Court Opinion

ID: 17237
Source: CourtListenerOpinion
Date Created: 2010-04-25 07:02:20+00
Date Added: 2024-06-11T16:46:41.414876
License: Public Domain

Revised April 6, 1999

                 UNITED STATES COURT OF APPEALS
                      FOR THE FIFTH CIRCUIT

                       _______________________

                             No. 97-11083
                       _______________________

DEBRA WALKER, ET AL,

                                                           Plaintiffs,

DEBRA WALKER; JEANETTE WASHINGTON; HAZEL
WILLIAMS; ZELMA LANG; RENITA BROWN; LILLIE THOMPSON,

                                                 Plaintiffs-Appellees,

TRACEY SMITH,

                                     Intervenor Plaintiff-Appellee,

                               versus

MESQUITE TX, CITY OF, ET AL,

                                                           Defendants,

DEPARTMENT OF HOUSING & URBAN DEVELOPMENT,

                                                   Defendant-Appellee.

                ********************************

HIGHLANDS OF McKAMY IV AND V COMMUNITY IMPROVEMENT
ASSOCIATION; GINGER LEE; PRESTON HIGHLANDS HOMEOWNERS’
ASSOCIATION, INCORPORATED; DAVID BEER,

                                                Plaintiffs-Appellants,

                               versus

THE HOUSING AUTHORITY OF THE CITY OF DALLAS,

                                                  Defendant-Appellee.

_________________________________________________________________
           Appeal from the United States District Court
                for the Northern District of Texas
_________________________________________________________________

                                March 16, 1999

Before JONES, SMITH, Circuit Judges, and SHAW*, District Judge.

EDITH H. JONES, Circuit Judge:

             The Dallas Housing Authority (DHA), the United States

Department of Housing and Urban Development (HUD), and the City of

Dallas were found liable several years ago for unconstitutional

racial     discrimination   and    segregation       within      Dallas’s   public

housing    programs.     The    primary      issue   on   this    appeal    is   the

constitutionality of the provision of the district court’s most

recent remedial order that directs newly constructed units of

public housing to be located in “predominantly white” Dallas

neighborhoods.

             Specifically, this is an appeal from a final judgment in

two actions that were consolidated for trial. In the first action,

two homeowners and their homeowners’ associations (“Homeowners”)

sought declaratory and injunctive relief against DHA’s construction

of   two     new   public      housing       projects     adjacent     to    their

neighborhoods.1     The Homeowners challenged the remedial order’s

      *
          District Judge of the Western District of Louisiana, sitting by
designation.
      1
         The two homeowners’ associations are: (1) Highlands of McKamy IV and V
Community Improvement Association and (2) Preston Highlands Homeowners’
Association, Inc.

                                         2
provisions for new public housing construction and race-conscious

site selection alleging that these were not narrowly tailored to

remedy the vestiges of past discrimination and segregation. In the

second action, the original class plaintiffs, tenants in the public

housing programs, sought declaratory relief that the remedial order

provisions are constitutional. The district court entered judgment

against the Homeowners in the first action and for the class

plaintiffs in the second action.        The Homeowners appealed.       We

essentially vacate and remand for further consideration by the

district court.

                             I.   BACKGROUND

          Part of the convoluted history of this case is concisely

recounted in Walker v. HUD, 912 F.2d 819, 821-25 (5th Cir. 1990)

[hereinafter Walker IV]. We will not repeat that history here, but

some important procedural and substantive gaps in this court’s

prior opinion, which addressed different issues, should be filled

in.

          This case began in 1985 and initially resulted in a

consent decree, which was approved by the district court in 1987.

See Walker v. HUD, 734 F. Supp. 1231, 1247-82 (N.D. Tex. 1989)

[hereinafter   Walker   I]   (reprinting   the   district   court’s   1987

consent decree and its “Findings of Fact & Conclusions of Law

Approving the Proposed Consent Decree”).            The consent decree

                                    3
addressed    the    plaintiff    class’s2    challenge     under    the   Equal

Protection Clause of the Fourteenth Amendment and 42 U.S.C. § 1983

to the purposeful racial discrimination and segregation within

DHA’s public housing programs.          The defendants were DHA and HUD.

The City of Dallas was joined as both a defendant to the lawsuit

and a party to the consent decree in 1989.           See Walker v. HUD, 734
F. Supp. 1289 (N.D. Tex. 1989) [hereinafter Walker III].                     The

history of public housing in Dallas is a sordid tale of overt and

covert racial discrimination and segregation. See generally Walker

III, 734 F. Supp. at 1293-1312 (recounting in detail the history of

public housing in Dallas).            Virtually all non-elderly public

housing units3 were constructed in minority areas of Dallas.4                 No

new public housing units were built between 1955 and 1989 at least

in part for fear that they might be located in white areas.               Tenant

selection and assignment procedures for public housing units were

crafted and administered to maintain racially segregated projects.

      2
         The consent decree defined the plaintiff class as “all black persons
presently or who during the pendency of this Decree become either (a) residents
of a DHA owned or managed project, or (b) participants in the DHA Section 8
Existing Housing Program.” See Walker I, 734 F. Supp. at 1263.
      The plaintiff class will be referred to throughout this opinion as the
“Walker plaintiffs.” Deborah Walker is one of the named plaintiffs representing
the class.
      3
         “Public housing units” refer to housing units owned and operated by DHA.
In contrast, under DHA’s Section 8 certificate and voucher programs, participants
rent housing units from private owners, and their rents are subsidized by DHA.
      4
         In 1994, of DHA’s approximately 6,400 public housing units, 6,100 were
in minority areas and 300 were in predominantly white areas. An additional 75
units are currently under construction or just completed in a predominantly white
area (Frankford & Marsh project), and the units at issue in this lawsuit would
add another 80 units to predominantly white areas of Dallas.

                                       4
DHA’s Section 8 housing programs were operated to discourage blacks

from moving into white areas of metropolitan Dallas.                   See id.

Blacks were purposefully segregated for decades into either Section

8 housing in minority areas of Dallas or predominantly black

housing projects in minority areas of Dallas.

               The   1987   consent   decree   required   the   demolition    of

approximately 2,600 units of public housing in DHA’s West Dallas

project, a public housing development located in a predominantly

black area of the city and referred to by this court as “one of

Dallas’s worst slums.”5         Walker IV, 912 F.2d at 821.        These units

were to be replaced on a one-for-one basis with additional public

housing units and Section 8 certificates and vouchers.              See id. at

822.       The decree also required that one hundred newly constructed

replacement units be built in a predominantly white area of Dallas,

that a nondiscriminatory tenant selection and assignment plan be

implemented, and that a Section 8 mobility plan be established to

       5
         The West Dallas project was completed in 1955 and contained 3,500 units.
In many ways, it is at the heart of this litigation. It was constructed to solve
the “Negro housing problem.” See Walker III, 734 F. Supp. at 1295. It is the
second largest public housing project in the United States. See id. at 1296
n.21.    As of 1983, one-third of its units were so dilapidated as to be
uninhabitable. See id. at 1307. In 1986, rejection rates for available units
in the West Dallas project ranged from 58-60%. See id. at 1308. At that time,
there were 1,583 vacant units of which 1,300 had been boarded up for more than
ten years because of their deteriorated state. See id. The 1987 consent decree
was designed to alter this concentration of public housing by requiring the
demolition of all but approximately 900 of the West Dallas units, the
reconfiguration and rehabilitation of the remaining units, and the creation of
new public housing opportunities in predominantly white areas of the city and its
suburbs.

