UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
Frank J. Steinhauser, III, et. al., Civil No. 04-2632
JNE/SRN
Plaintiffs,
v. PLAINTIFFS’ JOINT MEMORANDUM OF LAW IN OPPOSITION TO SUMMARY JUDGMENT - AMENDED
City of St. Paul, et. al.,
Defendants.
Sandra Harrilal, et. al., Civil No. 05-461
JNE/SRN
Plaintiffs,
v.
Steve Magner, et. al.,
Defendants.
Thomas J. Gallagher, et. al., Civil No. 05-1348
JNE/SRN
Plaintiffs,
v.
Steve Magner, et. al.,
Defendants.
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INTRODUCTION
Plaintiffs will show the Court that summary judgment as requested by Defendants is improper as there are genuine issues of material fact present in every claim presented in the Complaint.
Prior the Court considering Defendants’ motion for summary judgment, Plaintiffs request that the Court consider the facts and issues raised by Plaintiffs in their spoliation motions, and once again consider Plaintiffs’ renewed request that the Court deny Defendants’ motion for summary judgment due to destruction of relevant evidence related to defenses raised by Defendants including immunities, and to Plaintiffs’ claims. Plaintiffs’ submit that there is now even more evidence before the Court of Defendants’ non-disclosures and/or destruction of evidence relevant to claims and defenses herein, including Defendants’ failures to disclose federally mandated “analysis of impediments” (AI) to affordable housing related to Defendants’ affirmative duty to further fair housing (AFFH). In over four years of discovery herein, Defendants have failed to produce, and Plaintiffs have been unable to discover, any evidence that Defendants ever conducted an AI for disclosure to the U.S. Department of Housing and Urban Development (HUD) and the public related to whether the “protected class” was adversely impacted by the City’s application of its “heightened code enforcement standard” and illegal policy of removing “grandfathering rights” under the Minnesota State Building Code through “Code Compliance” inspections and certifications applied to older inner-city housing stock disproportionate occupied by “protected class” members. This issue is not to be taken lightly, as falsification of AFFH certifications in return for hundreds of
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millions of dollars in federal funding and spoliation of documents related thereto through destruction of internal documents, including e-data and e-mail communications, have serious implications. Defendants spoliation of written communications, including e-mails and other e-data for the years prior to 2005, has left Plaintiffs, HUD and the public without the key evidence HUD required the City to maintain related to the Defendants’ Fair Housing certifications and obligations. HUD regulations require the City to conduct a full and fair analysis of impediments to fair housing in the City, to identify those impediments, including those based on the City’s legislative code, rules, procedures and practices related to fair housing and “protected classes,” its illegal demands to the private market landlords in the City to meet expensive “code compliance” inspections and its creation of other barriers to fair housing. The City’s illegal “Code Compliance” requirements subverting grandfathering protections for older buildings in violation of the State Building Code, brings into question whether the City falsified its certifications to HUD through material non-disclosures.
INTRODUCTION OF PLAINTIFF RENTAL PROPERTY OWNERS
Plaintiffs are or were landlords providing housing primarily to low-income, “protected class” tenants in the City and at various times housing under the Federal Section 8 funded program. Plaintiffs owned and managed older rental properties located in the inner-city neighborhoods where older housing stock was common, where poverty was persistent, and where people of color had a critical need for safe and decent affordable housing. See generally Affs. of Plaintiffs attached as Exs. 70-79 to 2nd Engel Aff., and Exs. 140-144 to 2nd ShoemakerAff.
Case 0:05-cv-00461-JNE-SRN
There is copy errors.
FACTS
“We’ve reached that point where being nice, being civil and being polite in deteriorating inner city neighborhoods hasn’t got us anywhere.” State Senator Randy Kelly, Saint Paul, St. Paul Pioneer Press, 1-1-1995. “We have to take more drastic actions to stop deterioration of our neighborhoods and communities. We’ve reached the saturation point in low-income, rundown rental housing. We can’t take any more.” Id. “Saint Paul needs to do all that i[t] can to preserve and improve the existing privately owned rental stock that provides much of our affordable housing, where owners are now struggling with maintenance and management issues. If we lose that housing stock, we have lost a great housing resource in the city.” Saint Paul Planning Commission, Minutes 10-9-1998.
After taking over leadership of the City, Mayor Kelly stated, “If you’re to have a healthy city, you’ve got to have a high-quality, safe and attractive housing stock.” Pioneer Press, September 26, 2003.
And higher standards are exactly what Kelly and Dawkins put in place in 2002: “In essence the new rules shorten the time-lines for code compliance and increase the number of situations where we issue misdemeanor tags. The goal is to achieve aggressive, consistent, stepped-up enforcement throughout the city…if code enforcement has to come to your property twice, you’re going to be charged with a crime, and the Judge1 is going to treat it
1 Council President Bostrum reported to City Council that he and City Attorney met with Chief Judge Mott re Mayor Kelly’s “problem properties” priority - City Attorney was bringing Police and Code staff to meet Judge. Ex. 238 to 3rd Shoemaker Aff.,45341 (Council minutes,4-10-2002). Early 2002, Dawkins was questioning “How pull off”
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seriously.” Ex.84,3rd Engel Aff., STP0037; Ex.108,3rd EngelAff., STP658 (“We heightened inspection standards”).
Kelly and Dawkins were finally able to implement their 1995 “Change of Ownership” strategy in the inner city of Saint Paul by adopting the “heightened standard,” applying “code to max” (Ex. 298, 3rd Shoemaker Aff.,50147-50158) and bringing “heavy enforcement” (Ex. 84 ,3rd Engel Aff) down on inner city property owners, primarily low-income landlords with so called, “problem properties,” a definition that varied from neighborhood to neighborhood. Pat Fish, p.243.
Bill Cullen, former president of St. Paul Association of Responsible Landlords (SPARL) testified that Dawkins suggested to landlords that maybe the solution for the city was to try and increase the quality of properties to the point that the lower tier of less qualified tenants would not have places to rent – how would the landlords like it of they didn’t have to deal with tenants at the bottom of the market – “if all those tenants that are at the bottom...were no longer in St. Paul” Cullen,202-03, 113. Cullen remembers being “shocked”
“crackdown” (Ex.82,3rd Engel Aff.) – City needed District Court “buy-in” to ensure victory. Ex.217, 3rd Shoemaker Aff.,40072; Ex.157, 3rd Engel Aff. (“Prep city atty and judges”); Dawkins-City Attorneys held further private meetings with Chief Judge (Ex.83 ,3rd Engel Aff; Ex.111, 3rd Engel Aff; Ex.112,3rd Engel Aff; Ex.113,3rd Engel Aff); City Attorney Dolan private meeting with housing Referee Yanish who later presided over City initiated-promoted Tenant Remedy Cases by Dolan against Steinhauser, Meysembourg, Brisson, Harrilal and others. After the civil litigation proceeded to the point that Dawkins and the City were “9 for 9” in court before Referee Yanish, Dawkins returned to Judge Mott in private for a “Thanks” and to run further City-Kelly-Dawkins plans for property owner crackdown by Mott for approval. Ex. 114,3rd Engel Aff., and Dawkins., p.311-364. The City assured itself of additional allies in its war (“Build small army,” Ex. 157,3rd Case 0:05-cv-00461-JNE-SRN Document 237 Filed 08/25/2008 Page 5 of 78
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by Dawkins’ comments. Id.203
Sara Anderson, a housing advocate from Project Hope recalls City Official Dawkins telling her that City officials and employees “don't want low-income people renting in the City”. Anderson,76-77,128.
