APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA (D.C. Civil No. 71-1575).
Weis, Circuit Judge, Tom C. Clark,*fn* Associate Justice and Garth, Circuit Judge.
Plaintiffs, various individuals eligible for low-income public housing in Philadelphia and organizations with a membership interested in such housing, seek relief in this civil rights action against the City of Philadelphia, the City's housing authority ("PHA"), and its redevelopment authority ("RDA"), and the Department of Housing and Urban Development ("HUD"). The dispute centers upon a plot of land in South Philadelphia which was condemned and cleared as a site for low-income public housing in 1959, and which has remained vacant since then. The district court found that the four governmental defendants had committed violations of various constitutional and statutory duties, 425 F. Supp. 987 (E.D. Pa. 1976). The court ordered injunctive relief as follows: (1) the government defendants were ordered to "take all necessary steps" for the construction of the planned project; (2) PHA was ordered to formulate a plan for the racial composition of the project when built and tenanted; (3) PHA was ordered to formulate a plan to further the integration of all Philadelphia public housing projects; and (4) all parties*fn1 were enjoined from interfering with the construction of the project. All defendants except HUD have appealed.
We affirm the district court's finding that, in delaying and frustrating the construction of the project, the City of Philadelphia acted with discriminatory intent and thereby violated plaintiffs' constitutional and statutory rights. We also affirm the finding that PHA and RDA have violated Title VIII of the Civil Rights Act of 1968 in failing to carry out the construction of the project; however, we affirm not on the ground relied upon by the district court*fn2 (that the agencies were liable for not acting affirmatively to end racial discrimination as mandated by § 3608(d)(5) of the Act, 42 U.S.C. § 3608(d)(5)), but on the ground that their activities in clearing the site "[made] unavailable or [denied] a dwelling to . . . person[s] because of race" within the meaning of 42 U.S.C. § 3604(a).
We therefore affirm those sections of the district court order directing the construction and tenanting of the project at issue (parts (1) and (2)). We also affirm so much of part (4) of the order as enjoins interference with the project's construction by the governmental defendants, but we vacate so much of that paragraph which enjoins the Whitman Area Improvement Council ("WAIC"). Because we can find no basis for the far-reaching equitable relief granted against PHA with respect to all public housing in Philadelphia, we also vacate part (3) of the district court's order.
The focal point of this dispute is the Whitman Urban Renewal Area ("Whitman") in South Philadelphia. Within the Whitman Urban Renewal Area is the site of the project (henceforth "Whitman project") which is at issue here. Like other neighborhoods in urban America, Whitman has undergone a transformation in its racial composition over the past several decades. Unlike most, however, Whitman has changed from an originally racially mixed area to one which is virtually all-white. Moreover, this change has resulted almost wholly from the urban renewal efforts of the defendant governmental agencies.
As revealed by the district court's analysis, Whitman's present all-white population must be viewed against a backdrop of, on the one hand, a growing concentration of blacks and other minorities in discrete, insular sections of Philadelphia (North Philadelphia, West Philadelphia and South Central Philadelphia), and on the other, a reduction in the number of blacks residing in other parts of the city, including Whitman. The net result has been, in the words of the district court, that "[the] City of Philadelphia is today a racially segregated city." 425 F. Supp. at 1006.
This litigation involves not the city as a whole, however, but only the Whitman Urban Renewal Area for which the public housing at issue was planned. That area is a residential area consisting of block upon block of two-story row houses. Prior to the postwar concentration of blacks in the three sections of Philadelphia previously mentioned (North, West, and South Central Philadelphia), a substantial number of black residents could be found in Whitman's row houses. Still, a trend away from a dispersed black population throughout Philadelphia - and, by inference, a trend away from an integrated Whitman - was evident as early as 1940. That year's census revealed a decline of about 300 blacks from the population of Whitman. 425 F. Supp. at 1009. As late as 1950 though, a number of black households were to be found in the southeast and northwest corners of this area. Indeed, 75 black families lived in the southeast corner alone, Exhibit P-168. Of this number 52 families lived in a five-square-block area that would be leveled during 1959-60 in the initial phase of urban renewal in Whitman. As found by the district court, these 52 households constituted "46% of the families living [in this five-block area], which made this area an integrated section of Philadelphia." 425 F. Supp. at 1009.