                                        5
assist black families joining the Section 8 program in finding

housing in white areas of Dallas.6

               DHA repeatedly violated the 1987 consent decree.          First,

it resisted the construction of the 100 units of new public housing

in a predominantly white area.        See Walker I, 734 F. Supp. at 1243-

45.        Site selection for and construction of the 100 units was

eventually completed, but only by court order.              See id.     Second,

DHA violated the tenant selection and assignment and mobility

provisions of the decree.          See id. at 1235-42.         DHA failed to

establish and fund the required Section 8 mobility program, failed

to timely obtain fair market exception rents,7 delayed implementing

a nondiscriminatory tenant selection and assignment program, failed

to include in Section 8 housing information a full list of all

Section 8 units available in non-minority areas, and failed to use

all of the Section 8 certificates and vouchers allocated by HUD to

DHA.       See id.

       6
         The Section 8 mobility program was designed to educate landlords about
the Section 8 program and to assist Section 8 participants in locating Section
8 housing in non-minority areas of Dallas. Specifically, the program was to
include landlord recruitment, exceptions to HUD’s “fair market value” rent caps
on Section 8 vouchers and certificates, Title VIII enforcement actions, and child
care and transportation services. The program was also to provide neighborhood
specific information on crime rates, job training and employment opportunities,
day care, medical facilities, neighborhood shopping, transportation, social
services, objective indicators of school quality such as TAAS test results, and
“environmental hazards or other conditions inimical to family life.”
       7
         The value of a Section 8 voucher or certificate is capped by HUD at the
“fair market rent.” This cap, however, can be increased by special application
to HUD.

                                       6
             In March 1992, the district court vacated the 1987

consent decree on the grounds that its terms were not implemented

and   that   the   vestiges     of   purposeful     segregation     persisted.

Subsequently, the district court granted the Walker plaintiffs’

uncontested motion for summary judgment on the issue of liability.

In September 1994, the district court held a trial on the issue of

a remedy.    The district court entered its remedial order affecting

DHA in February 1995 and its remedial order affecting HUD in April

1996.

             The remedial order affecting DHA requires DHA (1) to

demolish at least 2,630 units of its West Dallas project, (2) to

develop 2,807 replacement units for the demolished West Dallas

units through both new construction and Section 8 vouchers and

certificates,8 (3) to develop, either through construction or

acquisition, an additional 3,205 new units of public housing in

predominantly white areas of metropolitan Dallas in which the

poverty rate does not exceed 13%, and (4) to develop all new public

housing units in predominantly white areas until there are as many

      8
         These 2,807 units have already been funded by HUD. The 2,807 units are
made up of 774 new public housing units and 2,033 Section 8 certificates and
vouchers. Specifically, the replacement units consist of (i) the 100 units
constructed pursuant to court order from the 1987 consent decree, (ii) 1,335
Section 8 certificates and vouchers previously funded by HUD, (iii) 339 new
public housing units allocated to DHA in 1990 and 1991 as part of the proposed
2,000 unit West Dallas project, (iv) 335 new public housing units allocated under
HOPE VI in 1994 as replacement units for West Dallas, and (v) 698 additional
Section 8 vouchers promised by HUD. Therefore, there are 674 new units of public
housing currently funded but not under construction. Eighty of these units are
specifically at issue in this case.

                                       7
units in predominantly white areas as there are in minority areas.9

A “predominantly white area” is defined as less than 37% Hispanic,

black, or other minority.         The required 3,205 new units may be

satisfied by the use of Section 8 certificates or vouchers, but

only after court approval.10       The construction costs for 674 of the

2,807 new replacement units have been previously allocated to DHA

by HUD,11 although only 75 of these units are currently under

construction or completed.12

            The Homeowners filed this suit against DHA and HUD to

enjoin the construction of two new 40-unit public housing projects

      9
         The source of this final detail of the district court’s remedial order
is unclear. The written order itself is confusing. Paragraph A.3 requires that
all of the 3,205 new units be built in predominantly white areas.
      In slight contrast, the district court reiterates throughout his oral and
written opinions that all of the 674 new units of public housing (i.e., the ones
currently funded by HUD but not under construction) “and any other allocated in
the future, must be developed in predominantly white areas until there are
approximately as many non-elderly public housing units in those areas as in
minority areas.” 10/6/97 Written Opinion, at 22. The district court goes on to
say, “The race conscious site selection remedy is limited. It applies only until
there is a comparable number of public housing units in white and minority
areas.” Id. at 22-23; see also 8/25/97 Oral Opinion, at 22 (“Again, the 674
units must be placed in white non-minority areas until there are as many public
housing units in white areas as in minority areas.”).
      10
         To date, no plan for the use of Section 8 certificates or vouchers has
been submitted to the district court. However, HUD states in its brief to this
court that it “expects to meet this obligation by providing funding for Section
8 certificates and vouchers for all of the 3,205 units, at a rate of 320 units
per year for 10 years. Thus, it is likely that the only public housing units
developed under the Remedial Orders will be the 774 units already allocated by
HUD and designated as replacement units under paragraph A.1 of the HUD Remedial
Order and paragraph A.2 of the DHA Remedial Order.”
      11
         The district court authorized that 200 of the replacement units may be
used in the reconfiguration and revitalization of the West Dallas project.
      12
          The 75 units either under construction or completed are at DHA’s
Frankford & Marsh site.

                                       8
on sites adjacent to their neighborhoods.13                        The Homeowners allege

that the remedy of new construction is not narrowly tailored

because    it    requires     that          the    new     units     be    constructed      in

predominantly white areas.              The Homeowners do not contest either

the remedial order’s poverty site-selection criterion or HUD’s

site-selection standards set forth in 24 C.F.R. § 941.202.

            In    response       to    the        Homeowners’       action,      the   Walker

plaintiffs sought declaratory relief that the remedial order was

constitutional.        The Homeowners’ request for an injunction and the

Walker plaintiffs’ declaratory judgment action were tried together

in   October     1996.     The     district         court    denied        the   Homeowners’

injunctive relief and granted the Walker plaintiffs declaratory

relief.    The district court gave an oral opinion on August 25,

1997, entered final judgment on September 18, 1997, and issued its

written opinion on October 6, 1997.14

                                      II.    STANDING

            As    an     initial       matter,       DHA     and     HUD    challenge      the

Homeowners'      standing     to       bring       their     suit.         The    burden   of

establishing standing rests with the party seeking to invoke

federal jurisdiction (i.e., the Homeowners).                        See United States v.