“PROTECTED CLASS” MEMBERS
Saint Paul has acknowledged that “Fair housing laws provide protection from discrimination in housing for certain groups, generally referred to as “protected classes” and “[t]hese groups have been included in fair housing laws because individuals have been identified over time as having difficulties in obtaining housing due to their status as a member of one of these groups.” Ex. 267,3rd Shoemaker Aff., Regional Analysis of Impediments to Fair Housing (AI), May 2001,4.
The Regional AI, partially funded by City, focused on “the incomes of protected class members, their relative low rates of home ownership, high rent burdens, tendency to live in larger households, and their disproportional representation among users of emergency shelter-transitional housing facilities. Id. 2001,AI,5,15. (Ex. 237,3rd Shoemaker Aff., 2000 ConPlan referred to AI. p.97; Ex.86,3rd Engel Aff., ConPlanUpdate2003, p.44).
“It is often people of color, people with disabilities, women, large families, and new immigrants who earn significantly less than the population as a whole and who experience the greatest housing cost burdens. Ex.267,3rd Shoemaker Aff., AI May 2001,8. Protected class
Engel Aff) against landlords by funding SMRLS). Ex. 92, 3rd Engel Aff, Ex.88,3rd Engel Aff. Case 0:05-cv-00461-JNE-SRN Document 237 Filed 08/25/2008 Page 6 of 78
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members tend to have lower incomes, less expensive rental units/homes - more likely to be renters. Id.
A much higher percentage of people of color than Whites fall within HUD’a definition of “Very Low income”. Id, 9. “Among renters … disparities between Whites and people of color are particularly strong, with lower income Blacks in “unaffordable housing” at 67.2% versus Whites at 33.9%. Id.,14.
A disproportionate percentage of “protected class” persons live in the City’s inner core neighborhoods where there is a concentration of older, affordable low-income rental housing stock. Ex. 268,3rd Shoemaker Aff., ConPlan2005, pp.44,50,Map.
Poverty is persistent in those areas of the City. Id.,50-51. Many residents have poor credit, bad tenancy, and personal issues that prohibit access to affordable housing – they need support services. Id.,104.
CITY RECOGNIZED IN MAY 2001 “PROTECTED CLASS”
TENANTS WERE VULNERABLE TO BIAS AND RENT BURDENED
The City continues year after year to admit bias is present and affecting minorities, the disabled and families with minor children in their housing choices. Ex.103, 3rdEngel Aff., City’s Comprehensive Plan 1/9/2002,p.10;Ex.268,3rd Shoemaker Aff., 2005Con.Plan,87.
The City reported to HUD that “Housing discrimination can be a significant barrier for individuals and families seeking affordable housing” and “discrimination is often difficult to detect” and “can prevent access to safe and decent housing.” Id.,105.
In 2002, poverty continued to be persistent in the City; HUD estimating that 7,700
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renter households in the City had incomes at or below 30 percent of the regional median ($16,988-family of four) who paid more than 50% of their incomes for rent. Ex.103,3rd Engel Aff., City’s Comprehensive Plan 1/9/2002, p.10.
The City has long acknowledged that “people of color” and other “protected class” persons have a disproportionate need for affordable housing in the City. In June 2005, the City reported to HUD that 37,000 households had unmet housing needs. Ex.268,3rd Shoemaker Aff.,2005Con.Plan,83.
HISTORICAL SHORTAGE OF AFFORDABLE HOUSING IN CITY
Historically, the City has had a critical shortage of low-income housing. Ex.237,3rd Shoemaker Aff., Con.Plan2000,16. A large number of “protected class” persons wait years for affordable housing in the City. Gutzmann,62.
The City has large numbers of immigrants and persons of color who are constantly seeking affordable housing and who are disproportionately burdened in housing. Ex.237,3rd Shoemaker Aff., Con.Plan2000,23-25.
Between 1989 and 2000, the City acknowledged that when including new units constructed, vacant units rehabilitated and units demolished, the overall change in housing went up merely 468 units. 2000 End-of-the-Year Housing Report,2-28-2001. In 2005, the City reported that owner occupied units had increased by 1,993 units since 1990 while occupied rental units decreased by 133 units. Ex. 268,3rd Shoemaker Aff., ConPlan2005,43.
The City’s Housing Action Plan 2002 stated “affordability of housing in St. Paul continues to be a critical issue” and “the need and demand for housing that is affordable to
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lower income households(…below 30% of AMI) is severe.” The City’s Task Force noted “there are not adequate resources currently targeted to address this situation.” Ex.103,3rd Engel Aff.,p.2. The Task Force was concerned that City data showed over five years a total of 649 units have been demolished, of which 123 units (the PED/HRA projects) triggered the local policy. Id.3.
In April 2003, the City confirmed that, “the lack of affordable housing opportunities remains a major issue facing many Saint Paul lower income households [at or below 30% of the AMI], who are also protected class members.” Ex.86,3rd Engel Aff,40. “[T]he lack of affordable housing realistically limits housing choice for many protected class members.” Id. “27.6% of Saint Paul’s lower income residents cannot find adequate affordable housing in the City of Saint Paul.” Id.
In 2005, the City confirmed that “[t]he oldest housing stock in the City is located primarily in areas immediately adjacent to the central core where the greater amounts of low-moderate income populations reside. Id at 44. The availability of affordable, large units (3 bedrooms) is scarce because they are costly to maintain and construct and profit margins are minimum. Id.
PUBLIC HOUSING AND SECTION 8 WAITING LISTS
In 2005, PHA reported to the City (for inclusion in City’s ConsolidatedPlan2005) that 6,219 people were on PHA’s waiting lists with a 2-4 year wait; a disproportionate number of minority residents were on PHA’ lists – 61 percent were African-Americans; 2,747 Section 8 applicants, and list was closed. Ex.268.3rd Shoemaker Aff., ConPlan2005,47.
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PHA Management Reports provide data on comparisons of waiting lists with actual occupancy in both PHA and Section housing. PHA’s waiting lists show PHA and Section 8 list racial percentages. PHA’s December 2002 Management Report showed the composition of the waiting list as follow: Blacks 63%, Whites 22%; Asians 13%.
PHA scattered sites home occupancy revealed: Asians at 60.6%; Blacks 28.7%; Whites 9.7%. Ex.181, 3rd Shoemaker Aff. By December 2005, PHA’s waiting list showed Blacks at 57%, Whites at 25% and Asians at 16%, with occupancy at PHA overall at Blacks 34.6%, Whites 38.4% and Asians at 13.3%. Ex.182,3rd Shoemaker Aff.
PHA attempts to maximize the number of affordable units available to the PHA within its current resources by minimizing the number of units off-line; reduce turnover time for vacated public housing units; reduce time to renovate public housing units.
CITY’S AFFIRMATIVE DUTY TO FURTHER FAIR HOUSING
UNDER HUD REGULATIONS DUE TO CITY’S RECEIPT OF
MILLIONS OF DOLLARS OF FEDERAL GRANTS
HUD annually provides St. Paul with a variety of program funding and support services primarily for persons of low and moderate income and homeless persons. These HUD funded programs are called, Community Development Block Grant (CDBG) Program, HOME Investment Partnership (HOME) program, and Emergency Shelter Grant (ESG) program. Ex.86,3rdEngelAff.“Forward, i”.