Though integrated, Whitman was also somewhat dilapidated - although subsequent developments were to show that the existing housing stock, i.e., the two-story row houses, could be salvaged through renovation. In the mid-1950's, however, renewal meant something other than renovation or restoration: renewal meant the razing of existing structures and the construction of "public housing" high-rise buildings. Thus when urban renewal came to Whitman in 1959-60, the integrated, five-block site mentioned above*fn3 was cleared of its residents, and its structures were leveled. The cleared site has remained virtually untouched, and without building construction, since that time.
Such, of course, was not the plan. The Philadelphia Housing Authority ("PHA") acquired the site through condemnation during 1959 and 1960, with the intention of constructing low-income public housing. After hearings PHA obtained necessary approvals both from the Philadelphia City Planning Commission and, in 1957, from the Department of Housing and Urban Development ("HUD").*fn4 On June 26, 1960, demolition contracts were awarded, and shortly thereafter the site was cleared.
The 1960 census tract reflects the impact of PHA's renewal efforts. With site clearance underway, only four black families were to be found within the five-block project site. 425 F. Supp. at 1009.*fn5 To quote the district court, PHA action "had the effect of removing some of the Black families who lived on the Whitman site." Id. at 995.
Thus by 1960 the ongoing clearance of the Whitman project site had worked substantial changes in the racial composition of the southeast section of Whitman, an area that had previously been integrated to the extent of having 46% black families. Condemnation and demolition had forced some black families to move out of Whitman, while others had relocated in the blocks adjacent to the project site (N.T. 31-147). By 1970, however, not one black family was to be found in the entire southeast corner of Whitman (Exhibit P-170). Indeed, the 1970 census revealed that only 100 blacks remained in the Whitman Urban Renewal Area as a whole (down from 200 in 1960 and from 400 in 1950 (N.T. 31-70)), and these families were concentrated in the northwest section of Whitman.
PHA's original plan for the Whitman site called for the development of a low-income project ("Delaware Towers"), which would consist of four high-rise apartment buildings. Because this plan, if implemented, would have required additional annexation of two small parcels of land, PHA held a public hearing on January 12, 1961. 425 F. Supp. at 987. Local opposition to high-rise, low-income housing on the Whitman site surfaced at this hearing, and, although the additional annexation was approved, community opposition to the construction of high-rise public housing on the Whitman site intensified. The high-rise opponents formed the Whitman Area Improvement Council to continue their fight. 425 F. Supp. at 995. Subsequently, Congress enacted the Housing Act of 1964, which included as § 1007 of that Act the so-called Barrett Amendment, which produced a change in the design of the Whitman project from high-rise towers to one- and two-family home construction. See 425 F. Supp. at 996. Thus, five years after condemnation and clearance of the Whitman project site by PHA, planning for the site had to begin anew.
The shift away from high-rise construction brought a new city agency into the planning process for the Whitman site - the Redevelopment Authority of Philadelphia ("RDA"). RDA had earlier become involved in Whitman when, on October 27, 1963, it sought federal approval for the Whitman Urban Renewal Area. RDA's original plan involved razing an additional 103 homes in Whitman and rehabilitating 2500 more. This Whitman Urban Renewal plan did not itself affect the Whitman project site. Although the site was located within the Urban Renewal Area, it was designated as land to be used solely for public housing; indeed, the project site was the only area in Whitman which was designated for that purpose. 425 F. Supp. at 995. RDA's plan did not involve public housing per se, but rather involved assuring a substantial number of comfortable, attractive single-family residences in Whitman through the replacement or renovation of existing row-houses. The district court summarized RDA's efforts in Whitman as follows:
RDA, with federal funds from HUD and from other sources, condemned and acquired a total of 101 properties and parcels of land in the Whitman Urban Renewal Area at a total estimated cost of $1,550,075. 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. (N.T. 2-16). There was no opposition by WAIC to these privately developed homes. (N.T. 2-20). 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 homes. (N.T. 2-20). A total of 1,123 households have received funds from this program. Over one-fourth of all the households in the Whitman area have benefited from the grant and loan program initiated by RDA. (N.T. 2-21). Further, urban renewal activities in the area have included a wide range of activities benefiting the Whitman area. (N.T. 2-20).