Hays, 515 U.S. 737, 743, 115 S. Ct. 2431, 2435 (1995); Lujan v.

      13
         One site is at the intersection of McCallum and Meandering Way, and the
other site is at the intersection of Hillcrest and Highway 190.
      14
         These opinions will hereinafter be cited respectively as: 8/25/97 Oral
Opinion, 9/18/97 Final Judgment, and 10/6/97 Written Opinion.

                                               9
Defenders of Wildlife, 504 U.S. 555, 561, 112 S. Ct. 2130, 2136

(1992).       In a case that has proceeded to final judgment, the

factual allegations supporting standing (if controverted) must be

supported adequately by the evidence adduced at trial.                See Hays,
515 U.S. at 743, 115 S. Ct. at 2435; Lujan, 504 U.S. at 561, 112 S.

Ct. at 2137; Gladstone Realtors v. Village of Bellwood, 441 U.S.
91, 115 n.31, 99 S. Ct. 1601, 1616 n.31 (1979); see also CHARLES ALAN

WRIGHT   ET AL.,   13A FEDERAL PRACTICE & PROCEDURE § 3531.15, at 105 (2d ed.

1984).15

              The irreducible constitutional minimum of standing is

composed of three elements:

              First, the plaintiff must have suffered an
              “injury in fact”--an invasion of a legally
              protected interest which is (a) concrete and
              particularized, and (b) actual or imminent,
              not conjectural or hypothetical.       Second,
              there must be a causal connection between the
              injury and the conduct complained of . . . .
              Third, it must be likely, as opposed to merely
              speculative, that the injury will be redressed
              by a favorable decision.

Hays, 515 U.S. at 742-43, 115 S. Ct. at 2435 (quoting Lujan, 504
U.S.     at   560-61,    112   S.   Ct.   at   2136)   (internal   citation   and

quotations omitted).           In applying these constitutional standing

      15
           “If this were an appeal from a judgment granting the defendants’
motion to dismiss for lack of standing, we would be required to accept as true
all of the material allegations of the complaint.      However, because we are
reviewing a final judgment based upon a fully developed record, we must evaluate
standing from all materials of record.” Pollard v. Cockrell, 578 F.2d 1002, 1006
(5th Cir. 1978) (internal citations and quotations omitted).

                                          10
requirements, the Court has adopted a prudential principle that

bars the adjudication of “generalized grievances” against allegedly

illegal government conduct.16         See id.     In the equal protection

context, this prudential principle means that standing exists only

for those persons who are personally denied equal treatment by the

challenged discriminatory conduct.             See id. (citing Allen v.

Wright, 468 U.S. 737, 755, 104 S. Ct. 3315, 3326 (1984)); see also

Valley Forge Christian College v. Americans United for Separation

of Church and State, Inc., 454 U.S. 464, 489 n.26, 102 S. Ct. 752,

768 n.26 (1982) (rejecting the proposition that every citizen has

“standing to challenge every affirmative-action program on the

basis of a personal right to a government that does not deny equal

protection of the laws”).

            DHA and HUD principally contend that the Homeowners lack

standing because they allege an injury that is conjectural and a

generalized grievance. The essence of the Homeowners’ complaint is

twofold: (1) they have been purposefully discriminated against

because of their race (i.e., they were intentionally singled out

because of     their   race   to   accommodate    two   new   public   housing

      16
          A “generalized grievance” is a harm “shared in substantially equal
measure by all or a large class of citizens.” Warth v. Seldin, 422 U.S. 490,
499, 95 S. Ct. 2197, 2205 (1975). “The prudential principle barring adjudication
of ‘generalized grievances’ is closely related to the constitutional requirement
of personal ‘injury in fact,’ and the policies underlying both are similar.”
Apache Bend Apartments, Ltd. v. United States, 987 F.2d 1174, 1176 (5th Cir.
1993) (en banc).

                                      11
projects adjacent to their neighborhoods), and (2) this decision

has inflicted or threatens to inflict specific injury including

decreased property values, increased crime and population density,

environmental problems, and diminished aesthetic values of the

neighborhood because DHA will fail to operate and maintain the two

projects     properly.        The   remedial   order’s    explicit   racial

classification alone is sufficient to confer standing on these

particular homeowners. In Allen v. Wright, 104 S. Ct. 3315 (1984),

the Supreme Court wrote regarding the “stigmatizing injury” caused

by racial discrimination that “[t]here can be no doubt that this

sort of non-economic injury is one of the most serious consequences

of discriminatory government action and is sufficient in some

circumstances to support standing.”            Id. at 755, 104 S. Ct. at

3326.    The Court continued, “Our cases make clear, however, that

such injury accords a basis for standing only to ‘those persons who

are     personally   denied    equal    treatment’   by   the   challenged

discriminatory conduct.        Id.; see also City of Richmond v. J.A.

Croson, 488 U.S. 469, 493, 109 S. Ct. 706, 721 (1989) (“To whatever

racial group these citizens belong, their ‘personal rights’ to be

treated with equal dignity and respect are implicated by a rigid

rule erecting race as the sole criterion in an aspect of public

decisionmaking.”).

                                       12
           Under the remedial order, DHA selected the homeowners’

neighborhood because they are white and they live in an area of

Dallas that is at least 63% white.                  The remedial order also

requires that new units not be located in areas where the poverty

rate exceeds 13%.       Thus, these homeowners’ “whiteness” is one of

two   controlling    elements      which      identified    the     specific       sites

adjacent     to   their     neighborhoods         for      new     public      housing

construction.     When a homeowner’s neighborhood adjoins a proposed

public housing      project      whose   site    was    determined        by   a   race-

conscious standard, he has standing to sue because of the explicit

racial classification.        Cf. Hays, 515 U.S. at 744-45, 115 S. Ct. at

2436 (“Where a plaintiff resides in a racially gerrymandered

district, however, the plaintiff has been denied equal treatment

because of the legislature’s reliance on racial criteria, and

therefore has standing to challenge the legislature’s action.”).

           DHA and HUD cite three cases to support their contention

that the Homeowners’ injury is a generalized grievance lacking the

specificity and particularity necessary to confer standing.                         Each

case is easily distinguishable from the case at hand.                     In Warth v.

Seldin, 422 U.S. 490, 504-07, 95 S. Ct. 2197, 2208-09 (1975), the

plaintiffs    alleged     that    an   adjacent    town’s        zoning    ordinances

effectively excluded low and moderate income persons from living in

the town, but they could not demonstrate that the ordinances

                                         13
specifically precluded them from living in the adjacent town.           In

Apache Bend Apartments v. United States, 515 F.2d 1174, 1177 (5th

Cir. 1993), the plaintiff-taxpayers were not seeking to litigate

their own tax liability, but the tax liability of taxpayers who

were not before the court.      And in Hays, 515 U.S. at 744-45, 115 S.