The City voluntarily accepts the “affirmative duty” to further federal fair housing (AFFH) policies required by the HUD as a condition for receipt of federal grants primarily for the benefit of low and moderate income housing. Ex.86,3rdEngelAff. The CDBG program Case 0:05-cv-00461-JNE-SRN Document 237 Filed 08/25/2008 Page 10 of 78
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objective 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.” Id.
In 2000, the Mayor and City Council adopted the City’s HUD Five Year Consolidated Plan for 2000 through 2004 (“ConPlan2000”) Id. ( Ex. 237,3rd ShoemakerAff.). The City identified the lack of affordable housing as an unmet need in the 2000 Consolidated Plan and in 2003 stated that a total of 9 HUD funded activities would assist with the preservation or creation of affordable housing. Id.,38.
The City acknowledged that the CDBG program’s “primary objective is “providing decent housing” principally for persons of low and moderate income.” Ex.237,3rd Shoemaker Aff, ConPlan2000,vii. St. Paul has about 30% lower median family income than the metropolitan median income due to the high poverty in the City. Id.,60.
Following the City’s reference to Chapter 34, Minimum Property Maintenance Standards, and “Substandard Condition but Suitable for Rehabilitation,” the City stated, “While the City does not collect data related to the race or ethnicity of those households with identified housing needs, it would not be surprising if those data revealed a disproportionate impact on persons of color.” Id. 23. “The number of new immigrants … coupled with historic settlement patterns that find racial and ethnic communities more heavily concentrated in central cities and the reality of racial and ethnic bias in the housing market all contribute to such a differential impact.” Id.
The City included a map indicating the geographic concentrations of households of
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color and showing the 37 planning districts where more than 50% of public school students were children of color. (Id.,23A) The high number of immigrants who continue to arrive in the City “would suggest that the differential impact between minority-headed renter households and all renter households will continue to grow over the next five years.” Id.23-4.
In 2000, the City acknowledged that African-Americans were disproportionately represented in emergency shelters (A-A 52%; Hispanics 16%, Whites 33%) and transitional housing indicating that they were most likely to be without any housing at all. Id.,24,31. Homelessness in the City “disproportionately affects persons of color.” Id.,28. The City concluded by admitting that “racial and ethnic minorities have a greater housing need than the population as a whole.” Id.,25.
The City acknowledged that migration to the area, demolition of housing, and a low level of construction have resulted in serious affordability issues for the working poor. Id.,27. The City acknowledged that “the number of new units added to the stock over the decade just barely exceeds the number that were … demolished.” Id.,60.
The City acknowledged that common barriers that prevent homeless persons or families from obtaining permanent housing include criminal background checks, credit checks, past unlawful detainers, and problems associated with bias. Id.,28. In 2000, the City admitted that bias continues to affect the City’s racial and ethnic minorities, the disabled and families with minor children. Id.,77.
The City recognized the “need to change attitudes and public opinion toward rental housing.” Id.,88.
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The majority of the City’s housing stock of smaller, single family, duplex and apartment units are aging, more than 50 years old, but generally in sound condition; the portion that had not been repaired or updated now required a substantial investment in order to remain viable. Id.,47.
In 2000, the City acknowledged that its regulatory policies, including what some may consider “above standard” development requirements, can pose a barrier to affordable housing – the City cited its own building code as one such barrier. Id.,59. The Metropolitan Council had determined that Cities regulations, ordinances and fees as well as administrative practices may exceed reasonable protection of public health and safety and contribute to housing costs. Id. Saint Paul promised that it “will continue examine its enforcement of the building code.” Id.,87.
The City’s 2000 Consolidated Plan, and all other updates since then, fail to state whether the application of the City’s heightened code standards (more strict 82% of time when compared to HQS and its private market “Code Compliance” requirement – see Ex.171,3rd Shoemaker Aff.) have had an adverse affect on affordable housing and whether those policies and practices have disproportionately impacted “protected classes” in the City. Id. 87-88.
The oldest housing stock in the City is located primarily in the areas immediately adjacent to the central core. Id.,62. The most recent data for the 2000 Consolidated Plan indicated that these same areas coincide with the city’s lower income census tracts. Available information to the City in 2000, suggested that “large minority populations also reside in
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these neighborhoods.” Id.
Many of the City structures that provide rental housing affordable to lower income households are smaller (1-4 unit) buildings owned by landlords who own relatively few buildings and “[t]hey are the kinds of structures that are at highest risk of becoming “problem properties” or vacant buildings – yet “maintaining them in good condition represents the most cost effective way of providing affordable housing.” Id.,68. The City’s 2000 Plan noted that with stepped up code enforcement there should be matched additional resources for repair and rehabilitation. Id.,69. “Additional resources must be identified and used in partnership with code enforcement to assist property owners in making the necessary repairs and improvements. Id. The City admitted that the current rental rehab programs were generally under subscribed by property owners and suggested an assessment for the reason. Id.
Census block groups with at least 51 percent low to moderate income residents are CDBG eligible. Id.,137-C (Census Tracts Map).
In January 2002, the City claimed that one half of the City’s housing was built before 1940, the condition of its housing stock was stable, the level of reinvestment remained constant, there were few indicators of disinvestment, and that the City had a low number of “vacant buildings”. Comprehensive Plan,1/9/02,STP00523,35. The City did admit that “Among the most vulnerable residential structures in the city’s housing stock are its rental properties”. Ex.103,3rd Engel Aff. (CompPlan1/9/02).
The City’s 2003 Consolidated Plan Update states that the CDBG funds City “code
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enforcement” efforts, City activities related to “rental rehabilitation,” “vacant buildings,” “demolition” of housing, and other fair housing related activities. Ex.86,3rd EngelAff. pp.11-33. In 2003, the City received $12,452,666 of CDBG, HOME and ESG funds from HUD.
As a recipient of CDBG funds, the City must continually certified to HUD that the City will “affirmatively further fair housing” (AFFH) as well as identify impediments to fair housing choices within its jurisdiction. “Local Government Certifications” attachment to Ex.86,3rdEngelAff.. The City admits that under HUD’s interpretation of AFFH, the City must: (1) analyze and eliminate housing discrimination in the jurisdiction; (2) promote fair housing choice for all persons; (3) provide opportunities for inclusive patterns of housing occupancy regardless of race, color, disability, national origin, etc.; (4) foster compliance with the nondiscrimination provisions. Id.,38-9. PHA provides a similar certification of AFFH to HUD. Ex.171,3rd Shoemaker Aff.
“City’s obligation to [AFFH] applies to all housing activities in its jurisdiction whether publicly or privately funded.” Id. The City has loudly proclaimed that it has adopted “even more stringent ordinances than federal and state laws in order to mitigate housing discrimination, while setting City policy directions to ensure the rights of all Saint Paul residents.” Id.,39.
As part of the HUD required “Analysis of Impediments to Fair Housing (AI), the City claims that it “continually evaluates its housing policy and housing practices to determine whether the City has deliberately or inadvertently prevented people from living where they choose. Id.,40.
