New Horizons Rehab., Inc. v. State

• Decision Date: 19 July 2019
• Docket Number: Case No. 4:17-cv-00049-TWP-DML
• Parties: NEW HORIZONS REHABILITATION, INC., Plaintiff, v. STATE of Indiana, Executive Director, Indiana Department of Homeland Security in his official capacity, Defendants.
• Court: U.S. District Court — Southern District of Indiana

400 F.Supp.3d 751

NEW HORIZONS REHABILITATION, INC., Plaintiff,

v.STATE of Indiana, Executive Director, Indiana Department of Homeland Security in his official capacity, Defendants.

Case No. 4:17-cv-00049-TWP-DML

United States District Court, S.D. Indiana, New Albany Division.

Signed July 19, 2019

Jan P. Mensz, Kenneth J. Falk, ACLU of Indiana, Indianapolis, IN, for Plaintiff.

Aleksandrina Penkova Pratt, Jefferson S. Garn, Jennifer Elizabeth Lemmon, Winston Lin, Indiana Attorney General, Indianapolis, IN, for Defendants.

ORDER ON CROSS-MOTIONS FOR SUMMARY JUDGMENT

TANYA WALTON PRATT, JUDGE

This matter is before the Court on cross-motions for summary judgment. Plaintiff New Horizons Rehabilitation, Inc. ("New Horizons") initiated this action alleging Defendants, the State of Indiana (the "State") and the Executive Director of the Indiana Department of Homeland Security ("DHS") in his official capacity (collectively, "Defendants"), issued a zoning decision that violates the Equal Protection Clause of the Fourteenth Amendment; the Rehabilitation Act, 29 U.S.C. § 794 (the "Rehabilitation Act"); the Fair Housing Amendments Act, 42 U.S.C. § 3604(f) ("FHAA"); and the Americans with Disabilities Act, 42 U.S.C. § 12132 ("ADA"). (Filing No. 1 at 9.) On October 27, 2017, this Court granted New Horizons a preliminary injunction and enjoined DHS from classifying New Horizons' proposed dwelling as a Class 1 structure. (Filing No. 43.) In the fall of 2018, New Horizons filed a Motion for Summary Judgment (Filing No. 60 ) and Defendants filed a Cross-Motion for Summary Judgment (Filing No. 66 ). For the following reasons, the Court grants in part and denies in part each parties' Motion for Summary Judgment. The result of this ruling grants New Horizons a permanent injunction.

I. BACKGROUND

For the most part, the material facts are undisputed. New Horizons is an Indiana not-for-profit corporation that assists persons who have intellectual and developmental disabilities in the southeastern Indiana counties of Ripley, Dearborn, Ohio, Franklin, Decatur, and Switzerland. (Filing No. 22-1.) It provides a variety of a services for its clients, including community-based employment services through job training, placement, and follow-along services, individualized home and community-based services, day-program services, respite care, family support, pre-vocational training and work opportunities in an industrial setting. Id. at 1-2. New Horizons owns six supported living homes located in Lawrenceburg, Batesville, Peppertown, and Oldenburg, Indiana. (Filing No. 60-1 at 11, 42.)

No more than four adults are allowed to live in a home full time, and they are assisted by New Horizons staff. (Filing No. 22-1 at 2.) Between five and seven staff are employed at each home, and a staff person is on-site 24 hours a day, seven days a week, but staff does not live at the home. (Filing No. 26-2 at 22; Filing No. 60-1 at 29.) The homes are recognized by the Bureau of Developmental Disabilities within Indiana's Division of Disability and Rehabilitative Services as "supported living service arrangements." (Filing No. 22-1 at 2.)

The residents of New Horizons' homes have either physical or mental impairments

that substantially limit one or more of their daily activities so that they cannot live on their own and require the assistance of staff. Id. at 3; Filing No. 60-1 at 22-23. New Horizons offers residential living as an option for clients who wish to live with the greatest possible degree of independence. (Filing No. 22-1 at 2.) The staff assures the safety of the residents of the homes and provides support to assist them in acquiring and maintaining skills to attain as much self-sufficiency as possible. Id.

New Horizons' homes are single-family dwellings and comply with all local land-use requirements imposed on single-family residences. Id. at 3. They are located in neighborhoods and are physically indistinguishable from the surrounding single-family homes. Id. They provide permanent housing for the residents and are not intended for transient stays. Id. The residents of the homes live much like a nuclear family would—they eat together, grocery shop together, engage in activities together, pool their money, and live together with no locks on their bedroom doors. Id. ; Filing No. 26-2 at 64-65, 68; Filing No. 60-1 at 18. Residents of these homes live with each other for years and form attachments and close relationships similar to a family and genuinely care for each other. (Filing No. 60-1 at 65-66.) New Horizons considers the residents to be families and attempts to create homes in which the residents feel that they are family. Id.