Ct. at 2436, the plaintiffs were denied standing to challenge a

reapportionment plan because they did not live in the district that

was the focus of their claim.          In contrast to these three cases,

the Homeowners live in neighborhoods next door to the proposed new

40-unit housing projects, and the location of these projects was

selected specifically because of the homeowners’ race.

              In general, the racial classification of the homeowners

is an injury in and of itself.          See Shaw v. Reno, 509 U.S. 630,

643, 113 S. Ct. 2816, 2824 (1993) (“Classifications of citizens

solely on the basis of race are by their very nature odious to a

free people whose institutions are founded upon the doctrine of

equality.      They threaten to stigmatize individuals by reason of

their membership in a racial group and to incite racial hostility."

(internal citations omitted)). But the Homeowners also allege that

constructing two new 40-unit public housing projects adjacent to

their neighborhoods will cause a decline in their property values

and   other     problems   involving    crime,   traffic   and   diminished

aesthetic values.      Relying on the district court’s fact finding

                                       14
that the Homeowners have not suffered such an economic injury

caused by the new public housing projects, HUD and DHA challenge

whether the Homeowners have in fact suffered a decrease in property

values.    Despite this finding, we cannot conclude, having reviewed

the record, that the Homeowners did not put forth adequate evidence

at trial to confer standing upon them.          The district court did not

hold that the Homeowners lack standing, as he was well aware of the

potential     for   neighborhood   disruption     traceable    to   improperly

managed public housing projects.           HUD and DHA cite no cases in

which standing has been denied to homeowners who asserted their

quality of life and property values would be diminished by a next-

door public housing or other HUD project.            The caselaw is to the

contrary.17

            In sum, the Homeowners alleged and sufficiently proved

facts that were adequate to support standing to sue.18              The injury

      17
          See Alschuler v. HUD, 686 F.2d 472, 476-77 (7th Cir. 1982); South East
Lake View Neighbors v. HUD, 685 F.2d 1027, 1034-35 (7th Cir. 1982); Society Hill
Civic Ass’n v. Harris, 632 F.2d 1045, 1054 (3d Cir. 1980).
      18
         As a subsidiary matter, DHA contends that the Homeowners lack standing
because their alleged injury would not be redressed by the invalidation of the
remedial order’s requirement that public housing be built only in "predominantly
white areas." In other words, DHA argues that it could have selected the two
sites in question even without the race-conscious site selection criterion.
         DHA applies the wrong legal standard. The test is whether DHA would
have selected these two sites absent the race-conscious criterion, not whether
it could have selected the sites. See Warth, 422 U.S. at 504, 95 S. Ct. at 2208
(framing the standing question as whether, absent the challenged zoning
ordinances that allegedly excluded low-income persons from living in the town of
Penfield, there was a substantial probability that the plaintiff would have been
able to obtain such housing). There is no evidence in the record that DHA would
have chosen the two sites in question absent the race-conscious criterion, and
the Walker plaintiffs admit in their brief to this court that "[t]he record is
clear that DHA would not have chosen the sites absent the court order."

                                      15
they assert is not too abstract or conjectural.                    The line of

causation between the alleged unconstitutional conduct and the

injury is not attenuated.            And the prospect of obtaining relief

from    the    injury    as   a   result    of   a   favorable   ruling   is   not

speculative.

                 III.    HOMEOWNERS’ EQUAL PROTECTION CLAIM

              The district court held that the Homeowners failed to

allege an equal protection violation.                 The Homeowners challenge

this conclusion.

                  A.    Lack of a Similarly Situated Group

              The district court, citing Samaad v. City of Dallas, 940
F.2d 925 (5th Cir. 1991), found that the Homeowners failed to show

an equal protection violation because they did not identify a

similarly situated set of black persons who have been treated

better.       See id. at 941 n.31      This requirement, however, applies

only    to    equal     protection    claims     involving   facially     neutral

government actions, where it is necessary to establish that the

government is distinguishing or classifying persons on the basis of

race.        See id. at 941.         Explicit racial classifications, in

         Additionally, HUD argues that the Homeowners are challenging the wrong
part of the remedial order by contesting the 3,205 additional units of public
housing that must be built in predominantly white areas. It is quite clear from
the record, however, that the Homeowners have properly challenged the two 40-unit
projects, which were selected on a race-conscious basis to be built next to their
neighborhoods. Obviously, these two projects are part of a larger remedial
scheme that is affected by this court’s opinion herein.

                                           16
contrast, establish unequal treatment by their very nature.                 See

Shaw, 509 U.S. at 642, 113 S. Ct. at 2824 (“Laws that explicitly

distinguish between individuals on racial grounds fall within the

core of [the Equal Protection Clause’s] prohibition.”).               Because

the Homeowners challenge an explicit racial classification within

the district court’s remedial order, they have properly alleged an

equal protection violation.

            The district court also suggested that the Homeowners

failed to demonstrate an equal protection violation because “[t]he

impact [of the new construction], if any, on the Homeowners will be

considerably less than [the] impact of the existing DHA public

housing projects on the property owners in the black neighborhoods

with    existing   projects.”     The      district   court’s   reasoning   is

incorrect: racial classifications are not acceptable simply because

they are perceived to have little impact.              Any explicit racial

classification, regardless of the burdens or benefits its imposes,

is     suspect   and   subject   to   strict    scrutiny.       See   Adarand

Constructors, Inc. v. Pena, 515 U.S. 200, 227, 115 S. Ct. 2097,

2113 (1995) (“[A]ll racial classifications, imposed by whatever

federal, state, or local government actor, must be analyzed by a

reviewing court under strict scrutiny.”); Powers v. Ohio, 499 U.S.
400, 410, 111 S. Ct. 1364, 1370 (1991) (“It is axiomatic that

                                      17
racial classifications do not become legitimate on the assumption

that all persons suffer them in equal degree.”).

                    B.   Intent to Discriminate

          The district court held that the Homeowners failed to

prove an equal protection violation because there is no intent to

treat whites worse than similarly situated blacks. Once again, the

district court is incorrect.    An explicit racial classification

does not require any inquiry into “intent” in order to allege an

equal protection violation.   See Shaw, 509 U.S. at 642, 113 S. Ct.

at 2824 (“No inquiry into legislative purpose is necessary when the

racial classification appears on the face of the statute.”).

“Express racial classifications are immediately suspect because,

‘[a]bsent searching judicial inquiry . . ., there is simply no way

of determining whether classifications are ‘benign’ or ‘remedial’

and what classifications are in fact motivated by illegitimate

notions of racial inferiority or simple racial politics.’”   Id. at

642-43, 113 S. Ct. at 2824 (quoting Croson, 488 U.S. at 493, 109 S.

