree to leverage other federal, state, and private resources to eliminate vestiges of discrimination and segregation throughout the County. The decree is designed to redirect resources so that more home ownership assistance and development of affordable housing and employment opportunities can take place in impoverished African American communities, while traditional public housing assistance can be used in white communities of higher income populations that have barred the use of such assistance within their borders in the past.

 This section of the decree also calls for the demolition and replacement of dilapidated or obsolete units as scattered site units outside of racially identifiable and low income impacted communities. In addition, adequate transportation and police protection are to be provided at all of the ACHA's public housing developments.

 The decree provides that the Task Force will be the entity to implement the extensive community development provisions of the decree. The Task Force will identify mechanisms for the targeting of resources, including all federal, state, local, and private resources, identify and develop a plan of housing and community and economic development activities and opportunities provided for in the decree, and approve all projects and expenditures related to community and economic development in the decree.

 Section VI of the decree calls for the eventual merger of the public housing and Section 8 waiting lists. Individuals on the two lists will first be cross-listed, so that individuals may be offered, but not penalized for rejecting, a unit for which they did not apply. After one year, the lists will be merged so that an applicant will be offered a range of all available desegregative housing opportunities, which may include conventional public housing, Section 8 tenant based assistance, and other assisted housing units. Each applicant will receive counseling by a nonprofit Fair Housing Services Center ("FHSC"), created under section VII of the decree, at the time he or she is made an offer or offers.

 This section provides that the ACHA jurisdiction initially will be divided into four regions so that, if an applicant is offered a desegregative opportunity outside his or her home region, he or she may reject the offer without penalty. If no desegregative opportunities are available, the applicant will be offered other available units, but may wait for a desegregative housing opportunity. If an applicant is offered, but rejects, a desegregative housing opportunity in his or her home region, except where good cause is shown, the applicant would move to the bottom of the waiting list.

 Section VII of the decree creates the FHSC which will counsel each applicant at the time he or she is offered housing in the County and assist applicants in considering and making desegregative moves. The FHSC also will perform marketing and outreach services to help increase the number of landlords in identifiably white areas willing to accept Section 8 certificates. The decree also creates a mechanism for the offering of assisted housing units through the FHSC, which will further increase the desegregative housing opportunities available to class members.

 This section also creates a Section 8 Mobility program that provides class members with 450 desegregative Section 8 certificates. To ensure that low income persons such as class members are able to use Section 8 assistance in units that are decent, safe, and sanitary, the ACHA will obligated to inspect a certain number of units to determine whether HUD's Housing Quality Standards are being met.

 Section VIII of the decree requires that HUD conduct a study, or Housing Opportunities Analysis, to determine whether class members actually have housing opportunities in areas previously closed to them, and whether additional assisted housing should be provided to enhance class members desegregative housing opportunities.

 Section IX of the decree provides for the commitment of extraordinary expenditures, or those expenditures over and above those resources that would be provided to the County and the ACHA in the normal course, for a period of seven years. This section also ensures the defendants' compliance with the terms of the decree. The defendants are enjoined to implement the decree and take all actions necessary to fulfill its obligations. In addition, the court will retain jurisdiction over the case for at least seven years. The court may then extend its jurisdiction over one or more of the defendants if the court determines that any of the defendants has not fulfilled its specific obligations under the decree, or the ACHA's low-income housing programs are not desegregated to the extent practicable.

 III. Approval of the Consent Decree

 A. Standard

 Under Rule 23(e) of the Federal Rules of Civil Procedure, a class action settlement must meet with the approval of the court. In exercising its sound discretion, the court must determine whether the settlement is fair, adequate, and reasonable. Walsh v. Great Atlantic & Pacific Tea Co., Inc., 726 F.2d 956, 965 (3d Cir. 1983). Relevant to this determination are the following factors:


... (1) the complexity, expense and likely duration of the litigation ...; (2) the reaction of the class to the settlement ...; (3) the stage of the proceedings and amount of discovery completed ...; (4) the risks of establishing liability ...; (5) the risks of establishing damages ...; (6) the risks of maintaining the class action through the trial ...; (7) the ability of the defendants to withstand a greater judgment; (8) the range of reasonableness of the settlement fund in light of the best possible recovery ...; (9) the range of reasonableness of the settlement fund to a possible recovery in light of all attendant risks of litigation ....

 Girsh v. Jepson, 521 F.2d 153, 157 (3d Cir. 1975). We now proceed to an examination of these factors. *fn3"

 B. Evaluation of the Consent Decree

 1. Complexity, Expense and Likely Duration of the Litigation.

 Litigation of the constitutionality of the housing policies and practices of the defendants spanning the last five decades has been complex and burdensome. It is anticipated that a trial of this matter would last for three weeks or more. To determine the constitutionality of the policies and the practices of defendants, the court would have to hear evidence on the alleged role of HUD's predecessor agencies and the local defendants establishing public housing on a segregated basis, their perpetuation of and failure to dismantle the vestiges of housing segregation existing throughout Allegheny County and the degree of segregation in public and assisted housing that has injured class members. Expert testimony would be offered to explain the degree of segregation measured in Allegheny County's public and assisted housing programs and the private market, and the remedies required to dismantle that segregation, which would be complicated, time consuming, and expensive.

