Marin City Council v. MARIN CTY. REDEVEL. AGENCY

• Decision Date: 05 September 1975
• Docket Number: No. C-74-2225 AJZ.,C-74-2225 AJZ.
• Citation: 416 F. Supp. 700
• Court: U.S. District Court — Northern District of California
• Parties: The MARIN CITY COUNCIL et al., Plaintiffs, v. The MARIN COUNTY REDEVELOPMENT AGENCY et al., Defendants.

416 F. Supp. 700

The MARIN CITY COUNCIL et al., Plaintiffs, v. The MARIN COUNTY REDEVELOPMENT AGENCY et al., Defendants.

No. C-74-2225 AJZ.

United States District Court, N. D. California.

September 5, 1975.

Marilyn J. Berger, Legal Aid Society of Marin County, San Rafael, Cal., David B. Bryson, Richard M. Pearl, Cal. Rural Legal Assistance Cooperative Legal Services Center, San Francisco, Cal., for plaintiffs.

James L. Browning, Jr., U. S. Atty., James A. Bruen, Asst. U. S. Atty., San Francisco, Cal., for federal defendant Secretary of HUD; Timothy F. Winchester, Dept. of Housing and Urban Development, San Francisco, Cal., of counsel.

Cecil F. Poole, Jacobs, Sills & Coblentz, San Francisco, Cal., for defendants Highlands Associates, Eugene Ford, Mid-City Financial Corp., Shire West Corp.

Benjamin D. James, Jr., James & McGriff, San Francisco, Cal., William S. Hochman, Bagshaw, Martinelli, Corrigan & Jordan, San Rafael, Cal., for defendant Marin County Redevelopment Agency.

Douglas J. Maloney, County Counsel, County of Marin, San Rafael, Cal., for defendants Marin County Planning Commission and the County of Marin.

ORDER GRANTING IN PART DEFENDANTS' MOTIONS TO DISMISS AND FOR SUMMARY JUDGMENT

ZIRPOLI, District Judge.

This action involves a challenge to the construction of a housing development entitled Richardson Highlands on the remaining 36 acres of an urban renewal project, land which plaintiffs describe in their complaint as "the most attractive piece of developable land in the Western United States." The development is located in the hills above Marin City, an unincorporated area in Marin County, California. Plaintiffs contend that the development should include subsidized low- and moderate-income housing because it is part of an urban redevelopment project. Plaintiffs are several residents of Marin City, its City Council and its Tenant Union. Defendants are the Secretary of Housing and Urban Development (HUD), the Marin County Redevelopment Agency (the Agency), the County of Marin and the developer, Highlands Associates (including its participating partners). The core of the dispute is the likely effect of the cost of the townhouses in Richardson Highlands ($47,000 to $57,000) on the racial composition of development — plaintiffs claim it will be virtually all white. By contrast, Marin City itself is 95 percent black. In their complaint, plaintiffs state eight causes of action. Defendants have moved to dismiss or for summary judgment against all eight causes of action. Having reviewed the extensive record of this case, the court concludes that defendants' motions should be granted as to all but two of plaintiffs' causes of action.

The court's review of the materials now in the record discloses the following history of the Marin City area. During World War II, the federal government built temporary housing in the Marin City area for shipworkers employed nearby. At one time the population of the area reached approximately 6,000, including approximately equal numbers of white and black residents. By 1955, the temporary housing had become delapidated and the population of the area had declined. The County became concerned about the area and established a Redevelopment Agency to improve it. In 1956 the Housing and Home Finance Administration (HHFA), HUD's predecessor, funded a feasibility study by the Agency of possible redevelopment of Marin City. The study included inquiry into the housing desires of the persons then residing in Marin City, and the Agency submitted a redevelopment plan to the HHFA. Based upon it, HHFA in 1958 apparently supplied the Agency with funds to purchase a 121 acre parcel of land in the Marin City area from the Marin County Housing Authority, which had acquired it from the federal government. This parcel became known as Calif. R-8, apparently HUD's label for it. Later that year the Agency approved a redevelopment plan which HHFA also found acceptable, and the Agency and HHFA entered into a Loan and Capital Grant Contract under which the federal government agreed to finance the implementation of the plan. The contract has been amended several times since 1958, usually to increase the amount of money the federal government would contribute to the project.