Ct. at 721).

          The district court’s skepticism of the Homeowners’ right

to pursue an equal protection claim was unfounded, so we proceed to

address the merits of their claim.

                                 18
                          IV.   NARROW TAILORING

            The primary issue on appeal is whether the remedial

order’s requirement that new public housing units be built or

acquired in “predominantly white areas” is narrowly tailored to

remedy the vestiges of past discrimination and segregation within

Dallas’s public housing programs. No party suggests on appeal that

the racial steering, which for so many years was a part of Dallas’s

public housing programs, has not been effectively eradicated.19

Rather, the parties’ dispute centers on the district court’s

efforts to rectify the effects of the now-past discriminatory

practices of DHA, HUD, and the City of Dallas.              In short, is it

constitutional in this case to implement a race-conscious site

selection criterion for newly built or acquired public housing?

            Any   race-conscious    remedial     measure    receives    strict

scrutiny under the Equal Protection Clause.          See Adarand, 515 U.S.

at 227, 115 S. Ct. at 2113; Black Fire Fighters Ass’n v. Dallas, 19
F.3d 992, 995 (5th Cir. 1994) [hereinafter BFFA].            This is true no

matter    which   race   is   burdened    or   benefitted    by   the   racial

classification in question.        See Adarand, 515 U.S. at 224, 115 S.

Ct. at 2111 (citing Croson, 488 U.S. at 494, 109 S. Ct. at 722).

Strict scrutiny requires that a racial classification be (1)

     19
          See 8/25/97 Oral Opinion, at 5 (“From the very beginning the primary
purpose that DHA had was to prevent blacks from moving into white areas of the
city and the suburbs. That is not true of DHA today . . . .”).

                                     19
justified by a compelling government interest and (2) narrowly

tailored to further that interest.    See Adarand, 515 U.S. at 227,

115 S. Ct. at 2113.      The Homeowners do not contest that there

exists a compelling government interest in this case.   Therefore,

our inquiry focuses on whether the remedial order is narrowly

tailored.

            In assessing whether a remedy is narrowly tailored,

courts are to assess five factors: (1) the necessity for relief,

(2) the efficacy of alternative remedies, (3) the flexibility and

duration of relief, (4) the relationship of the numerical goals to

the relevant market, and (5) the impact of the relief on the rights

of third parties.    See United States v. Paradise, 480 U.S. 149,

171, 107 S. Ct. 1053, 1066 (1987); BFFA, 19 F.3d at 995.     Before

examining these factors, however, we must address the standard of

review.

            When a district court’s race-conscious remedial measure

is challenged as not being narrowly tailored, the party defending

the remedial measure bears the burden of producing evidence that

the remedial measure is constitutional.   See Wygant v. Jackson Bd.

of Educ., 476 U.S. 267, 277-78, 106 S. Ct. 1842, 1848-49; Aiken v.

City of Memphis, 37 F.3d 1155, 1162 (6th Cir. 1994); see also Raso

v. Lago, 135 F.3d 11, 20 (1st Cir. 1998) (Stahl, J., dissenting).

The party challenging the remedial measure, of course, bears the

                                 20
ultimate burden of demonstrating that the racial classification is

unconstitutional.   See id.

          In   general,   we   review   a   district   court’s   legal

conclusions de novo and its findings of fact for clear error.

However, “if the trial court bases its findings upon a mistaken

impression of applicable legal principles, the reviewing court is

not bound by the clearly erroneous standard.”     Inwood Labs., Inc.

v. Ives Labs, Inc., 456 U.S. 844, 855 n.15, 102 S. Ct. 2182, 2189

n.15 (1982); see also United States v. Bentley-Smith, 2 F.3d 1368,

1373 (5th Cir. 1993).

          In the case at hand, the district court placed the burden

of production, as well as the ultimate burden of proof, on the

Homeowners. Because he improperly placed the burden of production,

we are not bound by the clearly erroneous standard in reviewing his

findings of fact.   Nonetheless, although more rigorous review may

be in order, we will deferentially examine the district court’s

findings because this is a complicated case in which the district

court has a decade’s worth of experience with Dallas’s public

housing programs.

          Race-conscious remedies must be narrowly tailored to

eliminate the effects of past discrimination as well as bar like

discrimination in the future.    See Paradise, 480 U.S. at 172-75,

107 S. Ct. at 1067-68; id. at 183, 107 S.Ct. at 1073 (citing

                                 21
Louisiana v. United States, 380 U.S. 145, 154, 85 S. Ct. 817, 822

(1965)).     “Racial classifications are simply too pernicious to

permit any but the most exact connection between justification and

classification.”       Adarand, 515 U.S. at 229, 115 S. Ct. at 2113

(quoting Fullilove v. Klutznick, 448 U.S. 448, 537, 100 S. Ct.
2758, 2805 (1980) (Stevens, J., dissenting)).               This means that a

race-conscious remedy must be framed to address the exact effects

and harms of the discrimination at issue.              See Wygant, 476 U.S. at

280, 106 S. Ct. at 1850.

             In application, arriving at an exact fit between harm and

remedy requires consideration of whether a race-neutral or less

restrictive remedy could be used.           See Adarand, 515 U.S. at 237-38,

115 S. Ct. at 2118; Wygant, 476 U.S. at 280 n.6, 106 S. Ct. at 1850

n.6.   This is because a race-conscious remedy should be the remedy

of last resort.      See Alexander v. Estepp, 95 F.3d 312, 316 (4th

Cir. 1996) (“[E]xplicit racial preferences, if available at all,

must be only a ‘last resort’ option.”).            A “race-conscious remedy

will   not    be   deemed   narrowly        tailored    until   less   sweeping

alternatives——particularly race neutral ones——have been considered

                                       22
and tried.”      Williams v. Babbitt, 115 F.3d 657, 666 (9th Cir.

1997).20

            The first two Paradise factors are the necessity for

relief and efficacy of alternative remedies.            These weigh against

race-conscious site selection for two reasons.              First, Section 8

housing vouchers have not been given a fair try to prove their

potential to desegregate.         Second, other criteria than a racial

standard will ensure the desegregated construction or acquisition

of any new    public housing.      See infra, text at n.31.

