St. Paul Intertribal Housing Bd. v. Reynolds

• Decision Date: 31 May 1983
• Docket Number: Civ. No. 4-82-872.
• Parties: ST. PAUL INTERTRIBAL HOUSING BOARD, a Minnesota nonprofit corporation, Plaintiff, v. William Bradford REYNOLDS, individually, and in his capacity as Assistant Attorney General, Civil Rights Division, United States Department of Justice; Attorney General William French Smith; the United States Department of Justice; the United States Department of Housing and Urban Development; Samuel R. Pierce, Jr., Secretary, Thomas T. Feeney, Minneapolis Area Manager of the United States Department of Housing and Urban Development; and other defendants now unknown to the plaintiff, Defendants.
• Court: U.S. District Court — District of Minnesota

564 F. Supp. 1408

ST. PAUL INTERTRIBAL HOUSING BOARD, a Minnesota nonprofit corporation, Plaintiff, v. William Bradford REYNOLDS, individually, and in his capacity as Assistant Attorney General, Civil Rights Division, United States Department of Justice; Attorney General William French Smith; the United States Department of Justice; the United States Department of Housing and Urban Development; Samuel R. Pierce, Jr., Secretary, Thomas T. Feeney, Minneapolis Area Manager of the United States Department of Housing and Urban Development; and other defendants now unknown to the plaintiff, Defendants.

Civ. No. 4-82-872.

United States District Court, D. Minnesota, Fourth Division.

May 31, 1983.

Larry B. Leventhal, Leventhal & Associates, Minneapolis, Minn., for plaintiff.

Catherine H. Coleman, U.S. Dept. of Justice, Civ. Div., Washington, D.C., for defendants.

MEMORANDUM OPINION AND ORDER

DIANA E. MURPHY, District Judge.

This action for declaratory and injunctive relief and monetary damages was brought by plaintiff St. Paul Intertribal Housing Board (the Board), a non-profit Minnesota corporation, against the defendant federal government agencies and officers. Plaintiff seeks a declaration that there is no legal impediment to the use of funds from the Department of Housing and Urban Development (HUD) Section 8 Moderate Rehabilitation Housing Program (HUD Program) in the Board's urban Indian housing project, injunctive relief restraining defendants from withdrawing or suspending funding for the Board's project and from violating plaintiff's civil rights, damages from defendant William Bradford Reynolds, Assistant Attorney General, Civil Rights Division, and others unknown to it for allegedly depriving and conspiring to deprive plaintiff of its civil rights, and costs and attorneys' fees under 42 U.S.C. § 1988. Jurisdiction is alleged under 5 U.S.C. §§ 551, 701, 702, 705, and 28 U.S.C. §§ 1343, 2201 and 2202.

This matter now comes before the court on defendants' motion to dismiss or, in the alternative, for summary judgment, and on plaintiff's motion for summary judgment on its claim for declaratory relief.

I. Factual Background

The Board is an organization of American Indians duly organized as a nonprofit corporation for the purpose of providing housing for Indians in the city of St. Paul. The Board is governed by Indian directors representing several different tribes. The program administrator, the only paid employee of the Board, is also an Indian.

In 1980, following extensive investigation into the housing needs of the St. Paul Indian community and into the alternatives available to meet those needs, the Board drew up a program for low income Indian families located within the city. The program would provide twenty-four detached rental housing units of three and four bedrooms on scattered sites. The units would be available to families whose head of household is an enrolled member of a federally recognized tribe.

The Board approached both the Minnesota Housing Finance Agency (the Agency) and the St. Paul Public Housing Agency (PHA) for funding of its program.¹ The Agency was created in 1971 to facilitate the construction and rehabilitation of housing projects for families of low and moderate income. Minn.Stat. § 462A.01 et seq. The Minnesota Urban Indian Housing Act (the Act) authorizes the Agency to engage in housing programs for American Indians residing in the Minneapolis-St. Paul area or other cities in the state with a population of more than 50,000. Minn.Stat. § 462A.07, subd. 14 and 15. The Act authorizes programs for construction, purchase, and rehabilitation of housing and seeks innovative methods of providing urban Indian housing. The Act also requires that, to the extent possible, the programs come up with funds from other public and private sources in addition to the state appropriation. The proposal submitted by the Board called for the Agency to loan it legislatively-appropriated Indian housing money for property acquisition.

PHA was formed in 1977 and is operated by a seven person commission appointed by the mayor. Its mission is to provide a range of affordable rental housing opportunities to eligible low income and elderly residents, and it administers several federal rental assistance programs including HUD Program funds. The proposal submitted by the Board called for PHA to commit HUD Program funds to its program.

