American Atheists, Inc. v. Detroit Downtown Development Authority, No. 07-2398.

• Court: United States Courts of Appeals. United States Court of Appeals (6th Circuit)
• Writing for the Court: Sutton
• Citation: 567 F.3d 278
• Parties: AMERICAN ATHEISTS, INC.; Steve Walker; Law Offices of Dennis G. Vatsis, P.C.; Dennis G. Vatsis, Plaintiffs-Appellants/Cross-Appellees (07-2398), v. CITY OF DETROIT DOWNTOWN DEVELOPMENT AUTHORITY, Defendant-Appellee/Cross-Appellant (07-2400), St. John's Episcopal Church, Intervening Defendant-Appellee/Cross-Appellant (07-2445).
• Decision Date: 28 May 2009
• Docket Number: No. 07-2400.,No. 07-2445.,No. 07-2398.

567 F.3d 278 AMERICAN ATHEISTS, INC.; Steve Walker; Law Offices of Dennis G. Vatsis, P.C.; Dennis G. Vatsis, Plaintiffs-Appellants/Cross-Appellees (07-2398),
v.
CITY OF DETROIT DOWNTOWN DEVELOPMENT AUTHORITY, Defendant-Appellee/Cross-Appellant (07-2400),
St. John's Episcopal Church, Intervening Defendant-Appellee/Cross-Appellant (07-2445). No. 07-2398. No. 07-2400. No. 07-2445. United States Court of Appeals, Sixth Circuit. Argued: March 5, 2009. Decided and Filed: May 28, 2009.

[567 F.3d 281]

ARGUED: Robert James Bruno, Robert J. Bruno, Burnsville, Minnesota, for Appellants. Frederick A. Berg, Kotz, Sangster, Wysocki & Berg, P.C., Detroit, Michigan, Dale M. Schowengerdt, Alliance Defense Fund, Leawood, Kansas, for Appellees. Richard Brian Katskee, Americans United for Separation of Church and State, Washington, D.C., Lowell V. Sturgill, Jr., United States Department of Justice, Washington, D.C., for Amici Curiae. ON BRIEF: Robert James Bruno, Robert J. Bruno, Burnsville, Minnesota, for Appellants. Frederick A. Berg, Kotz, Sangster, Wysocki & Berg, P.C., Detroit, Michigan, Joel Lee Oster, Kevin H. Theriot, Alliance Defense Fund, Leawood, Kansas, for Appellees. Lowell V. Sturgill, Jr., Robert M. Loeb, United States Department of Justice, Washington, D.C., Jessica C. Abrahams, McKenna Long & Aldridge LLP, Washington, D.C., Philip W. Horton, Arnold & Porter LLP, Washington, D.C., for Amici Curiae.

Before: KEITH, SUTTON, and GRIFFIN, Circuit Judges.

OPINION

SUTTON, Circuit Judge.

As part of its efforts to revitalize the local economy, the City of Detroit in the late 1990s built a new stadium, Comerica Park, for its professional baseball team (the Tigers) and a new stadium, Ford Field, for its football team (the Lions). Soon after completing the stadiums (stadia if you like), Detroit sought to feature them by putting in bids to host the Super Bowl for the National Football League, the All-Star game for Major League Baseball and most recently the Men's Basketball Final Four for the National Collegiate Athletic Association.

When the first of these bids succeeded— when the NFL in 2002 agreed to hold the Super Bowl at Ford Field in 2006—the City began to prepare for the event. In 2003, it created a development program, empowered to reimburse up to 50% of the costs of refurbishing the exteriors of downtown buildings and parking lots. The program was limited to property in a discrete section of downtown Detroit but reached

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out to all property in that area, including property owned by religious organizations. Three churches participated in the program: a Methodist church, a Baptist church and an Episcopal church. Of the $11.5 million allocated for completed and authorized projects, 6.4% (or about $737,000) went to these churches.

The question at hand is whether the Establishment Clause of the United States Constitution, or its counterpart in the Michigan Constitution, prohibits the City from including religious organizations in the program. The lead plaintiff, American Atheists, maintains that they do, and it filed this lawsuit to enjoin the agency from making any grants to religious entities. The district court rejected these arguments in large part, and we reject them in full.

Everyone agrees that the program allocates benefits to a broad spectrum of entities on a neutral basis, as the City awards grants without regard to the religious, non-religious or areligious nature of the entity. The facial neutrality of the program, everyone also agrees, does not mask an intent to advance religion: Detroit sought to fix up its downtown, not to establish a religion. And as will generally be the case when a governmental program allocates generally available benefits on a neutral basis and without a hidden agenda, this program does not have the impermissible effect of advancing religion in general or any one faith in particular. By endorsing all qualifying applicants, the program has endorsed none of them, and accordingly it has not run afoul of the federal or state religion clauses.

