Court Enjoins City of New York From Proceeding With Rezoning and Development Plan—Defendants Failed to Consider Impact of Development on Racial Segregation Despite Being Required to Do So Because of Their Receipt of Federal Funds

Plaintiffs moved for an injunction under the federal Fair Housing Act (FHA), alleging discrimination by the defendants, the mayor, the City of New York and the Department of Housing Preservation and Development (HPD), in the rezoning and development of the Brooklyn area known as the Broadway Triangle. The city’s “chosen developers,” non-party United Jewish Organizations of Williamsburg Inc. (“A”), and non-party Ridgewood Bushwick Senior Citizens Council Inc. (“B”), plan to construct “affordable” housing within the predominately white Community District 1 (Community 1), the Williamsburg-Greenpoint neighborhood, even though the Broadway Triangle includes the land in the “overwhelmingly non-white, …Community District 3 (Community 3), Bedford-Stuyvesant neighborhood.” The City Council had rezoned the subject industrial area “to a residential area, with limited building heights between 70-80 feet.”

The plaintiffs alleged that the rezoning and the designation of “A” and “B” in a no-bid process, to build and design low rise buildings “containing numerous large apartments, despite the general demand for smaller apartments, perpetuates segregation and disproportionately impacts a minority group or groups.” The plaintiffs asserted that the defendants failed to consider, as required by law, “whether other alternatives exist,” and had “not demonstrated that their policies and actions are furthered by legitimate interests which cannot be satisfied by lesser or non-discriminatory alternatives.” The court agreed with the plaintiffs.

The court noted that “for religious reasons, Hasidim do not use elevators during the Sabbath, which necessitates their walking up and down stairs, making taller buildings unattractive to them.” Although the defendants had argued that “people of all races and ethnic backgrounds can qualify for residences on lower floors,” the court found such statement to be “untrustworthy when the applicant pool is not diverse.”

The court noted that the “Williamsburg area has been marred by a long history of federal court discrimination battles, fueled by the desire of Hasidic families to reside together in Williamsburg for religious reasons….” Thus, there has been “‘historic over-representation of Hasidic in the Williamsburg projects’” and “large apartments in three…City Housing (NYCHA) developments…were ‘occupied almost entirely by Jewish families, and…all families on the waiting list for apartments of seven rooms or more in the three Williamsburg projects are Hasidic.” Further, Community 1 is only “5.5 percent black; Community 3 is 77 percent black.”

The city suggested that the most likely explanation of why African Americans comprise only a minute portion of the applicant pool in Williamsburg is “individual choice.” The court found that there was no evidence indicating that African American applicants sought “to avoid living” in Williamsburg and such suggestion is “contrary to Plaintiffs’ position in this litigation….”

Following a hearing, the court found that the plaintiffs had demonstrated “a likelihood of success on the merits under the…[FHA]“; “irreparable harm absent injunctive relief”; and “a balancing of the equities in their favor….” The majority of the defendants’ arguments had been previously made and rejected. Those arguments included that “despite the existing high-rise middle income Mitchell-Lama and affordable NYCHA buildings right across the street and in the immediate surrounding area, the density/height increases advocated by plaintiffs would burden the infrastructure and, are out of ‘context’…; that the apartments are awarded by a monitored ‘Race Blind Lottery’ so that anyone who qualifies can live there, after application of the preference for Community 1 residents…; that awarding contingent site authorizations to ['A'] and ['B'] is not unusual as authorizations are routinely issued to a wide variety of developers, and New York State has financial incentive for construction of large apartments…”; that two Williamsburg projects “include a well-represented Hispanic population, and the fact that only five black households out of 86 households qualified” for one of the Hispanic housing projects and “two black households out of 32 households qualified” for the other Hispanic housing project “is attributable to their choice ‘not to do so because the rent for a NYCHA apartment is going to remain lower than the rent for an affordable housing apartment’ and because blacks did not likely apply because of ‘personal choices [which] cannot be attributed to any City policy.’”

The defendants also argued that the FHA did not require “zoning for taller buildings to maximize affordable housing” and did “not trump environmental considerations.” The court explained that the plaintiffs did not “advocate racial quotas, but merely that Defendants comply with the…[FHA]” and that “ race neutral policies violate the…[FHA] if racial segregation is perpetuated or if a minority group or groups are adversely impacted.”

