METRO. HOUSING DEVELOPMENT CORP. v. Village of Arlington Heights

• Decision Date: 02 April 1979
• Docket Number: No. 72 C 1453.,72 C 1453.
• Citation: 469 F. Supp. 836
• Parties: METROPOLITAN HOUSING DEVELOPMENT CORP. et al., Plaintiffs, Northwest Opportunity Center and Eluteria D. Maldonado, Intervening Plaintiffs, v. VILLAGE OF ARLINGTON HEIGHTS, a Municipal Corporation, et al., Defendants, and Village of Mount Prospect, a Municipal Corporation, Intervening Defendant, Forest View Civic Association Inc. et al., Intervening Defendants and Counter Plaintiffs, and Surrey Ridge Homeowners Association et al., Intervening Defendants and Counter Claimants.
• Court: U.S. District Court — Northern District of Illinois

469 F. Supp. 836

METROPOLITAN HOUSING DEVELOPMENT CORP. et al., Plaintiffs Northwest Opportunity Center and Eluteria D. Maldonado, Intervening Plaintiffs, v. VILLAGE OF ARLINGTON HEIGHTS, a Municipal Corporation, et al., Defendants and Village of Mount Prospect, a Municipal Corporation, Intervening Defendant Forest View Civic Association Inc. et al., Intervening Defendants and Counter Plaintiffs and Surrey Ridge Homeowners Association et al., Intervening Defendants and Counter Claimants.

No. 72 C 1453.

United States District Court, N. D. Illinois, E. D.

April 2, 1979.

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F. Willis Caruso, Sybille C. Fritzsche, Chicago, Ill., Robert G. Schwenn, Lexington, Ky., for plaintiffs.

Jack M. Siegel, Chicago, Ill., for defendants.

R. Marlin Smith and James M. Phipps, Chicago, Ill., for intervening defendant Village of Mount Prospect.

Staehlin, Jantorni & Sullivan, Chicago, Ill., for intervening defendants and counter claimants.

Daniel D. Mangiamele, Chicago, Ill., for intervening defendants and counter plaintiffs.

BUA, District Judge.

This important and celebrated zoning discrimination case was filed in 1972. The plaintiffs and defendants have strenuously contested the issues over a number of years. They have obtained two opinions from the court of appeals and one from the United States Supreme Court. After the remand of the case to this court last year, the original parties negotiated a settlement agreement and asked this court to enter a consent decree. The Village of Mount Prospect and other parties objected to the proposed decree, and this court allowed them to intervene. Three days of hearings were held last September. After fully developing and exploring all of the issues, the court now enters the consent decree.

I. FACTS.

Plaintiff Metropolitan Housing Development Corporation (MHDC) contracted to purchase a parcel of land located in the defendant Village of Arlington Heights (the St. Viator property). MHDC, a non-profit corporation, planned to construct a racially integrated moderate and low-income housing project to be known as Lincoln Green. The contract was contingent upon MHDC's ability to obtain proper zoning from the Village and financial assistance from the federal government.

MHDC filed a petition with the Village for rezoning of the St. Viator site from a single-family to a multiple-family classification. Following a series of public meetings, the Arlington Heights Board of Trustees voted to deny the petition for rezoning. MHDC, together with three black individuals seeking low cost housing in Arlington Heights, then filed suit against the Village in the District Court for the Northern District of Illinois, requesting injunctive and declaratory relief. The plaintiffs claimed that the Village's refusal to rezone was racially discriminatory, violating their rights under, inter alia, the Equal Protection Clause of the Fourteenth Amendment and the Fair Housing Act, 42 U.S.C. § 3601 et seq.

The district court held that the Village's action did not violate the Equal Protection Clause because it was motivated by a desire to protect local property values and the integrity of the Village's zoning plan, rather than by racial discrimination or opposition to low-income housing. Metropolitan Housing Development Corp. v. Village of Arlington Heights, 373 F.Supp. 208, 211 (N.D.Ill.1974). The court observed that no section of the Fair Housing Act, 42 U.S.C. § 3601 et seq., seemed applicable to the facts of the case. 373 F.Supp. at 209. Cf. Metropolitan Housing Development Corp. v. Village of Arlington Heights, 558 F.2d 1283, 1286 n. 2 (7th Cir. 1977) (district court did not rule on Fair Housing Act claim either because plaintiffs did not pursue it or because they did not consider it different from their constitutional claim).

The Seventh Circuit approved the district court's finding that there was no discriminatory purpose underlying the Village's refusal to rezone. Nevertheless, it reversed that court's decision on the ground that the "ultimate effect" of the denial of rezoning was unconstitutional because it would disproportionately disadvantage blacks. Metropolitan Housing Development Corp. v. Village of Arlington Heights, 517 F.2d 409, 413-15 (7th Cir. 1975).

