JURIST - Paper Chase: Supreme Court orders rehearing in health care case

JURIST - Paper Chase: Supreme Court orders rehearing in health care case

Tuesday, November 27, 2012
Supreme Court orders rehearing in health care case
Julia Zebley at 8:35 AM ET

[JURIST] The US Supreme Court [official website] on Monday remanded [order list, PDF] Liberty University v. Geithner [docket; JURIST report] to the US Court of Appeals for the Fourth Circuit [official website]. The court ordered the lower court to re-consider the case in light of National Federation of Independent Business v. Sebelius [JURIST report]. The Fourth Circuit previously dismissed [JURIST report] the suit as untimely. The suit's original petition for certiorari [text, PDF] questioned whether the Patient Protection and Affordable Care Act (PPACA) [HR 3590 text; JURIST backgrounder] could force the insurance mandate on both employers and citizens. The court denied certiorari in Delling v. Idaho [docket; SCOTUSblog backgrounder] over the dissent of three justices. The case would have reviewed whether the ability to raise a defense of insanity in a criminal case is mandated by the Constitution. Justice Stephen Breyer, in dissent, argued that the issue needed to be decided in consideration of Idaho's policies on the issue:

To illustrate with a very much simplified example: Idaho law would distinguish the following two cases. Case One: The defendant, due to insanity, believes that the victim is a wolf. He shoots and kills the victim. Case Two: The defendant, due to insanity, believes that a wolf, a supernatural figure, has ordered him to kill the victim. In Case One, the defendant does not know he has killed a human being, and his insanity negates a mental element necessary to commit the crime. In Case Two, the defendant has intentionally killed a victim whom he knows is a human being; he possesses the necessary mens rea. In both cases the defendant is unable, due to insanity, to appreciate the true quality of his act, and therefore unable to perceive that it is wrong. But in Idaho, the defendant in Case One could defend the charge by arguing that he lacked the mens rea, whereas the defendant in Case Two would not be able to raise a defense based on his mental illness. Much the same outcome seems likely to occur in other States that have modified the insanity defense in similar ways.

Breyer was joined by Justices Ruth Bader Ginsburg and Sonia Sotomayor.
The Court also released a per curiam summary judgment [opinion, PDF] in Nitro-Lift Technologies, LLC v. Howard [docket] that the Oklahoma Supreme Court had erred by not following the Federal Arbitration Act [text]. "By declaring the noncompetition agreements in two employment contracts null and void, rather than leaving that determination to the arbitrator in the first instance, the state court ignored a basic tenet of the Act's substantive arbitration law."

Release | Supreme Court accepts major PLF property rights case - Pacific Legal Foundation

Release | Supreme Court accepts major PLF property rights case - Pacific Legal Foundation

Supreme Court accepts major PLF property rights case

Orange County, FL; October 5, 2012: The U.S. Supreme Court announced today that it will hear a major property rights case out of Florida, in which attorneys with Pacific Legal Foundation (PLF) represent property owner Coy Koontz, Jr.
The case — Koontz v. St. Johns River Water Management District — challenges the confiscatory and unconsti­tutional demands that a local government agency imposed on the Koontz family as a condition of giving permission to develop the family’s property.

PLF Principal Attorney Paul J. Beard issued this statement today, in response to the Supreme Court’s acceptance of the Koontz case: “Property owners large and small, from coast to coast, should be thankful that the U.S. Supreme Court has accepted this important property rights case. If the Koontz family can be hit with the government rip-off that happened in this case, then everybody’s property rights are put at risk. The Koontz family merely wanted to exercise their rights as property owners, to develop the family’s land in legal and responsible ways. But regulators saw a chance to pounce and make all kinds of costly, unrelated, outrageous demands. Without any justification, the government demanded money, labor and resources as the price for allowing the Koontzes to use their own land. This was a flat-out shakedown, a form of extortion. And government shakedowns of property owners aren’t just wrong, they’re unconstitutional. The Supreme Court is to be applauded for deciding to weigh in on this injustice.”

Making Extortionist Demands

Paul J. Beard II
Principal Attorney


Alan E. DeSerio
Managing Attorney


Brian T. Hodges
Managing Attorney

For years, the father of PLF’s client, the late Coy Koontz, Sr., sought to develop the vacant, commercially zoned land that he owned, immediately south of State Road 50 and east of State Road 408, in Orange County.
But the St. Johns River Water Management District refused to issue any of the necessary permits, because Koontz would not agree to costly and unjustified conditions that the District imposed as the price of getting a permit. Specifically, the District demanded that Koontz dedicate his money and labor to make improvements to 50 acres of District-owned property located miles away from the proposed project.
“The demand that Mr. Koontz spend his resources improving government-owned property, miles away from his own land, bore no connection to the development project that he proposed,” said Beard. “In other words, what we have here is a classic case of an unconstitutional shakedown. The U.S. Supreme Court has ruled that government violates property rights — it commits a ‘taking’ in violation of the Fifth Amendment — if it tries to use the permitting process to extract conditions that aren’t related to the impact of the proposed development.”
Officially, most of the 3.7 acres that Mr. Koontz sought to develop lay within a habitat protection zone, and was classified as wetlands subject to District jurisdiction. But the property had actually been seriously degraded, and made unfit for animal habitat, because of development on adjacent land owned by others, including government land. Nevertheless, Mr. Koontz offered to mitigate for the proposed disturbance of wetlands by dedicating 11 acres of his own land in the vicinity (nearly 80 percent of his property in the area) to the state for conservation.
But the District was not satisfied with this offer. Instead, it demanded that Mr. Koontz replace culverts and plug ditches on some of the District’s own property located up to seven miles away. Cost estimates for the off-site work ranged from $10,000 (the District’s estimate) to between $90,000 and $150,000 (Koontz’s expert’s estimate).
“The District never demonstrated how the off-site improvement of 50 acres of wetlands on government lands was related in nature or extent to the alleged impact of Mr. Koontz’s proposed development on little more than three acres of his own property,” said PLF’s Beard.
Mr. Koontz refused the District’s unreasonable demand. Because of his refusal to comply, the District denied his permit applications outright.
The Koontz family sued in state court, arguing that their Fifth Amendment rights had been violated, and they won at the trial and appellate levels. After the District issued the necessary permits without the off-site mitigation condition, Mr. Koontz was awarded damages for the period of time during which the District unlawfully withheld permits.
However, the Florida Supreme Court then ruled for the District, refusing to recognize that the District had imposed an unconstitutional taking. Coy Koontz, Sr., died before he could see his property developed, and his son took over his legal battle.

PLF Carries on the Fight at the High Court

“We petitioned the U.S. Supreme Court to take the case, because the District unconstitutionally used the permit process for its own gain, not as a means of reasonable regulation of property use,” said Beard.
Nollan v. California Coastal Commission is the landmark 1987 U.S. Supreme Court ruling establishing that governments can’t impose unrelated demands as the price of permits or other regulatory actions. The Nollan case was brought to the Supreme Court by Pacific Legal Foundation, and one of PLF’s ongoing missions is to force regulators to abide by Nollan’s principles.
About Pacific Legal Foundation and its Atlantic Center
Donor-supported Pacific Legal Foundation (www.pacificlegal.org) is the leading legal watchdog organization that litigates, pro bono, for limited government and property rights, in courts nationwide. PLF’s Atlantic Center is headquartered in Stuart, Florida.
Today’s announcement by the Supreme Court brings to eight the number of PLF direct-representation cases for liberty and limited government that have been accepted by the High Court over PLF’s four-decade history. Of the seven previous PLF cases at the Supreme Court, PLF has won six — most recently Sackett v. EPA, which was decided earlier this year.

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LandLordsRockofAges Hud Complaint vs. City St.Paul_Mpls MN

More landlords go after city of St. Paul.

http://www.hud.gov/directory/800/800num3.cfm

Fair Housing Laws and Complaints Information by State Print version Organization 800 Number Information Available Housing Discrimination Hotline 800-669-9777 Provides information for callers about Fair Housing Rights. Records consumer complaints of unfair treatment or discrimination. In English and Spanish. TDD line for the hearing impaired. 800-927-9275 Provides callers with information on Fair Housing rights and HUD programs on Fair Housing and Equal Opportunity. HUD Office of Fair Housing Enforcement 800-347-3739 Provides callers from CA, NV, AZ and HI with information on Federal Fair Housing laws.
Content current as of 5 December 2000 Back to Top FOIA Privacy Web Policies and Important Links Home U.S. Department of Housing and Urban Development 451 7th Street S.W., Washington, DC 20410 Telephone: (202) 708-1112 TTY: (202) 708-1455 Find the address of a HUD office near you

U. S. DEPARTMENT OF HOUSING & URBAN DEVELOPMENT
OFFICE OF FAIR HOUSING & EQUAL OPPORTUNITY
ROCK OF AGES MISSIONARY
BAPTIST CHURCH, INC.,
REVEREND SYLVESTER DAVIS,
JOHNNY EARL HOWARD, SR.,
GREGORY RYAN,
DAVID ROERING, JOSEPH EGAN,
ROBERT EGAN, LESLIE LUCHT,
RONALD ST AEHELI,
JAMES SWARTWOOD,
KENNETH JOHNSON AND
CK PROPERTIES, LLC,
St. Paul Complainants,
RONALD FOLGER, JULIE FOLGER,
RBE PROPERTIES, LLC,
STEVEN MELDAHL,
SlM PROPERTIES, INC,
MAHMOOD KHAN AND
JAMES SWARTWOOD,
)

