Hallmark Developers v. Fulton County, Georgia, CIV.A.1:02-CV1862ODE.

• Citation: 386 F.Supp.2d 1369
• Decision Date: 12 September 2005
• Docket Number: No. CIV.A.1:02-CV1862ODE.,CIV.A.1:02-CV1862ODE.
• Parties: HALLMARK DEVELOPERS, INC. and Charles Garrison; Plaintiffs v. FULTON COUNTY, GEORGIA, Defendant
• Court: United States District Courts. 11th Circuit. United States District Courts. 11th Circuit. Northern District of Georgia

386 F.Supp.2d 1369

HALLMARK DEVELOPERS, INC. and Charles Garrison; Plaintiffs v. FULTON COUNTY, GEORGIA, Defendant

No. CIV.A.1:02-CV1862ODE.

United States District Court, N.D. Georgia, Atlanta Division.

September 12, 2005.

Kathryn M. Zickert, Linda Irene Dunlavy, Marcia M. Ernst, Smith Gambrell & Russell, Atlanta, GA, for Plaintiff's Attorney.

Larry Wayne Ramsey, Jr., Overtis Hicks Brantley, Steven E. Rosenberg, Valerie

A. Ross, R. David Ware, Office of Fulton County Attorney, Atlanta, GA, for Defendants' Attorney.

ORDER

EVANS, District Judge.

The above-styled action, having come on for trial without a jury on May 31, June 1, and June 2, 2005, and the Court having considered the testimony, exhibits, briefs and arguments of counsel hereby finds and concludes as follows:

I. Background and Procedural Posture

This is a civil suit for declaratory and injunctive relief, as well as for compensatory damages, attorneys' fees and costs, brought pursuant to the Fair Housing Act, as amended, 42 U.S.C. § 3601 et seq. This action stems from the Defendant's denial of Plaintiffs' request to rezone approximately 182 acres of land located in the southwest quadrant of Fulton County ("Subject Property" or "Hallmark development").

On July 3, 2002, Plaintiffs filed the instant lawsuit, asserting that the denial of their proposed development on the Subject Property violates the Fair Housing Act, the Civil Rights Act, and the Fifth and Fourteenth Amendments to the U.S. Constitution and amounts to exclusionary zoning. Plaintiffs also alleged state law claims challenging the constitutionality of the existing zoning classification for the property. Two days later, on July 5, 2002, Plaintiffs filed an identical lawsuit in Fulton County Superior Court asserting the same state and federal law claims as in their federal suit. The state court action was stayed pending adjudication or dismissal of the previously filed federal suit.

Defendant filed a motion for summary judgment which was granted in part. Specifically, the Court granted summary judgment to Defendant on Plaintiffs' federal equal protection and exclusionary zoning claims; held that Plaintiffs' federal takings claim was not ripe and dismissed it without prejudice; and declined to exercise jurisdiction over Plaintiffs' state takings claim. With regard to the Fair Housing Act claim, the Court found that Plaintiffs did not present evidence of discriminatory motive or intent in the zoning decision but denied Defendant's motion in the face of Plaintiffs' evidence that the decision had a disparate impact on African-Americans. Only this latter claim remains for determination.

II. Findings of Fact

The South Fulton County Planning Area is the part of Fulton County which is south of Camp Creek Parkway and Campbellton Road. (Tr. at 413). The South Fulton 2015 Land Use Plan adopted July 7, 1999, updated July 11, 2001, and amended August 7, 2002 covers this area. Pl.'s Ex. 17. The 2000 U.S. Census divided this area into eleven census tracts.¹ The overall population is more than 70% African-American, according to the 2000 Census data. However, four of the census tracts contain much lower percentages of black population, ranging from 31% to 54%. The property at issue in this case is in a tract with 54% black population; an adjoining tract to the east has 87% black population and the adjoining tract to the west is 42% black. South Fulton County, as defined, is sparsely populated when contrasted with nearby municipalities such as East Point, College Park, and Hapeville.² The contrast is even greater if the comparison is with the downtown Atlanta area.

While the South Fulton County Planning Area generally is less affluent than the rest of Fulton County, its black and minority population tends to be as affluent or more affluent than the white population. This is true for 10 of the 11 census tracts, including the one which encompasses the subject property.

The South Fulton 2015 Land Use Plan depicts a wide swath of land along both sides of the South Fulton Parkway which has been slated for mixed use development. It is denominated a Live/Work corridor. The idea is to integrate work places, shopping, entertainment, services, housing and community facilities in a pedestrian friendly environment. (Pl.'s Ex. 18 at 6.3). The uses contemplated for the Live/Work corridor include high density retail, service, office and institutional uses along with multi-family and single-family residential. (Pl.'s Ex. 18 at 6.3). The area currently is rural-residential in character. (Def.'s Ex. 3 at 3). The area is zoned agricultural and the minimum lot size is one acre. Land uses consist of detached single-family homes and vacant land. (Def.'s Ex. 3 at 3). The Subject Property is within the Live/Work corridor on the south side of South Fulton Parkway.

