Court Opinion

ID: 8917308
Source: CourtListenerOpinion
Date Created: 2022-11-27 05:36:37.544503+00
Date Added: 2024-06-11T17:09:06.602909
License: Public Domain

HENLEY,
Senior Circuit Judge, dissenting.
I agree with the court’s conclusion that it is at least doubtful that an implied right of action against a federal funding agency exists under the Civil Rights Act of 1964, but I find no liability under the fifth amendment or under Title VIII of the Civil Rights Act of 1968, and in any event I cannot fully accept the terms of the court’s mandate on remand.
FACTS
As the court noted, HUD conducted its first compliance review in May, 1969. The report submitted by HUD investigator John M. Nelson concerning this review relates that the THA Executive Director admitted that THA public housing was segregated. More important with respect to the ultimate finding of liability here, the report also states, “No objection was offered to trying to integrate.... ” Indeed, the follow-up letter written by HUD’s Assistant Regional Administrator notes that the THA agreed to implement all the specific recommendations made by HUD. Certainly, the absence of any objection to integration and a positive response to HUD’s recommendations did not require further agency action at this juncture.1
*1427When the February, 1971 compliance investigation resulted in a finding of noncompliance with Title VI, one HUD official advised the THA of HUD’s reluctance to provide any further funding for either new construction or modernization of THA projects. As the majority notes, HUD Area Director Babbitt also wrote to the THA Board demanding that it comply with its adopted Tenant Assignment “Plan B” in making all future tenant assignments, suggesting that the Board adopt certain procedures relating to such assignments, and advising that all THA housing project funds would be deferred until a compliance investigation showed that the THA was complying with Title VI. By proposing that the THA adopt the tenant assignment procedures enumerated in his letter Babbitt in no way intended to convey that a mere paper resolve would bring the THA into compliance. That he did not have such a facile solution in mind is obvious from his deferral of all further funding until the THA complied with the requirements of Title VI. Likewise, Babbitt’s release of funds after the March 23 compliance check revealed that “the Texarkana Authority [was] beginning to implement some of the procedures necessary for compliance with Title VI” was not designed to abet the THA’s cause. Rather, the evidence of record demonstrates that his purpose in attempting to secure the funding in question was to provide adequate housing for all low income persons without regard to race. Two internal mem-oranda written before Babbitt’s second letter to the THA are particularly instructive. A handwritten memorandum dated March 25, 1971 from Thomas Broadwell to A. Ma-ceo Smith and Harold A. Odom states,
Dr. Babbitt does not feel like saying the door is open — if you do these things — we feel you’re in compliance.
Dr. Babbitt’s approach is to advise them they’ve been in non compliance for several years and that a recent investigation disclosed they were still in non compliance. Within five weeks [of the February, 1971 compliance review] another visit was made [the March 23 visit] and indications were evident of some slight improvement. Based upon the fact that he (Dr. Babbitt) did not want to continue withholding funds which would naturally improve the community they were approving certain projects.
Another memorandum dated March 26 from William “Sonny” Walker to Smith explains Babbitt’s desire not to create an open door to HUD funds. It states as follows:
Mr. Babbitt does not want to take any position or make any recommendation that cannot be supported by HUD guidelines and conceivably weaken our ability to enforce the full intent of Title VI. You will note that Mr. Babbitt’s [second] letter [to the THA] provides for us to work with Texarkana on a continuing basis, along with the submission of monthly progress reports detailing compliance with Title VI. In essence, this means that we will not give them a ‘clean bill’ in exchange for any immediate paper promises, but we will, on a continuing basis, suggest certain action that will assist them in fully complying with the intent of the law.
Hopefully, we will accomplish such things as minority group board members, tenant councils, and desirable initial occupancy of new projects through close monitoring and Equal Opportunity Staff assistance.
The circumstances surrounding deferral of $21,053.00 in additional modernization funds after the 1973 compliance review resulted in a determination of noncompliance with Title VI and Title VIII also deserve mention. Significantly, HUD Area Director Barber was prompted to request the release of the $21,053.00 only after the THA Executive Director advised the HUD Little Rock Area Office on April 22, 1974 that ten units at Ozan Courts, where a $731,000.00 modernization program had been completed only several weeks earlier, had developed *1428roof leaks following heavy rains. In his May 23 memorandum apprising Regional Administrator Morgan of the situation Barber explained,
