Vieux Carre Property Owners, Residents and Associates, Inc. v. Pierce, 82-3558

• Decision Date: 21 November 1983
• Docket Number: No. 82-3558,82-3558
• Citation: 719 F.2d 1272
• Parties: VIEUX CARRE PROPERTY OWNERS, RESIDENTS AND ASSOCIATES, INC., et al., Plaintiffs-Appellants, v. Samuel R. PIERCE, Jr., etc., Defendant, and City of New Orleans, Defendant-Appellee, and Canal Place One, Intervenor-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 1272

719 F.2d 1272

21 ERC 1307

VIEUX CARRE PROPERTY OWNERS, RESIDENTS AND ASSOCIATES, INC. et al., Plaintiffs-Appellants, v. Samuel R. PIERCE, Jr., etc., Defendant and City of New Orleans, Defendant-Appellee and Canal Place One, Intervenor-Appellee.

No. 82-3558.

United States Court of Appeals, Fifth Circuit.

Nov. 21, 1983.

Derbes & Derbes, James G. Derbes, James R. Logan, New Orleans, La., for plaintiffs-appellants.

Barham & Churchill, David A. Marcello, Margaret E. Woodward, New Orleans, La., for City of New Orleans.

Stone, Pigman, Walther, Phillip A. Wittmann, Cathy S. Glaser, New Orleans, La., for intervenor-appellee.

Appeal from the United States District Court for the Eastern District of Louisiana.

Before BROWN and JOHNSON, Circuit Judges, and CASSIBRY, District judge^*.

JOHNSON, Circuit Judge:

Appellants, Vieux Carre Property Owners, Residents and Associates, Inc., and the Louisiana Landmark Society, filed this lawsuit against the United States Department of Housing and Urban Development (HUD) and the City of New Orleans (the City) seeking to enjoin the use of federal funds granted to the City pursuant to an Urban Development Action Grant (UDAG). The grant would fund public improvements adjacent to Canal Place, Phase I, to be used in connection with Canal Place, Phase II. Phase II is a hotel, retail and parking development presently under construction in the Central Business District of New Orleans near the foot of Canal Street. Plaintiffs argue that federal funds should be withheld because the City, as the entity delegated responsibility for an environmental and historic preservation review, had not complied with the provisions of the National Environmental Policy Act of 1969 (NEPA), 42 U.S.C. Sec. 4321, et seq., and the National Historic Preservation Act of 1966 (NHPA), 16 U.S.C. Sec. 470, et seq. The developer of Canal Place and beneficiary of the UDAG funds, Canal Place 2,000, intervened in the lawsuit.

A temporary restraining order halting construction was denied and summary judgment was granted by the district court in a well-reasoned opinion on August 10, 1982 in favor of HUD, the City, and Canal Place 2,000, dismissing plaintiffs' lawsuit. Plaintiffs have appealed against the City and Canal Place 2,000, but have not pursued an appeal against HUD. We affirm the district court's decision.

I. Facts

The City of New Orleans is an eligible recipient of UDAG funds under Title I of the Housing and Community Development Act of 1974 (HCDA), as amended 42 U.S.C. Sec. 5301, et seq., and its implementing regulations, 24 C.F.R. Sec. 570, et seq. Action Grants provide assistance to "distressed cities" to stimulate private and public investment and strengthen the economic, employment and tax bases of the urban area. See generally, 24 C.F.R. Sec. 570.450(a).

On January 20, 1981, the City filed a grant application with HUD for UDAG funds to implement public improvements associated with a hotel, retail and parking complex (Canal Place, Phase II) to be constructed near the river end of Canal Street. More particularly, the UDAG project is planned as a 511-room hotel, a 223,000 square-foot multi-level shopping mall and a parking facility to accommodate 1550 vehicles. The federal funds requested in the grant application will be used for the following civic improvements to be enjoyed by the citizenry at large:

1. Sidewalk construction within the vicinity of Canal Place;

2. Streetlighting within the vicinity of Canal Place;

3. Landscaping within the vicinity of Canal Place;

4. Elevated pedestrian walkway from Canal Street to the Mississippi River Ferry;

5. Relocation of New Orleans Public Service, Inc. (NOPSI) power lines and support lines; and

6. NOPSI substation screening.

Canal Place 2,000, a Louisiana ordinary partnership and joint venture, is the developer of the project. Joseph Canizaro, the managing partner, is a well-respected developer of numerous office buildings in downtown New Orleans and is active in various civic organizations concerned with urban growth in New Orleans. Although the City requested a grant in the amount of $10 million, HUD preliminarily approved a $6 million grant for the public improvements in April of 1981. The developer will expend over $100 million of private funds on the UDAG project.