Because they are disabled, New Horizons' residents receive either Social Security Disability ("SSD") or Supplemental Security Income ("SSI") payments (Filing No. 22-1 at 3-4.) They use these payments to pay for their food, shelter costs, and other personal items and expenses. Id. New Horizons is the representative payee for those residents' who are unable to write checks and personally manage their benefits. (Filing No. 60-1 at 9-10.) A portion of residents' SSD or SSI payments go to New Horizons pursuant to a lease that it has with each resident. Id. at 59; Filing No. 22-1 at 10. New Horizons does not rent to the public at large; it only assists persons with an intellectual or developmental disability. (Filing No. 60-1 at 38-39.) It screens potential residents to make sure they are compatible with one another. Id. at 54-55. Residents may stay in a New Horizon home for their entire life and would never see an increase in rent, even if their SSD or SSI payments increase. (Filing No. 26-2 at 64, 70.) New Horizons is a certified "Medicaid home provider," meaning it receives some of its funding from Medicaid and its residents are eligible for Medicaid benefits. (Filing No. 60-1 at 43-44.)

Before a resident moves into a New Horizon home, a contractor hired by the Bureau of Developmental Disabilities will complete an inspection check list to make sure the overall environmental conditions are satisfactory. Id. at 49-51, 96-97. Among other things, the inspections ensure there is a working fire extinguisher in each home. Id. at 96. All New Horizons' residences have fire extinguishers, smoke detectors, and CO₂ detectors. Prior to the opening of any home, New Horizons invites the local fire department to come to the home and do a walk through to familiarize themselves with the layout and to do a visual check for any risks. (Filing No. 60-3.) Once the home is opened, residents will engage in five safety drills on a staggered schedule—drills for fire, bomb, medical, tornado, and intruder. (Filing No. 60-2 at 20-21.) During the fire drill, which may occur in the evening hours after the residents' bedtime, staff members will assist the resident to get to a designated area across the street. Id. at 16-17. It takes about five minutes to get to the designated area, but only about half that time for the residents to get out of the house. Id. at 20.

In 2013, New Horizons was donated an unimproved piece of real estate in Lawrenceburg, Indiana, on the condition that it would build a supported living home for adults with intellectual and developmental disabilities on the property. (Filing No. 22-1 at 4.) The donors are parents of an adult who will reside in the home once it opens. Id. at 4-5. As with all New Horizons homes, the residents will be persons with intellectual or developmental disabilities and are limited in one or more of their major life activities. Id. at 5. The property is located within what Lawrenceburg's zoning ordinance characterized as an "R-1" district, which is zoned for single, two, and multi-family homes. Id. The house will be indistinguishable from the homes surrounding it, and it will conform to all the requirements Lawrenceburg imposes on single-family homes. Id.

New Horizons initially struggled with the city of Lawrenceburg to zone the home in the same manner as all other single-family residences. After litigation with the city, New Horizons persuaded Lawrenceburg to zone its proposed home as a single-family residence. Id. at 5-6; New Horizons Rehabilitation, Inc. v. City of Lawrenceburg , No. 4:16-cv-00169-RLY-DML (S.D. Ind.).

While New Horizons was attempting to negotiate with Lawrenceburg, its Executive Director, Marie Dausch ("Dausch"), was informed that the planned home had to be approved by DHS because it was deemed to be a commercial building. (Filing No. 22-1 at 5-6.) She was also informed that plans for the home had to be drawn up by an architect, as opposed to the builder who had drawn up the then-existing plans. Id.

In 2015, New Horizons paid an architect $2,200.00 to make changes to the original plans to conform to what DHS required and the plans were submitted to the Plan Review Section of the Division of Fire and Building Safety within DHS. Id. at 6; Filing No. 26-2 at 58-59. That department issued the architect a construction design release specifying that plans for a fire suppression system had to be submitted before the release could be issued. (Filing No. 22-1 at 6.) New Horizons had never previously been required to put such a system in any of the other homes it operated, including an existing home in Lawrenceburg. (Filing No. 22-1 at 6.) Dausch attempted to submit a variance request so that the home could be built without the costly commercial fire suppression system. Id. But she did not understand the process of filing the request and therefore abandoned it. Id.

On January 26, 2017, New Horizons settled its lawsuit with the city of Lawrenceburg, which agreed to treat the proposed New Horizons home the same way it would treat any single-family dwelling for zoning purposes. Id. at 5. But in February 2017, DHS informed Lawrenceburg officials that the planned home was a Class 1 structure that had to be submitted to DHS for review and release. (Filing No. 22-2 at 56.) Of primary concern to New Horizons was...