Our Maintenance Engineer and the Construction Analyst both, after field visits, are in agreement that reroofing is essential if the money spent in the modernization program is to be protected. These roofs are the built-up type over twenty years old, and continuous water damage because of roof leakage will result in serious damage to the renewed living units.
Normally, we would not press an issue of this nature, but there is a $700,000 investment that will deteriorate rapidly if some action is not taken soon.
After receiving Barber’s memorandum Morgan evidently sent it to Lloyd D. Clap-saddle, the Assistant Regional Administrator, who contacted Acting Assistant Regional Administrator for Equal Opportunity Leonard Chaires to request his comments on the matter. Clapsaddle also offered the following recommendation:
Considering that $731,820 has already been committed to modernization of Project Ark-15-1 [Ozan Courts] and the additional $21,053 is available .. . and urgently needed for roof repairs to prevent damage to dwelling units otherwise modernized, we would recommend release of the funds. Our recommendation, however, would be conditioned to provide that any application from the Authority for a new program, modernization or other, would not be considered until a compliance review is conducted by your office and resultant findings resolved.
At Chaires’ direction, Thomas Broadwell then conducted the June, 1974 compliance review.
The court attempts to make much of the removal of strictures against HUD funding of THA projects. Its statement that “HUD then proceeded to give the THA over one million dollars in modernization funds and federal grants,” gives the impression that HUD officials eagerly filled the agency trough with federal dollars and allowed the THA unbridled access. It bears noting, however, that one of HUD’s principal goals in removing restrictions on federal funding was to prevent severe weather damage to recently modernized apartments at Ozan Courts.2 As to the “giveaway” of additional federal monies, HUD’s intent is clearly revealed in later correspondence between Leonard Chaires and the THA Executive Director. Chaires’ letter, drafted shortly after the June, 1978 compliance review conducted by Angeles Ramos, stated,
On August 1, 1974, this Office acting in good faith placed your Authority in substantial compliance. The rationale was that the LHA was receiving or about to receive various grants and therefore provide you an opportunity to integrate some of your projects [by relocating tenants of a project undergoing modernization to vacant apartments in other projects]. The facts are that you did receive approximately $1,475,528 in ... grants but you did not integrate one single project: You did manage to cluster or group.
After informing the THA of its noncompliance with Title VI, the letter additionally stated,
If the Authority does not voluntarily comply or adopt and implement a plan adequate to accomplish the purpose of Title VI within 60 calendar days from the date of this letter, it will be necessary for this Office to refer this matter to the Assistant Secretary for Fair Housing and Equal Opportunity in Washington, D.C., with a recommendation that the Department begin administrative proceedings pursuant to Section 602 of Title VI of the Civil Rights Act of 1964 seeking the termination of Federal assistance for your Housing Authority.
*1429It is noteworthy that the plan subsequently approved by HUD contained, inter alia, provisions to remedy the deficiencies in THA employees’ knowledge concerning equal opportunity matters that Ramos noted in his final report of the June, 1978 compliance review. Like the confusion surrounding the use of hardship and preference ratings, see slip op. at 11 n. 13, the employees’ lack of awareness of the requirements of Title VI, demonstrated by the following excerpt from Ramos’ report, undoubtedly resulted in some of the improper tenant assignments and inaccurate documentation.
All the administrative staff were given a written Employee Interview with the following responses to the questions ...:
1. What laws apply to nondiscrimination in housing at this LHA? Three did not know, one response was Civil Rights Act of 1966, another response was Civil Rights Act of 1964 and another answered with Fair Housing of 1968.
2. Does the LHA provide HUD assurance of nondiscrimination? Four responded ‘yes’ and two responded T don’t know.’
3. If so, name the assurances? None provided the correct answer.
4. What coverage do the assurance[s] accord? No correct answers.
5. Have you received training in nondiscrimination by the LHA and when? The answer was no.
6. Please explain Fair Housing? No correct answers.
7. Purpose of Statement of Policies? No correct answers.
8. Purpose of M.O.A. and Plan adopted by LHA? Three answered ‘I don’t know’ and three answered ‘Plan B.’ Right answer should have been Modified Plan ‘B.’
It is clear from the record that at HUD’s insistence the THA not only explained the requirements of Title VI to its employees, but also agreed to dismiss or discipline any employee who failed to comply with the law.
FIFTH AMENDMENT
The court’s depiction of federal officials guided by a discriminatory purpose not only fails to mirror the evidence of record in this case but also contravenes the clear error standard that circumscribes this court’s review of the district court’s findings of fact. Pullman-Standard v. Swint, 456 U.S. 273, 102 S.Ct. 1781, 72 L.Ed.2d 66 (1982); Rogers v. Lodge, — U.S. —, 102 S.Ct. 3272, 73 L.Ed.2d 1012 (1982).