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The CDBG funds are designated by the City for code enforcement activities, owner and rental rehabilitation, and demolition in CDBG low-income and moderate income areas of the City. Ex.237,3rd ShoemakerAff.,110-112, 115,119, 121-122, 129,133-34. Ex.86,3rdEngelAff., pp11-13,20,24,25,29,30,33. CDBG funds also are provide to Block Clubs, District Councils, and Neighborhood Development Corporations. Id.,10,14,16,18,20,24,30,31. The 2003 Update contains many pages listing numerous sub-grantees and mentions the City’s partnership with PHA and housing problems in City. Ex.86,3rd EngelAff.
In 2002, the City stated that its share of the region’s lower cost housing that is located in the central cities had been growing and should be reversed, because according to the City, that was providing few choices for lower income households and fewer workers for suburban businesses. Ex.103,3rdEngelAff.,CompPlan2002,21.
The plan recommended that Saint Paul aggressively work to capture the its share of an emerging market of smaller households and older empty-nest households, many of whom have moderate or higher incomes, want to live in an urban environment and are currently unable to find suitable options in Saint Paul. Id.,7.
The City claimed that it would support measures to lower construction costs associated with local requirements, a reassessment of the State Building Code, and rental housing resources for replacement housing and rehabilitation. Id.,22.
PRESERVING OLDER HOUSING STOCK IS CRITICAL TO PRESERVING AFFORDABLE HOUSING YET COSTLY AND RESOURCES NEEDED
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The City has consistently acknowledged that preserving the existing, older housing stock is critical to preserving affordable housing and yet the preservation of the older rental housing is costly and financial resources must be made available to owners of low-income housing who are particularly vulnerable. Ex.237,3rd ShoemakerAff.
“Many of the structures that provide rental housing affordable to lower income households in Saint Paul are smaller (1-4 unit) buildings owned by landlords who own relatively few buildings. They are the kinds of structures that are at highest risk of becoming “problem properties” or vacant buildings and, yet, maintaining them in good condition represents the most cost effective way of providing affordable housing.” Ex.103,3rd EngelAff.,CompPlan2002,28-29.
The City admitted that it must coordinate code enforcement with measures for repair and improvement and that additional resources must be identified to assist property owners in making the necessary repairs. Ex.268,3rdShoemakerAff.,ConPlan2005,86.
The City is a “built city” with little available vacant land for development of new affordable housing. Removal of older housing stock is seen as a way to make way for new development and a higher tax base due to reductions in federal and state funding to the City. ConPlan2005,105.
DEFENDANTS MAYOR KELLY AND DAWKINS KNOWLEDGE OF CONCENTRATION OF “PROTECTED CLASS” IN AREAS OF INNER CITY
Prior to becoming mayor of St. Paul, Defendant Kelly was in the Minnesota Legislature for 22 years as representative and senator representing the City’s East side where
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a high percentage of “protected class” reside. Ex.243-245,3rdShoemakerAff., 45415-45428.
Prior to becoming Director of Neighborhood Housing and Property Improvement (NHPI) of St. Paul, Defendant Dawkins was in the Minnesota House for 16 years representing the City’s Frog Town area where a high percentage of “protected class” reside. Ex.239-242,3rd Shoemaker Aff.,45402-45414.
Dawkins recognized that people of color were being disproportionately impacted by the higher code enforcement standard: “Perhaps a disproportionate number of folks getting EC [City fines for “excessive consumption” of code enforcement services] are people of color; but if this is so, then maybe it’s because a disproportionate number of families living in poverty are people of color.” Ex.299,4thShoemakerAff . “The new way to bill-out for excessive consumption … Everything counts …I estimate the new ordinance will bring in half a million dollars or more, and the Mayor has basically said it’s ours to spend.” Ex.300,4th ShoemakerAff.(Dawkins to Code Enforcement Staff,11-13-03).
CITY’S HISTORY OF DISCRIMINATION AGAINST PROTECTED CLASSES
Community Stabilization Project (CSP) Director Catie Royce testified concerning Kelly and Dawkins’ efforts to assist the City in de-concentrating poverty in St. Paul’s inner city neighborhoods and how those efforts assisted the City’s demolition of affordable housing disproportionately occupied by “people of color”:
“…the randy andy show were responsible for deconcentration of poverty policy when they were up at the capitol. … Randy was the first legislator in this state to begin to institutionalize the racist language of “deconcentration of poverty” which he used to get approximately $100,000 appropriated to the Minnesota Housing Finance Agency to demolish low income rental housing because ‘it was responsible for crime and blight.”
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I’m pretty sure those were the exact words of the bill. That was the first time that I saw Andy carry polluted water for randy, he authored the companion bill in the house. That money was used about five years later to demolish the Lakewood Apartments, 138 units of very affordable, structurally sound rental housing located on the banks of the now gentrified Lake Phalen. Lakewood was in poor condition and there were many code violations because the city and the district council had conspired to ignore the property for years. Lakewood was home to a diverse community of low income families, there was ONE WHITE family in Lakewood, ONE!!!
Ex.128,1stShoemakerAff.,RoyceDepo.,Ex. 3.
Ms. Royce testified that under Mayor Norm Coleman, the City was “doing a lot of demolition, using a lot of city funds to demolish affordable housing” and was “particularly interested in tracking Community Development Block Grant funds in the hopes that we could require replacement of those units through that period conducted.” Id.,17-18. The City “started to use a significant amount of public subsidy to go after large complexes. They wanted to demolish Concord Square, known as Bluff Park Homes now. We intervened strongly there, Community Stabilization Project, and they jumped across the city to the East Side and went after a complex called the Lakewood Apartments. They successfully demolished that.” Id.
Royce continued, “vacating and demolitions of units throughout the city have been a part of trying to get rid of rental housing. Now, then you can make the leap, without having a whole bunch of brain synapse occurring, that that is also going after people or color.” Royce, 88. “The rather recent (five years) strategy of requiring the highest level of rehab, I think they call it code compliance, on a vacant building, even if its only been vacant for a short amount of time is not a policy conducive to preserving our existing stock of housing. It is
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policy that should be analyzed as people look over this issue in general. Not many of our homes, including mine, could withstand the level of scrutiny created by this code compliance inspection.” Id. Royce recall talking to Dawkins about this issue and that Dawkins understood that “Code Compliance” was a higher level of rehabilitation to an older home. Id.,189-190.
CITY MINIMUM PROPERTY MAINTENANCE CODE FOUND
TO BE 82% MORE STRINGENT WHEN COMPARED
TO FEDERAL SECTION 8 STANDARDS
In 1994, the City proposed to PHA, it long term partner, that the City’s Property Maintenance Code (City Code) be substituted for the federally mandated Housing Quality Standards (HQS) applicable to federally subsidized, Section 8 “low income” housing in the City. During this process, the City and PHA discovered that the City’s code was actually “more stringent” 82% of the time when compared to the federal code. Ex.171,3rd ShoemakerAff,PHA011488-494;Ex.180,3rdShoemakerAff.,PHA012087;Ex.115, 3rdEngelAff.,STP6689-90.
Representative Dawkins’ Legislative Aid attended the City’s Community and Economic Development Committee meeting on October 26, 1994, where PHA informed the City that HUD tightly controls the variations in HQS by local jurisdictions due to the adverse effect a higher local housing code can have on the availability of affordable housing. Ex.1783rdShoemakerAff.,PHA011881;Ex.174,3rdShoemakerAff.,PHA011799; Ex.177;3rdShoemakerAff., PHA 011877-011890.