On or about October 16, 1980, the Advisory Council on Urban Indians for the State Indian Affairs Intertribal Board recommended that the Agency fund the Board's proposal, calling it a well-written, well-researched program. Subsequently, the Agency approved the program and agreed to loan $720,000.00 of state funds to the Board. PHA's assurance that HUD Program subsidies would be available for the Board's plan was a condition of approval by the Agency.

PHA approved the Board's program on December 3, 1980. It reserved twenty-four HUD Program unit assignments for its use. The PHA commissioners noted, however, that potential legal problems were raised by a project open only to Indians and recommended HUD review the question. Implementation of the Board's program was blocked when HUD took the position that Title VI of the Civil Rights Act of 1964 and Title VIII of the Civil Rights Act of 1968 prohibited the use of HUD Program funds in the Board's project because it featured an impermissible racial preference. Up to this point the parties agree on the factual background, but they disagree on facts related to the role of defendant Reynolds.

According to defendants, HUD officials sought an opinion from the Justice's Department's Civil Rights Division on the question of whether Title VI and Title VIII prohibited the use of HUD Program funds for the Board's project. After the Division had done some initial, inconclusive research, Reynolds had the question referred to the Justice Department's Office of Legal Counsel (OLC). Defendants state that on June 8, 1982, OLC completed its opinion on the question of whether a private HUD Program project owner (rather than an Indian Housing Authority) could restrict tenant eligibility to Indians only. OLC concluded that the Board's program was not the type of Indian preference that courts had recognized as permissible and that the tenant eligibility restriction on its face violated Titles VI and VIII. The Justice Department then sent the OLC opinion to HUD on or about June 28, 1982. Defendants support their version of the facts with the affidavits of Reynolds and Daniel Searing, a staff attorney in the Coordination and Review Section of the Civil Rights Division.

The Board claims, however, that HUD referred the question of the legality of utilizing federal funds for the Board's housing program to the Department of Justice, Civil Rights Division, Office of Coordination and Review in late 1980 or early 1981. The Board asserts that in the middle or latter part of 1981, the Section of Coordination and Review researched and completed an opinion which has been withheld solely as a result of actions by defendant Reynolds who directed that a contrary opinion be prepared. Plaintiff alleges Reynolds' actions resulted from bias and prejudice and were without legal justification.

II. Discussion

A. Claim for Declaratory Relief

The parties agree that a special trust relationship or guardian-ward relationship exists between the federal government and Indians. When special or preferential treatment is reasonable and rationally related to the fulfillment of the special trust obligation to Indians, it is permissible differentiation in legitimate public interest rather than prohibited racial discrimination. See Morton v. Mancari, 417 U.S. 535, 94 S.Ct. 2474, 41 L.Ed.2d 290 (1974).

Defendants argue that the trust doctrine does not apply to the Board's program because there is not evidence of legislative intent to support such a program in the statutes involved and because the doctrine is meant only to protect the quasi-sovereign status of tribes as political entities and to promote political self-determination. They claim the Board's program benefits individual, off-reservation Indians rather than facilitating self-determination.

The Board argues on the other hand that sufficient legislative intent to provide funds for urban Indian housing can be found in both the federal and state legislation involved and that the scope of the trust doctrine is broad enough to include housing programs for the benefit of individual urban Indians.

(1) Legislative Intent

In order for an Indian preference program to fall within the trust doctrine and thus not be racially discriminatory, there must be an expression of legislative intent to benefit Indians in such manner. See Joint Tribal Council of Passamaquoddy Tribe v. Morton, 528 F.2d 370 (1st Cir.1975); Eric v. Secretary of HUD, 464 F.Supp. 44 (D.Alaska 1978). Although the trust doctrine must be based on a statute, the doctrine is not limited by statute but by common law trust principles.² Eric v. Secretary of HUD, 464 F.Supp. 44 (D.Alaska, 1978). See also United States v. Mason, 412 U.S. 391, 93 S.Ct. 2202, 37 L.Ed.2d 22 (1973); Seminole Nation v. United States, 316 U.S. 286, 62 S.Ct. 1049, 86 L.Ed. 1480 (1942); Manchester Band of Pomo Indians, Inc. v. United States, 363 F.Supp. 1238 (N.D.Cal. 1973). Thus, if Congress expressed an intent to benefit off-reservation Indians in the United States Housing Act of 1937³ which now covers the HUD Program, the intended effect may be determined by application of common law trust principles.

The Housing Act of 1937 (the Housing Act) evidences congressional intent to provide funds for Indian housing. It authorizes the Secretary of HUD to make contributions to public housing agencies. 42 U.S.C. § 1437c(a). A public housing agency is defined as including any state. 42 U.S.C. § 1437a(b)(6). Since the definition of state includes Indian tribes, bands, and groups, 42 U.S.C. § 1437a(...