Minneapolis Complainants, )
vs.
CITY OF ST. PAUL,
A MUNICIPAL CORPORATION AND
CITY OF MINNEAPOLIS,
A MUNICIPAL CORPORATION,
Respondents.
)
_._--------------------------------------------------------- )
HOUSING DISCRIMINATION
COMPLAINT
Submitted November 5, 2012
HUD Inquiry No.: _ _ _
HUD Case No.: ___ _
[Title VIII]
[Title VI]
[Section 109]
Housing Discrimination Complaint
Rock of Ages Missionary Baplisl Church, el al. vs. SI. Paul and Minneapolis
November 5, 2012
TABLE OF CONTENTS
Introduction. . . . . . . . . . . . . . . . . . . .. . . . . .. .. . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . .. 7
St. Paul Complainants ................................................... .................. 7
Minneapolis Complainants.. . . . . . .. . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . .. 7
Other Aggrieved Persons ....... ....................... . .. .. ........ .. ... ........... . ...... 7
Counsel for Complainants .. . . . . . . . . .. .. . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . ... 8
Summary of Alleged Wrongful Conduct.................................. .. ............ 8
Violations Occurred Due to "Protected Class" status.................................. 9
Disparate Treatment and Disparate Impact ............................. . ................. 9
HUD's Jurisdiction and Obligation To Investigate Complaint ...... .. ................ 9
Timely Filing of Complaint - Respondent Cities' Continuing Violations ........... 10
Address and Location of the Properties in Question .................................... 10
St. Paul and Minneapolis Respondents. . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 10
St. Paul and Minneapolis Complainants are Members of Twin Cities Faith
Community and Providers of Privately-Owned, Low-Income Housing .............. 10
Complainants Provide "Safe, Decent and Sanitary" Rental Housing ... ... ... .... . ... 12
Respondent Cities Receive Annual Federal Grants Requiring Cities to
Conduct Mandatory "Analysis ofImpediments to Fair Housing Choice" ... .. ....... 12
"Impediments to Fair Housing Choice" as defined by HUD .............. .. ........... 12
HUD's Fair Housing Planning Guide ("FHPG") ........................................... 13
FHPG - Analysis of Local Building, Occupancy, Health and Safety Codes ........ 13
St. Paul and Minneapolis' Obligation to Create and Maintain
"AI" Related Records ........................................................................ 14
St. Paul and Minneapolis' Obligated to Follow FHPG ............. .. .................. 14
2
Housing Discrimination Complaint
Rock of Ages Missionary Baplisl Church, el of. vs. SI. Paul and Minneapolis
November 5,2012
Respondents' Continued Failure to Comply With Certifications ...................... 14
Respondents Have Failed To Update Their "AIs" """"" ................................ 15
Respondents Have Failed to Update 2009 "AI" Since Gallagher vs. Magner ...... 15
Negative, "Disparate Impact" from Respondent Cities' Housing Policies
and Enforcement of Such Policies ........................................ . ................ 16
Respondents Fail To Follow City Codes ................................. ................. 16
Respondents Violate State Building Code ................................................ 17
Additional St. Paul "Public Sector" Actions Denying Housing.. .. .. .. .. . .. .. .. .. .... 18
Over-regulation of private housing market ...................................... 18
Cl·t y , s "Va cant BU 'lI dm' g" P0 I'l C.l es ............................................... . 19
Prohibiting re-occupancy in normal tenant turnover ........................ ... 19
Requiring major renovations to current codes """ ............................ 19
City's Illegal Egress Window Policy ......... . ................. ...... ............ 19
Deed restrictions - rental to owner-occupied only .............................. 19
Condemnations violate State Building Code .................................... 19
City Condemnations, Nuisance designations and Demolitions ............... 20
Other standards violate Minnesota Building Code, HQS,
and City'S Duty to Affirmative Further Housing ............................... 20
City Admits Unique, "Rigorous" Building Code ......................................... 20
City Admits - $30,000 Average to Meet City Code Policies...... . ......... 20
Heavy Volume of Demolition of Former Affordable Homes ................. 21
Different City vs. Federal Minimum Housing Codes ....................... ... 21
Preferential Treatment to Other Property Owners .............................. 21
St. Paul selectively targets Private Owners ...................................... 21
3
Housing Discrimination Complaint
Rock of Ages Missionary Baptist Church, et al. vs. St. Paul and Minneapolis
November 5, 2012
Confiscatory administrative fees, penalties and assessments,
vacant building registration fees, inspection and permit fees .... ............. 21
Repeated, retaliatory and punitive City inspections ............................ 21
City administrative hearings ...................................................... 22
Minnesota State Building Official Donald Hedquist.......................... 22
Additional Minneapolis Public Sector Actions Deny Housing....................... 22
Minneapolis Rental Licensing and Revocation Ordinance,
Policies and Practices.. . .. .. .. .. .. .. ... .. .. .. .. . .... .. .. .. .. .. .. .. .. . .. .. .. . . . ..... 22
Ron and Julie Folger ...................................................... 23
Spiros Zorbalas .................. ................. ...... . .. .... .... ....... . 23
Minnesota Tenants Union ................................................ 23
Confiscatory administrative fees, penalties and assessments,
including vacant building registration fees ...................................... 24
Condemnations violate State Building Code................................... 24
Repeated, retaliatory and punitive City inspections ........................... 24
Excessive inspection fees, permit fees, fines and assessments .......... ..... 24
Heavy City administrative burdens ............................................... 24
City administrative hearings. . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 24
City threats to revoke rental licenses ............... . ........... .. .... ..... .... ... 25
City hair-trigger condemnations and demolitions ..... . ........................ 25
Different City vs. Federal Minimum Housing Codes .............. . ........... 25
Minneapolis selectively targets low-income housing providers .............. 25
Preferential Treatment to Other Property Owners ........................ ...... 25
St. Paul and Minneapolis Housing Policies Act As Disincentive to Private
Low-Income Housing Providers ........................................................... 25
4
Housing Discrimination Complaint
Rock of Ages Missionary Baptist Church, et al. vs. St. Paul and Minneapolis
November 5,2012
St. Paul and Minneapolis - Forced Gentrification . ........... . ..... .... ... ...... ........ 26
St. Paul and Minneapolis' Public Sector Actions Perpetuate Segregation ........... 26
St. Paul and Minneapolis Public Housing Agencies Are Largest
Low-Income Landlords In The Metro Twin Cities ...................................... 26
St. Paul and Minneapolis Use Police Power To Target Their Competition .......... 27
Public Housing Agencies Considered "Problem Properties" ........ . .................. 28
Low-Income and "Protected Class" Tenants Occupying Privately Owned Units
Are Negatively Impacted By Respondents' Anti-Private Market Actions ........... 28
St. Paul and Minneapolis Apply Higher City Code Policies Than Required
Under Section 8 Housing Quality Standards ............................................. 28
Federal Section 8 Program Requires Reasonable Standards ........... . ............... 28
Congressional Policy to Encourage Private Owner Participation ...................... 29
City vs. Federal Inspection Standards .................................................... 29
St. Paul Study - City Code 82% More Stringent Than Federal Code ................ 30
Local Code Standards Lead to Abandonment, Exceed Reasonable Protection,
Increase Costs and Pose Barriers to Affordable Housing .............................. 30
215 Alliance, et al. v. Andrew Cuomo, et aI., ............................................ 30
SPPHA Adopts Higher St. Paul Code Without Analysis ofImpediments ........... 31
St. Paul and Minneapolis Have Failed to Acknowledge Significant Studies and
and Court Decisions - Violating Affirmative Duty to Further Fair Housing ........ 31
The 2001 Regional Analysis of Impediments to Fair Housing .. ...................... 31
Mn Court of Appeals, 2012 Decision - St. Paul Violated State Building Code ..... 32
Mn Court of Appeals, 2010 - Bee Vue vs. City a/St. Paul- City'S arbitrary,
capricious decision to demolish low-income housing .................................. 32
5
Housing Discrimination Complaint
Rock of Ages Missionary Baplisl Church, el 01. vs. SI. Paul and Minneapolis
November 5, 2012
United States Federal District Court, Minnesota, 20 I 0 - Michael and Jerin
McRath vs. City of St. Paul- City destruction of Section 8 Housing Provider ...... 33
Gallagher, et al. vs. Magner, City of St. Paul, et al . .................................... 33
St. Paul and Minneapolis have ignored Gallagher, et al. decision and failed
to conduct legitimate "Analysis ofImpediments" .................... .. ................. 34
St. Paul Violated Spirit of Fair Housing and City's Affinnative Duty to Further
Fair Housing in Magner vs. Gallagher Petition to U.S. Supreme Court .............. 35
The City had contractual duty under its federal certifications
not to "disparately impact" protected classes ........................ .. .......... 35
St. Paul failed to disclose its contractual duty to Supreme Court ...... ...... 35
St. Paul sought to "gut" Fair Housing Act ...... .. ...... .. ....................... 35
St. Paul forced Supreme Court and fair housing advocates to expend
valuable and limited resources .................................................... 35
St. Paul's never intended to pursue Petition to argument and
final decision before Supreme Court .................... .......... . ... ........... 35
St. Paul's Petition in Magner filed to gain bargaining power for City
in federal fraud False Claims Act ("FCA") lawsuit vs City ................... 36
United States of America, ex reI., Fredrick Newell vs. City of St. Paul ...... 36
Second False Claims Act lawsuit filed against City: United States of
America, ex reI. Andrew Ellis, et al. vs. City of Minneapolis,
City of Saint Paul, et al ................................ .. .......................... 36
City filed Magner Supreme Court Petition to coerce United States
to waive rights to pursue City for $180 Million in Section 3 fraud .......... 36
City admits dismissal of Magner Petition in return for United States'
agreement not to pursue City for fraud in the two cases ........ .. ............. 36
Conclusion, Damages and Relief Sought .. .. .... .. ....................................... 37
6
Housing Discrimination Complaint
Rock of Ages Missionary Baptist Church, et al. vs. St. Paul and Minneapolis
November 5, 2012
HOUSING DISCRIMINATION COMPLAINT
INTRODUCTION
St. Paul and Minneapolis Complainants include members of the faith
community, property owners, low-income housing providers and business owners.
St. Paul Complainants
Pursuant to 42 U.S.C. § 3610 of the Fair Housing Act ("FHA"), St. Paul
Complainants Rock of Ages Missionary Baptist Church, Inc., Reverend Sylvester Davis,
Johrmy Earl Howard, Sr., Gregory Ryan, David Roering, Joseph Egan, Robert Egan,
Leslie Lucht, Ronald Staeheli, James Swartwood, Kenneth Johnson and CK Properties,
LLC (collectively, "St. Paul Complainants") file their Fair Housing Complaint against the
City of St. Paul ("St. Paul").
Additional St. Paul low-income housing providers support this Housing
Discrimination Complaint against the City of St. Paul but are unwilling to publicly join in
this Complaint for fear of retaliation from City officials, who have a history of reprisals
against other property owners who have publicly challenged illegal City actions.
Minneapolis Complainants
Pursuant to 42 U.S.C. § 3610 of the Fair Housing Act ("FHA"), Minneapolis
Complainants Ronald Folger, Julie Folger, RBE Properties, LLC, Steven Meldahl, SJM
Properties, Inc" Mahmood Khan and James Swartwood (collectively, "Minneapolis
Complainants") file their Fair Housing Complaint against the City of Minneapolis.
St. Paul and Minneapolis Complainants have standing to file this Complaint.
Other Aggrieved Persons in
St. Paul, Minneapolis and Twin Cities Metro Region
Other aggrieved persons include residents and potential residents and other lowincome
housing providers who have been subjected to discriminatory policies and
practices by the Cities of St. Paul and Minneapolis on the basis of race, color, national
origin, disability, or familial status.
7
Housing Discrimination Complaint
Rock of Ages Missionary Baptist Church, et of. vs. St. Paul and Minneapolis
November 5, 2012
Representing St. Paul and Minneapolis Complainants:
John R. Shoemaker (Attorney at Law)
Direct dial (952) 224-4610
Paul F. Shoemaker (Attorney at Law)
Direct dial (952) 224-4605
SHOEMAKER & SHOEMAKER, P.L.L.C
International Plaza, Suite 200
7900 International Drive
Bloomington, MN 55425
Phone: (952) 224-4600
Fax: (952) 224-4601
(john@shoemakerlaw.com)
(Paul@shoemakerlaw.com)
Summary of Alleged Wrongful Conduct - Legal Basis
Complainants allege that St. Paul and Minneapolis have failed to comply with and
