Petition — Alexander v. Department of Housing and Urban Development

: Supreme Court, U

* 5.

FILED

DEC 16 077

; — JR., CLERK

IN THE

Supreme Court of the United States

| OCTOBER TERM, 1977

NO. ZG" 874

GENANETT ALEXANDER, et al.,

Petitioners,

us,

UNITED STATES DEPARTMENT OF

HOUSING AND URBAN DEVELOPMENT, et ai.

Respondents.

PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

RICHARD L. ZWEIG

WILLIAM MARSH

PAUL LEVY, Of Counsel

Legal Services Organization

of Indiana, Inc.

107 North Pennsylvania—Suite 300

Indianapolis, Indiana 46204

ATTORNEYS FOR PETITIONERS

Central Publishing Company, Ine, Indianapolla, Ind. 46206

= ss ~ <——eee

.

INDEX

Page

ee Oe SIE 6 cccceccdecdcenenecscessscess ii

reer o9 cncedéaceunecbececedeeeese l

r ͤ¶»˙‚ ˙ͤu; 2

Question Presented for Revi ess, 2

Statutory Provisions Involved ...........6.6666645 2

Statement of the Case ere 2

A. Summary of the Facts 2

HB. Course of the Proceedings ............... 4

le: ee MED EEE e eee 4

Reasons for Granting the Writ 6

A. The Decision Below Conflicts with the

Decision of the United States Court of

Appeals for the District of Columbia Circuit. 6

B. This Case Raises a Significant Issue Relat-

ing to the Displacement of Thousands of

People from Housing Owned by the Federal

r edd neaebaadasaan 4

D ²ͤ OB ⁵ a slau 12

ee see 0 0 60 A-l

TABLE OF AUTHORITIES

Cases

Page

Caramico v. Secretary of HUD, 509 F.2d 694

OS Ge, BOT cccccccuscewsedecoceedecdstecedes h

Cole v. Harris, Nos, 75-2268, 75-2269 (D.C. Cir. Nov.

Ee Bree 6666b0cnncadéedededsceesecuecei 6, 7, 8, 11

Statutes

,, d 7˙—;·˙L˙ re ort 4

D ns en akn his eapeaeueunees 9

r een ene 3,9

D = . 90

e ⁰ 6

D d. % ve 2

D eg eeacekoiasneaaneend 4

. . 4

42 U.S.C. Seca. 4601-462e 6c ceees 2, 5, 7, 8, 10, 11

Miscellaneous

115 Cong. Rec. 6101 (1969)—(Remarks of Congress-

man Koch eeeeeeeennenes 10

115 Cong. Rec. 31533 (1969)—(Remarks of Senator

ese eee e 10

115 Cong. Rec. 36049 (1969) (Remarks of Congress

r ˙¹—w ⅛— vi 10

115 Cong. Rec, 36049 (1969) — (Remarks of Senator

e dec deteaas 10

ii

TABLE OF AUTHORITIES (Continued)

Miscellaneous (Continued)

Page

116 Cong. Rec, 11224 (1970)—(Remarka of Congreas-

..

116 Cong. Rec, 20463 (1970)—(Remarks of Senator

Dresses ee eee es eee e

H.R. Rep. No, 1656, 91at Cong., 2d Seas, (1970)

4 Housing & Development Reporter No, 26

,, en ia |

HUD Property Disposition Handbook, Multi-Family

. ec

S. Rop. No, 488, 91st Cong., lat Sess. (1969)

Statement of Assistant Secretary Lawrence g.

Simons on “HUD Troubled Projects“ Before the

Senate Banking, Housing and Urban Affairs

Committee, October 17, 19777

1954 U.S, Code & Cong. Adm. News, 2747 and 2748

9

2

INTHE :

Supreme Court of the United States

OCTOBER TERM, 1977

NO.

GENANETT ALEXANDER, et al.,

Petitioners,

Us.

UNITED STATES DEPARTMENT OF

HOUSING AND URBAN DEVELOPMENT, et ai.

Respondents.

PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

OPINIONS BELOW

The opinion containing the findings of fact and

conclusions of law of the United States District Court for

the Southern District of Indiana is unreported and is

reproduced in the Appendix at page A-1. The opinion of

the United States Court of Appeals for the Seventh

Circuit, is reported at 555 F.2d 166, and is reproduced in

1

2

the Appendix at page A-6. The order of the Court of

Appeals denying plaintiffs’ Petition for Rehearing En

Banc is reproduced in the Appendix at page A-17.