Having obtained approval for its redevelopment plan, the Agency demolished all structures in Calif. R-8, including 640 units of temporary wartime housing and 305 other structures. At about the same time, the Housing Authority constructed 300 units of public housing on land immediately adjacent to Calif. R-8; all the people who had resided in the demolished structures and who wished to remain in Marin City apparently were relocated. Once the 121 acres of Calif. R-8 were cleared, the Agency made some improvements on it, such as streets and gutters, and entered into a contract with a developer which was to carry out the redevelopment plan and construct housing on the parcel. The developer constructed 192 units of low- and moderate-income housing on Calif. R-8 during the period between approximately 1962 and 1967. Meanwhile, the housing patterns in Marin County were operating to concentrate almost all black residents of the County in Marin City. The whites who had resided there tended to move to other parts of the county but the blacks, for financial and other reasons, were generally unable to find suitable housing in the County outside Marin City. Like other persons of modest means, they were caught in the squeeze of the housing shortage in the County. By the late 1960s nearly 95 percent of Marin City's 1,600 residents were black. All parties appear to concede that it is now a black ghetto.

The developer who had initially been engaged by the Agency stopped building housing in approximately 1967 and there was a three-year hiatus during which no further construction took place on Calif. R-8. At that time, the land that remained to be developed consisted mainly of a 36 acre area on the hills behind and above Marin City; further construction on this area had been contemplated by the redevelopment plan. In 1970, both the developer and the Agency were apparently in default on their contract with HUD, and HUD contemplated terminating the project without developing these 36 acres. Instead, it appears that local officials at the HUD Regional Office in San Francisco decided to attempt to revitalize the project. See Fitzhugh Deposition at 46. Under this federal stimulus, the Agency began to solicit bids from other developers interested in the remaining 36 acres. Additionally, HUD and the Agency entered into the eighth amendatory contract to the original contract, which authorized the expenditure of further federal money.

One developer proposed using the remaining 36 acres for low- and moderate-income housing but HUD rejected this proposal because it had had prior unsatisfactory experiences with this developer. Additionally, in 1971, HUD decided that, under its Project Selection Criteria, 24 C.F.R. §§ 200.700 et seq., no more subsidized housing would be approved for Calif. R-8 because it would tend to cause further racial "impaction." It is not clear what HUD grounded this decision upon, although it apparently was not the result of any protracted study. See Fitzhugh Deposition at 65; 68; 70. In 1972, the Agency received bids from a number of developers for the remaining 36 acres of Calif. R-8 and accepted the bid of Highlands Associates, which agreed to pay slightly over $1,000,000 for the 36 acres. Highlands proposed a two-phase development of these 36 acres, the first phase to consist of townhouses costing between $47,000 and $57,000 apiece and the second to include expensive apartments and some "moderate income" housing. From the materials in the file, it appears that Highlands Associates may make efforts to distinguish the development, Richardson Highlands, from the remainder of Marin City because it views the proximity of Marin City's ghetto as an obstacle to selling the expensive townhouses it intends to build. Plaintiffs feel that such a development will serve only to increase the housing segregation in County and seek to compel Highlands to include low- and moderate-income housing in the development.¹

At the outset, the court is met with challenges to its subject matter jurisdiction and to plaintiffs' standing to maintain this action. In particular, the Secretary contends that the court is without subject matter jurisdiction of the claims asserted against her. The court concludes that it does have jurisdiction of the claims as to which it does not grant defendants' motions for several reasons. First, given the court's administrative law approach to the case, it has jurisdiction under the Administrative Procedure Act, 5 U.S.C. §§ 701 et seq., to review plaintiffs' challenges to HUD's 1971 decision to reject proposals of further subsidized housing in Calif. R-8. Second, since plaintiffs' challenges to the 1971 decision are premised at least in part on the Civil Rights Acts of 1964 and 1968, the court has original jurisdiction under 28 U.S.C. § 1343(4). Additionally, it appears to the court that it has jurisdiction under 28 U.S.C. § 1331 since the civil rights interests asserted by plaintiffs are, like constitutional rights, "almost by definition, worth more than $10,000." CCCO-Western Region v. Fellows, 359 F.Supp. 644, 647-48 (N.D.Calif. 1972); Cortright v. Resor, 325 F.Supp. 797 (E.D.N.Y.1971); see Spock v. David, 469 F.2d 1047 (3d Cir. 1972). Finally, since plaintiffs have asserted cognizable federal claims against the nonfederal defendants, it appears to the court that the federal claims they have against the Secretary should properly be considered pendent to the claims against the nonfederal defendants. Compare Princess Cruises Corp. v. Bayly, Martin & Fay, Inc., 373 F.Supp. 762 (N.D. Calif.1974); contra, Aldinger v. Howard, 513 F.2d 1257 (9th Cir. 1975).

On the standing issue, both plaintiffs and defendants rely on...