enforce their statutory, regulatory and contractual civil rights obligations associated with
their receipt and use offederal housing and community development funds.
Respondents St. Paul and Minneapolis, through their facially neutral laws,
ordinances, regulations and administrative policies, procedures and practices
("practices") related to low-income housing in the Cities, have without sufficient
justification denied housing or otherwise made housing unavailable to "protected class"
members as defined by federal law and have "disparately impacted or effected" said
"protected class" members in violation of 42 U.S.C. § 3604(a) of the Fair Housing Act
("FHA").
Respondents through such housing practices have created, perpetuated or
increased segregation without a sufficient justification in violation of §3604(a) FHA.
Respondents have failed to consider, adopt and implement less discriminatory
alternatives in their housing practices.
Respondents St. Paul and Minneapolis, through their facially neutral laws,
ordinances, regulations and administrative policies, procedures and practices related to
low-income housing in the Cities, have without sufficient justification discriminated in
their provision of services or facilities in connection therewith, all in violation of 42
U.S.C. § 3604(b).
Respondents have failed to consider, adopt and implement less discriminatory
alternatives in their housing practices.
Respondents St. Paul and Minneapolis have failed to affirmatively further fair
housing in their jurisdictions as required by 42 U.S.C. § 5304(b)(2), 42 U.S.C. §
12705(b )(15), and related federal statutes and regulations.
8
Housing Discrimination Complaint
Rock of Ages Missionary Baptist Church, et al. vs. St. Paul and Minneapolis
November 5, 2012
Respondents St. Paul and Minneapolis have violated the Housing and Community
Development Act of 1974 (as amended), 42 U.S.C. § 5304.
Respondents St. Paul and Minneapolis have violated Title VI of the Civil Rights
Act of 1964, 42 U.S.C. § 2000d et seq., 24 CFR Part 1, and associated regulations;
Complainants have evidence, as summarized herein, demonstrating that St. Paul
and Minneapolis have failed and continue to fail to comply with their individual civil
rights certifications provided to HUD as a condition of annual federal grant funding to the
Cities. Despite their knowing noncompliance on a continual basis since approximately
2002, Respondent Cities continue to falsely certify annually to HUD that said Cities are
in compliance with all applicable federal requirements in order to continue receiving
millions of dollars in federal grants.
Alleged Violations Occurred Due to "Protected Class" status
The alleged violations by Respondents occurred because of the race, color,
national origin, disability and familial status of those who have been denied housing and
otherwise negatively affected by Respondents violations.
Disparate Treatment and Disparate Impact
Respondents St. Paul and Minneapolis, through their acts and omissions detailed
herein, and those acts and omissions that will be discovered during the investigation by
HUD, have engaged in differential treatment of the beneficiaries of federal housing and
community development funding, on the basis of race, color, national origin, disability
and familial status.
Additionally, Respondent Cities have adopted and implemented laws, ordinances,
regulations and administrative policies, procedures and practices, that while neutral on
their face, have had and continue to have the effect of discriminating on the basis of race,
color, national origin, disability and familial status and that have perpetuated segregation
on the basis of race, color, national origin, disability and familial status.
HUD's Jurisdiction and Obligation To Investigate This Complaint
HUD has the statutory authority to enforce compliance with the Fair Housing Act
and related statutes and regulations. 42 U.S.C. § 3608(e)(5).
Moreover, HUD has authority from Congress to provide funding grants to
municipalities as grantees only if said grantees provide the required submissions and civil
rights certifications. See Housing and Community Development Act of 1974, 42 U.S.C.
§5304(b )(2).
HUD is prohibited from providing federal funds to a grantee that has failed to
9
Housing Discrimination Complaint
Rock of Ages Missionary Baptist Church, et al. vs. St. Paul and Minneapolis
November 5, 2012
either make the required certifications or issued a false certification. Federal grants such
as Community Development Block Grants that Respondents receive on an annual basis,
are specifically conditioned upon legitimate and valid certifications by said Respondent
Cities as grantees.
Timely Filing of Complaint - Respondent Cities' Continuing Violations
Many of the specific instances detailed herein have occurred more than one year
before the filing of this Complaint. However, Complainants allege that each instance set
forth herein is part of Respondent Cities' ongoing pattern and practice of housing
discrimination, both intentional and by "disparate impact," and by the Respondent Cities'
continued disregard of their civil rights obligations and certifications.
At least one violation by each Respondent City has occurred within the past year
as required by Section 810, FHA, for HUD' s jurisdiction of this Complaint. Each of
Complainants and other aggrieved parties have been adversely affected within the last
year by Respondent Cities' laws, ordinances, regulations and administrative policies,
procedures and practices related to low-income housing in said Cities and said Cities'
failures to comply with their certifications and other statutory and regulatory obligations.
Address and location of the properties in question
The discrimination occurred within the jurisdictional boundaries of the City of St.
Paul and City of Minneapolis and involved low-income housing stock within each City.
St. Paul and Minneapolis Respondents
City of St. Paul
Ms. Shari Moore, CMC
City Clerk's Office
310 City Hall
15 Kellogg Blvd., West
Saint Paul, MN 55102
City of Minneapolis
City Clerk's Office
City Hall, Room 304
350 South 5th St.
Minneapolis, MN 55415
St. Paul and Minneapolis Complainants are Members of the Twin Cities Faith
Community and Providers of Privately-Owned, Low-Income Housing
St. Paul and Minneapolis Complainants include members of the faith community,
property owners and low-income housing providers.
10
Housing Discrimination Complaint
Rock of Ages Missionary Baptist Church, et 01. vs. St. Paul and Minneapolis
November 5, 2012
Rock of Ages Missionary Baptist Church, Inc. and Reverend Sylvester Davis
support this Fair Housing Complaint against the City of St. Paul. Rock of Ages Church
members and attendees are predominately African-American. Approximately one-half of
the Church's members have disabilities as recognized by federal law. The Church has
served the St. Paul Frogtown community since 1974. Church members and attendees
from the Frogtown area have experienced difficulties in finding affordable and available
housing in St. Paul and have experienced overcrowding in existing housing units.
Because the lack of affordable housing in the City, members of Rock of Ages Church
have had to leave St. Paul and have had difficulty locating suitable affordable housing
elsewhere in the Twin Cities Metro Area. The lack of affordable housing for the AfricanAmerican
community in St. Paul is negatively impacting individuals and families and
minority-member churches. The lack of affordable housing in Frogtown and in the
immediately surrounding areas has caused and continues to cause great difficulty for
Rock of Ages Church in sustaining its membership and support services to the Frogtown
Community.
The remaining St. Paul Complainants own and manage approximately 60
affordable low-income rental properties in the City. St. Paul Complainant Johnny Earl
Howard is a long time resident of St. Paul with over 30 years of community service
including formation of the 600 member Thomas Dale Block Club dedicated to making
the community a better and safer place to live. He has worked in partnership with City
police to improve the safety of neighborhood residents and has lobbied successfully for
stronger laws related to "problem properties". Mr. Howard has received numerous
awards for community development and organizing such as the St. Paul Companies
Leadership Award, the Urban League Man of the Year Award and the William H.
Spurgeon Award. Mr. Howard is also a real estate investor and low-income housing
provider in the City.
Minneapolis Complainants own and manage approximately 170 affordable lowincome
rental properties in the City of Minneapolis.
The majority of St. Paul and Minneapolis C0mplainants' 230 rental properties are
located in the inner-city areas of St. Paul and Minneapolis where most of the affordable
housing stock consists of older homes and where a high number of vacant homes exist.
Complainants' rental properties are mostly older single family and duplex homes.
Complainants' homes provide affordable housing to very-low, low and moderate
income persons and families. African-Americans, Hispanics, Native Americans, and
other minorities, and individuals with disabilities (all considered "Protected Class"
members under federal law) make up the largest percentage of tenants in Complainants'
affordable housing units.
St. Paul Complainants' housing stock is occupied primarily by persons of color.
African-Americans represent the largest percentage of these "protected class" tenants
with smaller percentages of Hispanics, Native Americans, mixed race individuals and
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November 5, 2012
families and disabled tenants occupying these affordable rental homes.
Minneapolis Complainants' low-income rental housing stock is occupied almost
exclusively by persons of color including an average of eighty percent (80%) occupancy
by African-Americans. Hispanics, Native Americans and mixed race tenants also occupy
these affordable rental homes. A large percentage of these renters have disabilities as
defined by federal law.
Complainants Provide "Safe. Decent and Sanitary" Rental Housing
Complainants provide affordable, "safe, decent and sanitary" rental housing in
high demand in St. Paul and Minneapolis. Many of the Complainants provide housing to
Section 8 Housing Choice Voucher holders ("Section 8" tenants), a federal rent subsidy
program administered by the St. Paul Public Housing Agency and the Minneapolis Public
Housing Agency. Many of the Section 8 tenants are also "protected class" members.
Respondent Cities Receive Annual Federal Grants Requiring Cities to Conduct
Mandatory "Analysis ofImpediments to Fair Housing Choice"
St. Paul and Minneapolis, as "Entitlement Jurisdiction" grant recipients for HUD
funding, have an obligation to affirmatively further fair housing ("AFFH" duty) within
their jurisdictions. Respondents' AFFH duty includes conducting an Analysis of
Impediments to Fair Housing ("AI") every three to five (3-5) years as a condition for
receipt of federal funds through the Community Development Block Grant program
("CDBG"), HOME Investment Partnerships Program ("HOME"), Emergency Shelter
Grant program and Housing Opportunities for Persons with AIDS program. 24 C.F.R.
§91.225(a)(l), 24 C.F.R. §570.601(a)(2). Each City continues to also receive federal
funds under the HUD administered Neighborhood Stabilization Program ("NSP"). The
NSP grant process also requires St. Paul and Minneapolis to AFFH and conduct the
mandatory "AI" as defined by HUD.
Since 1996, HUD has defined a legitimate Analysis of Impediments to Fair
Housing ("AI") as a comprehensive review by each Entitlement Jurisdiction of their own
laws, regulations, administrative policies, procedures and practices to determine how they
affect the availability, location and accessibility of housing and an assessment of public
sector actions affecting fair housing choice for all protected classes.
"Impediments to Fair Housing Choice" are defined by HUD and federal law as:
(l) Intentional Discrimination: Any actions, omissions, or decisions taken because
of race, color, religion, sex, disability, familial status, or national origin which restrict
housing choices or the availability of housing choices; or
(2) Disparate Effect or Impact: Any actions, omissions, or decisions which have
the effect of restricting housing choices or the availability of housing choices on the basis
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of race, color, religion, sex, disability, familial status, or national origin.
HUD's Fair Housing Planning Guide
HUD's Fair Housing Planning Guide ("FHPG") provided by HUD to St. Paul and
Minneapolis since \996, states that "policies, practices, or procedures that appear
neutral on their face but which operate to deny or adversely affect the provision of
housing to persons of a particular race, color, religion, sex, disability, familial status, or
national origin may constitute such impediments." FHPG, Section 4.2, p. 4-4.
HUD's Fair Housing Planning Guide provides that impediments to fair housing
choice include actions or omissions in the Public Sector that are "counterproductive to
fair housing choice." FHPG, Section 4.2, p. 4-4.
HUD defines a legitimate "AI" to include an analysis of all housing within a
jurisdiction and the "AI" should not be limited to housing assisted or subsidized by the
Federal, State, or local jurisdictions. FHPG, Section 4.2, p. 4-5.
The FHPG, Section 4.3AI, pgs. 4-5 to 4-6, provides that "Public Sector" areas that
must be analyzed by Entitlement Jurisdictions, including St. Paul and Minneapolis,
include:
(\) "local building, occupancy, and health and safety codes that may affect