 2. The Reaction of the Class to the Settlement

 Class members were provided with individual notice of the provisions of the consent decree and the right to file timely objections. Of 9,455 residents of and applicants for ACHA housing that were mailed notices, approximately 5,000 of those are projected to be class members, i.e., African Americans. As of November 15, 1994, the deadline for filing objections or comments to the consent decree, the court received five submissions. Of the five submissions, two responses were from non-class members who claimed they were not interested. Given the fact that only one of the other three submissions was referenced as an objection, out of a class of 5,000, 99.98% of the class appears to favor the agreement. Overwhelming support of the class for the decree weighs heavily in favor of the adequacy of the settlement. See Metropolitan Pittsburgh Crusade of Voters v. Pittsburgh, 686 F. Supp. 97, 101 (W.D.Pa. 1988). Although the three submissions deserve the court's thoughtful consideration, they do not warrant disapproval of the consent decree.

 One class member, Willa Mae Koon, raised a complaint about the ACHA because of the delay inherent in receiving an offer of Section 8 assistance, which was not relevant to the adequacy of the decree. There is no basis for assuming that the decree will affect the length of time individuals must wait to receive Section 8 certificates.

 Another class member, Leah Evans, complained about the lack of affordable, safe housing available for the use of Section 8 assistance. The consent decree provisions calling for the enforcement of HUD's Housing Quality Standards, designed to ensure that Section 8 is used to subsidize only decent, safe, and sanitary housing, and the provision of counseling, marketing and outreach by the FHSC actually aim to increase the number of landlords willing to accept Section 8 assistance for decent, safe, and sanitary units in non-impacted neighborhoods.

 Finally, the submission of Davida Brooks, the only class member submission referenced as an "objection," appears to point out the value of living in a black community and to express concern over an insufficient number of black communities. It is unclear whether this class member currently lives in what she considers a "black community" and would like to remain in that community, or whether she would like the option to choose among a greater number of communities open to African Americans. The decree addresses both concerns. First, it sets out to improve black communities in which a substantial number of federally subsidized units are sited. These communities generally have undergone decline and disinvestment. The decree, therefore, attempts to target improvements to identifiably African American public housing developments and the neighborhoods in which they are located to equalize conditions at all developments and neighborhoods and to provide for community and economic development.

 Second, the consent decree seeks to maximize the number of communities open to African American residents of or applicants for public housing or Section 8 rental assistance. The FHSC will provide class members with counseling and support services to help each individual consider public and federally assisted housing and the use of Section 8 certificates in neighborhoods that provide enhanced educational, employment, commercial, and social opportunities.

 3. The Stage of the Proceedings and the Amount of Discovery Completed.

 The consent decree in this case has been reached only after extensive investigation, research, discovery, and briefing. Full discovery included written discovery, document production, and depositions. All parties submitted motions for summary judgment, pretrial statements, and proposed findings of fact and conclusions of law. Because all pretrial preparations have been completed, the parties and the court are in the best possible position to evaluate the risks of establishing liability and the extent of relief that may be awarded after a trial and thus to determine whether the decree is fair, adequate, and reasonable.

 4. The Risks of Establishing Liability.

 Plaintiffs' counsel recommended approval of the consent decree not because of any perceived weakness in their case against HUD, the ACHA, the County, or the RAAC. Rather, because of the strength of plaintiffs' case and the liability already established through HUD's stipulation, the parties negotiated a decree affording the class with comprehensive relief. The comprehensive relief provided by the decree satisfies the factors relevant to determining the decree's fairness and also obviates the need for full litigation of liability and remedy.

  5. The Range of Reasonableness of the Settlement Fund in Light of the Best Possible Recovery and the Attendant Risks of Litigation.

 The court has determined that the relief provided in the decree is well within the range of reasonableness in light of the best possible recovery and the attendant risks of litigation. Harris v. Pernsley, 654 F. Supp. 1042, 1052 (E.D.Pa. 1987).

 The Supreme Court has considered appropriate remedies for long-standing segregation in housing. In Hills v. Gautreaux, 425 U.S. 284, 47 L. Ed. 2d 792, 96 S. Ct. 1538 (1976), the Court found that once a constitutional violation is shown "the scope of a district court's equitable powers to remedy past wrongs is broad," id. at 297 (quoting Swann v. Charlotte-Mecklenburg Board of Education, 402 U.S. 1, 15, 28 L. Ed. 2d 554, 91 S. Ct. 1267 (1971)), and "all reasonable methods [are] available to formulate an effective remedy." Id. (quoting North Carolina State Board of Education v. Swann, 402 U.S. 43, 46, 28 L. Ed. 2d 586, 91 S. Ct. 1284 (1971)). The Court requires that "every effort should be made by a federal court to employ those methods to achieve the greatest possible degree of [relief], taking account the practicalities of the situation." Hills, 425 U.S. at 297 (quoting Davis v. Board of School Commissioners, 402 U.S. 33, 37, 28 L. Ed. 2d 577, 91 S. Ct. 1289 (1971)).