JURISDICTION

The judgment of the Court of Appeals was entered May

20, 1977. The order denying plaintiffs’ Petition for

Rehearing En Banc was entered September 19, 1977, and

this Petition is filed within 90 days of that date. The

jurisdiction of the Supreme Court is invoked pursuant to

28 U.S.C. Sec.1254(1).

QUESTION PRESENTED FOR REVIEW

Whether tenants who reside in a housing project

acquired by the United States Department of Housing

and Urban Development [HUD] and who are ordered by

HUD to vacate their residences pursuant to written

notices issued by HUD for its property disposition

program are “displaced persons” under Section 101(6) of

the Uniform Relocation Assistance and Real Property

Acquisition Policies Act, 42 U.S.C. Sec.4601(6), and thus

entitled to relocation assistance.

STATUTORY PROVISIONS INVOLVED

This case involves the Uniform Relocation Assistance

and Real Property Acquisition Policies Act of 1970

[URA], 42 U.S.C. Secs.4601-4626. The relevant provisions

are reproduced in the Appendix at page A-19.

STATEMENT OF THE CASE

A. Summary of the Facts

Petitioners (hereinafter “tenants”) are low- and

moderate-income persons who formerly resided at River-

> RIES Rieter

3

house Tower Apartments [Riverhouse], a 294-unit project

located in Indianapolis, Indiana. Riverhouse originally

was built by a non-profit corporation, Riverhouse

Apartments, Inc., which secured permanent financing

for the complex through a mortgage insured and

subsidized by HUD under Section 221(d)(3) of the

National Housing Act as amended, 12 U.S.C. Sec.

1715l(d)(3).

In July, 1970, Riverhouse Apartments, Inc., defaulted

on its mortgage, and in December, 1970, the mortgagee

assigned the mortgage to HUD. When the default

persisted, the United States initiated foreclosure proceed-

ings in May, 1973, and a court-appointed receiver

operated Riverhouse until it was purchased by HUD ata

Marshal’s sale on August 13, 1974.

After purchasing Riverhouse, HUD hired a manage-

ment agent to carry forward general management

responsibilities including entering into new leases and

making authorized repairs. However, during this time,

HUD decided not to rehabilitate the property, and, in

fact, permitted the buildings to sink into such a state of

decay that in November, 1974, HUD could declare

that the tenants’ interests would best be served by closing

the project.

During this same period following purchase HUD

began formulation of its property disposition program by

evaluating its options. A number of alternatives were

available to HUD. For example, HUD could have decided

to retain ownership of Riverhouse and rehabilitate all or

part of the complex, make essential repairs, or make no

repairs at all. Further, in deciding to retain Riverhouse,

HUD could have honored existing leases and entered into

leases with new tenants; or it could have demolished the

property or held it as an investment. In the alternative,

4

HUD could have chosen to sell the property either

rehabilitated or as is“, and could have provided a new

owner with subsidies and mortgage insurance. From

among these options, HUD chose to evict the tenants,

close Riverhouse and hold it for future investment

opportunity.

In closing the project, HUD also decided to impose the

financial burden of relocation upon the tenants and,

indeed, HUD provided the tenants with no relocation

assistance whatsoever. HUD also decided that it was in

its own best interest not to disclose its plans for the future

of the Riverhouse until this litigation was completed.

B. Course of the Proceedings

The tenants initiated this litigation in December, 1974,

to prevent the closing of their apartment buildings. They

sought an injunction requiring HUD to make essential

repairs and to keep the project open. Alternatively, the

tenants prayed for a declaration that should the project

be closed, the tenants were entitled to benefits under the

URA. Following the closing of the project, the tenants

filed an Amended Complaint in which they asked for

URA benefits and the return of some security deposits.

Jurisdiction of this cause was conferred on the District

Court by 28 U.S.C. Sec. 1337, 28 U.S.C. Sec. 1346, and 5

U.S.C. Sec. 701.