the availability of housing for minorities, families with children, and
persons with disabilities."
(2) "Public policies and actions affecting the approval of sites and other
building requirements used in the approval process for the construction of
public and private housing such as:
Building codes;
Demolition and displacement decisions pertaining to assisted housing
and the removal of slums and blight (e.g., relocation policies and
practices affecting persons displaced by urban renewal. revitalization,
and/or private commercialization or gentrification in low-income
neighborhoods).
(3) The administrative policies concerning community development and
housing activities, such as:
Multifamily rehabilitation;
Activities causing displacement (e.g., revitalization of neighborhoods,
property tax increases, and demolition of subsidized housing) which
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affect opportunities of minority households to select housing inside or
outside areas of minority concentration or individuals with disabilities
to select housing that is accessible and is in accessible locations.
FHPG, Section 4.3AI, pgs. 4-5 to 4-6 (emphasis added).
St. Paul and Minneapolis' Obligation to Create and Maintain "AI" Related Records
HUD's FHPG requires St. Paul and Minneapolis as "Entitlement Jurisdictions" to
create and maintain records documenting the "AI" and demonstrating the actions taken to
overcome the effects of any impediments to fair housing identified through legitimate
"Als". FHPG, Section 4.1 , pg. 4-3. See also 24 C.F.R. § 91.425 (a)(l)(i) and § 570.601
(a)(2).
St. Paul and Minneapolis Obligated to Follow FHPG
St. Paul and Minneapolis in working together with its "2009 AI" contractor,
Western Economic Services, LLC ("WES") were obligated to follow the FHPG
provisions in order that a legitimate "Analysis of Impediments to Fair Housing Choice"
would be created for the benefit of the communities and members of "protected classes,"
their advocates and housing providers, including Complainants. See FHPG and
Respondent City HUD funding certifications.
St. Paul and Minneapolis' Continued Failure to Comply With Certifications
St. Paul and Minneapolis failed to include any reference in the 2009 AI to laws,
regulations, administrative policies, procedures and practices ("Public Sector actions") of
each City so that a determination could then be made by said Respondents on how those
"Public Sector actions" affect the availability, location and accessibility of housing,
including assessment of public sector actions affecting fair housing choice for all
protected classes. St. Paul and Minneapolis have failed to update the 2009 AI to include
the required topics and scope of analysis including for the annual grant submissions to
HUD for 2012.
St. Paul and Minneapolis were bound by HUD' s definition of a legitimate, legal
"AI". St. Paul and Minneapolis purposefully failed to conduct the "AI" as required.
St. Paul and Minneapolis failed to include any reference in the 2009 AI to the
FHPG subjects set forth immediately below that, according to the HUD FHPG must be
analyzed in a legitimate "AI" as a condition of payment under the above-referenced
federal grant programs:
(1) "local building, occupancy, and health and safety codes that may affect
the availability of housing for minorities, families with children, and persons with
disabilities;
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(2) Demolition and displacement decisions pertaining to assisted housing
and the removal of slums and blight (e.g., relocation policies and practices
affecting persons displaced by urban renewal, revitalization, and/or private
commercialization or gentrification in low-income neighborhoods); and
(3) Activities causing displacement (e.g., revitalization of neighborhoods
and demolition of subsidized housing) which affect opportunities of minority
households to select housing inside or outside areas of minority concentration or
individuals with disabilities to select housing that is accessible and is in accessible
locations.
St. Paul and Minneapolis also failed to include any reference in the 2009 AI to
evaluating housing needs for racial or ethnic minorities, or for persons who have suffered
the effects of racial or ethnic discrimination or segregation as those important factors are
affected by laws, regulations, administrative policies, procedures and practices ("Public
Sector actions") of each City.
St. Paul and Minneapolis Have Failed To Update Their "Als"
Since completion of the 2009 AI, and continuing each year thereafter through
2012, St. Paul and Minneapolis have failed to update their "Als" to include the required
FHPG topics and analysis. Respondents are in continued violation of their annual HUD
funding certifications and are thereby ineligible for continued federal grants.
Respondents Have Failed to Update 2009 "AI" Since Gallagher vs. Magner
St. Paul and Minneapolis have failed to update the 2009 "AI" or to conduct a
replacement "AI" since 2009, including as part of their 2010, 2011 and 2012 HUD
funding grant applications and submissions.
St. Paul and Minneapolis' failure to comply with their funding certifications and
federal law is even more egregious when considering the 2010 decision of the United
States Federal Court of Appeals for the 8th Circuit in Gallagher, et al. vs. Magner, City of
St. Paul, et al., 619 F.3d 823 (8th Cir. 2010). In September 2010, the 8th Circuit
determined in three consolidated fair housing lawsuits, Steinhauser, et al., Harrilal, et al.,
and Gallagher, et al., that twelve St. Paul low-income housing providers had presented
sufficient evidence for trial that St. Paul through its housing policies and practices had
"disparately impacted" protected class members and thereby violated the Fair Housing
Act.
In Gallagher, et aI., St. Paul's local building, occupancy, and health and safety
codes have been challenged since early 2004 as negatively affecting the availability of
housing for minorities, families with children, and persons with disabilities.
St. Paul failed to meet its duty to affirmatively further fair housing ("AFFH")
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Rock of Ages Missionary Baptist Church, et al. vs. St. Paul and Minneapolis
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during the period of 2002 through present by failing to conduct legitimate AIs concerning
its local building, occupancy, and health and safety codes. St. Paul has refused to
conduct legitimate AIs (including updating its 2001 AI) since the Steinhauser, et al. case
was filed against the City in May 2004, and the Harrilal and Gallagher actions were filed
in 2005. St. Paul failed to conduct a legitimate AI because conducting legitimate AIs
every three-five years would implicate the City in the pending litigation.
Despite notice to St. Paul of housing discrimination complaints concerning its
public sector actions, the 8th Circuit's decision in Gallagher, et al., and other Minnesota
Appellate Court decisions, St. Paul has continued since 2002 on a on-going basis to
aggressively and illegally apply its local building, occupancy, and health and safety codes
to low-income housing, "protected class" members and housing providers, including St.
Paul Complainants. Low-income housing providers in St. Paul have continually
challenged St. Paul's long-standing violation of the Minnesota State Building Code.
The City has used its blanket denials of liability and the Court system as cover for
its continued breaches of federal law, all the while it has continued to harm the "protected
classes" in the City who have suffered and continue to suffer the negative effects of such
City housing policies. Instead of conducting valid "AIs" that would benefit the
"protected class" members within St. Paul and those seeking to relocate to the City, St.
Paul officials have continually refused to conduct the required "AIs" and comply with the
City'S federal funding certifications in order to promote the City's litigation position and
continue its illegal conduct.
Respondent City of Minneapolis has also ignored the 8th Circuit's decision in
Gallagher, et al. and continued to avoid conducting legitimate AIs covering its building,
occupancy, and health and safety codes that many low-income housing providers,
including Minneapolis Complainants have continued to challenge over recent years.
Negative, "Disparate Impact" from Respondent Cities' Housing Policies
and Enforcement of Such Policies
The Respondent Cities' oppressive laws, regulations, policies and procedures
related to rental housing and other low-income, privately owned housing stock, and
enforcement of same, have displaced significant numbers of "protected class" members
and their families, made low-income housing unavailable and "disparately impacted"
individuals and families considered "protected class" members. For a summary of
evidence of "disparate impact" from St. Paul's building codes and code enforcement
operations presented by appellants to the 8th Circuit in Gallagher, et al. , see 619 F.3d
823, at 829-30, 833-838.
Respondent Cities Fail To Follow City Codes
Respondents St. Paul and Minneapolis have consistently failed to follow their
own City Codes during inspections and issuance of correction orders. Respondents
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Rock oj Ages Missionary Baptist Church, et al. vs. St. Paul and Minneapolis
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frequently fail to "specify" the actual claimed code violation or describe with specificity
the remedial action necessary to correct the violation claimed by City inspectors. See St.
Paul Legislative Code, Sec. 34.21(1)(c); and Minneapolis Code of Ordinances, Section
244.150. As a result of Respondents' consistent failure to follow these two requirements,
owners are unsure of what is being claimed as a violation by City inspectors. Frequently,
what one inspector claims is a code violation on one property is not claimed as a violation
by another inspector at a second property. Respondents fail to properly train their code
inspectors which adds to the negative impact on Complainants, other providers and
tenants alike.
These Public Sector actions and failures by Respondents toward Complainants
and other low-income housing providers creates numerous administrative burdens for
Complainants. For example, these public sector actions result in time consuming
attempts to contact City inspectors who are difficult at best to contact, the added expense
from having to guess what action is exactly required by the inspectors so that erring on
the side of over-compensating to avoid heavy penalties, fees and assessments is necessary
to survive but with the resulting undue cost burdens. These City actions and failures also
result in the burdens of City administrative appeals and court appearances required to
challenge such intentional and/or reckless City conduct to protect properties, businesses
and customer-tenants' housing.
Respondents Violate State Building Code
St. Paul and Minneapolis have continually for years violated the Minnesota State
Building Code (Minn. Stat. 326.101-194) that applies state-wide and prohibits municipal
code provisions and related policies that are different from or in addition to those code
requirements set out in the State Code. See City of Morris v. Sax Invs., Inc., 749 N.W.2d
1 (Minn. 2008) (city authority to enact and enforce rental housing habitability standards
is restricted by State Building Code); and Builders Association of Minnesota vs. City of
St. Paul (No. AII-2270, Mn. Ct. Apps. July 23, 2012).
The primary example of Respondents long standing violation of the State
Building Code is their illegal requirements that existing homes be brought up to "current
codes" before occupancy can be continued. St. Paul and Minneapolis call this
requirement, "Code Compliance" or "Code Compliance Certification" which in both
Cities means the Cities illegally strip owners of older homes of "grandfathering"
protections provided by the State Building Code. The State Building Code provides that
older homes are subject to the building codes in force at the time they were built, not to
the ever expanding new code provisions adopted year after year. The State Building
Code was adopted by the State Legislature to promote uniformity and affordability in
housing.
The "Code Compliance" policies of St. Paul and Minneapolis violate the
uniformity and affordability policies behind the State Building Code and have the effect
of acting as a disincentive to providers of low-income housing in these Cities, negatively
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November 5, 2012
impacting the housing providers' "return on investment" that HUD in its Fair Housing
Planning Guide ("FHPG") acknowledges is a legitimate factor and concern for private
housing providers. The "Code Compliance" policies also cause displacement of lowincome
and "protected class" members from affordable housing and remove these former
affordable units from occupancy for extended periods of time and in many cases,
permanently.
Additional St. Paul "Public Sector" Actions Denying
"Protected Class" Housing
St. Paul's laws, regulations, administrative policies, procedures and practices
("Public Sector actions") affecting "protected class" housing have not been the subject of
any Analysis ofImpediments ("AI") since 2001. No legitimate "AI" has been conducted
in 2010 through 2012 as required by federal law in St. Paul's HUD grant submissions.
Nevertheless, the City has since 200 I added numerous regulatory burdens to lowincome,
privately-owned "protected class" housing providers that have made housing