The court then noted that a claim is stated under the FHA “when the municipality creates a land development plan or zoning classification which discriminates, even though the plan is effectuated by private developers….” Moreover, under the FHA, “a plaintiff need demonstrate only that the challenged actions had a discriminatory effect….” Thus, “[a] prima facie case of discriminatory effect is made by showing that defendant’s actions either (1) perpetuate segregation, harming the community in general or (2) disproportionately impact a minority group….” Once a plaintiff demonstrates a prima facie case, the defendants must prove that their actions “furthered a ‘legitimate, bona fide government interest and that no alternative would serve that interest with less discriminatory effect’….”

A plaintiffs’ expert “in demographic statistical analysis and residential segregation” provided evidence that “plans to construct buildings of only 6-7 stories, and the creation of very large apartments for very large families (despite the far greater local demand for smaller apartments), favors one religious group to the detriment of others.” The plaintiffs’ expert testified that “Brooklyn is a fairly segregated county, with concentrations of blacks, whites and Hispanics in particular areas.” Evidence indicated that “[y]iddish speakers are concentrated in the northwest area of the Broadway Triangle, and the concentration of whites appear to be increasing in the area adjacent to the proposed developments….”

Forty-three percent of the proposed units would be three and four bedroom apartments. The developers proposed to build “89 units which are 0, 1 or 2 bedrooms and 68 units which are three or four bedrooms.” The defendants conceded that there was evidence that “the city-wide need for large apartments was only 11 percent.” The plaintiffs’ expert testified that of the qualifying individuals in Community District 1 and 3, “75 percent of blacks needed small apartments (while only 25 percent needed large apartments), 68 percent of Hispanics needed small apartments (while only 32 percent needed large apartments), 68 percent of whites needed small apartments (while only 32 percent needed large apartments) and 40 percent of white/Yiddish speakers needed small apartments.”

Thus, while “approximately 9,000 Yiddish speaking individuals in Community Districts 1 and 3 needed large apartments,” “approximately 90,000 blacks and Hispanics” would need small apartments.

The plaintiffs’ expert further explained that while African Americans make up five percent of those who would qualify for a small apartment in District 1, they make up only one percent of those who qualify for a large apartment. Yiddish speaking households would make up eight percent of those who qualify for a small unit, but would make up 24.6 percent of those who would qualify for a large unit. Although the defendants cited “a demand for large apartments and a shortage of them, it is well known that there is a shortage of housing of all sizes throughout New York City.” The court opined that “the need for large apartments…cannot justify construction of very commodious spaces, when such apartments are proposed only where the white/Yiddish speakers are the sole demographic group for whom the need for large apartments is greater.”

The court then stated that “community preference only serves to perpetuate segregation in the Broadway Triangle. It is undisputed that residents (and former residents to whom outreach would be expected) from the predominantly white Community 1 area would be given a first preference for 50 percent of the units.” The plaintiffs’ expert testified that given Community 1′s preference, “the racial composition for the projects would be [three] percent black, 37 percent Hispanic, 48 percent white, and 14 percent white/Yiddish speakers; whereas, extending the preference to Community 3 would result in residents being 31 percent black, 34 percent Hispanic, 27 percent white, and 8 percent white/Yiddish speaking….” Although the court did not find that “the community preference must be extended to Community 3, it is noteworthy that such an extension might act to correct the imbalance in the applicant pool in the Broadway Triangle.” Additionally, the court noted that “[a]lthough community preferences have been routinely offered, and, a preference was given in the 1990s to Community 3…, offering any preference is impermissible if it violates the…[FHA].”

HPD’s witnesses conceded that the defendants had “failed to consider the impact of the development on racial segregation…, despite the requirement to do so, as recipients of federal funds…” and had not analyzed or evaluated “the impact of the community preference on segregation in the Broadway Triangle….”

The court explained that there can be “no compliance with the [FHA] where Defendants never analyzed the impact of the community preference…. The defendants argued that they had complied with the FHA “based on a four year old 2007 city-wide fair housing analysis.” The court rejected such argument and distinguished authorities cited by the city. The court acknowledged that “not every zoning amendment must contain a housing balance.” However, the court stated that “the proposed developments are planned where housing is already out of balance. Where balance is lacking, town ordinances have been invalidated for exclusionary zoning….” The court also noted that the three proposed developments will not only “not foster integration of the neighborhood, but it will perpetuate segregation in the Broadway Triangle.”