            The Homeowners argue that Section 8 alone is capable of

remedying the effects of past discrimination in Dallas’s public

housing programs, and they contend that Section 8 has not been

given a fair try.       They also point out, and the district court

agrees, that Section 8 is more cost-efficient than new construction

and   is   preferred   by   the   majority    of   public   housing    program

participants. Section 8 is more flexible than fixed public housing

because the participants may decide where and in what type facility

      20
          It is true that in Hills v. Gautreaux, the Supreme Court did not
disapprove a remedial order which, to end discrimination in public housing,
required housing to be built in nonblack neighborhoods of Chicago. See 425 U.S.
284, 296, 96 S. Ct. 1538, 1546 (1976).      But the Court did not consider the
propriety of that remedy as opposed to a non-race conscious remedy like a
vigorous Section 8 program. The only disputed issue in that case was whether the
remedy could extend beyond the city limits of Chicago. Further, Hills predates
significant changes that have occurred both in HUD’s approach to public housing
and in the scrutiny afforded race-conscious remedies. Hills does not mandate
either the construction of new public housing or race-conscious site selection.
We must review the application of the Paradise factors, which the district court
correctly understood to frame the issues here.

                                      23
to reside. As a result, virtually all available Section 8 vouchers

have been snapped up in Dallas.

            Unfortunately, however, numerous programs that would

encourage    and    assist    black    families    to    use   Section    8    in

predominantly white areas had been in effect or fully operational

for only a short time before trial on the Homeowners’ case.                   For

instance, the record indicates that DHA’s mobility program had been

operating as originally proposed by the Walker plaintiffs and the

district court since only approximately 1994.21                  In addition,

exceptions to the “fair market rent” caps on Section 8 vouchers and

certificates have been slow in coming.22                It also appears that

potential Section 8 landlords may now be paid “signing bonuses” for

accepting Section 8 tenants.           These are but three examples of

numerous “helping-hands” that may be employed to promote the

      21
          See 10/30/96 Testimony of Ann Lott, Director of DHA’s Section 8
Mobility Program (agreeing that most of the efforts to improve DHA’s mobility
program have been within the preceding two years); 8/7/96 Deposition of Lott
(explaining new procedures within DHA’s mobility program that were implemented
in the prior year, including a marketing campaign for prospective landlords, a
landlord newsletter, and private briefings for landlords on the Section 8
program).   But see 10/30/96 Testimony of Lori Moon, President & CEO of DHA
(stating that DHA’s mobility efforts have been in effect since 1989).
      22
          It is unclear from the record whether HUD has granted DHA a 120% fair
market exception rent across-the-board for all Section 8 housing in predominantly
white areas. It is also unclear whether DHA could be granted fair market rent
exceptions higher than 120%. Evidence in the record shows that a 160% fair
market exception rent would significantly increase the availability of Section
8 housing in predominantly white areas. Prior to implementing a race-conscious
remedy, it would seem advisable to ensure (1) that rent exceptions above 120% are
foreclosed, as they offer the potential to break-down a significant barrier to
an even more effective Section 8 program, or (2) that 120% fair market exception
rents have been fully implemented and tried, if that is the statutory maximum.

                                       24
success of Section 8 as a desegregation tool.23           While the history

and timing of their implementation by DHA and HUD in this case are

not perfectly clear, it is evident from the record that they were

not programs of long-standing before trial. If Section 8, combined

with such assistance programs, is an effective desegregation tool,

then Section 8 is superior to a race-conscious remedy in that it

allows market forces and personal preferences rather than racial

criteria to guide the homemaking decision.

            The   district   court   found,    agreeing   with    the   Walker

plaintiffs, DHA, and HUD, that Section 8 needed to be combined with

new construction or acquisition in predominantly white areas in

order to remedy the effects of past discrimination.              Adopting the

Walker plaintiffs’ proposed findings of fact and conclusions of law

in toto, the court concluded that Section 8 alone was an inadequate

remedy for several reasons: there are not enough Section 8 units in

predominantly white areas; among the available units there is a

lack of three and four bedroom units; rents in predominantly white

areas are too high to be covered even by Section 8’s fair market

exception rents; landlords do not want to participate in the

Section 8 program; and Section 8 participants become frustrated in

looking for housing in predominantly white areas and settle for

housing in minority areas.           The court also found that rental

      23
         Another example would be the vigorous enforcement of state and federal
laws prohibiting racial discrimination by private Section 8 landlords.

                                      25
contract    requirements     in   predominantly      white   areas    contain

provisions that are difficult for Section 8 families to meet (e.g.,

high security deposits, requirement of having held a job for the

past year, etc.).      We neither accept nor attempt to reject these

factual findings. Rather, there is one overarching factual finding

by the district court——which is uncontested by all parties——that

transcends the parties’ objections to Section 8 as a remedial

measure.

            In 1987, when the district court first found DHA in

violation of its original consent decree, a negligible number of

black families in DHA’s Section 8 programs lived in predominantly

white areas.24   In contrast, in September 1994, approximately 1,050

Section 8 black families lived in predominantly white areas.25             And

in the fall of 1996, there were approximately 1,335 Section 8 black

families in predominantly white areas.26          These numbers show that

in the two year period between 1994 and 1996, the number of Section

8 black families living in predominantly white areas increased by

285, or 27%.     And it was during this same time period that DHA’s

Section 8 mobility program was getting fully underway. The program

      24
         The Walker plaintiffs state that in 1987 there were 66 Section 8 black
families living in predominantly white areas, which amounted to approximately
2.4% of all black families in DHA’s Section 8 program.
      25
          According to testimony in the record, this amounted to approximately
21% of all black families in DHA’s Section 8 program.
      26
          According to testimony in the record, this amounted to approximately
24-25% of all black families in DHA’s Section 8 program.

                                      26
currently in place, which the district court has not criticized,

essentially became fully operational around 1994.                 Based on the

relative success of DHA in moving blacks into predominantly white

areas via its Section 8 program between 1994 and 1996, the Walker

plaintiffs, HUD, and DHA have produced insufficient evidence to

show    that   the   district     court’s     race-conscious    site   selection

criterion      is    necessary     to     remedy     the   effects     of   past

discrimination.        Cf.   In   re    Birmingham    Reverse   Discrimination

Employment Litig., 20 F.3d 1525, 1545-47 (11th Cir. 1994);27 see

also BFFA, 19 F.3d at 995 (“The broad skip promotion remedy in the

decree is difficult to justify when the knowledge to narrow it

seems readily available.”).             Section 8, a race-neutral remedial

measure, is increasingly successful at moving black families into

       27
          In In re Birmingham Reverse Discrimination Employment Litigation, non-
black employees of the Birmingham Fire Rescue Service (BFRS) challenged a 1981
consent decree entered into by the City of Birmingham that required, inter alia,
that 50% of all promotions to the rank of BFRS lieutenant would be filled by
qualified blacks (i.e., for every two promotions to lieutenant, one must be
filled by a black candidate). See id.
      The 11th Circuit noted that between 1978 and 1981, BFRS significantly
increased its total number of black employees from 8 to 42, which represented a
shift in the black percentage of BFRS’s workforce from 1.89% to 9.3%. See id.
This was achieved without the use of a race-conscious remedy. See id. The court
stated that “there is strong evidence in the record of this case that the City
had implemented effective alternatives to race-based quotas to remedy its prior
discriminatory behavior.” Id. “While the district court correctly concluded
that, when the decree was entered, no black had as yet become a fire lieutenant,
we believe that, given the City’s progress at the entry-level, alternative
measures designed to increase black representation in the fire lieutenant ranks
were feasible.” Id. The court proceeded to list the non-race-based remedies
that the plaintiffs proposed regarding promotion to BFRS lieutenant. See id. at
1546-47.    It then concluded, “Considering the efficacy of the alternative
remedies, the relief provided in the decree cannot be reconciled with the
requirement that a government’s use of race must be narrowly tailored.” Id. at
1547.