In 1994, PHA informed City leaders that “local HUD staff feared more stringent
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standards would reduce the supply of affordable housing for Sec 8 holders.” Ex.172,3rd ShoemakerAff.,PHA011789. PHA Staff informed the City that HQS was a national minimum standard for unit habitability and that HUD tightly limited local variations because HUD did not want Cities to unduly restrict the supply of dwelling units available to Section 8 participants by setting standards higher than HQS. Ex.177,3rdShoemakerAff.,PHA11879-11881(Items incorrectly identified as Housing Quality Violations: minor drip in wash basin or tub; one burner out on stove; condition of appliances; types of locks; heat shut off from certain rooms; crack window pane (which are not a safety problem or cause drafts); location of outlets and light fixtures; peeling paint; worn carpeting or other floor covering; stained wall paper; lack of screens; no air conditioning; occasional roaches or mice).
RISK OF WHOLESALE ABANDONMENT IN INNER CITY
In 1997, two years after the Minnesota State Building Code was amended to allow one and two unit dwellings to be covered by Certificates of Occupancy (CofO), Council members Dan Bostrum and Roberta Megard promoted a new ordinance that would require City inspection for all rental single family and duplexes. Ex.210,3rd ShoemakerAff.,p.32; Ex.167 3rd Shoemaker Aff.,PHA011340.
The City acquired notice during the debate on the proposed ordinance that, “Most rental property owners are small-business people who are struggling to make ends meet,” that “Most rental properties in the Twin Cities have very slim profit margins and have incomes that barely allow for repair of tenant-caused damage and basic maintenance, let alone improvements and aesthetics” and the “financial burden of costly repairs cannot be met by
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many rental property owners and would likely result in an increase in the number of abandoned properties” and the “increased cost due to inspections and code compliances will result in higher rents, which will decrease the number of affordable housing units for moderate to low-income tenants.” Ex.169,3rd Shoemaker Aff., PHA011390.
Councilmember Jerry Blakey stated during the debate that “We need to make sure there’s financial resources in place or the costs will be passed on to the tenants.” Ex. 166 to 3rd Shoemaker Aff., PHA011339.
Councilmember Mike Harris stated the proposed ordinance “would impose overly strict standards for aging properties that may be adequate, if not up to code.” Ex. 168 to 3rd Shoemaker Aff., PHA011363.
The City received further notice during this debate when Catie Royce, director of the Community Stabilization Project (Royce - CSP) suggested that grants or low-interest loans should be provided for repairs or many landlords will simply abandon their properties with followed demolition and reduction of the city’s already limited supply of low-rent housing and increase in homelessness. Dawkins acknowledged the need for resources. Ex. 299 to 4th Shoemaker Aff .
In November 1997, the City’s Planning and Economic Development (PED) noted that it “needed to study which city housing programs could release parts of their budgets for the inspections [CofO], as well as possible impact on increased rents, displacement of tenants and reduction of low-cost housing.” Ex. 179 to 3rd Shoemaker Aff., PHA012054 (emphasis added).
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In 1999, another City Council proposal related to the C of O inspection program was promoted and the City claimed that under that program, “Class C building will still meet City Codes …, but will have frequent citations for code violations.” Ex. 164 to 3rd Shoemaker Aff., PHA011285. The question for PHA and HUD was whether the additional City regulation would unduly restrict the supply of affordable housing available. Id.
In 1999, during the public debate over the City’s proposed Housing Plan, the City received further notice that increased regulation of the low-income rental housing market could backfire as “too much code enforcement could lead to more housing being condemned and boarded up, pushing even more low-income people into shelters or looking for replacement housing when the vacancy rate was less than 2 percent.
In 1999, City enacted a rental registration program adding further regulations to the private rental market. Ex. 171 to 3rd Engel Aff., STP211856-211860.
In 2000, the City acknowledged that attitudes and public opinion as a barrier to affordable housing, including division in neighborhood communities which pits renters against owners and single family residents perception that a rental building is a “problem property”, rather than recognize problems which may be associated with tenants. Id at 61.
In 1999, the City and Ramsey County recommended that given the critical need for low income housing in the City and County, “all efforts should be taken to preserve existing stock” and that the City and County should develop a set of strategies to carry out this policy, including assurances that resource are adequate. Id at 56.
In September 2000, John Lensch, a legislative aide to Councilmember Chris Coleman
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was informed by PHA that in fact the City’s Code had been found to be more stringent than Section 8 HQS. Ex. 170 to 3rd Shoemaker Aff., PHA011439.
In January 2004, Lensch, by then a State Representative for the City, would comment before the City Council that he felt that a property before the Council on a proposed resolution ordering the owner to remove or repair the home within 15 days “will end up as another rental property in a zip code that already has twice the number of Section certificates of any other zip code in St. Paul.” Ex. 266 to 3rd Shoemaker Aff., 45764.
2000 US CENSUS DATA
The City acknowledged in its 2003 Consolidated Plan Update (Ex. 86 to 3rd Engel Aff) that the 2000 Census showed that the City had gained nearly 15,000 residents since 1990 the racial communities had increased in population and there had been an increased number of children and persons of color living in poverty. Id at 40.
HUD’s 2000 Census “CHAS” data for St. Paul showed that among renters in the City, 37.1 % of White renters had housing problems (cost burdens of greater than 30% of income and/or overcrowding or without complete kitchen or plumbing facilities) while 53.9% of Blacks had such problems, and Hispanics had 57.5% Black family households had 59.3% and Hispanics families had 64.9%. Ex. 262 to 3rd Shoemaker Aff., 45701-45707.
INSPECTORS HAD KNOWLEDGE THAT AREAS WHERE PLAINTIFFS’
HAD RENTAL PROPERTIES HAD A HIGH CONCENTRATION
OF “PROTECTED CLASS” TENANTS
Defendant Lippert stated, “We know that we are very effective. As I drive around town I rarely drive down a block where I haven’t solved a problem. On some blocks I have
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been to every house on the block. This is of course true of every inspector.” Ex. 100 to 3rd Engel Aff., STP0409-0410.
Ms. Royce testified that based upon her considerable time and experience in the inner city of St. Paul assisting protected class, that the concentrations of minorities in the City were located on the East side, Railroad Island, along Payne Avenue and in those neighborhoods, Summit-University, Frogtown, and West Side for the Latino population. Royce, p. 30-31. This was true, she said, both before and after Randy Kelly was Mayor. Id.
Nevertheless, Dawkins in November 2003, he boasted, “We got our new excessive consumption ordinance and our new rental registration ordinance … yesterday….Everything counts …I estimate the new ordinance will bring in half a million dollars of more, and the Mayor has basically said it’s ours to spend.” Ex. 300 to 4th Shoemaker Aff. Dawkins reminded inspectors the Mayor wanted every property written up, which would slow down the inspection department but “it is the way to build our base so we do bring-in a million on re-inspects.” Id.
LONG TERM PARTNERSHIP BETWEEN THE SAINT PAUL
PUBLIC HOUSING AGENCY AND CITY OF SAINT PAUL
The Saint Paul Public Housing Agency (PHA) owns and manages federally subsidized low-income, primarily to low and moderately low income “protected class” tenants in the City and manages the Section 8, Housing Choice Voucher program. Gutzmann, p. 14.
