Gautreaux v. Chicago Housing Authority

• Decision Date: 22 June 1999
• Docket Number: 98-2311 and 98-3145,Nos. 98-1807,s. 98-1807
• Citation: 178 F.3d 951
• Parties: Dorothy GAUTREAUX, et al., Plaintiffs-Appellees, v. CHICAGO HOUSING AUTHORITY, a corporation, and Joseph Shuldiner, Executive Director, in his official capacity, Defendants-Appellants.
• Court: U.S. Court of Appeals — Seventh Circuit

178 F.3d 951

Dorothy GAUTREAUX, et al., Plaintiffs-Appellees, v. CHICAGO HOUSING AUTHORITY, a corporation, and Joseph Shuldiner, Executive Director, in his official capacity, Defendants-Appellants.

Nos. 98-1807, 98-2311 and 98-3145.

United States Court of Appeals Seventh Circuit.

Argued Oct. 30, 1998.

Decided May 28, 1999.

Rehearing and Suggestion for Rehearing En Banc Denied June

22, 1999. ^*

Michael L. Shakman, Miller, Shakman, Hamilton, Kurtzon & Schlifke, Alexander Polikoff (argued), Chicago, IL, for Plaintiffs-Appellees in Nos. 98-1807 and 98-2311.

Alexander Polikoff (argued), Chicago, IL, for Plaintiffs-Appellees in No. 98-3145.

Susan Getzendanner (argued), Nancy S. Eisenhauer, Skadden, Arps, Slate, Meagher & Flom, Jerome Butler, Chicago, IL, for Defendant-Appellants Chicago Housing Authority and Joseph Shuldiner.

Barry A. Miller (argued), Michael L. Shakman, Edward W. Feldman, Miller, Shakman, Hamilton, Kurtzon & Schlifke, Chicago, IL, for Appellees Daniel E. Levin and Habitat Company.

Before CUMMINGS, ^** KANNE, and DIANE P. WOOD, Circuit Judges.

DIANE P. WOOD, Circuit Judge.

When the time comes to write the story of public housing in the United States, the thirty-plus year saga of this litigation and the experience of the City of Chicago will surely feature prominently. The case began in 1966, when Dorothy Gautreaux and others filed a class action claiming that the Chicago Housing Authority ("CHA") had intentionally perpetuated racial segregation both in its tenant assignment practices and in its siting policies. In 1969, the district court found for the plaintiff class, Gautreaux v. Chicago Housing Auth., 296 F.Supp. 907 (N.D.Ill.1969) (Gautreaux I), and entered a remedial decree designed to address the constitutional violations, Gautreaux v. Chicago Housing Auth., 304 F.Supp. 736 (N.D.Ill.1969) (Gautreaux II). That decree has continued in force ever since. The CHA has now appealed to this court from three orders the district court entered in 1998 in the course of supervising the decree. We conclude that these orders are essentially interlocutory in nature, that we lack jurisdiction over the appeal, and that it therefore must be dismissed.

I

In order to understand why we lack jurisdiction over this appeal, it is necessary to summarize briefly the history of this litigation. Prior to the entry of the 1969 decree, the Gautreaux class showed that the CHA had effectively designated four housing projects, built in majority-white Chicago neighborhoods, as "white," and that it had reserved the remainder of its facilities for non-whites. Using a discriminatory pre-clearance procedure and quotas, the CHA restricted the number of African-American families it assigned to the four "white" family housing projects. As a result, despite the fact that 90% of the families on the CHA's waiting list were African-American, African-Americans comprised less than 10% of the families in those four projects. The picture was the opposite in the other projects: there, the tenants were (as of 1969) 99% African-American, and 99.5% of the units were located in neighborhoods that were majority African-American.

A. The 1969 Injunction and the 1987 Receivership Order

The Gautreaux II injunction divided Cook County into "Limited Areas," in which 30% or more of the population was African-American, and the "General Area," which was the rest of the county. Initially, it required the CHA to build three dwelling units in the General Area for every one unit it constructed in the Limited Areas; later, that ratio was changed to one-to-one. The injunction defined a dwelling unit as a residential unit "which is to be initially made available to and occupied by a low-income, non-elderly family, subsequent to the date [of the injunction], directly or indirectly by or through CHA...." Gautreaux II, 304 F.Supp. at 737. More generally, the injunction required that the CHA "affirmatively administer its public housing system in every respect (whether or not covered by specific provision of this judgment order) to the end of disestablishing the segregated public housing system which has resulted from CHA's unconstitutional site selection and tenant assignment procedures." Id. at 741. The idea was to bring about a gradual cure of the CHA's constitutional violations over time, as the CHA made new units available to public housing residents. The injunction is still in place, and, of critical importance to our decision, the CHA has requested neither its modification nor its termination.

