604 F.2d 1083 (8th Cir. 1979), 79-1181, Monarch Chemical Works, Inc. v. Thone

Docket Nº:79-1181.
Citation:604 F.2d 1083
Party Name:MONARCH CHEMICAL WORKS, INC., Appellant, v. Governor Charles THONE, Jack Falconer, City of Omaha, a Municipal Corporation, Appellees.
Case Date:August 16, 1979
Court:United States Courts of Appeals, Court of Appeals for the Eighth Circuit
 
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Page 1083

604 F.2d 1083 (8th Cir. 1979)

MONARCH CHEMICAL WORKS, INC., Appellant,

v.

Governor Charles THONE, Jack Falconer, City of Omaha, a

Municipal Corporation, Appellees.

No. 79-1181.

United States Court of Appeals, Eighth Circuit

August 16, 1979

Submitted May 18, 1979.

Page 1084

[Copyrighted Material Omitted]

Page 1085

Annette Mason (argued) of Ross & Mason, Bruce G. Mason, Omaha, Neb., on brief for appellant.

Patrick W. Kennison, Asst. City Atty., Omaha, Neb., argued; Herbert M. Fitle and James E. Fellows, Omaha, Neb., on brief for appellee City of Omaha.

John E. Brown, Asst. Atty. Gen., Lincoln, Neb., argued; Paul L. Douglas, Atty. Gen. and Gary R. Welch, Asst. Atty. Gen., Lincoln, Neb., on brief for appellee Governor.

Before GIBSON, Chief Judge, HEANEY and McMILLIAN, Circuit Judges.

HEANEY, Circuit Judge.

Monarch Chemical Works, Inc., appeals from an order of the District Court, refusing to permanently enjoin the construction of a medium-minimum security prison by the State of Nebraska in the East Omaha area of Omaha, Nebraska. Monarch contends that the construction of this facility without a full environmental review violates the National Environmental Policy Act of 1969 (NEPA), 42 U.S.C. § 4321 Et seq., and the Federal Housing and Community Development Act of 1974, 42 U.S.C. § 5301 Et seq. We affirm.

The history of this case has been fully set forth in two comprehensive opinions of the District Court. 1 We repeat only those facts pertinent to this appeal.

East Omaha is an area within the City of Omaha, consisting of approximately 120 acres of land lying south of Eppley Airfield. The area is characterized by a mix of low density residential, commercial and heavy industrial land uses. It is also characterized by an almost total absence of public improvements such as storm drainage, paved streets and sidewalks.

In an effort to upgrade this area, the East Omaha Redevelopment Plan was adopted by the City in 1976. According to this Plan, residents of the generally substandard housing would be relocated out of the area and the land would be converted to industrial uses more compatible with the general character of the area. Redevelopment was to be accomplished in two phases. Under the first phase, the City planned to acquire 77.76 acres of land through voluntary negotiations with property owners. Any existing housing would then be demolished and the property would be filled and graded for resale to industrial users. Under the second phase, eminent domain proceedings would be instituted against landowners who refused to voluntarily sell, if sufficient interest in their property was shown by potential industrial users. Funds for the acquisition and clearing of the property by the City were to be obtained from the federal government under the Federal Housing and Community Development Act. The paving of streets and the installation of storm and sanitary sewers was to be accomplished through a special assessment levy and through a revolving fund which would use monies obtained from the resale of the property acquired by the City to private industry.

An Environmental Impact Statement (EIS) for the project was completed by the City on February 5, 1976. 2 The EIS was approved by HUD and federal funds were released for the first phase of the project. No challenge to the adequacy of this EIS has been made.

In an unrelated series of events, the Nebraska State Legislature authorized the construction of a medium-minimum security prison to be built in Douglas County, Nebraska. A committee was appointed to select a site; thirty potential sites were reviewed, and a site within the East Omaha redevelopment area was finally selected.

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The Nebraska Department of Corrections then entered into an agreement with the City of Omaha to acquire the tract of land, which extends from East 23rd Street on the west to East 27th Street on the east, and from Woodland Road on the south to "J" Avenue on the north. Under the agreement, the City was to acquire the land within the site from private landowners, with resale to the State. The City was authorized to use eminent domain to acquire the land if voluntary acquisition was not possible. The original redevelopment plan was thus altered in two ways: the acquisition of land owned by existing industry was authorized, and the use of eminent domain was accelerated.

Negotiated attempts to acquire land owned by Monarch within the prison site were then begun by the City. When Monarch refused to sell, eminent domain proceedings were commenced. 3

On November 4, 1977, Monarch filed suit in federal district court, seeking to enjoin the construction of the prison project. Monarch contended that the decision to build the prison without the completion of a new EIS violated § 102 of NEPA, 42 U.S.C. § 4332, since the change from an industrial to an institutional use constituted a "changed circumstance" rendering the original EIS prepared for the East Omaha Redevelopment Plan inadequate.

A preliminary injunction was issued by the District Court on June 13, 1978. The court held that Monarch had standing to sue, and that the redevelopment of the East Omaha area by the City constituted a "major federal action" triggering the requirements of NEPA. Monarch Chemical Works, Inc. v. Exon, 452 F.Supp. 493, 501 (D.Neb.1978). 4 The court held that since the decision to construct a prison facility on the site varied from the original redevelopment plan, the City of Omaha "must make a bona fide evaluation of the sufficiency of the original EIS in light of the changed circumstances * * * , and must establish a suitable record for review purposes." Id. at 501. See 24 C.F.R. § 58.19 (1977). 5 No appeal from this order was taken.

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Pursuant to the order of the District Court, the City prepared an eleven-page "Written Statement," with fifteen exhibits, setting forth the reasons in support of its decision that the change from an industrial to an institutional use was not environmentally significant, and that no new environmental review was required. This "Written Statement" compared the construction of the prison facility with the construction of an industrial building, in the areas of compliance with local zoning regulations, amount of building coverage of the two proposed uses, the effect of both uses on the natural and human environment, the adequacy of sanitary sewers and transportation links for the proposed prison use, the effect of the prison construction on historic property, the effect of noise from Eppley Airfield on the prison and the effect of noise from the prison on adjacent land uses, and the effect of the prison on local air quality. The "Written Statement" concluded that the difference in environmental impact between...

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