Walker v. US Dept. of Housing & Urban Dev.

• Decision Date: 22 September 1989
• Docket Number: No. CA 3-85-1210-R.,CA 3-85-1210-R.
• Citation: 734 F. Supp. 1289
• Parties: Debra WALKER, et al., Plaintiffs, v. UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT, et al., Defendants.
• Court: U.S. District Court — Northern District of Texas

734 F. Supp. 1289

Debra WALKER, et al., Plaintiffs, v. UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT, et al., Defendants.

No. CA 3-85-1210-R.

United States District Court, N.D. Texas, Dallas Division.

August 4, 1989.

Revised September 22, 1989.

Michael M. Daniel, Elizabeth K. Julian and Kenneth L. Schorr, North Central Texas Legal Services, Inc., Dallas, Tex., for plaintiffs.

Arthur Goldberg, Leslie K. Shedlin, Thomas H. Peebles and Jonathan Strong, Dept. of Justice, Civil Div., Washington, D.C., Joseph G. Werner, Haynes & Boone, Marvin Collins, U.S. Atty., and Donald W. Hicks, Hill, Hicks & Collins, Dallas, Tex., for defendants.

MEMORANDUM OPINION-WALKER III: JOINDER OF THE CITY OF DALLAS AS A DEFENDANT SUBJECT TO THE CONSENT DECREE

BUCHMEYER, District Judge.

This is a class action that involves racial discrimination in low-income public housing in the City of Dallas and its suburbs. The original parties were the plaintiff class ("plaintiffs"), the Dallas Housing Authority ("DHA"), and the United States Department of Housing and Urban Development ("HUD").

This opinion,¹ however, concerns the City of Dallas.² And, it holds:

(i) that the City of Dallas will be joined as a party defendant in this case;

(ii) that the Consent Decree approved on Jan. 20, 1987 will be modified so that it is binding on the City of Dallas;

(iii) that the plaintiffs are entitled to summary judgment as to liability against the City of Dallas because the undisputed facts establish that the City was a substantial cause of DHA's deliberate racial segregation and discrimination in its public housing programs in Dallas; and

(iv) the scope of the injunction to be entered against the City of Dallas and the specific modifications that will be made to the Consent Decree — as well as the financial obligations to be imposed upon the City as a result of this opinion — will be determined after a hearing and the presentation of evidence by all parties.

These rulings should come as no surprise. In April of 1988, the "Housing Mediation Team" appointed by the Mayor recommended that "the City of Dallas should voluntarily agree to enter into the Walker v. HUD Consent Decree," stating:

"... We believe that there is strong sentiment by all parties with whom we have talked that the City has had an active, historical involvement in the DHA's operations and, therefore, bears some responsibility for the condition of public housing in Dallas. As a result, we have concluded that the City will be brought into the lawsuit involuntarily and will likely face enormous legal expenses in its defense. If the City is found liable, it then faces the likelihood of considerable financial outlays. It is for these reasons that we believe the City should enter the Consent Decree voluntarily."

To show why the City of Dallas should be joined as a defendant in this case subject to the Consent Decree — and why summary judgment as to liability should be entered against the City — this opinion will discuss (i) the procedural history, (ii) the relationship between DHA and the City, (iii) the long, unbroken history of deliberate segregation and discrimination in public housing by DHA and by the City of Dallas (iv) the conduct of the City and its officials concerning the Consent Decree, and (v) the applicable law.

I. The Procedural History

The complete procedural history of this action — both before and after the original parties settled the case with a Consent Decree approved by the Court on Jan. 20, 1987 — is detailed in the Walker I companion opinion. However, these additional facts are necessary to show the procedural setting for this opinion.

On Sept. 8, 1988, the plaintiffs filed a Motion to Modify the Consent Decree and to Enjoin the City of Dallas.³ Then, on Dec. 21, 1988, the plaintiffs filed an "alternative" Motion to Add the City of Dallas as a Party Defendant (and to file a Supplemental Complaint against the City). Both motions sought injunctive relief against the City of Dallas for the following reasons:

"1) There is a need for additional resources to accomplish the purposes and programs of the Consent Decree,

"2) The City of Dallas has a legal obligation to assist in the disestablishment of the racial segregation in DHA's programs and the housing patterns of the City of Dallas "3) The City of Dallas has opposed and attempted to obstruct the operation of the Consent Decree,

"4) The City of Dallas was a substantial cause of the creation and maintenance of racial segregation and discrimination in the housing assistance programs administered by the Housing Authority of the City of Dallas DHA."