                                         27
white areas, and the record indicates that it could be even more

successful with, for example, increased funding for both more

vouchers and the mobility program,28 more mobility counselors,29 and

higher fair market exception rents.30         When Section 8 has evidenced

such promising results, options such as these should be explored

and tested before adopting a race-conscious remedy as a last

resort.

            Additionally, it is unnecessary to employ the race-

conscious site selection criterion ordered by the court even if new

construction or acquisition of public housing occurs. The district

court may proceed with new construction as part of his remedial

plan, but he may not do so using a race-conscious site selection

criterion. Of course, other criteria may be employed to guide site

selection for new construction.         See United States v. Yonkers Bd.

of Educ., 837 F.2d 1181, 1184, 1236-37 (2d Cir. 1987) (using a

geographical site selection criterion for public housing).                  The

district court has already mandated that all new sites be in areas

      28
           See 10/30/96 Testimony of Ann Lott, Director of DHA’s Section 8
Mobility Program, at III-43 (stating that DHA is able to use virtually every
Section 8 voucher or certificate funded by HUD); see id. at III-65 (stating that
DHA could put to use an additional 1,500 Section 8 vouchers).
      29
          See id. at III-67 (stating that the mobility program could use more
counselors).
      30
          See id. at III-57 (stating that higher fair market exception rents
would assist in obtaining more Section 8 housing in predominantly white areas).

                                      28
where the poverty rate does not exceed 13%.31          The district court’s

concern that if it does not attach a race-conscious site selection

criterion to new construction, then the new units will end up in

minority areas and, as a consequence, Dallas’s public housing

projects will almost all remain in minority areas, is unfounded.32

            In deciding that Section 8 and nonracial site selection

criteria should be implemented before a racial standard, we are

mindful of the “respect owed a district judge’s judgment that

specified relief is essential to cure a violation of the Fourteenth

Amendment.”       Paradise, 480 U.S. at 183, 107 S. Ct. at 1073.

Nonetheless, a district court’s broad equitable powers remain

constrained by the boundaries of narrow tailoring.33               The recent

success of Section 8 and the availability of viable nonracial, non-

discriminatory site selection criteria, combined with the factors

discussed    in   the   following    paragraphs,     demonstrate     that   the

      31
         It is suggested in brief that this criterion essentially restricts the
areas available for new construction to predominantly white areas.
      32
          Moreover, the district court referred throughout his 8/25/97 Oral
Opinion and 10/6/97 Written Opinion to the danger of losing the funds already
allocated to new construction because they could not be transferred to the
Section 8 program. This may be true. Nonetheless, it does not justify the use
of a race-conscious site selection criterion.
      33
         See Billish v. City of Chicago, 989 F.2d 890, 893 (7th Cir. 1993) (en
banc); Wessmann v. Gittens, 160 F.3d 790, 808 (1st Cir. 1998) (“Croson, in
particular, leaves no doubt that only solid evidence will justify allowing race-
conscious action. . .”); id. (“Our dissenting brother’s valiant effort to read
into Croson a broad discretion for government entities purporting to ameliorate
past discrimination strikes us as wishful thinking.”).

                                      29
remedial order’s race-conscious site selection criterion is not

narrowly tailored.

          First,   DHA,    HUD,   and    the   City   of    Dallas   are   all

cooperating defendants.     That is to say, DHA, HUD, and the City of

Dallas no longer discriminate against black families in DHA’s

public housing programs, and -- by all accounts in the record --

all three defendants are active participants in crafting and

implementing remedial measures to eliminate the vestiges of past

discrimination.    In contrast, the Supreme Court approved a race-

conscious remedy in Paradise in large part because earlier, less

restrictive remedies had proven ineffective since the defendant

continually   resisted    their   implementation      and   stonewalled     in

developing acceptable procedures for the advancement of black

troopers within the Alabama Department of Public Safety.                   See

Paradise, 480 U.S. at 162-65, 107 S. Ct. at 1062-63 (describing the

Department’s continuing failure to comply with the parties’ consent

decrees); id. at 170-71, 176-77, 107 S. Ct. at 1066, 1069; see also

BFFA, 19 F.3d at 996 (finding a race-conscious remedial measure

unnecessary, in part, because the defendant was a willing party to

the settlement of the lawsuit).          Where, as here, the defendants

have begun making race-neutral, good faith, and effective efforts

to remedy the wrongs of the past, a race-conscious remedy should

only be a last resort.

                                    30
             Second, the district court, in his 8/25/97 Oral Opinion,

made references to the necessity of a race-conscious site selection

criterion     because     some     participants     in    DHA’s    public    housing

programs do not want and should not be forced to use Section 8.34

While some may find it difficult to use Section 8, a race-conscious

remedial     measure    is   not    justified     by     certain   class    members’

objections to looking for housing on their own versus their being

offered a unit owned and operated by DHA.                A race-conscious remedy

is justified, after race-neutral remedies have been considered and

found wanting, if it is the only effective means by which to remedy

the effects of past discrimination.               It is by this standard alone

that the district court must assess his remedial orders.                           As

applied to the facts of this case, the district court’s concern

seems      particularly      irrelevant      as    only     474    new     units   in

predominantly white areas are currently funded, and those units

must be filled by Section 8 families who participate in DHA’s

      34
          See, e.g., 8/25/97 Oral Opinion, at 28 (“Even if this money [for new
public housing construction] could be reprogrammed for Section 8, there would
still be a need for the use of public housing in the desegregation plan. Section
8, although the preferred method, is not the only method. Indeed, there are
members of this class who made it evident, abundantly clear to this Court, that
they did not trust Section 8, they would not use Section 8, and they should not
be forced to use Section 8.”); id. at 33 (“I recognized then, as I do now, that
although Section 8 certificates and vouchers may be the preferred method for most
people, for many people there are risks in Section 8 that not all class members
would want to take.     I declined to force those risks upon unwilling class
members.”).

                                        31
Family Self-Sufficiency Program.35         That is, they will be filled by

the “cream-of-the-crop” from DHA’s waiting lists.            Thus, those who

in all probability need public housing units the least (because

they would be successful Section 8 participants) will be directed

to the new units, while those for whom the district court expresses

concern will be left with Section 8.          DHA’s rationale for filling

the new units with participants in its self-sufficiency program is

commendable, but it throws askew part of the district court’s

reasoning regarding the remedial need for new construction in

addition to Section 8.