Thus, the court found that the plaintiffs had demonstrated “a likelihood of success on the merits of their [FHA] Claim” and the defendants had not demonstrated “that their policies and actions are furthered by legitimate interests, which cannot be satisfied by lesser, non-discriminatory alternatives.” Here, the defendants had “not even evaluated the proposed developments’ impact on segregation,” and, “more inclusive alternatives to the development do exist (including but not limited to extending the preference to Community 3).” Given the foregoing, the court found that the equities lie in the plaintiffs’ favor and “irreparable harm will result unless an injunction is granted—i.e., as a result of discrimination, a deprivation of housing financed with public funds.”

The court then ordered that the plaintiffs post only a “nominal undertaking,” since the movants were “non-profits and community groups” and defendants had “not shown what their own damages would be if the injunction were to be incorrectly granted.”

Comment: Generally, a “nominal bond” is inappropriate solely because a plaintiff is a not-for-profit entity since the purpose of an undertaking is to make a defendant whole in the event that an injunction is subsequently determined to have been improvidently granted. The amount of a bond is not to be based on a “means” test. If it were otherwise, a clever opponent to a real estate project might try to recruit a not-for-profit organization to serve as a plaintiff in order to avoid having to post a significant bond. Here, the court noted that the defendants had failed to show what their damages would be if the injunction were granted.

An article by Joel Stashenko in the Jan. 6 New York Law Journal reported that the city intended to appeal and believed that the court had “mistakenly discounted evidence submitted by the city.” Spokespeople for the plaintiffs had opined that the subject decision places the City on notice that “[w]hen it proceeds to develop housing—…—it must evaluate the potential impact on segregation and develop projects that include the entire community and will create more integrated neighborhoods” and expressed hope that the city would “seize on the opportunity to move forward with a much more inclusive affordable housing plan through a much more inclusive process.”

Broadway Triangle Community Coalition v. Bloomberg, 112799/09, NYLJ 1202537599878, at *1 (Sup., NY, Decided Dec. 23, 2011), Goodman, J.


Landlord-Tenant—Court Vacates NYC Housing Authority’s Determination Terminating the Petitioner’s Section 8 Subsidy and Remanded the Proceeding for Imposition of a Lesser Penalty—Petitioner Had Funds to Bring Her Rent Current, Had Suffered From a Mental Disability, Lived With a Minor Son and Would Be Rendered Homeless by Termination—Termination Penalty Was “Shocking to One’s Sense of Fairness and Disproportionate to the Offense”

The petitioner was a “mother and primary caretaker of her minor son.” She sought an order pursuant to Article 78 of the CPLR vacating the NYC Housing Authority’s (NYCHA) determination which upheld “the termination of petitioner’s Section 8 subsidy, and remanding the proceeding for imposition of a lesser penalty.” The petitioner argued, inter alia, that NYCHA’s decision was “arbitrary and capricious, an abuse of discretion” as to the severity of the penalty imposed and contrary to NYCHA’s own policies. The court granted the petition.

The petitioner had lived in the same NYCHA apartment “for over 15 years.” Prior to April 2010, her “primary source of income was Social Security Disability (SSD), which she received because of a psychological disorder.” The petitioner held a part time job with “Goodwill Industries” and currently, is employed as a clerical associate in the NYC Human Resources Administration since April 2010.

The petitioner receives a Section 8 subsidy. In 2008, “NYCHA assessed an overpayment against petitioner based on a failure to report all household income.” The petitioner signed a stipulation (Payment Agreement), promising to repay the overpayment. The petitioner initially made the payments. However, the petitioner had ceased making the payments (defaulted) and was subsequently advised by NYCHA that her Section 8 subsidy would be terminated. At an NYCHA hearing, the petitioner testified that she had defaulted “as a result of her bi-polar mental impairment.” Her impairment was “uncontroverted.” NYCHA terminated the petitioner’s subsidy after finding that the petitioner had “never communicated to NYCHA that her disability required an accommodation with respect to her payment on the stipulation.”

The petitioner emphasized that the sole reason for her default was “her bi-polar mental impairment.” She alleged that prior to her subsidy being terminated, she had spoken with a Section 8 Housing Assistant and had been advised “not to send in any further payments unless she had the entire amount of missed payments.”

The petitioner also argued that the hearing officer had failed to consider the mitigating circumstances and that if the Section 8 subsidy is terminated, it would likely result in the loss of her apartment.

The record was “replete” with instances in which petitioner stated that “her mental impairment impeded her from making the requisite payments and that she had the sums to become current under the Payment Agreement….” The petitioner’s documentation indicated that the Social Security Administration had recognized “the problems petitioner had in managing her financial affairs and as a result appointed a representative payee to receive petitioner’s SSD payments.” Moreover, the petitioner had remitted money representing the outstanding payments, but such payment had been returned with a letter indicating that the payment was being returned because her file had been forwarded to an NYCA collection attorney.