unavailable as defined by Section 3604 of the Fair Housing Act, caused displacement of
"protected class" members, negatively impacted housing choice and locational choice,
negatively impacted the rate of return for housing investors and providers and acted in
other ways as a disincentive to the privately-owned low-income housing market.
As part of the HUD required "Analysis of Impediments to Fair Housing" ("AI"),
St. Paul 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. Irrespective of such false claims by St. Paul, City officials and
attorneys have not been able to produce these records of continual action by the City that
are required to be publicly available under HUD regulations. The only "AI" records
since 2001-2002 that St. Paul can point to is the 2009 "AI," that as will be seen below,
fails to meet HUD's definition of a legitimate "AI".
Almost ten years ago, St. Paul officials acknowledged that certain housing
ordinances would impose overly strict standards for aging properties that may be
adequate, if not up to code, and that there are few properties in the City where a
determined inspector could not find a violation of some City ordinance.
Since 2002 and continuing to present, St. Paul has negatively impacted housing
choice and locational choice and displaced "protected class" members from their existing
housing, through City Public Sector actions as follows:
(I) Over-regulation of private housing market. St. Paul's actions
regarding housing policies continue to negatively impact banks and
private owners and investors who, but for the City'S oppressive and
excessive regulatory burdens mandated to cover low-income housing,
would have turned the thousands of "vacant" homes since 2002 into
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Rock of Ages Missionary Baptist Church, et 01. vs. St. Paul and Minneapolis
November 5, 2012
reoccupied, affordable homes without the delays that the City's overregulation
has created;
(2) City's "Vacant Building" Policies. St. Paul illegally designates
occupied homes as "vacant buildings" that can no longer be occupied
except by complying with expensive and in other ways onerous
administrative requirements. In many cases, these targeted homes either
meet the federal minimum housing standards ("HQS") under the federal
Section 8 Housing Choice Voucher Program, or would meet such HQS
standards with minimum actions by owners, if allowed by St. Paul
officials and employees;
(3) Prohibiting re-occupancy of units in normal tenant turnover period.
The City designates low-income rental homes that are in a normal tenant
turnover and cleanup period as "vacant" buildings subject to mandatory,
cost-prohibitive renovation to current codes in violation of the State
Building Code;
(4) Requiring oppressively expensive renovations of existing homes.
The City, in violation of State Building Code, requires currently occupied
and claimed "vacant" homes to meet "current building codes" under the
Cities' "Code Compliance Certification Process"; through this policy the
City illegally removes grandfathering protections under the State Building
Code for existing structures;
(5) City'S Egress Window Policy. City policy continues to require
existing homes to increase the size of the egress windows to meet City
code policies - this policy violates the Minnesota State Building Code and
case law construing that Code. See Minnesota Appeals Courts decision in
BAMvs. City a/St. Paul (Mn.Ct.Apps. 2012); The City has convinced its
Public Housing Agency to also follow this illegal policy;
(6) Deed restrictions - from former rental to owner-occupied only.
City policies forcibly convert claimed "vacant" formerly affordable rental
homes to "homeowner occupied only" homes through redevelopment
contracts and deed restrictions. This practice has the direct effect of
"thinning out" the low-income rental housing stock in the inner-city areas
of St. Paul. St. Paul's actions continue while the City continues to have an
affordable low-income rental housing crisis with thousands of "protected
class" members on waiting lists;
(7) Condemnations. St. Paul continues a policy of condemning safe,
decent and sanitary housing stock without a legal basis under the
Minnesota State Building Code or under the federal minimum housing
standards, "HQS". These punitive City actions take affordable rental
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Rock of Ages Missionary Baptist Church, et al. vs. St. Paul and Minneapolis
November 5, 2012
homes off-line for extended periods of time and result in unavailable
housing even though such housing is "safe, decent and sanitary" under
State law and the federal minimum HQS;
(8) City hair-trigger condemnations, nuisance designations and
demolitions on low-income rental properties even though such properties
are affordable, safe, decent and sanitary and occupied predominately by
"protected class" members. Where owners have made substantial
investment in capital improvements and repairs to older buildings, St. Paul
takes accelerated action to penalize owners and remove affordable housing
stock owned by the private market. Where the owner could, without City
interference, quickly make repairs required to the property by the State
Building Code, Section 8 HQS, or the City'S legitimate code provisions,
St. Paul is quick to order demolition and assess fines and penalties and
thereby make such housing unavailable. See, e.g., Bee Vue, et al. vs. City
of Saint Paul, Mn. Ct. Apps, April 13,2010, No. A09-531;
(9) Adopting other building and code enforcement standards that
violate the Minnesota Building Code, HOS, and the City'S Duty to
Affirmative Further Housing. St. Paul has adopted and continued to
implement its "Strategic Building Demolition And Securing Policy" with
federal funding from the Neighborhood Stabilization Program ("NSP I, II
and III") that has been and continues to be applied to older affordable
housing units.
City Admits Its Unique "Rigorous" Code
St. Paul acknowledges this Code program is "unlike any other
demolition program in the country" because it is part of a "rigorous,
comprehensive, strategic code enforcement effort designed to make
property owners either bring their properties up to code or sell them to
someone who is willing to invest the funds necessary to bring the property
into full code compliance based upon a detailed code compliance
inspection." Of course, St. Paul fails to acknowledge that the "codes' it
speaks of are in violation of the State Building Code, HQS policies, and its
AFFH obligations. Shockingly, the City fails to refer to any "AI"
concerning the "disparate impact" of applying such a "rigorous" policy to
older housing stock occupied predominately by "protected class"
members.
City Admits $30,000 Average To Meet City Code Policies
St. Paul's NSP efforts are negatively and disparately impacting
affordable rental housing stock. St. Paul admits that it costs owners on
average $30,000 in forced renovations in order to reoccupy a home.
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Rock of Ages Missionary Baptist Church, et af. vs. St. Paul and Minneapolis
November 5,2012
The homes that are selected (targeted) for abatement and potential
demolition are identified by members of the local neighborhood District
Councils [who, the City fails to state, are sub-grantees of City's HUD
funding and also obligated to Affirmatively Further Fair Housing].
The targeted homes are geographically grouped close together to
maximize the redevelopment potential of the resulting vacant lots.
Heavy Volume of Demolition of Former Affordable Homes
The City has reported that on average 40 homes a month are being
rehabilitated to this rigorous City Code and reoccupied and 8-10 homes
are being demolished. City officials fail to admit that while they suspect
former "protected class" members no longer have access to these
"renovated" properties, they have failed to conduct the analysis of
impediments required by their funding certifications on this critical issue.
Under NSP, the City also is involved currently with acquisition of 400
homes, with 300 homes subject to rehabilitation under the "rigorous City
Code standards" and 100 homes subject to demolition;
(10) Different City vs. Federal Minimum Housing Codes. St. Paul
applies City Code standards to Complainant's rental properties already
compliant with federal minimum housing standards under the Section 8
HQS program. Correction orders, fees and assessments are levied by the
City for failure to meet the City's higher minimum standards;
(11) Preferential Treatment to Other Property Owners. St. Paul Public
Housing ("SPPHA")rental properties with similar physical conditions and
tenant and guest behavior problems, are not targeted or in other ways
penalized no matter the seriousness of the code violations or behavior
issues at SPPHA properties;
(12) St. Paul selectively targets low-income privately owned rental
properties and their owners for code enforcement including oppressively
heavy fees, fees and assessments. Neighboring properties with similar
physical conditions and claimed code violations are not targeted by City
inspectors;
(13) Confiscatory administrative fees, penalties and assessments,
including vacant building registration fees. inspection and permit fees
against Complainants and other low-income housing providers;
(14) Repeated. retaliatory City inspections frequently occur on the same
property, sometimes multiple times in one year with unannounced
inspections by numerous City personnel;
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Rock of Ages Missionory Boptist Church, et 01. vs. St. Poul ond Minneopolis
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(15) City administrative hearings on claimed code violations and related
penalties, fines and assessments lack fairness and due process protections.
Through these laws, regulations, administrative policies, procedures and practices
("Public Sector actions"), St. Paul is abusing its police powers and is continuing to
violate the Minnesota State Building Code, Minnesota Supreme Court decisions, HUD
regulations, federally mandated Section 8 Housing Quality Standards ("HQS"), the Fair
Housing Act ("disparate impact"), the City's affirmative duty to further fair housing
(AFFH duty), and other federal statutory and regulatory provisions.
These City "public sector actions" have had and are continuing to have a
tremendously negative impact on affordable housing stock in the City, especially for
"protected class" members.
Minnesota State Building Official Donald Hedquist, after reviewing extensive
documentation, has opined that mandatory renovations under the City'S "Code
Compliance Certification" inspection" process "significantly increased the costs to
providers of housing to the point where forced sales and abandonment occurred and that
the City 's heightened code standard has contributed to the high number of vacant
properties in the City.
St. Paul's failure to conduct legitimate "AIs" has been willful and intentional, and
constitutes a serious, on-going pattern and practice of housing discrimination.
Additional Minneapolis Public Sector Actions Denying
"Protected Class" Housing
Minneapolis' laws, regulations, administrative policies, procedures and practices
("Public Sector actions") affecting "protected class" housing have not been the subject of
any legitimate "AI" as defined by HUD since 2001.
Nevertheless, Minneapolis has since 2001 added considerable additional layers of
regulatory burdens to low-income, privately-owned protected class housing providers that
have caused displacement of protected class members, interfered with the housing choice
and locational choice of protected class members, "disparately impacted" protected class
members, and negatively affected the return on investment of housing providers and
acted in ways to remove incentives for provision of privately-owned low-income rental
housing in the City.
Complainants hereby raise additional challenges to the laws, regulations,
administrative policies, procedures and practices ("Public Sector actions") of
Minneapolis, in addition to those challenges set forth above:
(I) Minneapolis Rental Licensing and Revocation Ordinance, Policies
and Practices. Minneapolis has implemented and applied a rental licensing
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Rock of Ages Missionary Baplisl Church, el al. vs. SI. Paul and Minneapolis
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revocation ordinance that has been used in recent years in a punitive
manner against low-income housing providers resulting in displacement of
a significant number of innocent "protected class' tenants from their
homes. This policy continues in the City. Minneapolis requires rental
housing providers to acquire a separate license for each rental home. If a
housing provider loses just two licenses, the City revokes all remaining
licenses which thereby forces the displacement of numerous other
innocent tenants who live in "safe, decent and sanitary housing" by federal
definition. See Minneapolis Code of Ordinances, Title 12, Chapter 244,
Article XVI.
Ron and Julie Folger. In the case of Complainants Ron and Julie Folger,
following the loss of two rental licenses under the City's oppressive
regulatory scheme, the City acting under Chapter 244 of its Code revoked
all 16 remaining rental licenses on Folgers' remaining 16 low-income
rental homes. The City's actions forced all tenants and families from those
16 homes. Almost all of Folgers' displaced tenants were minorities.
Formerly affordable homes occupied by "protected class" members were