I. A.

An agency of the City of Detroit, the Downtown Development Authority was created in 1976 "to halt property value deterioration in the downtown business district, to eliminate the causes of such deterioration, and to promote economic growth in the downtown business district." JA 841. In pursuing these goals, the agency may draft, propose and implement development plans for the economic growth of downtown Detroit, Mich. Comp. Laws § 125.1657(1)(c), (e)-(f), all of which must be approved by the Detroit City Council, and all of which must relate to a defined section of downtown Detroit, id. § 125.1653(4).

In 2003, the agency proposed, and the City Council approved, the Lower Woodward Facade Improvement Program. One among many "initiatives" to revitalize downtown Detroit, the program was designed to enhance the visual appearance of the downtown area by "encourag[ing] improvements to building facades and upgrades to edges of surface parking lots." JA 1115. In addition to preparing the city for the influx of visitors that would descend on Detroit for the 2006 NFL Super Bowl, and eventually the 2005 Major League Baseball All Star Game and the 2009 NCAA Men's Basketball Final Four, the agency believed that the program would "increase the sense of security, community, and continuity for existing and future developments" and "increase revenue at existing downtown business locations." JA 781.

Under the program, the agency allocated reimbursement grants, funded by local property-tax revenues, to property owners and tenants who owned or leased property within the program area and who made approved renovations to their buildings and parking lots. Qualified applicants were reimbursed for 50% of the costs of the renovations, subject to caps of $150,000 per building and $30,000 per parking lot.

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Anyone who owned or leased property within the program area—mainly a nine-block area between Campus Martius Park and Grand Circus Park—could apply for a grant, so long as the applicant was current on its state and local taxes and initially could fund the project on its own. Although the program limited applicants to one grant per building or parking lot, applicants could receive multiple grants if they owned or leased multiple properties within the area.

The agency established guidelines for making the grants. As to buildings, applicants could receive grants for "[p]ermanent physical improvements" to "building facades generally visible from a public right-of-way," JA 1120, such as renovations to storefront windows, exterior-lighting fixtures, masonry, brickwork, awnings, shutters, exterior doors, windows and signs. As to parking lots, applicants could receive grants for installing "fencing, brick piers, new curbs, new approaches, shrubbery, irrigation, lighting and other upgrades along the street-side edges of parking lots." JA 1121.

In reviewing grant applications, the agency ensured that proposed projects conformed to the "[p]rogram's design guidelines and objectives." JA 1126. Applicants had to describe the project in detail, estimate the project's cost and prove that they initially could finance the project in full. After the program manager verified that information, the applicant selected a firm to prepare a conceptual design of the project. Once the program manager, a design-review committee and the agency's board of directors approved the design, the applicant and the agency executed a reimbursement contract, in which the applicant agreed to complete the project and pay all of the costs of doing so, and the agency agreed to reimburse 50% of the approved design and construction costs (up to the $150,000 and $30,000 limits). Applicants became eligible for reimbursement after they completed the construction and after the agency verified that the project was constructed "in accordance with approved design documents," JA 1129, and the applicant had paid the contractor in full.

B.

All told, during the two and a half years of the program's existence, the agency received 204 grant applications, and 189 of them met the program's eligibility requirements. The agency approved 123 projects, and the applicants completed 91 of these projects, at a total cost to the agency of $11.5 million.

Of these 91 projects, nine involved renovations to buildings and parking lots owned by three downtown Detroit churches. Central United Methodist Church received four grants: one for repairs to the exterior of the church (including renovation of the building facade, entry door, outdoor sign, steeple clock and light fixtures); another for similar repairs to the church's activities building; and two more for improvements to the church's parking lots. Second Baptist Church received four grants: one for repairs to the exterior of the church (including renovation of the brick facade, the glass covering some stained glass windows, the exterior doors, the outdoor sign and the building trim); two more for similar repairs to two other church-owned buildings; and a fourth for improvements to the church parking lot. St. John's Episcopal Church received one grant for repairs to the exterior of the church and to the parking lot, including funds for the renovation of a stone wall, metal fence and entranceway canopies, installation of a new church sign and replacement of a protective glazing over some stained glass windows.

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The remaining 82 projects covered a range of improvements to downtown Detroit, including grants to a music hall, a bank, a hotel, an opera house, a theater and an apartment building. The three churches received about $737,000 from the agency—what comes to 6.4% of the $11.5 million in reimbursements.

C.

American Atheists, a non-profit organization that denies the existence of a deity and that "is dedicated to the separation of church and state," JA 913, along with one individual member of the organization, another...