The court found that the petitioner had “the available funds to bring herself current under the Payment Agreement” and that NYCHA procedures “permit, but do not require termination of petitioner’s Section 8 subsidy.”

Here, the “petitioner and her minor son will likely become homeless if her Section 8 subsidy is terminated.” The court opined that given the circumstances, the petitioner should be provided with a “penalty more proportionate to the offense, particularly given that it was undisputed that petitioner has a mental impairment which affects her financial capabilities.” The court noted that termination “would have severe consequences not only for petitioner but for the [child] she supports.” Thus, the court found that “the penalty of termination of petitioner’s housing subsidy…[is] shockingly disproportionate to the offense [of failure to report income]….” The court further noted that the petitioner had no record of any prior offenses and termination would likely result in homelessness. Accordingly, the court held that NYCHA’s decision to terminate the Section 8 subsidy “was disproportionate to the offense and shocking to one’s sense of fairness.” Thus, the court granted the petition and remanded the matter to the agency for imposition of a lesser penalty.

Matter of Thomas v. Rhea, 401987/11, NYLJ 1202538051105, at *1 (Sup., NY, Decided Jan. 4, 2012), Ling-Cohan, J.


Owner or Contractor Cannot Be Held Criminally Liable Under Executive Law §382(2) Solely Because They Allowed or Engaged in Construction Activities Without First Obtaining a Building Permit Under the State Uniform Fire Prevention and Building Code

This case involved an issue which “appears to be one of first impression,” i.e., whether “an owner of real property or a building contractor can be held criminally liable under Executive Law §382(2) solely because they allowed or engaged in construction activities without first obtaining a building permit” under the NYS Uniform Fire Prevention and Building Code (Code) (Executive Law Article 18). Based upon “the express language of the statute,” the court held that “they cannot and those counts of the indictment charging a violation of Executive Law §382(2) must be dismissed.”

Three defendants had been charged with having violated Executive Law §382(2) and a Town local law (Town law), “by failing to obtain permits prior to commencing and engaging in construction of a boathouse wholly within the waters of Lake Placid lake….” The defendants were charged with “two misdemeanor counts of violating Executive Law §382(2) by commencing and engaging ‘in construction of a boathouse…without a building permit’ issued under [the Code]” and with “ a non-criminal violation in the third count for failing to obtain a building use permit…under the [Town law].”

The court explained that “[t]he mere failure to obtain a building permit, without more, is not a violation of ‘standards for construction, maintenance, or fire protection equipment and systems’” and therefore, not a criminal violation under §382(2). There was nothing in the express language of Executive Law §382(2) or the legislative bill jacket which disclosed “any intent on the part of the Legislature to criminalize all violations of the uniform code.” There was no evidence presented to the grand jury that on the subject dates, “‘any condition was found to exist in, on or about’ any building in violation of” the Code or that any of the defendants had knowingly violated any of the applicable provisions of the Code or any lawful order of a local government regarding standards for construction. Additionally, neither a letter from the Town nor a stop work order had identified any such condition or standard. “The lack of a building permit is not a condition ‘in, on or about’ a building, and the requirement of a building permit is not a standard of construction or maintenance.”

Finally, there was no evidence that established that the defendants had been served “either personally or by registered or certified mail…with the stop work order” as required by Executive Law §382(2). Service upon the owner’s daughter was insufficient to prove that personal service had been made upon the owner. A town official had not testified that he had served or attempted to personally serve the owner or attempted to personally serve a subcontractor who was working on the site. Rather, the Town official had only testified in a conclusory manner about his ability to serve the contractor.

Accordingly, the court dismissed the counts involving Executive Law §382(2). The court also dismissed the Town law count since the boathouse structure was located “entirely within the waters of Lake Placid lake and connected to the shore by a removable ‘wooden ramp or gangway’” and was therefore exempt from the Town land use law. The local zoning laws had been “preempted in cases where the dock, building or structure at issue is located in a navigable water because, …the state has exclusive jurisdiction….”

People v. William H. Grimditch, 11-043-I, NYLJ 1202537910720, at *1 (Co., Essex, Decided Jan. 5, 2012), Meyer, J.

Scott E. Mollen is a partner at Herrick, Feinstein and an adjunct professor at St. John’s University School of Law.