The City of Dallas filed its reply to the plaintiffs' first motion (the motion to modify the Consent Decree) on Oct. 7, 1988. However, the City did not respond to the second motion (the motion to add the City as a party defendant); instead, it simply filed an answer to the plaintiffs' Supplemental Complaint on Jan. 11, 1989.⁴

On Dec. 12 and 14, 1988, a hearing was held on the plaintiffs' Motion to Modify the Decree and to Enjoin the City of Dallas.⁵ The evidence presented at that time primarily concerned the plaintiffs's liability claims against the City, and it did not focus on what specific relief should be granted. However, the plaintiffs sought a broad injunction which would:

(i) prohibit the City of Dallas from racial discrimination in "housing-related actions" and from obstructing the operation of the Consent Decree;

(ii) require the City to provide a "local program of housing assistance that meets the replacement housing requirements of 42 U.S.C. § 1437p" for the units to be demolished at the West Dallas Project;⁶

(iii) require the City to provide "the counseling and transportation services" necessary to help black families move to non-minority areas in Dallas and its suburbs under DHA's § 8 assistance program;⁷

(iv) require the City to improve the "facilities and neighborhoods of DHA's family housing projects" so they are equal to the facilities and neighborhoods of the "predominately white-occupied HUD assisted projects"; and

(v) require the City to implement an effective code enforcement program "to eliminate substandard conditions" at DHA's public housing projects and § 8 assisted units.

The plaintiff's Dec. 21, 1988 motion (to add the City as a party defendant) was expressly based upon the testimony and exhibits presented at the Dec. 12, 1988 hearing. This was also true of the plaintiffs' motion for summary judgment (also filed Dec. 21, 1988). And, the response by the City of Dallas to this summary judgment motion was based upon "the exhibits and testimony admitted into evidence at the Dec. 12, 1988 hearing."⁸

II. Relationship Between DHA And The City of Dallas

1. The City's Control of DHA In General

In 1938, DHA was created by the City of Dallas under Texas law. The five-member Board of Commissioners, which has responsibility for the operation of DHA, is appointed by the Mayor of Dallas.⁹ The relationship between the City and DHA was correctly described by City Council Member Lori Palmer:

"So while it is true that there are times when public officials in the City Council claim we have no direct responsibility or authority over that (DHA) board, that is not true. As a matter of fact, we make those appointments. And I have no doubt whatsoever that the policies and traditions which have been developed by the Dallas Housing Authority are a direct reflection of what has been the spoken or unspoken political climate in the city. I do not think that the DHA has been out on a limb in the development of those policies over many years."

Similarly, DHA Executive Director Jack Herrington testified that, in his experience, "members of the DHA Board have been responsive to the Mayor who appoints them."

In addition, under the "Cooperation Agreement" between the City of Dallas and DHA,¹⁰ the City agrees to "cooperate with DHA by such action as the City and DHA may find necessary in connection with the development and administration of the public housing" in Dallas. Accordingly, the City has described its relationship with DHA in this manner:

"The Housing Authority of the City of Dallas was created by City Council resolution. It provides a specific public service in response to a need found by the Dallas City Council. State law recognizes this relationship as different from relationships the City has with other legal entities or governments.... The Authority is, in effect, an `arm of convenience' of the city government."¹¹

Recognizing that DHA has no power to levy taxes, the City of Dallas has provided assistance to DHA in numerous ways, including: performing many of the Housing Quality Standard inspections for DHA's § 8 program; acting as a co-administrator of DHA's § 8 Moderate Rehabilitation Program; and providing relocation services for residents displaced by DHA's acquisition of land for its projects.

More significantly, the City of Dallas — through its employees, as well as the Mayor and members of the City Council — has directly intervened in the operations of DHA and has, on numerous occasions directed DHA to take certain actions.¹² Examples of this control which the City of Dallas has historically exercised over DHA include:

... the City's selection of sites for DHA's public housing;

... its direction that DHA construct the 3500-unit West Dallas Housing Project; and

... the City's placement of one of its own employees into the position of Executive Director of the DHA.

These and many other situations in which the City exercised control over DHA are discussed in part III ("Deliberate Segregation in Public Housing by DHA and by the City of Dallas").

2. The City's Responsibility Under the CDBG Program to Prevent Discrimination by DHA

Since August of 1974, the City of Dallas has participated in the federal Community Development Block Grant ("CDBG") program, which is administered by HUD. By 1988, the City had received $195 million in CDBG...