For the next 18 years, the district court patiently waited in vain for the CHA to develop what has become known as "scattered site housing." In 1987, it finally appointed a receiver (Daniel E. Levin and The Habitat Company), to whom it assigned the responsibility for developing scattered site housing on the CHA's behalf. Gautreaux v. Pierce, Order of Aug. 14, 1987. The receivership order applies both to housing projects that were underway at the time and to "all CHA non-elderly public housing development programs which may in the future be authorized by HUD during the pendency of [the case against the CHA]." Id. at 2. The receiver is authorized to exercise

all powers of CHA respecting the scattered site program necessary and incident to the development and administration of such program, including: (a) Making all determinations governing the scattered site program in compliance with prior and future orders of this Court, including without limitation (1) submission to HUD of applications for funding, development programs and other documents....

Id. at 2-3. The receivership order also directs the CHA to give the receiver its full cooperation. As with the injunction, the CHA has not asked that the receivership order be modified or terminated, and it remains in effect.

B. The Current Controversy

In 1992, Congress passed a new public housing funding program called HOPE VI, an acronym for "Homeownership and Opportunity for People Everywhere." 42 U.S.C. § 1437l (note). The program seeks to revitalize severely distressed or obsolete public housing developments by funding a mixture of local public housing authority activities on a competitive grant basis. Local public housing authorities may use HOPE VI grant monies for a variety of purposes, including, among other things, planning revitalization projects, demolition, renovation, providing Section 8 rent vouchers, social services, and (of greatest interest here) building replacement dwellings. To the extent that obsolete public housing is eliminated through HOPE VI, replacement units can be made available through a combination of Section 8 vouchers, new construction, renovation, and other acquisitions. Under HOPE VI, any demolished housing units must "be located in up to 3 separately defined areas containing the community's most severely distressed projects." Id. It does not similarly restrict the locations in which replacement units may be built. Id.

In 1993, the CHA prepared the first of several funding proposals it has submitted to HUD under the HOPE VI program. It took this step unilaterally--that is to say, without any input from the receiver. In the application, however, it represented to HUD that the location of any replacement units would comply with the locational requirements of the Gautreaux injunction. The proposal was successful: HUD awarded it $50,000,000 for the Cabrini-Green Redevelopment Project. When the receiver learned of the existence of the application, it approached the CHA and asked to become involved in the HOPE VI projects, insofar as they would implicate the receiver's authority over the construction of replacement housing. The discussions that followed did not resolve this question definitively. Instead, the CHA was inconsistent in later grant applications. In 1996, it received one grant for the rehabilitation of its ABLA and Henry Horner developments on the basis of a proposal prepared in concert with the receiver, but in the same year it received another grant for the Robert Taylor Homes on the basis of a proposal it prepared independently (after erroneously advising the receiver that no replacement units would be involved).

This spotty cooperation between the CHA and the receiver turned to outright hostility sometime in late 1996. In September 1997, the CHA filed an emergency motion with the district court, asking it for an order clarifying that the 1969 injunction did not extend to any aspect of the HOPE VI program. In February 1998 (the "February order"), the district court instead held that the portion of HOPE VI funds dedicated to the construction of dwelling units fell squarely within the plain language of the injunction, and that any replacement units were therefore subject to the injunction's locational requirements.

Despite this order, the CHA continued to refuse to cooperate with the receiver or to release the information necessary to allow the receiver to play a role in the HOPE VI grant application due June 29, 1998. In May 1998, the receiver accordingly asked the court to compel the CHA's cooperation. The court granted this motion (the "May order"), explaining that since "HOPE VI is a 'non-elderly public housing development program[ ] ... authorized during the pendency of' the Gautreaux litigation, ... it therefore fits entirely within the Receiver's jurisdiction."

Finally, in August 1998, the receiver filed a second emergency motion to compel the CHA's cooperation with the 1987 receivership order and the district court's February and May orders. It took this action after it learned through a news report that the CHA had unilaterally negotiated a settlement with Cabrini-Green residents who had brought a lawsuit against the CHA, see Cabrini-Green Local Advisory Council v. Chicago Housing Auth., 1997 WL 31002 (N.D.Ill. Jan. 22, 1997), and that this settlement would involve the construction of dwelling units. In its "August order," the district court held that the...