C. The Rulings Below

On the basis of these facts, the district court held that

the tenants were not “displaced persons” under the URA,

and thus were not entitled to URA assistance.' In so

holding, the district court concluded that the “termina-

1 The District Court also ruled that the tenants were

not entitled to the return of their security deposits.

nab

—— —

„ aah e eee eee

5

tion of the present use of Riverhouse Tower Apartments

is not a program or project undertaken by a federal

agency’ to which the provision of the Uniform Relocation

Act append.” Further, the district court concluded that

the tenants were ineligible to receive URA benefits

because the “type of federal financial assistance received

by Riverhouse Tower Apartments under the National

Housing Act is excluded from the definition of ‘federal

financial assistance’ set forth in the Uniform Relocation

Act, 42 U.S.C. Sec. 4601(6).”

On appeal, the United States Court of Appeals for the

Seventh Circuit affirmed the judgment of District Court.

Relying upon Caramico v. Secretary of HUD, 509 F.2d

694 (2d Cir. 1974), the Seventh Circuit concluded that the

eviction of tenants from federally owned housing

projects following foreclosure is not the sort of displace-

ment to which benefits attach under the URA. The

Seventh Circuit delineated those circumstances under

which the URA is applicable, declaring that a displaced

person qualifies only where governmental activities

involve “the acquisition of land to accomplish an

objective benefitting the public or fulfilling a public

need.” 555 F.2d at 170. Because the court of appeals

concentrated on the termination of the previous Section

221(d)(3) program and ignored the property disposition

program required by 24 C.F.R. Part 270, the court

concluded that the closing of Riverhouse could not be

considered such a program or project. In consequence,

the Seventh Circuit held that the tenants were not

“displaced persons” within the meaning of the URA.

2 See also, HUD Property Disposition Handbook, Muiti-

Family Properties,4315.1.

6

REASONS FOR GRANTING THE WRIT

A. The Decision Below Conflicts With A Deci-

sion Of The United States Court Of Appeals

For The District Of Columbia Circuit

The instant case is in direct conflict with Cole v. Harris,

Nos. 75-2268, 75-2269 (D.C. Cir., Nov. 14, 1977).. Cole

involved the displacement of residents of Sky Tower, a

housing project located in Washington D.C., which was

purchased in 1970 by a non-profit corporation with HUD

mortgage insurance and subsidies. HU subsidized the

interest rate on the mortgage under a program designed

to bring rents within the reach of low- and moderate-

income families.* Upon default, the mortgagee foreclosed

the mortgage and conveyed title to HUD in exchange for

mortgage insurance proceeds. Thereafter, HUD hired a

management firm to operate the project. However, a year

later, HUD concluded that the project was blighted,

vandalized, unsafe and unattractive. Accordingly, HUD

decided to forego rehabilitation and instead, ordered

residents to vacate the project and began to demolish the

structures. In response, Sky Tower residents filed suit

seeking to prevent further demolitions and a declaration

that the URA was applicable to the tenants ordered to

vacate.

Alexander and Cole share a common nucleus of

operative facts. Both involved multi-family housing

projects insured and subsidized by HUD. Following

default by private mortgagors, HUD acquired, operated

and closed the projects, and evicted the residents as a

part of its property disposition program. In both cases,

HUD refused to provide URA assistance to the residents,

forcing them to search for shelter in tight housing markets

made even tighter by the closing of these projects.

3. Section 236 of the National Housing Act, 12 U.S.C. Sec

1715z-1. The Section 236 progra tiall, — K

Mati — ally replaced the

e

7

Based upon these facts, the Cole court concluded that

the dislocated residents of Sky Tower were displaced

persons” within the meaning of Section 10166) of the

URA, 42 U.S.C. Sec. 4601(6), and, in consequence, that

they were entitled to URA benefits. In order to reach its

conclusion, the District of Columbia Circuit construed

the URA definition of “displaced person,” which, reduced

to its essential language, states:

The term “displaced person” means any person who

... moves from real property .. as a result of the

acquisition of such real property, . or as the result

of the written order of the acquiring agency to vacate

real property, for a program or project undertaken by

a Federal agency ....

URA Sec. 101(6), 42 U.S.C. Sec. 4601(6). The Cole court

held that this statute states two alternative grounds for

eligibility, referred to by the court as “the acquisition

clause” and “the notice clause.” Cole v. Harris, supra,

Slip Op. at 9.