forced into illegal rental status by City officials. The City's actions denied
housing to "protected class" members occupying Folgers' rental homes.
Minneapolis took these punitive actions despite a continued affordable
housing crisis in the City where affordable low-income rental housing for
protected class members is in great demand and thousands of poor
families, most of whom are "protected class" members, are waiting for
affordable and available housing. Like other Complainants targeted by
Minneapolis for punitive code enforcement measures, F olgers have
sustained substantial monetary losses as a direct result including
completely being eliminating from providing any rental housing in the
City for at least five years.
Spiros Zorbalas. During 20 II through present, Minneapolis has sought to
apply its rental license revocation policy to a second low-income rental
housing provider in the City. This large owner has over 40 rental
properties, housing approximately 2,000 families. The owner, Spiros
Zorbalas appealed the City's decision to revoke three (3) of his rental
licenses but was unsuccessful in the Minnesota Appellate Courts where
the standard of review distinctly and overwhelmingly favors
municipalities' decision no matter what affirmative obligations these cities
have under the Fair Housing Act, HUD regulations and funding
certifications. The City has continued to threaten revocation of all rental
licenses Zorbalas holds in the City.
Minnesota Tenants Union's Opposition to City's Rental Licensing
Revocation Policies. Press accounts reveal that there has been
considerable opposition from the Minnesota Tenants Union and other
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Rock oj Ages Missionary Baptist Church, et al. vs. St. Paul and Minneapolis
November 5,2012 .
concerned affordable housing advocates to the City's oppressive license
revocation policies that have such a negative and widespread impact on
"protected class" tenants and housing providers. This opposition has for
the time being spared Zorbalas and his 2,000 tenant families from the
City's regulatory hatchet. However, thousands of tenants in the City
continue to live in fear of being displaced because of Minneapolis'
vendetta against selected low-income housing providers like Zorbalas,
Folgers, other Minneapolis Complainants and other private low-income
housing providers;
(2) Confiscatory administrative fees, penalties and assessments,
including vacant building registration fees against Complainants and other
low-income housing providers that cause Complainants and other
providers to cut hours of their workers and leave homes sit vacant for
years. These City policies deny housing to protected class members;
(3) Condemnations. Minneapolis continues a policy of condemning
safe, decent and sanitary housing stock without a legal basis under the
Minnesota State Building Code or under the federal minimum housing
standards, "HQS". Minneapolis, in cooperation with a private energy
company, condemns homes without any legal basis or for simple, quickly
correctable items. In each case, the City immediately levies its
oppressively high vacant building fees on the housing provider and refuses
to lift the condemnation orders even though licensed contractors quickly
remedy any legitimate code issues. These punitive City actions take
affordable rental homes off-line for extended periods of time and result in
unavailable housing even though such housing is "safe, decent and
sanitary" under State law and the federal minimum HQS;
(4) Repeated, retaliatory City inspections frequently occur on the same
property, sometimes three times in one year with unannounced inspections
by numerous City personnel;
(5) Excessive inspection fees, permit fees, fines and assessments,
including for tenant caused damage and conduct;
(6) Heavy City administrative burdens in providing the City with
management plans and other related documentation for only one incident
of claimed "disorderly behavior" at a rental property. City policy does not
require a conviction of a tenant or guest for the claimed disruptive or
illegal behavior. City policy requires the housing provider to have a
computer for constant email communications with City police even if only
one claimed event occurred at the subject property;
(7) City administrative hearings on claimed code violations and related
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penalties, fines and assessments lack fairness and due process protections;
(8) City threats to revoke rental licenses when housing providers are
challenging property taxes in Minnesota Tax Court;
(9) City hair trigger condemnations and demolitions on low-income
rental properties even though such properties are affordable, safe, decent
and sanitary and occupied predominately by "protected class" members.
Where owners have made substantial investment in capital improvements
and repairs to older buildings, Minneapolis takes accelerated action to
penalize owners and remove affordable housing stock owned by the
private market. Where the owner could, without City interference, quickly
make repairs required to the property by the State Building Code, Section
8 HQS, or the City's legitimate code provisions, Minneapolis is quick to
order demolition and assess fines and penalties and thereby make such
housing unavailable;
(10) Different City vs. Federal Minimum Housing Codes. Minneapolis
applies City Code standards to Complainant's rental properties already
compliant with federal minimum housing standards under the Section 8
HQS program. Correction orders, fines and assessments are levied by the
City for failure to meet the City's higher minimum standards;
(II) Minneapolis selectively targets low-income privately owned rental
properties and their owners for code enforcement including oppressively
heavy fees, fines and assessments. Neighboring properties with similar
physical conditions and claimed code violations are not targeted by City
inspectors; and
(12) Preferential Treatment to Other Property Owners. Minneapolis
Public Housing rental properties with similar physical conditions. and
tenant and guest behavior problems are not targeted or in other ways
penalized no matter the seriousness of the code violations or behavior
issues at MPHA properties.
St. Paul and Minneapolis Housing Policies Act As Disincentive
to Low-Income Private Housing Providers
St. Paul and Minneapolis' oppressive laws, regulations, policies and practices
have acted and continue to act as a significant disincentive to Complainants and others in
the private low-income housing market to continue providing low-income rental housing
in these cities and/or to enter the market or to expand the number of low-income housing
units in these cities, in order to meet the high demand for such housing.
Respondents' public sector actions negatively affect the "return on investment" to
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Complainants and others in the private market providing critically needed affordable
housing in both cities. HUD requires St. Paul and Minneapolis to include this analysis in
their "AIs" but the Cities intentionally omit this required analysis.
St. Paul and Minneapolis - Forced Gentrification
Respondents' housing laws, regulations, policies and practices have reduced and
continue to reduce the affordable housing stock that is primarily used by "protected
class" members in the inner-city areas of these Cities. Respondents are forcibly
gentrifying and thinning-out these minority communities and displacing "protected class"
members from these development zones.
Respondents' actions result in the "thinning out" of available older rental housing
stock and the forced gentrification of the inner-city areas through new construction of a
limited number of replacement residential units, frequently with mixed income units,
deed restrictions on properties prohibiting rentals, expansive commercial developments
overlapping the former affordable housing footprint, and the rise in property values and
related loss of affordability of housing for the low, very low and moderate income
persons in those areas. The majority of residential occupants in these targeted areas are
'protected class" members who will continue to bear the brunt of the negative, "disparate
impacts" of Respondents' policies.
St. Paul and Minneapolis' Public Sector Actions Pemetuate Segregation
Furthermore, Respondents' public sector actions are perpetuating segregation by
forcibly pushing concentrations of minority individuals and families farther from the
newly developed inner-City commercial corridors, all the while maintaining the
segregation but simply transferring such segregation farther from the downtown areas of
St. Paul and Minneapolis to the outer reaches of City limits.
St. Paul and Minneapolis Public Housing Agencies Are
Largest Low-Income Landlords In The Metro Twin Cities
Respondent Cities provide affordable, federally subsidized rental housing through
their sister govenunent agencies, the Saint Paul Public Housing Agency ("SPPHA") and
the Minneapolis Public Housing Agency ("MPHA"). SPPHA and the MPHA are the
largest low-income landlords in these Cities with close to a billion dollars in public
housing infrastructure including high-rise towers, town home developments, and
scattered site homes across the City. MPHA owns and manages over 6,000 public
housing rental units consisting of 42 high-rise apartment buildings, 753 single family
homes scattered across Minneapolis ranging from 2-6 bedrooms for adults with
dependents, and 184 town home units. SPPHA owns and manages 16 high-rise
apartment buildings, 1,338 units offamily development sites and duplex clusters, and 421
scattered sites homes across St. Paul.
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SPPHA and MPHA's rental businesses provide affordable housing to low-income
individuals and families, including to minorities and the disabled.
However, Complainants and other Section 8 and low-income housing providers in
St. Paul and Minneapolis actually provide a higher percentage of units to "protected
class" members than Respondents' public housing agencies. The privately-owned
housing market is essential to meet overall federal housing policies.
St. Paul and Minneapolis' public housing agencies rely on federal funding for
approximately 85% of their yearly operating budget, including maintenance and capital
improvements. For example, in 2009, MPHA received over $115 Million in federal
grants.
Like all publicly owned rental businesses across the country, the Public Housing
Agencies in St. Paul and Minneapolis are consistently under-funded, run their operations
under constant financial cutbacks and related pressures, have inadequate funds for
property maintenance, repairs and capital improvements and therefore are forced to
prioritize the maintenance, repairs and capital improvements to meet budget constraints.
The Respondents and their public housing agencies recognize that PHA rental
properties are subject to all the same housing, fire, safety and other codes as the private
owners oflow-income housing.
Nevertheless, Respondent Cities apply a different, preferential standard of City
codes and code enforcement to their sister government agencies who are in competition
with Complainants and other low-income housing providers for tenants in the lowincome
marketplace.
St. Paul and Minneapolis Use Police Power To Target Their Competition
St. Paul and Minneapolis have a systemic and particularized policy and practice
of targeting low-income, older, privately-owned rental properties for elevated building
standards and heavy code enforcement.
Yet, Respondents do not apply these onerous and illegal code policies set forth
above to their sister government agencies even though the PHAs have a significant
volume of documented serious code violations in their older housing stock and serious
tenant and guest behavior problems that are used by Respondents as an excuse to target
private providers.
While each PHA consistently performs in a satisfactory manner during preannounced
federal housing inspections, the housing conditions inspection results do not
demonstrate a lack of code issues but rather a normal state of repair and disrepair and
needed maintenance and improvements that are typical for a low-income housing
provider with older housing stock.
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Public Housing Agencies Considered "Problem Properties"
Respondents' PHAs have tenant and guest behavior problems that lead to forcause
terminations and evictions. SPPHA for example, has acknowledged that the City
of St. Paul and SPPHA have labeled SPPHA rental properties as "problem properties"
when considering tenant behavior problems.
Low-Income and "Protected Class" Tenants Occupying Privately
Owned Housing Units and Seeking Such Housing Are Negatively Impacted
The fact that Respondents fail to apply their onerous, oppressive statutory and
regulatory housing code practices and schemes against their PHAs' housing stock,
coupled with Respondents' intentional failure and refusal to conduct legitimate "Als",
demonstrates the knowledge by City officials that such public sector actions directed
against the private market are contrary to federal and state law, illegal in all respects and
would have a negative and disparate impact on "protected class" members occupying
City owned housing.
Respondents Apply Higher City Code Policies Than Required
Under Section 8 Housing Ouality Standards
As part of the Section 8 Housing Choice Voucher program, Complainants open
their rental units to periodic inspections conducted by local Public Housing Agency