            Third, it remains unclear why there is an absolute

remedial necessity to build 474 new units of public housing using

a racial classification when (1) 2,033 (or 72%) of the remedial

order’s 2,807 replacement units will be Section 8 and (2) DHA and

HUD may submit a plan to use Section 8 for all of the 3,205

additional units of public housing to be built in predominantly

white areas.36     In sum, out of a total of 6,012 units within the

remedial order, only 474 (or 8%) must——assuming an acceptable

      35
          DHA’s Family Self-Sufficiency Program is a voluntary program that
requires participants to, for instance, be employed or attend school.       The
participants sign a five-year contract with DHA in which they agree to abide by
the program’s regulations. In essence, the program is designed to make its
participants self-sufficient by providing them with “upward mobility type
assistance.” 8/7/96 Deposition of Lori Moon, President & CEO of DHA, at 110.
      36
          As noted previously, HUD states in its brief to this court that it
intends to fulfill its entire obligation regarding the 3,205 additional units
with Section 8 vouchers or certificates.

                                      32
Section 8 plan is submitted for the 3,205 additional units——be new

construction in predominantly white areas.       If Section 8 can

effectively satisfy the district court’s remedial goal regarding

5,628 units, it is baffling to assume that it cannot do so for an

additional 474 units.

          DHA, HUD, and the City of Dallas offer two responses to

this criticism.      First, they argue that 474 units is a tiny

proportion of the overall number of units contemplated by the

remedial order; the deference due a district court in fashioning a

remedial order should protect such a small element of the overall

remedial plan.    This would be correct if the 474 units were not

attached to a racial classification which requires that they be

built in predominantly white areas.    Racial classifications, even

small ones, receive strict scrutiny.   Second, they contend that if

the 474 units already funded by HUD are not built in white areas,

they will either not be built at all or will be built in minority

areas which will only further the racial segregation of DHA’s

public housing projects.    As discussed previously, the district

court may entertain any number of site selection criteria regarding

new public housing units, except for race.    No one suggests that

the 474 units should not be built, only that requiring that they be

built using a race-conscious site selection criterion is not

narrowly tailored.

                                33
            The fourth Paradise factor, the relationship of numerical

goals to the relevant markets, also cuts against the race-conscious

site-selection criterion in the remedial order.37                    The district

court’s remedial goal is to have half of the families in DHA’s

public housing programs (either public housing units or Section 8)

in predominantly white areas of Dallas and half in “minority

areas”.      The     justification    for   this       goal    is   that   Dallas’s

population is approximately half white and half “minority” and,

therefore, public housing should be divided accordingly. This goal

is overly broad.        This suit was brought by black plaintiffs on

behalf of a class of black plaintiffs.           There is no suggestion that

the suit ever expanded to include all minorities or that any

liability of the public agencies to other minorities could be

found.      The    court’s   definition     of     a       “predominantly    white”

neighborhood, with 63% white population, is also based on the idea

that public housing may not be placed in neighborhoods with higher

concentrations of Hispanics. There is no evidence in the record to

support the court’s arbitrary definition of a predominantly white

neighborhood.        The emphasis should instead be directed toward

placing public housing participants in neighborhoods of their

choice     through     a   vigorous    Section         8      program,     non-black

     37
           The third Paradise factor considers the flexibility and duration of
relief.   On balance, that factor is neutral in this case.

                                      34
neighborhoods, census tracts in which no public housing currently

exists, or non-poor neighborhoods.38

            The fifth Paradise factor is the impact of a racially-

conscious site selection criterion on the rights of third parties.

Among all the groups affected by Dallas public housing, only these

Homeowners have maintained that they would be injured by the

racially-based site selection process that occurred here.               Despite

the court’s having purportedly found against them on this issue,

the totality of the remedial order is far more ambivalent.                   The

district court ordered stringent criteria for the design and upkeep

of the projects and for tenant selection here and in another

“predominantly white” neighborhood (the Frankford & Marsh site, see

supra, n.12), and he called for the participation of neighboring

community members, like these Homeowners, in planning the projects.

The court showed considerable sensitivity to the fact that public

housing has in the past been disgracefully neglected in Dallas.

The resulting remedial order thus cuts both ways with respect to

the Homeowners’ rights.       On one hand, it attempts to placate their

      38
         According to the Walker plaintiffs’ brief, at 11: “There are 113 county
census tracts with 63% or greater non-Hispanic white population, 95 of which have
a poverty population less than the county average. There are an additional 20
tracts with a non-Hispanic white population between 50% and 63%. Only seven of
these tracts have a poverty rate less than the county’s. There are an additional
16 tracts with a poverty population below the county average but the non-Hispanic
white population is less than 50%.”

                                       35
fears of deterioration in their neighborhoods.                     On the other hand,

it lends credibility to those fears.

            Because there are promising, non-racially discriminatory

ways to continue desegregating public housing in Dallas, the

provision    of    the    court’s      remedial       order        calling    for   the

construction      or   acquisition      of    units     of     public    housing     in

“predominantly white” areas is unconstitutional. Under the balance

of the Paradise factors, the criterion is not narrowly tailored,

and it is premature to utilize such a last-resort measure.                     We must

vacate and remand this portion of the remedial order for further

consideration.

            In    so   doing,    we   emphasize   several           points.     First,

increased reliance on Section 8 demands that the public agencies

implement a vigorous mobility plan that serves the relocation needs

and concerns of black families, reaches out to white landlords,

affords adequate fair market rent exceptions, and combats illegal

private discrimination.          Second, this opinion does not deal with

the   remedial     order’s      nondiscriminatory        tenant       selection     and

assignment provisions, which are not challenged by the Homeowners.

Third,   this     opinion    does     not    preclude        the    construction     or

acquisition of additional public housing if sites are selected by

means of nonracial criteria.          But we also recognize that Section 8

is overwhelmingly preferred by public housing families, that it

allows market forces and personal preferences to control the

                                        36
homemaking decision, and that it has not proven ineffective at

desegregating Dallas’s public housing programs when combined with

a vigorous mobility program.          As applied to the facts of this case,

the district court erred in employing a race-conscious remedy

before utilizing race-neutral alternatives.

                                 V.   CONCLUSION

              For the foregoing reasons, the district court’s remedial

order is VACATED to the extent indicated and the case is REMANDED

for further proceedings; the declaratory judgment awarded to the

Walker    plaintiffs     is   REVERSED;      and   this    court’s    stay   of

construction at the sites adjacent to the Homeowners’ subdivisions

shall    be   ENFORCED   until    the   district   court   holds     additional

hearings and enters a remedial order revised in accordance with the

foregoing opinion.

              Remedial order VACATED and REMANDED; declaratory judgment

for Walker plaintiffs REVERSED; stay ENFORCED pending entry of

revised remedial order.

                                        37