All of this RDA sponsored reconstruction in Whitman took place outside of the vacant Whitman project site. As described above by the district court, RDA condemned several blocks adjacent to the project site. Through the efforts of private developers, new townhouses were built on these sites. All of these houses were sold to and are occupied by white families.
It will be recalled that the clearance of the Whitman project site during 1959-60 had reduced the total number of black households in southeastern Whitman. Some of these families had relocated in areas adjacent to the cleared project site. RDA's condemnation of several of these blocks for construction during 1969-73 had the effect of again dislocating these families. The 1970 census revealed that the combined effect of PHA's and RDA's failure to provide any low-income housing on the vacant Whitman project site, and RDA's condemnation of several blocks adjacent to the project site resulted in an all-white area in southeastern Whitman.*fn6
In sum, to repeat the conclusion of the district court, "[the] effect of these urban clearance actions by both RDA and PHA appears to have converted an integrated area of Philadelphia into a non-integrated area." 425 F. Supp. at 1009.
Although the Whitman project site lay vacant throughout this period (1960-70), planning for the site continued. With the enactment of the Barrett Amendment and the abandonment of a high-rise design, a new plan for the site, involving both PHA and RDA, was developed. PHA sold the Whitman site to RDA for $1,217,679.59. 425 F. Supp. at 996. RDA in turn was to convey the site to a private developer, which would construct low-rise public housing upon it.
The need for a new plan that would be acceptable to WAIC led to the endorsement of the concept of a "turnkey" developer. As described by the district court:
A turnkey developer differed from a conventional housing developer in that the turnkey developer would purchase the land, hire the architect to design the project, produce the drawing, set a cost for his project and then submit his proposal to the Housing Authority. (N.T. 5-22). The Housing Authority, if it decided to accept a turnkey developer's proposal, would, after appropriate public hearings and approvals, sign a contract with the turnkey developer and HUD, which specified that the turnkey developer would build the project and upon completion turn it over to the Housing Authority for the agreed upon purchase price. The Housing Authority would manage the project and HUD would provide the necessary subsidies. (N.T. 5-22, 5-23).
425 F. Supp. at 996. HUD's involvement necessitated review by the agency's Equal Opportunity staff. As the Whitman project site could now be described as an integrated project planned for an all-white area, HUD approved the site for low-income, turnkey housing on June 4, 1968.*fn7
PHA and RDA solicited turnkey developers for the project during the latter part of 1969. From the 12 developers who responded, PHA chose Multicon Construction Corp. and Multicon Properties, Inc. ("Multicon") to build the Whitman project. PHA's choice of Multicon was approved by HUD on May 20, 1970. RDA and Multicon entered into a contract on July 14, 1970 under which Multicon might obtain the project site and build the project. The Philadelphia City Council and then-Mayor Tate enacted an ordinance approving Multicon; an agreement of sale was executed by PHA and Multicon; and, on October 30, 1970, RDA conveyed title of the site to Multicon.
Multicon's design called for the building of 120 townhouses on the Whitman site. Unlike most public housing to that point in time, each unit was to be a discrete structure on its own plot of land - much closer in conception to the detached, single-family home characteristic of suburban developments than to the typical multi-family structures characteristic of low-income public housing. Indeed, one reason why Multicon's plan was selected was its compatibility with the surrounding neighborhood: the plan "maintained existing street patterns and the housing was of the same design as the other houses in the Whitman area." 425 F. Supp. at 997. This design also met the requirements for a newly promulgated federal program, "Turnkey III", under which the tenants of a project could eventually own their homes by paying rent, assuming maintenance responsibilities and residing in the project for a designated time.*fn8
Approval of an urban renewal project necessitated consultation with local community representatives. WAIC was designated the "local citizen participation unit" for the Whitman Urban Renewal Area. The district court described a process of extended consultation with and participation by WAIC during the course of the approval process. 425 F. Supp. at 997. WAIC's suggestions produced modifications in Multicon's plan, and the result, by June 2, 1970, was a meeting at which the Turnkey III proposal was fully explained. The minutes of the June 2d meeting reported a consensus: "It was agreed the proposed plans look excellent." (N.T. 2-26). WAIC's endorsement of the planned townhouses is revealed in a letter dated June 9, 1970, from the then-President of WAIC to Multicon, the developer:
We were very impressed with the plans and feel that the design of these houses will make them an asset to our community.