inspectors using the federally mandated minimum housing standards called, "Housing
Quality Standards" ("HQS"). See 24 CFR 982.401. Complainants' Section 8 rental
units must pass the federal HQS in order to qualify these rental units as "safe, decent and
sanitary" and receive federal rent subsidies.
A federal, uniform minimum housing standard ("HQS") ensures Section 8 rental
units are "safe, decent and sanitary" across the country but restricts local communities
from raising housing standards higher than necessary. It is generally .acknowledged by
housing experts and public officials that when housing standards are too high, the
elevated standards will cause displacement of tenants, disincentives to private housing
providers and abandonment of critically needed affordable urban housing.
Federal Section 8 Program Requires Reasonable Standards
Section 8 housing standards do not require housing conditions to be free from all
defects. For example, the federal Section 8 HQS provisions provide:
Ceilings, walls, and floors must not have any serious defects such as severe
bulging or leaning, large holes, loose surface materials, severe buckling,
missing parts, or other serious damage (emphasis added).
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Congressional Policy to Encourage Private Owner Participation
Congress encourages private housing providers to participate in the Section 8
program because of limited federal funding and high demand for affordable housing.
Congress and Respondent Cities claim that, "Private property owners are a vital partner
in the Section 8 Housing Choice Voucher Program" and Congress, HUD and Respondent
Cities encourage Complainants and other private rental property owners to "partner with
us to provide decent, safe and affordable housing to low income families". Seehttp://www.stpaulpha.org. The MPHA website encourages private owners to participate
in Section 8 stating that benefits include, "more consistent, timely and full payments to
owners" and "periodic inspection of the unit helps to alert owners of required and/or
recommended repairs". See http://www.mphaonline.org.
SPPHA has stated that a number of important societal goals are met when private
owners of low-income rental stock participate in the Section 8 program: (1) provides
more opportunity and choices for very low and low-income people throughout the City;
(2) increases the chances for a voucher holder to find a unit that is close to their job,
daycare, or bus line; and (3) stabilizes families in affordable housing.
Low-income housing providers are encouraged by Congress and HUD to accept
Section 8 vouchers in order to promote "housing choice" and "locational choice" of
voucher holders and to maximize the opportunity to utilize their vouchers in the
community of their choice.
City vs. Federal Inspection Standards
Application of uniform minimum housing quality standards is necessary to
promote availability of affordable housing, including Section 8 housing. For example, in
1972 the State of Minnesota adopted a minimum state building code for purposes of
uniformity and to promote affordable housing. [See Minn. Stat. §§16B.59 - 16B.75, now
§§326B.101 - 326B.194J. St. Paul and Minneapolis subsequently adopted the State
building Code.
In St. Paul and Minneapolis Section 8 housing providers must present their rental
units for two separate inspections: The City based rental licensing/certificate of
occupancy inspection programs; and the Section 8 HQS inspections.
Where low-income housing providers must not only meet the federal minimum
housing maintenance standards ("HQS") but also higher local building and housing codes
in order to provide rental housing, a number of problems are created that negatively
impact the availability of housing and housing choice. HUD recognizes the conflict that
may arise from two competing inspection standards as HUD will not approve a
substitution of a local housing code for the federal minimum HQS if HUD believes the
local code provisions would severely restrict housing choice due to unnecessarily
elevated building and housing code standards.
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St. Paul Study - City Code 82% More Stringent Than Federal Code
In 1994, St. Paul proposed to its SPPHA that the City's Property Maintenance
Code be substituted for the federal minimum HQS. The City and SPPHA discovered that
the City's code was actually "more stringent" 82% of the time when compared to the
federal code. In 1995, St. Paul was informed that HUD tightly controlled 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. Al Hester of the SPPHA informed City
officials that "[L )ocal HUD stafffeared more stringent standards would reduce the supply
of affordable housing for Sec 8 holders".
Local Code Standards Lead to Abandonment, Exceed Reasonable Protection,
Increase Costs and Pose A Barrier to Affordable Housing
During 2002 through 2007, St. Paul recognized that application of higher building
standards and increased code enforcement could potentially lead to wholesale
abandonment of properties in the inner-city. See Gallagher, et aI., supra.
Over a decade ago, the Metropolitan Council determined that local municipal
regulations, ordinances and fees, as well as administrative practices, may exceed
reasonable protection of public health and safety and contribute to housing costs issues.
St. Paul recognized in 2000, 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 an example of a barrier to affordable
housing.
In 215 Alliance, et al. v. Andrew Cuomo, et aI., (Minnesota District Court No. 98-
64, 1999), Judge Donovan Frank stated that:
HUD has recognized that a disproportionate number of low-income tenants are
minority, elderly, or disabled [and) minority, elderly, and disabled tenants face
significant hurdles in locating housing above and beyond the mere shortage of
low-income housing ... Despite the nominal protection offederallaws, minority
tenants continue to experience discrimination by landlords and hostility from nonintegrated
communities .... Any policy which results in the displacement of lowincome
tenants will disproportionately affect these particular low-income citizens
whose housing options are especially constrained.
Despite the knowledge that application of higher City code standards would
jeopardize existing affordable housing stock, displace protected class members from their
homes and lead to other negative results, St. Paul and Minneapolis have continued for
years to implement building code standards and enforcement that is more stringent than
the federal minimum housing standards found in HQS and failed at the same time to
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conduct the Analysis of Impediments to Fair Housing required by their HUD funding
Certifications.
St. Paul and Minneapolis have a history of interfering with the "safe, decent and
sanitary" federal minimum standards by requiring higher building, fire, safety and
maintenance standards than required by Section 8 HQS and allowed by the Minnesota
State Building Code and State appellate court decisions.
SPPHA Adopts Higher St. Paul Code Without Analysis ofImpediments
SPPHA requires private providers of Section 8 housing to "have units which meet
the Saint Paul Housing Code or federal standards established for the program, where the
latter may exceed the housing code". Thus, where the City's Housing related codes are
higher than the federal minimum housing quality standards, SPPHA requires
Complainants and other Section 8 providers to meet the higher City code provisions.
Complainants and other Section 8 providers have experienced since 2007 and
continuing through present that SPPHA has raised HQS standards to meet St. Paul's
higher code standards.
At no time since 1995 has either St. Paul or SPPHA conducted an "analysis of
impediments to fair housing" related to their agreement to adopt and implement the
City's higher code standards to Section 8 properties including those properties that are
available for Section 8 Voucher tenants who are seeking private Section 8 housing.
The higher City code standards have adversely impacted housing choice and
locational choice, as the St. Paul PHA had stated would be the result. By applying
higher City code standards than the HQS minimum housing standard, Respondent Cities
have negatively impacted the incentives for providers of Section 8 housing and
negatively affected the return on investments, both of which are stated concerns of
Congress and HUD as part of their policies of encouraging private market participation in
the Section 8 program.
Respondent Cities Have Failed to Acknowledge Significant Studies and Court Decisions
- Respondents Continue to Violate Affirmative Duty to Further Fair Housing
The 2001 Regional Analysis of Impediments to Fair Housing reported that,
"Some demolition and redevelopment activities undertaken by local units of government
throughout the Twin Cities region have resulted in the displacement of protected class
members and a reduction in the amount of affordable housing available in many
communities. See 2001 "AI", pg. 56.
Eight years later, St. Paul and Minneapolis in their next AI, failed to discuss
demolition activities of St. Paul and Minneapolis even though both Cities had since 2001
continued a high volume of demolition of affordable, rental housing stock on a yearly
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basis. See 2009 Analysis of Impediments.
No update to the 2001 or 2009 Als have been conducted by St. Paul or
Minneapolis on this demolition issue or on any of the other local building, occupancy,
health and safety code topics required by the FHPG.
Minnesota Appeals Courts 2012 Decision -
St. Paul Violated State Building Code
The Minnesota Court of Appeals in early 2012 held that St. Paul had acted
illegally by requiring homeowners to replace egress windows with larger opening
windows because the State Building Code provided grandfathering protection to those
owners. See Builders Association of Minnesota vs. City of St. Paul, Mn. Ct. App., July
23,2012, No. Al 1-2270. The State Building Code allowed an exception from the State
Fire Code requirement for larger windows and openings. Under the State Building Code
provision, an exterior rough opening was not required to be expanded in order to fit the
window size demanded by St. Paul. To meet the City's contrary policy, a contractor
would frequently have to enlarge the exterior rough opening to allow a larger window
assembly. The City's policy caused greater expense to homeowners and as a result,
homeowners were reluctant to replace windows for fear of the added expense. St. Paul
attempted through its egress window policy to skirt the restrictions of the 2008 Minnesota
Supreme Court's decision in City of Morris v. Sax Invs., Inc., 749 N.W.2d 1, (Minn.
2008), where the Court held that local housing code requirements that are different from
State Building Code provisions are illegal.
Complainants believe the City is continuing its illegal policy today despite the
Court of Appeals ruling in BAM
Minnesota Court of Appeals. 2010
Bee Vue vs. City of St. Paul
Respondent St. Paul was handed a defeat in 2010 by the Minnesota Court of
Appeals after the Court reviewed a City demolition order on an affordable rental housing
property owned by Bee and Lamena Vue. The Court noted that the City's decision to
demolish a structure that was substantially complete and compliant with codes for a
claimed "nuisance" based on aesthetic appearance was arbitrary and capricious where the
City had failed to conduct an inspection that would demonstrate the claimed "nuisance".
The Vues were long-term housing providers in the City providing "protected class"
housing primarily to large families with children, and Section 8 voucher holders. The
City claimed the exterior of the home was "ugly" and thus shouldn't be allowed to exist
despite Vues' plan to rent the home to protected class family in the 5-6 bedroom home.
The City has had a shortage of large bedroom homes for over ten years and thousands of
low-income families have waited years for an opportunity to rent such homes in the inner
city. Bee Vue, et al. vs. City of Saint Paul, Mn. Ct. App., April 13, 2010, No. A09-53I.
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United States Federal District Court, Minnesota, 2010-
Michael and Jerin McRath vs. City a/St. Paul
Michael and Jerin McRath, Section 8 landlords in the City of Saint Paul, filed
their federal lawsuit in May 2010 against the City alleging that the City has intentionally
interfered with their Section 8 rental business through misuse of City code enforcement
policies, and thereby shut down rental homes that were approved by Section 8 housing
inspectors as "safe, decent and sanitary" housing under the federal HQS. This lawsuit
also raised and continues to raise the City's failures to Affirmatively Further Fair
Housing by failing to conduct legitimate "AIs" during the period since 2001. Michael
McRath, et al. vs. City a/St. Paul, Minnesota Federal District Court, No. 10-cv-1965.
Gallagher. et al. vs. Magner. City a(S(. Paul, et al.
In 2004 and 2005, twelve (12) St. · Paul low-income rental housing providers
challenged St. Paul's illegal housing code enforcement practices directed at them. The
8th Circuit Court of Appeals determined that the evidence presented by the Plaintiffs
demonstrated that the City's aggressive enforcement of the housing code resulted in
increased maintenance costs, fees, condemnations, vacant properties, forced sales of
properties, actual displacement of "protected class" tenants, decrease in affordable
housing and a disproportionate adverse effect on racial minorities. See Gallagher, el al.