Plaintiffs Hallmark and Charles Garrison acquired the Subject Property via cash purchase (the portion along Koweta Road at $4,000 per acre in 2000, and the portion along Stonewall Tell at $9,500 per acre in 2001) with the express intention of developing a mixed use development, including commercial, office, and residential structures. (Tr. at 45-46, 50). The planned complex was to include 950 residential housing units, partly free-standing homes and partly townhomes/apartments. The development required that the land be rezoned.

Hallmark previously had developed more than 70 subdivisions in Gwinnett County, DeKalb County, Rockdale County, Coweta County, and Fulton County. (Tr. at 32). It has never forfeited a bond or been sued for defective work or development in any of its subdivisions. (Tr. at 39, 41). Its principal, Chris Doughtie, has won numerous awards including Gwinnett County Builder of the Year and several professionalism awards. (Tr. at 41). Since the 1990s, Hallmark has focused on building low-income housing and has been successful in this field. While Doughtie has also built "high end" homes through his other corporations, Hallmark made its reputation for building low-income residences.

At trial Doughtie explained that he considered the term "low income" to be the same as HUD's definition, which is up to 80% of HUD's Adjusted Median Family Income ("HAMFI")(Tr. 69). In 2001-2002, the HAMFI for a family of four in the Atlanta Metropolitan Statistical Area was $71,200.³ The HAMFI is used by HUD to define eligibility for financial assistance in obtaining a mortgage. Hallmark uses the availability of HUD assistance as a selling point for its homes.

As a precursor to seeking rezoning of the Subject Property, Doughtie arranged for Fulton County Commissioner Bill Edwards, Beth McMillan, Joseph Johnson⁴ and their staffs to visit Chestnut Lake, a low-income, single-family subdivision that Hallmark had developed in Dekalb County. (Tr. at 54). Chestnut Lake contains 700 lots. The homes initially were priced in the range of $89,000 to $130,000, but after changes were made the price range was from about $120,000 to $150,000. (Tr. at 43, 55). The majority of the homes had been built by Mayfield Homes, which is owned in part by Doughtie and his son, Sean. (Tr. at 40, 43, 57). During the visit, Doughtie told Edwards and the other County representatives that Mayfield Homes would construct the free- standing homes planned for the Subject Property (Tr. at 111-112) and that these homes would be similar in appearance and layout to those at Chestnut Lake. Photographs of some of the Chestnut Lake homes were introduced into evidence at trial. Doughtie testified that Commissioner Edwards and others in the group expressed general approval of what they saw at Chestnut Lake and that they were receptive to Plaintiffs' plans to emulate it on the Subject Property. (Tr. at 52). Nevertheless, Commissioner Edwards did have some reservations and he also believed that there would be some community opposition to the project.

At trial, Commissioner Edwards testified that his concern with Plaintiffs' proposed development was "quality." (Tr. at 454). He elaborated as follows:

The quality — South Fulton County — this is one of the first zonings we had in South Fulton County. It was around the time when people were really taking a great look at our part of the county. And one of the concerns that — not only that we had, but the community has is the issue of quality, the materials that were used in the house, does it give a community feel, are we using the amenities to give additional quality to the home, those types of things.

* * * * * *

Then you had no ornamental railings.... You had the little wooden porch type deal, one car garage. There was — I didn't hardly see any molding of any type inside the construction. So it was just a very generic type structure.

* * * * * *

The rooms were real small ... really small rooms and kitchen area.

* * * * * * When you looked down the street, you [sic] looking for a wholesome feel for the community. I didn't feel that because all of the houses was of the same elevation, and they just looked like row houses.

(Tr. at 455-458).

Commissioner Edwards encouraged Plaintiffs to work with the community groups to see if they could devise a compromise project that would be acceptable to both. (Tr. at 467). Among the community groups with whom Plaintiffs conferred were the South Fulton Parkway Alliance, the Cliftondale Community Association, and Green South Fulton. (Tr. at 470).

There was community opposition to the rezoning application. The trial record contains the comments community group members made at the rezoning hearings. They objected to the density of the project, the number of apartment units in particular, the lack of two car garages, the smallness of the lot sizes (4,000 to 6,000 square feet), and the fact that the project was focused on lower priced homes and apartments. Plaintiffs' contention that the community groups were motivated by anti-black sentiment was not borne out by any trial evidence.

In October 2001 Plaintiffs filed an...