The City acknowledges that it “works closely with” PHA and that this “close relationship is based upon mutual goals, staff cooperation, joint planning and program Case 0:05-cv-00461-JNE-SRN Document 237 Filed 08/25/2008 Page 25 of 78
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development” Ex. 237 to 3rd Shoemaker Aff., City Consolidated Plan 2000, p. 7. PHA enjoys the “good cooperation and coordination between the City’s Code Enforcement Staff and PHA Staff.” Ex. 165 to 3rd Shoemaker Aff., PHA011323. PHA has a working relationship with the City’s code inspection department. Hester (1st), 132.
Even though PHA is no longer a city department, the City continues to have effective control over PHA as the Mayor appoints the members of the PHA Board of Commissioners and the City Council confirms those appointments. There are seven Commissioners, five of which are non-public housing residents. Ex. 268 to 3rd Shoemaker Aff., 2005Consolidated Plan, 111.
HUD mandates the City review PHA Housing Plans for submission to HUD to determine if PHA plans are in conformance with the City Consolidated Plan. Id at 41. The City recognizes that PHA needs to continue rehabilitation and modernization of its properties. Id at 41.
In the 2000 Consolidated Plan, PHA is listed as having 455 scattered site homes, 1,296 family development units, 2,543 Hi-Rise units in 16 Hi-Rises, for a total of 4,286 rental units. Id at 49. The City has intimate knowledge of the physical condition of PHA rental properties from a number of partnership sources, including PHA’s Comprehensive Grant Plan, its five year improvement plan, and at times City or county officials serving on the PHA Board of Commissioners. Id at 50.
The City reviews detailed information concerning PHA’s rental operations, including PHA’s five year capital funding plans, annual plans, proposed sales of PHA properties. Ex.
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184 to 3rd Shoemaker Aff., PHA 17394; Ex. 268 to 3rd Shoemaker Aff., Con Plan 2005, 111, Ex. 236 to 3rd Shoemaker Aff., Con Plan 2001 Update, 41.
COOPERATIVE AGREEMENT BETWEEN CITY AND PHA
The City and PHA were required by HUD to enter into and maintain a Cooperative Agreement. Ex. 154 to 3rd Shoemaker Aff., PHA00007-17. City and PHA are partners in provision of subsidized housing in the City.
The Cooperative Agreement also provides that the City will “Grant such deviations from the building code of the City as are reasonable and necessary to promote economy and efficiency in the improvement and administration of such Development, and at the same time safeguard health and safety;” “Cooperate with the PHA by such other lawful action or ways as the City and the PHA may find necessary in connection with the improvement and administration of such Development;” “Provide such services as are normally provided to other inhabitants or dwellings in the City for which PHA will pay the City a Service Charge.” The City and PHA are contract partners on a number of additional levels: the City provides supplemental police services to PHA under special contract (Contracts for Supplemental Police Services), and the City and PHA partner together in submissions to HUD. Ex. 237 to 3rd Shoemaker Aff., Con. Plan 2000, Ex. 236 to 3rd Shoemaker Aff., Con. Plan 2001 Update.
PHA CLAIMS IF ANY RENTAL LOST WOULD ADVERSELY
AFFECT AFFORDABLE HOUSING IN THE CITY
PHA has over 400 single family homes – if one is taken out of the subsidized role
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through “conversion” to private market rents, that in that event, the conversion of any PHA home would “adversely affect the availability of affordable housing” in St. Paul. Ex. 270 to 3rd Shoemaker Aff., PHA Plan, FY 2005, Attachment N. Sixty-Seventy percent of PHA’s homes were built between WWI and WWII. Id. 37-38, but some were built in early 1900s. Id.
PHA’S HOUSING STOCK
PHA has been chronically underfunded for almost the entire existence of public housing. Gutzmann, 23. PHA admits that it has to prioritize the repairs - life safety and exterior envelope to keep out the moisture. Id at 47. Hester testified that every year for PHA staff have to ask how much money they have – have to prioritized the work – in a general sense there are a lot of needs that are being deferred because of insufficient funds. Hester (1st) 160. Had to sell homes to pay for other repairs. Hester (1st) 170.
PHA at times takes 6-7 weeks to get a rental unit ready for a new tenant after a tenant departure and the home is vacant during that time. Id at 40. HUD measures PHA on how fast PHA can turn around a vacant home to reoccupy. Id at 40.
PHA is inspected about every two years by HUD but only on a portion of its properties and HUD inspectors have not taken a rental unit off line no matter what condition it was in at the time of inspection. Petro 57-58. HUD does not focus on housekeeping as much as actual physical condition Id at 59.
Petro testified that the City would issue orders on trash, yard issues, vehicles, screens. Petro, 63-64. Petro says that tenant intentional caused damage is significant in amount with broken doors, damaged screens, holes in walls. Petro, 66-71. Damage to PHA properties is
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fairly common across the scattered site portfolio. Id at 38-39. Tenants dictate whether there will be a rodent issue and frequently bring pests with them when they move in. Petro , 86-87. PHA does get complaints from its tenants that PHA is slow to make repairs. Petro, 106.
In fact, PHA has had serious health conditions in its properties from wet basements including mold filled homes. Hester, 140(2nd) (wet basements). PHA has rodent issues including mice and rats. Hester, 140-41(2nd).
In one case, PHA acknowledged that 125 showers in one of its High-Rises had to be gutted due to deadly mold conditions. Residents had complained and had to live in those conditions for a considerable period of time before PHA could address the needed repair. Ex. 196 to 3rd Shoemaker Aff., PHA21751-52.
PHA prepares a five year comprehensive plan for submission to the City and to HUD that details PHA capital funding needs, showing needed repairs and plans for deferred maintenance, repairs and improvements. Ex. 185 to 3rd Shoemaker Aff., PHA17505-17525.
PHA is subject to HUD review of its operations under the Public Housing Assessment System and while maintaining “high performer” status for overall operations, PHA scores on physical condition of its properties has ranged from 88% in 2002to 90% in 2005. Ex. 199, 200 to 3rd Shoemaker Aff., PHA22191,22198-22200; Ex. 206, 207, 208 to 3rd Shoemaker Aff., PHA22850,22855,22857.
The City acknowledges that PHA must acquire the necessary resources to modernize and maintain PHA’s stock of public housing. Ex. 268 to 3rd Shoemaker Aff., Con Plan 2005, 86.
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Gutzmann testified that PHA has been in crisis mode due to federal funding cutbacks and PHA had to sell off on two recent occasions many of its homes, where 2006-2007 on average those homes needed $40,000 in repairs. Gutzman, 56. PHA conducted an internal analysis of the costs needed for each of almost 20 homes, with the estimates running from a low of $13,000 to a high of $199,000. Gutzmann said the average costs to repair was $40,000. Gutzmann., 56-57; Ex. 190 to 3rd Shoemaker Aff., PHA 18488-18523. Hester, (1st) 155. PHA needed to sell these properties to get the money out of them and to avoid making expensive repairs. Hester (1st, 26).
City TISH evaluators conducted city code review prior to PHA sale of those homes and found that many of PHA’s homes were in fact not compliant with City Codes and had serious mold issues throughout. Ex. 192 to 3rd Shoemaker Aff., PHA 18636-18661 (2004); Ex. 189 to 3rd Shoemaker Aff., PHA18431-18487 (2006-07).