The Supreme Court reversed the decision of the court of appeals. It held that a showing of discriminatory intent was necessary to establish a violation of the Equal Protection Clause. Village of Arlington Heights v. Metropolitan Housing Development Corp., 429 U.S. 252, 265, 97 S.Ct. 555, 50 L.Ed.2d 450 (1977). Since the court of appeals had affirmed the district court's determination that there was no discriminatory motive underlying the Village's refusal to rezone, the Supreme Court held that the plaintiffs had suffered no deprivation of their constitutional rights. 429 U.S. at 268-71, 97 S.Ct. at 565-566. The Court then remanded the case to the Seventh Circuit for a determination of whether the Village's refusal to rezone the land violated the Fair Housing Act. 429 U.S. at 271, 97 S.Ct. at 565-566.¹

On remand, the court of appeals held that the Village of Arlington Heights has a statutory obligation under the Fair Housing Act, 42 U.S.C. § 3601 et seq., to refrain from the perpetuation of zoning policies that effectively foreclosed construction of low-cost housing within its boundaries.²Metropolitan Housing Development Corp. v. Village of Arlington Heights, 558 F.2d 1283 (7th Cir. 1977). In analyzing the case, the Seventh Circuit ruled that the presence or absence of an actual discriminatory effect caused by the Village's zoning decision would be decisive. The case was therefore remanded to this court for a determination of whether there was land in Arlington Heights, other than the St. Viator site, which was properly zoned and suitable for federally subsidized low-cost housing. If the Village was unable to identify any such land within its boundaries, its refusal to rezone the St. Viator site would be held to violate the Fair Housing Act because that refusal would have precluded MHDC from constructing low-cost housing in Arlington Heights. Only then would plaintiffs be entitled to the relief they sought, the rezoning of the St. Viator property to permit construction of multi-family housing. 558 F.2d at 1295.

The Village of Arlington Heights sought certiorari in the Supreme Court. When it was denied, 434 U.S. 1025, 98 S.Ct. 752, 54 L.Ed.2d 772 (1978), the case was remanded to this court for further proceedings consistent with the order of the court of appeals.

This court called the matter for a status report in March, 1978, and was advised by the parties that negotiations had commenced. They stated that the case would be resolved by the entry of a consent decree, obviating the need for a trial of the remanded issues. As a result of the ensuing negotiations, a tentative agreement was reached which provided for construction of a modified development on an alternate site.³

This alternate site currently is not in Arlington Heights. Rather, it is located in an unincorporated area of Cook County, between Arlington Heights and the Village of Mount Prospect. It contains approximately 26 acres, bounded on the north by Lawrence Lane in Mount Prospect and Prairie Park, on the east by a vacant parcel of land lying north and west of St. Cecilia Catholic Church, on the south by Golf Road, and on the west by Belmont Avenue, extended from its present location adjacent to the western boundary of Prairie Park to Golf Road.⁴

The subject property is vacant. Part of it is classified as C-2 Commercial under the Cook County Zoning Ordinance. The remainder is classified for R-5 Single Family Residence use. No part of the subject property is currently zoned for the construction of multiple family residences.

Under the terms of the consent decree, Arlington Heights would annex the subject property and rezone it to conform with MHDC's planned use.⁵ Fourteen acres of the property would be developed for commercial use by an independent developer. The proposed development on the remaining twelve acres would be an updated version of the original Lincoln Green project. The financing would be different, the units designed for the elderly would be in a separate building, and the low and moderate-income family townhouses segment would involve a less intensive use of land than that originally proposed.

The parties made a further report on June 22, 1978, at which time the court continued the matter to June 30, 1978, for entry of the consent decree. On June 30, the Village of Mount Prospect moved to intervene as a defendant in order to object to entry of the proposed decree.

In its petition, Mount Prospect sought, in the alternative, permissive intervention and intervention as of right. Mount Prospect argued that the court had no authority to enter the decree. It also claimed that entry of the decree would be unjust and inequitable, due to its potential effect on the citizens of Mount Prospect.

While the court was considering Mount Prospect's petition, it delayed entry of the consent decree. On July 5, 1978, the Board of Trustees of Arlington Heights had an open meeting to receive public comment on the decree, which it had previously developed in closed sessions. After listening to the comments, the Board voted to approve the decree. The normal procedures for preparing and approving an annexation and/or rezoning proposal were not followed.⁶

On August 21, 1978, this court, by unreported order, granted Mount Prospect permissive intervention, without deciding whether it was entitled to intervene as of right. Mount Prospect is before the court in its corporate capacity, as a representative of its residents.

Additional parties applied to the court for permission to intervene. These parties represented landowners in the vicinity of the subject property. On August...