Opinion ID: 468117
Heading Depth: 2
Heading Rank: 1

Heading: Citizen Participation.

Text: 5 Municipalities seeking UDAG grants or Section 108 loans are required to hold public hearings to obtain the views of citizens. 42 U.S.C. Sec. 5318(c)(3)(A) (1982); 24 C.F.R. Sec. 570.454(a) (1982), and section 570.303, incorporated by reference in section 570.702. The City's Community Development Department did hold a public hearing on July 27, 1982, in connection with the UDAG application at which the project (then a Marriott hotel to be funded in part by Industrial Development Agency (IDA) bonds rather than with any utilization of Section 108 loan guarantees) was discussed. Information packets were given to those attending, and the major features of the plan--a 220-room hotel, banquet facilities, meeting rooms, retail shops, a high quality restaurant and lounge, recreation facilities, access to the handicapped, and parking for 240 cars--were pointed out. The project, the hearing attendees were told, would be funded by a UDAG grant in the sum of $3 million, IDA bonds in the sum of $7.2 million, and developer cash funding of $1.8 million. City benefits would include a grant to Binghamton, an increase in the City tax base, progress in a deteriorated, vacant area, 200 to 250 new jobs, possible new convention business and good pedestrian access to downtown facilities. The only people speaking against the project at the July 27 meeting were affiliated with, or speaking on behalf of, the Holiday Inn, Howard Johnson's, and the Ramada Inn, other hotels in the vicinity, and were essentially objecting to the competition being financed out of public funds. 6 Appellants argue that the information provided at the hearing was inadequate since the UDAG application itself was not made available. They claim the information was misleading: the packet indicated the UDAG would be $3 million, but the UDAG application sought $3,206,000 and the grant approved was $3.3 million; while $7.2 million in IDA bonds were contemplated at the July, 1982, hearing, $8 million in bonds were sought and eventually the Section 108 loan proceeds in the amount of $7.3 million replaced the bonds altogether; the information packet referred to 200 to 250 new jobs but the UDAG application stated 280 jobs would be created and the Section 108 loan application ultimately referred to 200 new jobs. We agree with the magistrate that this potpourri of objections does not amount to significant abrogation of the citizen participation process. 7 Appellants complain that no economic benefit analysis, no affirmative action plan, and no information as to tax revenues, firm financial commitments or minority contractor participation was provided at the hearing. But we agree with the magistrate's conclusion in this case that, since citizen participation must take place [p]rior to submission of a full application, 24 C.F.R. Sec. 570.454(a) (1982), the applicant is not required to provide all this information at the public hearing. 8 Appellants also argue that changes in the UDAG application amounted to significant revision[s] requiring additional hearings pursuant to 24 C.F.R. Sec. 570.463(a) (1982). One such change was the use of the Section 108 loan instead of IDA bonds; a second was the substitution of a different developer. However, additional hearings are required under section 570.463(a) only when a revision alters the scope, location, or scale of the project or changes the beneficiaries' population. None of these occurred here. Summary judgment as to the issue of citizen participation which respect to the UDAG was properly granted. 9 The City, appellants further contend, compounded its error by failing to comply with even more explicit citizen participation requirements when it completely redesigned the project's financial underpinnings by substituting Section 108 funds for industrial revenue bonds. On January 14, 1983, a hearing as to that substitution was conducted. Appellants claim that the citizens were not provided with adequate and timely information within the meaning of 24 C.F.R. Sec. 570.303(c)(4) (1982), so as to enable them to be meaningfully involved in important decisions at various stages of the program. Id. However, the record indicates that the hearing was publicized and that the appellants were quite vociferous in objecting to the project. The minutes reflect that one of the named plaintiffs voiced the concern that [o]ther projects will have to be sacrificed, referring to the fact that [t]he amount of [Section] 108 funds the City plans to loan to the project is all that the City has. He also argued that the number of jobs that the project's proponents claimed would be created was exaggerated, pointing to past Binghamton projects where the jobs did not materialize. He was only one of several who spoke against the use of Section 108 loan funds in connection with community development objectives. These comments suggest that the public had adequate information about the project to discuss it meaningfully. In our view, the City complied with the requirements of section 570.303, as incorporated in section 570.702, by obtain[ing] views of citizens on the project, 24 C.F.R. Sec. 570.303(a) (1982). 10