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GAUTREAUX v. PIERCE

August 25, 1982

DOROTHY GAUTREAUX, ET AL., PLAINTIFFS,
v.
SAMUEL R. PIERCE, SECRETARY OF DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT, ET AL., DEFENDANTS.



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

MEMORANDUM OPINION AND ORDER

Presently before the Court are two related motions filed by different groups of petitioners in connection with this Court's continuing jurisdiction to oversee the administration of the consent decree entered in this matter between plaintiffs and the United States Department of Housing and Urban Development ("HUD") on July 16, 1981.

Petitioners William Lavicka and Barbara Piegare have moved for the issuance of a rule to show cause why HUD should not be held in contempt of this Court for authorizing section 8 housing assistance payments to the Academy Square housing development on the Near West Side of the City of Chicago allegedly in violation of the terms of the consent decree. Alternatively, petitioners Lavicka and Piegare request leave to intervene in this matter for the limited purpose of challenging HUD's actions with regard to the Academy Square development under the consent decree.

The second group of petitioners, Eugene Heytow, Marcel Lutwak and Richard Parrillo, are the developers of the Academy Square project. They seek an order from this Court declaring that no prior court orders in this matter preclude HUD from providing section 8 housing assistance payments to the Academy Square development or preclude the Chicago Housing Authority ("CHA") or its instrumentality, the Chicago Metropolitan Housing Development Corporation ("CMHDC"), from providing financing for the construction of Academy Square.

By minute order dated August 20, 1982, this Court allowed both groups of petitioners leave to intervene for the limited purposes described above.*fn1 On the merits, however, the Court concluded that HUD had acted properly in authorizing section 8 contract authority for the Academy Square development. Accordingly, the Court denied the relief sought by petitioners Lavicka and Piegare, but granted the relief sought by petitioners Heytow, Lutwak and Parrillo. The rationale for our decision is set forth below.

Both groups of petitioners focus on paragraph 5.8.2 of the consent decree which provides, in pertinent part:

  5.8.2. HUD will not reserve contract authority
  for Section 8 New Construction assisted housing
  units in the General Area or the Revitalizing
  Area of the Chicago SMSA in any structure, or in
  any group of structures on the same or contiguous
  parcels of real estate, which:
  (iii) Is to be located in any census tract if,
  following such location, the aggregate number of
  apartments and single family residences
  theretofore made available under any assisted
  housing program in such census tract would
  constitute more than 15% of the total number of
  apartments and single family residences in such
  census tract.

Petitioners Lavicka and Piegare maintain that HUD's reservation of section 8 authority for the 200-unit Academy Square development violates paragraph 5.8.2(iii) of the consent decree in that the 100 units of non-elderly housing included in the proposed development would exceed 15% of the total number of dwelling units in census tract 2817 (the proposed site of Academy Square) after construction of the project according to 1980 census data.*fn2 On the other hand, petitioners Heytow, Lutwak and Parrillo contend that HUD properly reserved section 8 authority for Academy Square on the basis of 1970 census data and an on-site inspection of census tract 2817 for compliance with paragraph 5.8.2(iii) of the consent decree. In addition, these petitioners contend that even if HUD should have referred to 1980 census data that may have been available to it when the relevant financing decision was made, paragraph 5.8.2(iii) does not bar HUD's reservation of section 8 authority for Academy Square under the particular facts of this case.

I.

Rule 24 of the Federal Rules of Civil Procedure states in pertinent part that:

    (a) Intervention of Right. Upon timely
  application anyone shall be permitted to
  intervene in an action: (1) when a statute of the
  United States confers an unconditional right to
  intervene; or (2) when the applicant claims an
  interest relating to the property or transaction
  which is the subject of the action and he is so
  situated that the disposition of the action may
  as a practical matter impair or impede his
  ability to protect that interest, unless the
  applicant's interest is adequately represented by
  existing parties.

In view of the rather unique set of circumstances before the Court at the present time, we conclude that both groups of petitioners should be permitted to intervene as of right pursuant to Rule 24(a) for the limited purpose of requesting that the Court determine whether or not HUD's involvement with the Academy Square development is or is not precluded by the terms of the consent decree. Both groups have a strong interest in the interpretation and construction of certain portions of the consent decree and in the provision of housing under that decree which is the subject matter of this action at the present time. Their ability to protect those interests may be impaired or impeded depending upon how this Court construes HUD's obligations under the decree, and it is apparent that those interests may not be adequately represented by existing parties.*fn3

The instant circumstances are thus distinguishable from others in which the Court has refused to find that newly-filed actions involving real estate developers' due process or equal protection challenges to the actions of HUD or the City of Chicago were related to the Gautreaux case, filed 16 years ago by black residents of public housing, within the meaning of Local Rule 2.31.*fn4 See, e.g., Kogen v. City of Chicago, No. 82 C 2944 (N.D.Ill. May 24, 1982); Finger Enterprises v. Pierce, No. 82 C 1400 (N.D.Ill. March 9, 1982). Those cases involved issues that were both narrower, in terms of the affected parties, and broader, in terms of the legal issues and requested relief, than the Gautreaux case. They could thus rise or fall on their own merits without much reference to the consent decree entered between HUD and plaintiffs in the instant case. By contrast, the issue raised ...


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