Natural Resources Defense Council, Inc. v. City of New York

• Decision Date: 26 February 1982
• Docket Number: D,No. 960,960
• Citation: 672 F.2d 292
• Parties: 12 Envtl. L. Rep. 20,451 NATURAL RESOURCES DEFENSE COUNCIL, INC., et al., Plaintiffs-Appellants, v. The CITY OF NEW YORK, et al., Defendants-Appellees. ocket 82-6026.
• Court: U.S. Court of Appeals — Second Circuit

Page 292

672 F.2d 292

12 Envtl. L. Rep. 20,451

NATURAL RESOURCES DEFENSE COUNCIL, INC., et al., Plaintiffs-Appellants, v. The CITY OF NEW YORK, et al., Defendants-Appellees.

No. 960, Docket 82-6026.

United States Court of Appeals, Second Circuit.

Argued Feb. 23, 1982.

Decided Feb. 26, 1982.

Bruce Terris, Washington, D. C. (Terris & Sunderland, Washington, D. C., Fried, Frank, Harris, Shriver & Jacobson, New

York City, Lanigan, O'Connel, Jacobs & Chazin, Basking Ridge, N. J., on the brief), for plaintiffs-appellants.

Arnold Roth, New York City (Rosenman Colin Freund Lewis & Cohen, New York City, on the brief), for defendant-appellee, John C. Portman, Jr.

Gaines Gwathmey, III, Asst. U. S. Atty., New York City (John S. Martin, Jr., New York City, of counsel), for defendants-appellees, Samuel R. Pierce, Jr. and James C. Watt.

Lorna Goodman, Asst. Corp. Counsel of the City of New York, New York City (Frederick A. O. Schwartz, Jr., New York City, on the brief), for defendant-appellee, The City of New York.

Before WATERMAN, VAN GRAAFEILAND and MESKILL, Circuit Judges.

VAN GRAAFEILAND, Circuit Judge:

These are appeals from orders of the United States District Court for the Southern District of New York, Duffy, J., granting the defendants' motions for summary judgment and the judgment dismissing plaintiffs' complaint. At issue is a project aimed at revitalizing a portion of the Times Square area in the City of New York. Long before the City fathers began to extol the sights and thrills of "The Big Apple", they proclaimed the wonders of "The Crossroads of the World", Broadway and 42nd Street and the Times Square area immediately to the north. Unfortunately for the City, in recent years the wonders which had attracted and thrilled millions of visitors began to disappear. When the City fathers looked at the area in 1981, this is what they saw:

Since World War II, the Broadway-Times Square area has experienced a deterioration of building stock, land use, and street environment resulting in increasingly, unproductive use of potentially valuable land, and in the appearance of uses which threaten Times Square's traditional public role. This decline was marked by a lack of significant construction in the area after World War II. During this time, fashionable hotels moved to Central Park South and to the east side of Midtown. The Times Square area hotels declined in quality and lost their prominent clientele. The area lost its monopoly on first-run movies. Falling patronage and sales forced high-quality restaurants and retail stores out of Times Square. In the place of these departed activities came more "action" movie houses, pornographic shops, shops catering to impulse buying, fast-food restaurants, soft-drink stands, topless bars, massage parlors, and pornographic book stores. In the 1970's this resulted in private mortgage foreclosures, in rem takings, tax arrears, reduced tax collections, building deterioration, the replacement of buildings with parking lots and disassemblage of property.

Today Times Square is a blighted urban area. The characteristics contributing to this blighted environment are the under-utilization of property in the area, high vacancy rates above the ground floor, the proliferation of pornographic uses, dilapidated store fronts, the number of lots in tax arrears, dirty and unsafe street conditions, and a high crime rate which requires increased allocation of police service to the area. These factors combine to reduce the attractiveness of the area to tourists and to most metropolitan residents and to threaten neighboring communities with the intrusion of blighting land uses.

(Record of Decision and Findings and Determinations of the City of New York and the New York State Urban Development Corporation Respecting the Times Square Hotel Project, 5.)