A ground-breaking ceremony for the Whitman Park Townhouse Project was held on December 16, 1970. Between the ground-breaking and the scheduled start of construction in late March 1971, however, WAIC's attitude toward the Townhouse Project shifted and hardened. By January 28, 1971, the President of WAIC was expressing doubts about the project; by March 22, 1971, WAIC had elected a new President and had decided to oppose the project - specifically, "to demonstrate the next morning" when construction was finally to begin. (N.T. 2-33). The stipulated facts revealed the following sequence of events when Multicon sought to commence construction of its townhouses on March 23rd:
Beginning on or about 7:30 A.M. on March 23, 1971 approximately thirty women, some of whom were WAIC members, entered on the site of the Whitman Park Townhouse Project and gathered around the bulldozer and backhoe, blocking the operations of the contractor, refusing to leave the property when so requested and preventing the operations of these pieces of equipment. Fred Druding, the new WAIC President, was also present in the morning. . . .
On or about 9:05 A.M. on March 23, 1971 demonstrators, including WAIC members, blocked a truck on Shunk Street from the Atlas Lumber and Millwork Company, which was attempting to make a delivery to MPI at the Whitman Park Townhouse Project, and as a result the truck driver was unable to enter the property to make the delivery. P-61 is incorporated herein.
On or about eight o'clock on March 25, 1971 [former WAIC President] Mrs. Alice Moore and other demonstrators, including members of WAIC, gathered around the bulldozer of Louis Dolente and Sons, parked on the northeast corner of Hancock and Shunk Streets, thereby preventing its operation.
(N.T. 2-33 to 34) (paragraph numbering omitted).
Unable to begin work, Multicon sought to enjoin further demonstrations in the Philadelphia County Court of Common Pleas. Although Multicon obtained a preliminary injunction, its attempts to return to work were to no avail, as demonstrators continued to block deliveries from Multicon's contractors and to bar all access to the project site. Multicon's request to the Philadelphia police to enforce the state court injunction was rebuffed.*fn10 Eventually, on April 30, 1971, the Pennsylvania state court judge decided to bar Multicon from attempting to return to work while the parties negotiated a settlement.425 F. Supp. at 998.
The district court summarized the ensuing negotiations between the parties as follows:
Shortly thereafter, there were a series of meetings between WAIC, PHA and Multicon. (N.T. 2-78, 3-41, 3-42, 10-39). Various changes in the Whitman Park Townhouse Project were proposed to WAIC 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 project would be an asset to the community. (N.T. 3-45, 10-43, 10-44, 10-45, 10-46, 10-47).On May 17, 1971, after full discussion and consideration of the settlement proposals, WAIC voted down the final settlement offer of PHA.(N.T. 2-89, 3-45, 3-46). On May 18, 1971, Mayor Rizzo was nominated as the Democratic candidate for Mayor. (N.T. 3-53). On May 20, 1971, a meeting was held in Judge Hirsch's chambers to consider a request by Multicon that the court's order of April 30, 1971 be lifted and that Multicon be permitted to return to work on the Whitman Park Townhouse Project.(N.T. 3-55, 3-56, 19-21, 19-24, 19-25). At the May 20th meeting, Managing Director Corleto stated that the City would not provide police assistance for Multicon should it return to work. (N.T. 3-57, 19-26 to 19-28). Mr. Gordon Cavanaugh, Chairman of PHA, stated to those present at the meeting that he had been instructed by Mayor Tate to order Multicon not to resume work. (N.T. 2-91, 3-59, 19-26, 19-34, 19-36). Judge Hirsch then signed an order permitting Multicon to return to work. However, faced with a threatened lack of police assistance, Multicon decided that it would not then return to work. (N.T. 19-38). On June 3, 1971, Multicon approached HUD in Washington, D.C. and sought assistance from HUD in building the Whitman Park Townhouse Project.(N.T. 3-69, 10-73). Multicon requested HUD to exert whatever pressure it could upon the City to get the City to cooperate in building Whitman. (N.T. 3-69, 10-73). However, a HUD official in Washington, D.C. stated that HUD did not want to take any action until after the November, 1971 election in Philadelphia. (N.T. 10-74 to 10-76).