vs. Magner, et al., 619 F.3d. 823 (8th Cir. 2010). By use of the term "aggressive," the
Court was referring to the allegations of illegal code enforcement.
The Gallagher, et al. Court cited the following examples of the City's aggressive
code enforcement behavior to find a prima facie case of disparate impact in support of
Appellants' action for violation of the Fair Housing Act:
The City favored owner-occupied housing over rental housing and the City
increased the level of housing code enforcement targeted at rental properties;
The City raised inspection standards by directing inspectors to "code to the max;"
The City instituted a system for easier reporting of Housing Code violations;
The new Housing Code enforcement system was expected to generate an
additional $500,000 in revenue;
The City increased code enforcement directed at so-called "problem properties"
seeking to compel compliance or force changes in ownership;
The City employed a variety of strategies for renter-occupied dwellings, including
orders to correct or abate conditions, condemnations, vacant building registration,
fees for excessive consumption of municipal services, tenant evictions, real-estate
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seizures, revocations of rental registrations, tenant-remedies actions, and if
necessary, court actions;
The City used a procedure known as "Code Compliance Certification" to require
rental properties to meet current housing and building standards and this allegedly
forced property owners to undertake expensive renovations, especially with
regard to older properties that were exempt from current building codes under
Minnesota law;
The City's explanation is that it targeted properties for code enforcement
occupied mostly by low-income tenants, and that racial minorities were
disproportionately represented as tenants; and
City officials made statements showing a desire and intent to reduce the amount
oflow-income tenants in the City.
The 8th Circuit noted that the common denominator in the Gallagher, et al.
housing providers' affidavits, allegations, and briefs was that St. Paul issued false
housing code violations and punished property owners without prior notification,
invitations to cooperate with the City, or adequate time to remedy code violations.
Punishment included fines, evictions, condemnations, revocation of rental registrations,
and the financial burden of Code Compliance Certification
The Gallagher, et al. housing providers produced owner affidavits describing the
increase in costs to operate their low-income rental properties due to the City'S code
enforcement policies and adverse effect of forced sales and evictions of tenants.
The 8th Circuit concluded that it was the aggressive manner in which the City
enforced its housing and building codes that was at the heart of the Fair Housing claim by
the housing providers and was the trigger for the adverse impact on protected class
tenants. The 8th Circuit noted that St. Paul failed to acknowledge the significant statistical
evidence provided by the housing providers, including from the City's own studies,
reports and other documents, and from HUD's studies and statistics, all supporting the
Court's prima facie findings.
St. Paul and Minneapolis Have Ignored the 8th Circuit's Decision in Gallagher, et al.
For over two years, Respondents have continued to ignore the decision of the 8th
Circuit Court of Appeals in Gallagher, et at. vs. Magner, et al., even though each of
Respondents have a continued obligation pursuant to their HUD funding certifications to
reevaluate their Public Sector actions through legitimate "AIs" as defined by HUD in its
FHPG.
St. Paul and Minneapolis have willfully and intentionally failed to take any action
to comply with their AFFH duties to conduct an analysis of impediments to fair housing
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choice on the issues raised by the Gallagher decision.
St. Paul and Minneapolis continue to ignore all laws and court decisions that
would rightfully restrict their continued illegal public policies negatively affecting
housing for the poor in their cities.
St. Paul Violated Spirit of Fair Housing and Its Affirmative Duty to Further Fair Housing
By Petition to United States Supreme Court in Magner vs. Gallagher
In early February 2011, the City of St. Paul filed a Petition with the United States
Supreme Court in Magner vs. Gallagher, seeking to eliminate "disparate impact" claims
from Fair Housing Act lawsuits. Even though "disparate impact" claims had been
consistently and uniformly litigated as valid claims for over 40 years, St. Paul, for
reasons the public now knows, sought to "gut" the Fair Housing Act.
Complainants submit that the City of St. Paul violated the City'S Affumative
Duty to Further Fair Housing by filing its Petition as such action was not only not in the
spirit of affirmatively furthering fair housing but was done for improper purposes:
(I) St. Paul knowingly challenged "disparate impact" claims that had
for over 40 years been unanimously determined by federal courts as a
legitimate basis for liability under Section 3604 of FHA;
(2) The City knew it had a contractual, statutory and regulatory duty
under its federal funding certifications to not "disparately impact"
protected classes irrespective of Section 3604 liability, and to conduct a
legitimate AI on such issue. St. Paul certified annually to HUD in return
for its receipt of millions of dollars of federal funding that the City would
not disparately impact "protected classes";
(3) St. Paul failed to disclose to Supreme Court that City had a duty
under its federal funding certifications not to "disparately impact"
protected classes;
(4) St. Paul's action of filing its Petition expressly seeking to "gut" the
most effective method of pursuing Fair Housing Act violations by
individuals, private companies, and government entities, violated the
City's duty to affirmatively further fair housing and to not take part in
actions that are not in the spirit of promoting fair housing;
(5) St. Paul's Petition forced the United States Supreme Court to
expend valuable and limited judicial resources on a case the City never
intended to carry to argument and final decision;
(6) St. Paul filed its Petition and continued the Supreme Court appeal
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and forced fair housing advocates across the United States to expend
valuable and limited resources to defend their organizations against the
City's actions;
(7) Sole purpose of St. Paul's Supreme Court Petition in Magner vs
Gallagher was to gain a bargaining chip for the City in two federal False
Claims Act ("FCA") lawsuits filed against the City, including:
(a) a False Claims Act (FCA) action filed against St. Paul by a St.
Paul business owner in 2009 titled, United States of America, ex reI.,
Fredrick Newell vs. City of St. Paul, Case No. 09-cv-1l77 (U.S .
District Court). Newell was seeking on behalf of the United States
government $180 Million in reimbursement from the City for false
certifications by the City under federal Section 3 HUD funding to the
City - the City's violations were confirmed after an extensive HUD
investigation in 2009; and
(b) a second FCA lawsuit against St. Paul and Minneapolis
commenced in early 20 II alleging fraudulent certifications by
Respondents' in their federal grant applications and submissions,
titled United States of America, ex rei. Andrew Ellis, et al. vs. City of
Minneapolis, City of Saint Paul, et aI. , Case No. ll-cv-416 (U.S.
District Court);
(8) St. Paul knew of the first of the two "sealed" False Claims Act
lawsuits against the City well before the City decided to prepare and file
its Magner vs. Galalgher Petition in early 2011. The City purposefully
filed its Magner Petition with the U.S. Supreme Court to coerce the United
States Government into waiving its rights to pursue the City for $180
Million in Section 3 fraud, in return for dismissal of a Petition the City
never intended to pursue to decision before the Supreme Court; and
(9) St. Paul finally admitted on September 25, 2012 that the City
dismissed its Magner vs. Gallagher appeal in return for the United States
Government's agreement not to sue the City directly in the two False
Claims Act lawsuits filed against the City.
The actions of St. Paul in pursuing a litigation strategy in Magner vs. Gallagher,
et al. before the United States Supreme Court wherein the City aggressively sought to
"gut" the Fair Housing Act by eliminating "disparate impact" claims, was contrary to the
obligations of the City and City Officials under the City's HUD funding contracts and
certifications.
Under St. Paul's certifications and submissions to HUD, St. Paul obligated itself
to affirmatively further fair housing, to conduct legitimate "AI," to refrain from
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intentional housing discrimination, to not take public sector actions that would have a
"disparate impact" on protected class members in the City, or to take any action that was
contrary to furthering fair housing or that was not in the spirit of furthering fair housing.
Legal Basis for Complaint
The City of St. Paul and City of Minneapolis, in the administration of their
federal housing and community development funds, have, on the basis of the race, color
and/or disabilities:
(I) made and continue to make housing unavailable in violation of 42 U.S.C.
§3604(a), Fair Housing Act;
(2) discriminated and continue to discriminate in the provision of services or
facilities in connection therewith, in violation of 42 U.S.C.§3604(b), Fair Housing Act;
(3) violated Title VI of the Civil Rights Act of 1964 and regulations promulgated
by the U.S. Department of Housing and Urban Development ("HUD") pursuant to Title
VI;
(4) violated the Housing and Community Development Act of 1974, as amended,
42 U.S.C. §5304(b); and
(5) failed in their obligation to affirmatively further fair housing ("AFFH") as
required by 42 U.S.C. § 5304(b)(2), 42 U.S.C. § 12705(b)(15), and related federal
statutes and regulations.
By engaging in this unlawful conduct, St. Paul and Minneapolis have harmed and
continue to harm "protected class" members, very low, low and moderate income persons
in these cities, similar individuals and families seeking to locate to said Cities and obtain
housing, and Complainants and other low-income housing providers.
Complainants Have Been Damaged
The unlawful "public sector" actions of Respondent Cities have directly and
indirectly damaged Complainants. Complainants seek all damages allowed by the Fair
Housing Act. Complaints damages include but are not limited to, all business damages
suffered by Complainants including unnecessary increased costs and fees, illegal fines
and assessments, unreasonable additional fees, reduced and loss of rental income, loss of
equity in properties, loss of profits, loss of good will, damage to reputation, reduced
interest income, administrative fees and expenses, other business damages, and attorney's
fees and litigation expenses.
37
Housing Discrimination Complaint
Rock of Ages Missionary Baptist Church, et al. vs. St. Paul and Minneapolis
November 5, 2012
Complainants' Request for Relief
Complainants seek a determination by HUD following an investigation that St.
Paul and Minneapolis are in violation of their statutory and contractual duties and
certifications.
Complainants ask that HUD deem Respondent Cities' certifications insufficient to
support their receipt of CDBO funds, HOME Investment Partnership funds,
Neighborhood Stabilization Program funds and all other federal funding applicable to all
civil rights certifications ("HUD funding").
Complainants ask that HUD withhold all said HUD funding until Respondent
Cities meet all of their statutory and contractual obligations, take appropriate actions to
remedy all adverse impacts of such policies and provide full restitution to all victims of
said illegal policies.
Complainants also seek their reasonable attorney's fees and costs and all other
relief available under the Fair Housing Act.
Respectfully submitted,
(john@shoemakerlaw.com)
(paul@shoemakerlaw.com)
7900 International Drive
Bloomington, MN 55425
Phone: (952) 224-4610
Fax: (952) 224-4601
Counsel for St. Paul and Minneapolis Complainants
St. Paul Complainants:
Rock of Ages Missionary Baptist Church
50 I Dale Street
St. Paul, MN 55103
Johnny Earl Howard, Sr.
638 Van Buren Ave.
St. Paul, MN 55104
38
Reverend Sylvester Davis
50 I Dale Street
St. Paul, MN 55103
Gregory Ryan
2800 Hillscourte South
Roseville, MN 55113
Housing Discrimination Complaint
Rock of Ages Missionary Baptist Church, et 01. vs. St. Paul and Minneapolis
November 5,2012
David Roering
7464 Granada Circle
Cottage Grove, MN 55106
Joseph Egan
5645 Bloomington Ave. South
Minneapolis, MN 55417
Leslie Lucht
1090 Cumberland St.
St. Paul, MN 55117
James Swartwood
5537 Dupont Ave., South
Minneapolis, MN 55419
Minneapolis Complainants:
Ronald Folger
Julie Folger
RBE Properties, LLC
4634 Hamlet Ave., North
Oakdale, MN 55128
Steven Meldahl
SJM Properties
7409 Hyde Park Dr.
Edina, MN 55439
39
Ronald Staeheli
4300 Blackhawk Road
Eagan, MN 55122
Robert Egan
11016 Bluff Court
Burnsville, MN 55337
Ken Johnson
CK Properties, LLC
309 Harrison Ave.
St. Paul, MN 55102
Mahmood Khan
2972 Old Highway 8
Roseville, MN 55113
James Swartwood
5537 Dupont Ave., South
Minneapolis, MN 55419

In a message dated 11/8/2012 11:45:27 A.M. Central Standard Time, grim_63@msn.com writes:

More landlords go after city of St. Paul.

Your message is ready to be sent with the following file or link attachments:
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