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April 6, 1970


The opinion of the court was delivered by: Austin, District Judge.


Congress enacted the Demonstration Cities and Metropolitan Development Program statute in November 1966, commonly referred to as the Model Cities Act. 42 U.S.C. Ch. 41, § 3301 et seq. In its prologue section to the operative provisions of the Act, Congress declared:

  "* * * that improving the quality of urban life is
  the most critical domestic problem facing the United
  States. The persistence of widespread urban slums and
  blight, the concentration of persons of low income in
  older urban areas, and the unmet needs for additional
  housing and community facilities and services arising
  from rapid expansion of our urban population have
  resulted in a marked deterioration in the quality of
  the environment and lives of large numbers of our
  people while the Nation as a whole prospers. * * *"
  Subch. 1, § 3301.

Its purpose was

  "* * * to provide additional financial and technical
  assistance to enable cities of all sizes (with equal
  regard to the problems of small as well as large
  cities) to plan, develop and carry out locally
  prepared and scheduled comprehensive city
  demonstration programs containing new and imaginative
  proposals to rebuild or revitalize large slum and
  blighted areas; to expand housing, job and income
  opportunities; to reduce dependence on welfare
  payments; to improve educational facilities and
  programs; to reduce the incidence of crime and
  delinquency; to enhance recreational and cultural
  opportunities; to establish better access between
  home and jobs; and generally to improve living
  conditions for the people who live in such areas, and
  to accomplish these objectives through the most
  effective and economical concentration and
  coordination of Federal, State, and local public and
  private efforts to improve the quality of urban
  life. * * *" § 3301.
  Pursuant to this proffer of assistance, the City of Chicago, under a contract dated July 1, 1968, received a total grant of $201,000 of federal funds for the purpose of planning and developing a comprehensive city demonstration program as provided under § 3304 of the Act.*fn1

On April 21, 1969, after a study of the Chicago proposal, the Federal Regional Coordinating Committee (composed of those agencies concerned in the operation of the Model Cities Act) criticized certain phases of the proposal and made recommendations for correction of certain phases of the Chicago plan before it could be finally approved. Such revisions were made by the city and on June 26, 1969 the defendant Secretary approved the Chicago Model Cities Program and authorized an assistance grant of $38,000,000 for the First Year Action Program under the Plan. The full program was to have a five year term.

Following the approval of June 26, 1969, the City of Chicago, on August 1, 1969, accepted the contract offered by the Department of Housing and Urban Development and is presently operating thereunder.

The thrust of the instant suit is to rectify the alleged failure of the defendant Secretary to perform his duty under § 3305 to determine, before his approval is given, that such Plan did "satisfy the criteria for such programs set forth in § 3303." It is alleged that the Chicago Model Cities Program received his approval although (1) it was prepared and submitted by the City without "widespread citizen participation" in its planning, and fails, as approved, to provide for such participation in violation of § 3303; (2) it failed to contain the statutory prerequisite of a relocation plan required by § 3303(4) and § 3307; (3) it did not contain "data as current and complete as necessary to make valid program determination" as required by CDA Letter No. 1, October 30, 1967, p. 4, 2.2 in that it was based on a 1960 census which overlooked 150,000 black residents and because the areas involved were inherently subject to rapid physical, social and economic changes.

The court is asked to enjoin the defendant Secretary "from continuing to approve and provide funds to the City of Chicago in its capacity as City Demonstration Agency for the purpose of carrying out any program funded" by the Act until such time as the City has satisfied the statutory conditions. Jurisdiction to provide such relief is sought under the Declaratory Judgment Act, 28 U.S.C. § 2201; under the Administrative Procedure Act, 5 U.S.C. § 702, 703, 704 for review of the Secretary's approval because it was given arbitrarily, capriciously, in abuse of his statutory authority, and without regard to the statutory limitations imposed on his authority; under 28 U.S.C. § 1331 as an action arising under the laws of the United States, i.e. the Model Cities Act and its regulations, wherein the amount in controversy exceeds $10,000; and additionally under 28 U.S.C. § 1361 as being an action in the nature of mandamus to compel the defendant Secretary to perform the statutory duty owed to the plaintiffs.

Defendant's motion to dismiss the complaint asserts (1) the court lacks jurisdiction of the subject matter and the person of the defendant because the suit is against the sovereign; there has been no waiver of sovereign immunity and no statutory consent exists permitting this suit; (2) there is a failure to state a claim upon which relief can be granted in that discretionary acts of officers of the United States are not subject to review; (3) there is a failure to join an indispensable party to this action — the City of Chicago; and in the event joinder is made, the venue of this action is improper under 28 U.S.C. § 1391(e); and (4) the plaintiffs have no standing to bring this suit.

There are two recognized exceptions to the sovereign immunity doctrine. Dugan v. Rank, 372 U.S. 609, 83 S.Ct. 999, 10 L.Ed.2d 15 (1969); City of Fresno v. California, 372 U.S. 627, 83 S.Ct. 996, 10 L.Ed.2d 28 (1969); Malone v. Bowdoin, 369 U.S. 643, 82 S.Ct. 980, 8 L.Ed.2d 168 (1962); Larson v. Domestic & Foreign Comm. Corp., 337 U.S. 682, 69 S.Ct. 1457, 93 L.Ed. 1628 (1949). The exceptions are applicable where the suit involves (1) actions by officers beyond their statutory powers, and (2) even though within the scope of authority, the powers themselves or the manner in which they are exercised are constitutionally void. Larson, supra, p. 702, 69 S.Ct. 1457. As alleged, this suit is within the first exception, because of the failure of the defendant to determine that statutory criteria exist in the plan before he can exercise his discretion to approve § 3305. It is not merely alleged that the Secretary's action was erroneous, or that he was mistaken as to fact or law; it is that he acted arbitrarily and capriciously beyond his statutory authority. In such circumstances, action for specific relief against the officer as an individual has been recognized. The court concludes that this is not a suit against the sovereign within the proscription of the doctrine of sovereign immunity. It is within a recognized exception to that rule.

There being no sovereign immunity, jurisdiction under the Administrative Procedure Act exists although that Act itself does not constitute a consent of the United States to all suits of whatever nature and is not a blanket waiver of sovereign immunity. It is applicable except where (1) statutes preclude judicial review, or (2) where agency action is committed to agency discretion by law. 5 U.S.C. § 701. The Supreme Court of the United States has very recently iterated the approach to the review provisions of the Act. In Data Processing Service v. Camp, March 3, 1970, 397 U.S. 150, 90 S.Ct. 827, 25 L.Ed.2d 184, it said:

  "There is no presumption against judicial review and
  in favor of administrative absolutism (see Abbott
  Laboratories v. Gardner, 387 U.S. 136, 140, [87 S.Ct.
  1507, 18 L.Ed.2d 681]) unless that purpose is fairly

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