The record before us does not contain substantial objective evidence of discriminatory intent on the part of HUD officials. On the contrary, it “demonstrates that the federal defendants consistently attempted to promote nondiscrimination and fair housing on behalf of all minorities in Texarkana.” Clients’ Council v. Pierce, 532 F.Supp. 563, 570 (W.D.Ark.1982). HUD’s actions during the ten year period in question can easily be “explain[ed] on nonracial grounds.” Washington v. Davis, 426 U.S. 229, 242, 96 S.Ct. 2040, 2049, 48 L.Ed.2d 597 (1976). In attempting to achieve compliance with Title VI, HUD, faced with the frequently obstreperous THA, was effectively confronted with two choices: to fund or not to fund. HUD chose to continue funding, all the while endeavoring to foster nondiscrimination and fair housing by informal means pursuant to its own regulation, 24 C.F.R. § 1.7(d)(1) (1982). See 42 U.S.C. § 2000d-1 (1976). Contrary to any assertion that funding and other agency decisions were made “because of” their discriminatory effect,3 the administrative rec*1430ord demonstrates that HUD’s actions were designed to provide access to adequate low income housing, which would inure to the benefit of black and white persons alike. This legitimate and worthy goal, apparent on the face of the record, cannot be discounted as readily as the majority suggests. While it may have been wiser, as a matter of constitutional policy, to withhold federal funds until the THA ceased its discriminatory practices, and deprive poor people, black and white, of housing, what is wise and what is constitutionally indispensable are not equivalent in the absence of proof of discriminatory intent. See Village of Arlington Heights v. Metropolitan Housing Development Corp., 429 U.S. 252, 265-66, 97 S.Ct. 555, 563-64, 50 L.Ed.2d 450 (1977).
TITLE VIII
From what has been said, it follows as well that the facts do not demonstrate a violation of Title VIII of the Civil Rights Act of 1968, 42 U.S.C. § 3608(e)(5) (Supp. IV 1980), any more than they demonstrate that HUD officials acted with a discriminatory purpose. HUD, the agency granted the discretionary authority to select the means to achieve fair housing, Shannon v. United States Department of Housing and Urban Development, 436 F.2d 809, 819 (3d Cir.1970), consistently attempted to “administer the programs and activities relating to housing ... in a manner affirmatively to further the policies of [fair housing],” 42 U.S.C. § 3608(e)(5). Clearly, there is no
Title VIII violation as a result of inaction or indolence' here.
TITLE VI — REMEDY
The court candidly recognizes the controversy as to whether Congress intended to create a private right of action against a federal funding agency under section 601 of Title VI of the Civil Rights Act of 1964, 42 U.S.C. § 2000d (1976). Indeed, substantial doubt has been expressed whether such a right exists. See Cannon v. University of Chicago, 441 U.S. 677, 719, 99 S.Ct. 1946, 1969, 60 L.Ed.2d 560 (1979) (White, J. and Blackmun, J., dissenting); Regents of the University of California v. Bakke, 438 U.S. 265, 380-81, 98 S.Ct. 2733, 2794-95, 57 L.Ed.2d 750 (1978) (separate opinion of Mr. Justice White); cf. NAACP v. Medical Center, Inc., 599 F.2d 1247, 1254 n. 27 (3d Cir.1979) (unequivocal determination that beneficiary of a federally funded program may not sue the federal funding agency). I, too, question whether an action against a federal administrative agency is available under section 601 of Title VI,4 particularly in the circumstances of this case.
In my view, a considerable obstacle to the implication of a private right of action against HUD under Title VI is the lack of any effective remedy. The court concludes that HUD violated the fifth amendment and Title VIII essentially throughout the ten year period from 1969 to 1979 and directs the district court to “fashion an effective remedy to eradicate the effects of over *1431a decade of discrimination in Texarkana.”5 The difficulty with this approach is that any relief devised by the district court, including desegregation of all THA projects ordered by the majority, must necessarily and ultimately be directed at the THA rather than HUD, if it is to be effective in redressing past discrimination in THA projects.6 The circumstances of this case, however, do not permit a remedy that encompasses the THA within its scope. Not only is the THA not a party to this action, but two valid consent orders, whose terms are not now before this court, also may preclude ordering any relief implicating the THA insofar as the same ten year period is concerned. Events postdating the consent decrees, including any violations thereof, are not, of course, completely governed by the terms of the decrees and can properly be the subject of a suit against the THA. In such a proceeding the district court would be free to take into account the decrees to the extent permitted or required by law. But there is simply nothing of consequence that HUD, this court or the district court can do in this proceeding to affect the consequences of HUD’s past acts.7 In present circumstances we should eschew a remand which directs the district court to do that which neither we nor it can do — fashion an effective remedy and then retain jurisdiction until the remedy is fully implemented.
CONCLUSION
Finding neither liability nor effective available remedy, I dissent.