PHA - CITY ADMIT PHA RENTAL PROPERTIES SUBJECT TO CITY CODE: PARTNERSHIP BETWEEN CITY AND PHA
PHA rental properties are subject to all the same City’s codes as Plaintiffs’ properties were. Gutzman, 78-79; Petro, 60; Hester (1st), 132; Ex. 304 to 4th Shoemaker Aff., Defendants’ Responses to Requests for Admission, No. 24. p.6. Yet, PHA admits that the City has not conducted interior inspection of PHA’s over 430 homes. Hester (1st), 137. Forty-one year veteran of PHA’s maintenance Henry Petro could not recall the City ever conducting an interior inspection on any of PHA’s scattered site homes. Petro, 62. Defendants could not produce any interior inspection records for PHA homes during Plaintiffs extensive discovery
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for same.
The City and PHA admit that at no time has the City designated any PHA home as vacant, required a “Code Compliance” or condemned any of its homes. Ex. 304 to 4th Shoemaker Aff., Defendants’ Admissions, Nos. 31-35. Petro, 22-3; Hester (1st), 137-38, Hester (2nd 63-64 – no vacants or code compliances). There has never been a requirement by the City that PHA homes be substantially renovated. Hester (1st), 134-5. Petro does not recall the City ever mandating that PHA replace roofs on homes as that is an issue for the owner, can you get four-five more years out of it … by patching it. Petro, 74. Petro doesn’t recall the City’s LIEP office ever inspecting any PHA home for code compliance and he would know if it had happened. Id at 81-83.
The City has issued minimal code orders on PHA homes, mainly for garbage. Petro, 62-64. PHA has had units of it larger rental building condemned for excessive combustibles but as soon as they were cleared, the units are reoccupied. Petro, 23-27.
PHA is frequently called by City staff and given verbal orders or given friendly reminders when PHA is not compliant with City codes. Ex. 117 to 3rd Engel Aff., STP 20003-05; Ex. 151 to 3rd Engel Aff., STP20555; Ex. 150 to 3rd Engel Aff., STP20513-522; Ex. 122 to 3rd Engel Aff., STP20070-72; Ex. 144 to 3rd Engel Aff., STP20450; Ex. 142 to 3rd Engel Aff., STP20401; Ex. 133 to 3rd Engel Aff., STP20233; Ex. 123 to 3rd Engel Aff., STP20098-99; Ex. 124 to 3rd Engel Aff., STP20105; Ex. 126 to 3rd Engel Aff., STP20108; Ex. 125 to 3rd Engel Aff., STP20106, Ex. 127 to 3rd Engel Aff., STP20116; Ex. 118 to 3rd Engel Aff., STP20018-19; Ex. 131 to 3rd Engel Aff., STP20208-09; Ex. 132 to 3rd Engel
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Aff., STP20213-20216; Ex. 146 to 3rd Engel Aff., STP20472. Ex. 138 to 3rd Engel Aff., STP20369-70; Ex. 139 to 3rd Engel Aff., STP 20374-75; Ex. 121 to 3rd Engel Aff., STP20052-56 (mold in mildew, Basement keeps flooding, water around foundation); Ex. 116 to 3rd Engel Aff., STP19980-82 “Don’t think this office can take action”.
PHA has a history of being subject to serious health and safety complaints on it properties. Ex. 121 to 3rd Engel Aff., STP20055, STP 20052-56 (1375 Jessie Street, August 2000, mold and mildew, basement keeps flooding, water around foundation - refer complaint to PHA “City owned.” Also, 5-1-03 note, “Left message for PHA Will check in a week”; Ex. 119 to 3rd Engel Aff., STP20036-37; Also 1653 Ford Parkway, Ex. 120 to 3rd Engel Aff., STP20050-51 (6/17/05 “Mold thru-out the house,” 5 ½ years of mold problems - “Public Housing has been working with the tenant for over 5 years for mold problem”. Other PHA homes also appear to be frequently subject to mold growth and wet basements. Ex. 204 to 3rd Shoemaker Aff., PHA22803, Ex. 205 to 3rd Shoemaker Aff., PHA22807-08.
PHA records of its Iowa Hi-Rise shows that 62-85 showers units showers and adjacent sheetrock walls in apartment closets and kitchens were found to have deadly mold growth – showers leaks had been reported over the years. Ex. 195 to 3rd Shoemaker Aff., PHA21735, Ex. 196 to 3rd Shoemaker Aff., PHA21751-752; Ex. 197 to 3rd Shoemaker Aff., PHA21778; Ex. 186 to 3rd Shoemaker Aff., PHA17714; Ex. 187 to 3rd Shoemaker Aff., PHA17716-17. PHA homes also appear to be frequently subject to mold growth and wet basements. Ex. 204 to 3rd Shoemaker Aff., PHA22803; Ex. 205 to 3rd Shoemaker Aff., PHA22806-08. PHA has a variety of other problems with proper maintenance of its public rental units. Ex. 188 to 3rd
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Shoemaker Aff., PHA17827-36. The City could not produce any enforcement documentation showing that these serious health and safety problems were of a concern to the City.
PHA “PROBLEM PROPERTIES”
PHA and the City have long recognized that PHA, while maintaining “high performer” status under HUD regulations, owns and manages significant numbers of “problem properties” due to criminal behavior of residents, guests and third parties on PHA properties. Ex. 202 to 3rd Shoemaker Aff., PHA22440; Ex. 203 to 3rd Shoemaker Aff., PHA22475-476. Since 1991, the City and PHA have had a special partnership called “ACOP” whereby a platoon of City police are devoted solely to policing PHA family developments. Ex. 161 to 3rd Shoemaker Aff., PHA656-660. The City police services under ACOP are above and beyond the “baseline” police services PHA is provided with like any other resident or business in the City. Ex. 160 to 3rd Shoemaker Aff., PHA0591(2003 ACOP contract). At times, there are arrests of PHA residents and gang activity. Hester (1st), 146-48. The City has received over $8 million from PHA for supplemental police services since 1991. Ex. 159 to 3rd Shoemaker Aff., PHA585.
PHA and the City submitted grant applications for ACOP through the 1990s and funding continued through 2001. Ex. 162 to 3rd Shoemaker Aff., PHA3194-3390 (1999 DEP application). PHA’s PHDEP application for 1999 for funding for two years through 2001 shows that PHA and City knew criminal activity was so extensive at PHA rentals that City and PHA needed federal funds to combat the crime in PHA properties. Id.
PHA has “problem properties” and police officers live in PHA Hi-Rises. Ex. 162 to
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3rd Shoemaker Aff., PHA3248. Thereafter, PHA used capital funds to help fund this special policing arrangement. PHA and the City see the ACOP program as being very necessary for a number of reasons including to keep the lid on significant criminal gang activity in and around PHA properties. Ex. 162 to 3rd Shoemaker Aff., PHA3313-14 – Chief Finney letter 5-27-99, re - problems and strategy).