425 F. Supp. at 998-99. (Footnote omitted).
At this juncture, on June 25, 1971, plaintiffs filed the complaint in the instant action in the United States District Court for the Eastern District of Pennsylvania. However, in view of the pending state court proceedings involving the various defendants and the possibility that those proceedings might provide a resolution of the dispute over the Whitman project, the federal court action was stayed. Later, with the realization that such a final resolution would not be forthcoming in the state courts, see 425 F. Supp. at 992-93, the parties went through drawn-out, constantly contested discovery proceedings which continued until the eve of trial on October 7, 1975.
During these 4 1/2 years of pretrial maneuvering in the federal district court, Whitman remained a site of controversy rather than a site of construction. On July 18, 1971, the same day that Multicon finally obtained a permanent injunction against WAIC's interference with Multicon's construction efforts at the Whitman site,*fn11 WAIC filed its own lawsuit, WAIC v. Multicon, No. 1187 (July Term 1971, C.P. Phila.), in an attempt to prevent that construction. This action was to continue until March 20, 1974, when it was finally dismissed as moot.
1971 was an election year in Philadelphia. During the mayoral campaign, the present Mayor, Frank Rizzo, "publicly took the position that within the framework of the law, he would support local communities in their opposition to public housing projects proposed for their neighborhoods. (N.T. 42-75, 42-77)." 425 F. Supp. at 1001.*fn12 While campaigning, Mayor Rizzo strongly supported WAIC's resistance to the Whitman project.*fn13
Once elected, the opposition of Mayor Rizzo and his City Administration to the Whitman project did not abate.*fn14 Indeed, Mayor Rizzo told James Greenlee, the chairman of PHA, that he meant to honor his campaign promise to Whitman residents that the Townhouse project would not be built. 425 F. Supp. at 1002. The Mayor urged Greenlee to investigate the possibility of cancelling the project. Mayor Rizzo was informed that cancellation of the Townhouse project would jeopardize federal funding for the entire city, especially in light of the project's HUD-necessitated pairing with the already constructed Morton Addition Project in a racially impacted area of Philadelphia. See note 7 supra. In view of these possible consequences, Greenlee suggested that an attempt at compromise should be made. Mayor Rizzo rejected any compromise where "people in the area felt that Black people would be moving into the area if public housing were built." 425 F. Supp. at 1002.
Faced with Mayor Rizzo's unequivocal disavowal of PHA's obligation to build the Whitman Townhouse project, Greenlee described to Rizzo the procedure for cancellation of public housing projects set out in the so-called "Phillips Amendment," Pub. L. No. 83-176, 67 Stat. 298, 306. In addition to requiring that the City repay any federal monies advanced and settle all claims by the builder, the Phillips Amendment would require a public hearing before the Philadelphia City Council. Mayor Rizzo indicated that the City's termination costs would be no obstacle; however, the public hearing requirement was anathema to him because the procedure "would bring Black people to City Hall to protest the proposed cancellation." 425 F. Supp. at 1002.
The City's subsequent opposition to the Whitman project took many forms. These were detailed in part by the district court when it described some of the difficulties encountered by Multicon. 425 F. Supp. at 999-1001. In addition, Multicon, the project developer, was told by Deputy Mayor Philip ...