. In discussing the 1969 compliance investigation the majority refers to Nelson’s remarks concerning hardship determinations in the investigative report. See 1411 n. 11. The report, which documents only one example of a tenant assignment made on the basis of hardship, notes that an elderly white woman who was relocating to Texarkana was assigned to an apartment at Bramble Courts two days after submitting an application for low income housing. Although the purport of Nelson’s statement that “[n]o consideration was given to previous filing applicants of which many were Negroes,” is that a discriminatory motive governed this assignment, it bears noting that several offers of this apartment made by the THA were refused because it had an inside location. Considering the rather cryptic nature of the investigator’s statements and the meager evidence contained in his report, agency action on *1427this matter hardly seemed warranted. In any event, HUD issued a specific recommendation addressing tenant assignment on the basis of hardship, which was adopted by the THA Board of Commissioners in August, 1969.

. Had HUD refused to modernize or repair Ozan Courts pending integration, paradoxically the black people who occupied Ozan might have been more free from discrimination but they would have been out in the rain.

. It is evident from the majority’s opinion that its finding of a constitutional violation is based almost entirely on the foreseeability of the segregative effect of decisions made by HUD officials and the claimed availability of alternative choices. Although the majority recognizes that “[d]isproportionate impact ... is not the sole touchstone of an invidious racial discrimination,” Washington v. Davis, 426 U.S. 229, 242, 96 S.Ct. 2040, 2049, 48 L.Ed.2d 597 (1976), its application of foreseeability comes perilously close to the forbidden formulation of “intent as [an] awareness of consequences,” Personnel Administrator v. Feeney, 442 U.S. 256, 279, 99 *1430S.Ct. 2282, 2296, 60 L.Ed.2d 870 (1979). The majority’s position appears to imply that because HUD presumably was aware of the disparate impact of its choices, the agency was constrained to either realize its goal of providing adequate low income housing by plodding along some other, undefined path or face a finding of liability under the fifth amendment. To the extent that the majority espouses the equation of foreseeability with intent, its position is untenable. See, e.g., Personnel Administrator v. Feeney, 442 U.S. at 279 n. 25, 99 S.Ct. at 2296 n. 25.

. The propriety of a suit by a private party under Title VI to compel termination of funding appears particularly doubtful. In his separate opinion in Regents of the University of California v. Bakke, 438 U.S. 265, 98 S.Ct. 2733, 57 L.Ed.2d 750 (1978), Mr. Justice White aptly stated,
Termination of funding was regarded by Congress as a serious enforcement step, and the legislative history is replete -with assurances that it would not occur until every possibility for conciliation had been exhausted. To allow a private individual to sue to cut off funds under Title VI would compromise these assurances and short circuit the procedural preconditions provided in Title VI.
Id. 438 U.S. at 382-83, 98 S.Ct. at 2795-96. Since appellants here are not seeking to compel funding termination, it is, of course, unnecessary to decide this question.

. This court at most could declare HUD’s actions illegal and perhaps restrain or condition further funding. But see note 4 supra.

. The remedy is, of course, also directed at redressing HUD’s alleged constitutional violation during the same ten year period.

. Indeed, the majority recognizes that any remedy fashioned by the district court, including an order requiring HUD to issue desegregation orders, will substantially affect the THA. It states, “[I]f the THA ... desires to participate in the proceedings before the district court concerning the appropriate remedy, it shall, upon proper motion, be given that opportunity.”