Although the overall Canal Place development was once envisioned as a thirteen- acre development extending from Canal Street to Conti Street in the Vieux Carre District and from Decatur Street to the river's edge, the UDAG site actually proposed in the instant case (Canal Place, Phase II) is bounded by Canal Street, North Peters Street, Ibberville Street, and the NOPSI substation. Phase II is adjacent to a presently existing thirty-two story office building (Phase I) in operation since 1979. A master plan developed in the mid-70's contemplated three later phases (a total of five phases) in the complete thirteen-acre development. Although plaintiffs would have the court believe that the five-phase master plan is a "fait accompli," Phases III through V ¹ are indefinite and speculative in nature; no final plans nor private funding commitments exist as to Phases III through V, and no further design work or land acquisition as to Phases IV and V has been performed since 1978. Indeed, the developer owns none of the land or air rights for Phase IV but owns some but not all the land for Phase V.

Phase II is located in the Central Business District in an area containing numerous hotels. Although the UDAG project area is located within the Vieux Carre National Historic Landmark District, it is not under the jurisdiction of the Vieux Carre Commission. The UDAG is a key component of the economic development strategy for downtown New Orleans and was intended to provide a retail anchor at the lower end of Canal Street, needed hotel rooms to bolster the City's vital tourist industry, and a stimulus for restoration of existing deteriorated buildings in the immediate area.

The private development portion of the UDAG project has been publicly scrutinized since its inception by the City Planning Commission, the Mayor's Office on Special Projects, the Vieux Carre Commission and countless civic organizations and boards. Contrary to the plaintiffs' suggestion, the UDAG project has been assessed, modified, and reassessed in order to arrive at a final Phase II that is in conformity with all applicable zoning ordinances. The Phase II site is a part of the Central Business Plan Community District, a zoning district developed and approved after a lengthy review process before the City Planning Commission and the City Council.

Under NEPA and NHPA, HUD is responsible for conducting an environmental and historic preservation review of this UDAG project. A provision of the Housing and Community Development Act, 42 U.S.C. Sec. 5304(h)(1), authorizes HUD to delegate to the UDAG applicant the responsibilities for environmental review, decision-making and action. The City was the UDAG applicant. Accordingly, the City Planning Commission, in coordination with the Mayor's Office of Federal Programs and Special Projects, undertook the responsibility for assessing the impact of Phase II upon the surrounding environment, including the adjacent Vieux Carre.

The assessment process commenced shortly after the UDAG application was filed. Phase II development plans were presented at two public meetings on January 28, 1981 and February 24, 1981. The effects of the UDAG project on the surrounding environment were assessed, including but not limited to effects upon the soil, the archeological remains, the water and air, the socioeconomic conditions of the area, the visual effects and the traffic.

Various agencies were consulted during the review process. In accordance with the provisions of NHPA, the City requested the State Historic Preservation Officer (SHPO) to render an opinion as to whether Phase II and the UDAG-funded public improvements would have an impact on the Vieux Carre. The SHPO and his staff reviewed the UDAG project, consulted with the Vieux Carre Commission, the City, and the developer, and made site visits, thereafter concluding that they had no objections to Phase II implementation. The developer had consulted with the Vieux Carre Commission on an ongoing and informal basis in regard to the Canal Place project since the mid-70's. After the UDAG application was submitted, Phase II was officially presented to the Commission, and it approved the federally-funded improvement, including relocating NOPSI power lines into the Vieux Carre.

The results of the City's environmental and historic preservation review were compiled in a comprehensive Final Environmental Assessment, presented to the City Planning Commission and adopted by the Commission on May 6, 1981. In all, a 298-page environmental assessment was submitted to HUD for final approval. This assessment is the backbone of the efforts of the City and developer to examine the environmental and historic impact of the project and to familiarize the citizenry with a UDAG project that will provide 954 new jobs, increase the federal, state and city tax base, provide a boost to the tourist industry and revitalize a vacant underdeveloped section of the Central Business District near an already developed and bustling tourist attraction--the Vieux Carre historic district.

The City and the developer vigorously defended their Final Environmental Assessment as a document in full compliance with the requirements of NEPA and NHPA. The district court, after thoroughly reviewing the City's historic and environmental review process, rendered summary judgment in favor of the City, HUD and Canal Place 2,000, concluding that the City's environmental assessment complied with NEPA and NHPA. This appeal followed.

II. Merits

Appellants make several attacks upon the district court's granting of a summary judgment in favor of the City and Canal Place 2,000. Specifically...