 The parties labored intensively to draft provisions designed to desegregate the ACHA's housing programs and provide class members decent, affordable, and racially integrated public housing opportunities. The result of this effort is a decree that provides the most comprehensive relief to date for victims of housing segregation and discrimination.

 For example, the decree provides substantial equitable relief that will alter the way in which tenants are selected and assigned to various public and assisted housing units. The waiting lists for Section 8 and public housing will eventually be merged so that applicants from one central list will be offered either type or both types of housing assistance, and so that the Section 8 list will no longer provide a means of escape for those wishing to avoid desegregative moves. Counseling will be provided to all applicants receiving an offer or offers of public or assisted housing, and supportive services will be provided to assist applicants in finding landlords willing to accept Section 8 certificates or in adjusting to new and unfamiliar neighborhoods.

 Significantly, HUD will help to encourage assisted housing owners or operators to fill vacancies through the FHSC by offering them a safe harbor from HUD monitoring of the owner's compliance with affirmative fair housing marketing obligations. This provision will help to increase both the number of assisted housing units available for desegregation and the overall housing opportunities of class members.

 The decree also creates a mechanism for the siting of the 100 replacement units demolished at Talbot Towers and for all other new units to the constructed in the County. All new units are to be scattered site units (twelve or less) to eliminate the use of public housing as a means of concentrating and isolating African Americans in the County. Also, because the inability of the ACHA to obtain cooperation agreements with municipalities has worked to prevent the construction of public housing in much of the County, resulting in the racial segregation of public housing and the neighborhoods in which it is located, the decree provides that the County is an appropriate entity to enter into cooperation agreements with the ACHA. This provision will provide class members with desegregative housing opportunities that they previously have been denied.

 With regard to resources to be spent to accomplish desegregation, the class will receive the benefit of a substantial portion of the discretionary funds available to the Secretary of HUD, which is 5% of the total housing assistance available to HUD. 42 U.S.C. § 1439(a)(1). These discretionary funds are distributed "in support of desegregation efforts," 42 U.S.C. § 1439(d)(4)(A), as well as among communities with housing needs resulting from natural disasters, emergencies, and the settlement of litigation.

  As previously noted, the decree provides the class with 450 desegregative Section 8 certificates to help remedy the lack of decent, affordable and rationally integrated housing opportunities in Allegheny County.

 The decree also generates federal and local resources for the replacement of 100 units that were demolished at Talbot Towers. These units, like all new units built in the County, are to be scattered site units. In addition, the decree contemplates additional public housing to replace demolished, obsolete or dilapidated housing, which will entail the future commitment of HUD's budget authority.

 The decree requires Allegheny County to set aside 25% of its annual, allocable Community Development Block Grant ("CDBG") funds for seven years to be targeted to seven municipalities to which African American use of public housing and Section 8 has been confined: Clairton, Duquesne, Rankin, Braddock, McKees Rocks, Homestead, and Wilkinsburg. Based on recent CDBG allocations, the decree will cause roughly $ 4,000,000.00 per year for seven years to flow through community based organizations to be spent in neglected African American communities in Allegheny County.

 The decree also requires the County to set aside 25% of its existing, unencumbered CDBG funds as of July 1994, for funding of the FHSC and the Task Force until April 1995 and for targeted projects thereafter. From April 1995, the decree requires the County to use, over and above the 25% set aside, $ 500,000.00 annually for funding of the FHSC and the Task Force. The decree also requires that HUD provide funding for the FHSC in the amount of $ 200,000.00 for the first year and up to $ 200,000.00 per year for the succeeding six years.

 The decree also is written to ensure that those resources defendants are required to spend for seven years to accomplish desegregation are used to leverage other federal, state, and private funds. Defendants must specifically apply for all reasonably available assistance that would materially assist in performing the activities, objectives, and purposes called for in the decree.

 Thus, as the decree provides class members with wide array of housing and community development opportunities, it falls within the range of reasonableness.

 6. Other Factors

 The consent decree is the result of good faith, arms' length negotiations. Harris, 654 F. Supp. at 1049. The parties participated in extensive negotiations from the time the court set the matter for trial in late May 1994, until the time that the decree was preliminarily approved on August 31, 1994. The decree is the result of intense, adversarial negotiations that involved not only each HUD Assistant Secretary, but also the Associate Attorney General of the United States.

 Furthermore, in evaluating the consent decree, the court may lend significant weight to the professional judgment of counsel participating in the litigation. Id. at 1055. In this case, the consent decree was negotiated and recommended by the court by highly experienced counsel, knowledgeable of civil rights class action litigation generally and housing desegregation litigation specifically.

 IV. Conclusion

 Because of the substantial discovery undertaken in this litigation, the complexity of the issues, the support of the class for the relief, HUD's stipulated liability under Title VIII, and the fact that this may be the most comprehensive consent decree of its kind, the court finds that the decree is fair, adequate and reasonable as a resolution of this litigation.

 Gustave Diamond

 United States District Judge

 Date: December 22, 1994

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