The City and PHA detail the significant criminal activity at PHA properties that supports their conclusion that PHA owns and manages “Problem Properties”. Ex. 162 to 3rd Shoemaker Aff., PHA 3194-3390; (drug related crime and gangs in PHA – Ex. 163 to 3rd Shoemaker Aff., PHA4114-4125; Ex. 156 to 3rd Shoemaker Aff., PHA283-285; Ex. 158 to 3rd Shoemaker Aff., PHA408-417; Ex. 155 to 3rd Shoemaker Aff., 271-272. PHA understands that definition of “problem properties: “loosely defined as those [properties] having numerous code violations, police calls and criminal activity, and/or poor property management practices.” Ex. 193 to 3rd Shoemaker Aff., PHA21332, Ex. 194 to 3rd Shoemaker Aff., PHA21356; Ex. 199 to 3rd Shoemaker Aff., PHA22191; Ex. 201 to 3rd Shoemaker Aff., PHA22206-208; Ex. 202 to 3rd Shoemaker Aff., PHA22440, Ex. 203 to 3rd Shoemaker Aff., PHA22475-476; Ex. 204 to 3rd Shoemaker Aff., PHA22803, Ex. 205 to 3rd Shoemaker Aff., PHA22806-08. City Police reports for criminal activity connected to PHA rental properties were sent to Assistant Chief Reding, a member of the PHA Board. P Ex. 157 to 3rd Shoemaker Aff., PHA288-307 (reports during 2003-2004).
CITY POLICE OFFICIAL SERVED ON PHA BOARD
In October 2001, Assistant Chief of Saint Paul Police, Tom Reding, was appointed to a
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five year term on the PHA Board of Commissioners thus providing the City with a “bird’s eye view of PHA’s entire rental operation. Ex. 198 to 3rd Shoemaker Aff., PHA022029 - 45. Reding served on the PHA Board from October 2001 forward even partnering with Dawkins in the City’s crackdown on so called “Problem Properties in 2003 and 2004. Ex. 198 to 3rd Shoemaker Aff., PHA022029-022045. In March 2004, Reding worked with Dawkins in preparing a training bulletin to police officers on how to work with code enforcement against private landlords. Ex. 105 to 3rd Engel Aff., STP0582-83.
ARGUMENT
Defendants are not entitled to summary judgment as requested in their memorandum of law in support of their motion for summary judgment because there is sufficient record evidence to raise genuine issues of material fact as to each contested cause of action. Summary judgment must be denied because, when the evidence is viewed in the light most favorable to Plaintiffs and after all reasonable inferences based on the evidence are made in the Plaintiffs’ favor, there are genuine issues of material fact upon which a reasonable fact-finder could decide in favor of the Plaintiffs.
The party requesting summary judgment bears the initial burden of informing the court of the basis for its motion and identifying the pleadings, admissions, discovery documents and affidavits that it contends show the absence of any genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (1986). Once the moving party has met its initial burden, the non-moving party must then go beyond the pleadings to designate specific facts that raise a genuine issue for trial. Id. at 324. The evidence produced by the non-moving
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party need not be in a form that would be admissible at trial in order to avoid summary judgment. Id. at 324.
A genuine issue of material fact exists if: (1) there is a dispute of fact; (2) the disputed fact is material to the outcome of the case; and (3) the dispute is genuine in that a reasonable jury could return a verdict for either party. RSBI Aerospace, Inc. v. Affiliated FM Ins. Co., 49 F.3d 399, 401 (8th Cir. 1995). When considering a motion for summary judgment, a court must construe all evidence and reasonable inferences in favor of the non-moving party. Enterprise Bank v. Magna Bank of Missouri, 92 F.3d 743, 747 (8th Cir. 1996); RSBI Aerospace, Inc., 49 F.3d at 401. Moreover, this circuit has held that summary judgment in a civil rights action is inappropriate where there are genuine factual disputes. See Gainor v. Rogers, 973 F.2d 1379, 1384-85 (8th Cir. 1992); Ludwig v. Anderson, 54 F.3d 465, 473 (8th Cir. 1995).
I.
PLAINTIFFS’ CLAIMS UNDER THE FAIR HOUSING ACT SURVIVE SUMMARY JUDGMENT BECAUSE THE PLAINTIFFS HAVE STANDING AND HAVE PRODUCED RECORD EVIDENCE TO RAISE GENUINE ISSUES OF MATERIAL FACT AS TO BOTH DISPARATE IMPACT AND DISPARATE TREATMENT CLAIMS.
A.
Plaintiffs have standing to bring claims under the Fair Housing Act.
The City does not dispute that Plaintiffs have Article III standing to bring its FHA claims. Rather, the City attacks the Plaintiffs’ prudential standing. The test for prudential standing is whether the constitutional or statutory provision on which the claim rests properly can be understood as granting persons in the plaintiff's position a right to judicial relief. The
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Supreme Court has held a party need not be a member of a protected class to suffer harm from discrimination.” Oti Kaga, Inc. v. South Dakota Housing Development Authority, 342 F.3d 871, 881 (8th Cir. 2003) (internal quotations and citations omitted).
The 8th Circuit recognized “the need to construe prudential standing broadly to vindicate the rights of citizens trammeled by illegal discrimination.” Id. at 882. Oti Kaga, despite being a corporation and not a member of any protected class, was held to have prudential standing because the discrimination affected its economic interests and “permitting Oti Kaga to prosecute the discrimination claims will effectuate the purpose of the Fair Housing Act’s anti-discrimination provisions and recognize Congress’s intent under the Fair Housing Act to extend standing to the full limits of Art. III” Id. at 882.
B.
Plaintiffs have presented evidence of disparate impact due to Defendants’ violation of the Fair Housing Act
Proof of a disparate impact claim requires a showing that a facially neutral policy has a significant adverse impact on members of a protected minority group. Oti Kaga, Inc., 342 F.3d at 883. Defendants argue that the Plaintiffs’ disparate impact claims fail because the policy at issue is not facially neutral. If that were the case, the policy would be facially discriminatory and no further analysis would be necessary. However, the analysis looks to the impact of the policy, which must be significantly adverse to members of a protected class. In the present case, the Defendants’ policy of targeting non-PHA low income housing with excessive code enforcement results in less choice in housing for the protected-class individuals seeking affordable housing because it drives private landlords who have
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affordable rental options out of the rental market.
Plaintiffs as a group had or have a higher percentage of people of color and disabled “protected class” in their properties. Plaintiffs were targeted – PHA was not. Plaintiffs have scattered site properties with over two times the number of Blacks occupying their privately owned units than Blacks occupying the PHA scattered site homes. Why? Maybe it is because the City cannot control the private market’s decision as to who should be allowed the freedom and privacy of a home in the inner city at affordable rates with the benefits of public transportation and community.
The City controls the number of Blacks and other minorities that can get into PHA scattered site homes by controlling the Board of Commissioners who are appointed by the Mayor and approved by the Council. The City went for further control in 2001 by making sure one of its senior police officials sat on the PHA board.
While Defendants using CDBG funds for code enforcement went after Plaintiffs for alleged behavior problems, the City and PHA were working together with federal funding to handle even worse behavior issues at and inside PHA properties. PHA’s problems were costing the taxpayer lots of money, yet Defendants failed to even mention “PHA” in the City’s 2002 Problem Property report where the City claimed the private market was costing the public so much money that the City was justified in cracking down on the private market.
The City had tools in place from 1995 forward for recouping its costs of police and code services but decided not to use those tools.
The City forcibly requires only the private market to bear the excessive costs of “code
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compliance inspections and certifications” with corresponding removal of State Building Code grandfathering protections, application of “current codes,” and resulting increase in costs to the private owners – removing those properties from the rental market for months in the short term during the “code compliance,” and forcing many owners into financial crisis, with abandonment, foreclosure, and reduction in low-income housing stock available for the 10,000 families waiting for housing.
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