In 1972, defendant, John Portman, with the encouragement of the Mayor's office of Midtown Planning and Development, decided to build a hotel on the west side of Broadway between 45th and 46th Streets. In August, 1973, Portman was granted a special zoning permit, a parking permit, and a zoning map change authorizing the proposed construction. Economic conditions deterred further progress until 1978, when In the meantime, the Mayor's office of Midtown Planning and Development oversaw the preparation of a 300-page Environmental Review covering the proposed project. Shortly after this document was completed and circulated, the City was advised that a theater on the project site known as the Helen Hayes Theatre was eligible for listing on the National Register of Historic Places.

a plan of cooperative public financing was devised. This involved ownership of the land by a subsidiary of the New York State Urban Development Corporation (UDC), a leaseback of the property to Portman, and a loan from the City to be funded by the United States Department of Housing and Urban Development (HUD). In August, 1978, the project was approved in concept by the New York City Board of Estimates. The Board authorized the Mayor to apply for a HUD grant of $15M, and increased this authorization to $21.5M in December, 1980. The City's participation was conditioned upon UDC's adoption of the project as a land use improvement project. On October 18, 1979, the Directors of UDC approved the general project plan and the initiation of UDC's participation in the project.

Pursuant to section 106 of the National Historic Preservation Act of 1966, 16 U.S.C. § 470f, and regulations thereunder, 16 C.F.R. §§ 800.1-.15, a Case Report relating to the Helen Hayes Theatre was submitted by the City to the New York State Historic Preservation Officer and the Advisory Council on Historic Preservation. On December 26, 1978, a Memorandum of Agreement was entered into permitting the demolition of the Helen Hayes Theatre. This Memorandum provided, among other things, for the possible use of parts of the theater in the hotel project and the use by preservation organizations of any other architecturally significant parts.

On February 18, 1981, the City inserted in the Federal Register a notice of intent to publish a Draft Environmental Impact Statement. The Draft Environmental Impact Statement was completed on May 22, 1981, and appropriate notice was published in the Federal Register on May 29, 1981. A public hearing was held on July 10, 1981, and the Court has reviewed the 213-page transcript of the proceeding. On August 12, 1981, a final 500-page Environmental Impact Statement was completed, and notice of completion was published in the Federal Register on August 21, 1981. The Statement described the proposed project as follows:

The proposed development is on the west side of Broadway between 45th and 46th Streets on a 74,300 square foot site. The design of the proposed project calls for a 50-story hotel with over 2,000 rooms, extensive convention and meeting facilities, restaurants and public areas, a 1,500-seat theatre and underground parking for 219 automobiles. The building will be open at street level to serve as an extension of Broadway Plaza, a pedestrian oriented project on the right-of-way of Broadway that the City is undertaking between 45th and 49th Streets. The building features a large open atrium around which the hotel rooms are situated. Shubert Alley, a feature of the theatre area between 44th and 45th Streets west of Broadway, will be extended under the hotel structure at street level northward to 46th Street.

At street level there will be a sidewalk cafe extending onto Broadway Plaza and retail shops. Vehicle access will be provided by a through roadway between 45th and 46th Streets adjacent to the hotel entrance. Pedestrian access will also be available from Broadway Plaza and the Shubert Alley extension.

Above the street will be two levels of retail space and the legitimate theater. The next three levels will provide meeting rooms, exhibition space and ballrooms. The main lobby will be above this meeting space and will include registration facilities, various restaurants and beverage facilities and retail shops. The atrium will extend 35 floors above this lobby to a revolving restaurant and lounge on the top floor. The hotel has been designed as a striking facility to be an attraction for City visitors.

(Final Environmental Impact Statement Proposed Times Square Hotel at 1-1 (hereinafter cited as Final E.I.S.) ).

On October 6, 1981, plaintiffs brought two suits in New York State Supreme Court alleging that defendants had failed to comply with pertinent State statutes and regulations, particularly the New York State Environmental Quality Review Act. (N.Y.Envtl.Conserv.L. Art. 8 (McKinney 1973)).

On October 7, 1981, the instant action, based largely on federal statutes and regulations, was commenced in the United States District Court for the Southern District of New York. On October 14, 1981, the State actions were removed to the district court for the purposes of joint trial. However, they were remanded at the time the district court dismissed most of the federal claims. On January 7, 1982, the complaints in the remanded State actions were dismissed in New York State Supreme Court and the dismissal was affirmed by the Appellate Division of the Supreme Court on February 23, 1982.

On October 30, 1981 and November 4, 1981, plaintiffs moved for partial summary judgment. On November 13, defendants moved to dismiss the complaint. At the time these motions were made, there was uncertainty as to whether a theater adjoining the Helen Hayes Theatre, known as the Morosco Theatre, was eligible for inclusion in the National Register of Historic Places. This uncertainty was resolved on November 17, 1981, when the Secretary of the Interior held in favor of eligibility. In making this determination, the Secretary specifically recognized that "differences of opinion exist on the eligibility of the Morosco Theatre."

While awaiting the Secretary's determination, the parties...