Concentrating on the “notice clause,” the court in Cole

held that the eviction of tenants from a HUD-acquired

project necessitated by HUD’s choice to demolish the

structures, was the kind of displacement for which

Congress intended URA coverage. HUD was the acquir-

ing agency; HUD issued written orders to the tenants to

vacate Sky Tower; and the tenants moved as a result of

those orders.

The court squarely held that the URA is not limited to

federal construction and rehabilitation projects.

Congress clearly did not intend that tenants dis-

placed by a simple decision to wreck their homes

would receive less protection than tenants displaced

by a constructive urban renewal project.

In sum, appellees qualify as “displaced persons“

within the plain terms of the notice clause.

8

Cole v. Harris, supra, Slip Op. at 10. In sharp contrast,

the Seventh Circuit, in the instant case, held that the

URA applies only to construction and rehabilitation

projects.

The conclusion and rationale of the Seventh Circuit

irreconcilably conflicts with the judgment of the District

of Columbia Circuit in Cole v. Harris, supra.’ The

contrasting results reached by the two courts undercut

the essential purpose of the URA—to provide uniform

and fair treatment of “persons displaced as a result of

Federal and Federally assisted programs. The two

decisions leave the anomolous result that tenants

residing in the District of Columbia are afforded

essential relocation assistance while tenants residing in

Indiana, Illinois, and Wisconsin are denied URA protec-

tion under identical circumstances. The conflict among

the circuits cannot be reconciled and should be resolved

by this Court.

B. This Case Raises A Significant Issue Relat-

ing To The Displacement Of Thousands Of

People From Housing Owned By The Federal

Government

For many years the two most notable federal and

federally-assisted programs displacing vast numbers of

poor families throughout the country were urban renewal

and the federal highway program. Today, a third

program threatens staggering displacement, namely, the

I Indeed, Judge Wilkey, dissenting i rgues

Cole and Alexander are indistinguishable — in —

2 v. Harris, supra, (dissenting opinion) at 1, 12, 25-

5 URA Sec. 201, 42 U.S.C, Sec.4621 (1970).

repossession and closing of federally-assisted, multi-

family housing projects under HUD's property disposi-

tion program. Ironically, the large bulk of this housing is

for low- and moderate-income families and was often

built particularly for families displaced by other federal

programs.“

In October, 1977, HUD reported to Congress the

magnitude of the problem of repossessed multi-family

projects. It was reported that 1,366 formerly subsidized

projects housing 154,724 families were in “financial

distress" —either owned by HUD, in serious default, or in

the process of assignment or foreclosure.’ The report

projects that HUD’s inventory of properties in financial

distress would reach 3,000 projects housing 342,000 unite

by 1982. Commenting on this trend, a recent analysis of

troubled HUD projects in Boston states:

Unless this trend is reversed, HUD may eventu-

ally have to face a charge that it is directly or in-

directly responsible for the effective displacement of

thousands of low- and moderate-income families in

these areas, with little prospect of standard housing

being available to them at a rental they can afford.

HUD Boston Area Office, Assisted Multi-Family Proj-

ects, City of Boston: A Strategy Paper 12 (Feb. 1977)

6 Section 221(d\3) of the National Housing Act, 12 U.S.C.

Sec. 1715 1(d)(3), the — 15 under which Riverhouse was

constructed, was designed in large part to house displaced

persons. See, 12 U.S.C. Secs. 1715 l(a) 1715 Wa Xe yi, 1715 Uf);

S.Rep. 1954 U.S Code & Cong. Adm. News, 2747-8.

7 Statement of Assistant Secretary Lawrence B. Simons

on “HUD Troubled Projects” before the Senate Roping,

Housing and Urban Affairs Committee, October 17, 1977, Pp. .

The three stages of distress outlined by Assistant Secretary

Simons were (with the number of projects indicated in

— 1 : 1) projects in the HUD owned acquired property

nven ( 0 2) projects in which the — has been

a to H D or the project is in the process o foreclosure

(960); and 3) projects in serious default, posing potential

neurance claims (212).

10

reported in 4 Housing & Development Reporter No. 26

(March 21, 1977) at 950.

Consequently, the question presented by this case is of

major importance from a variety of vantage points. First,

the issue raised is of critical importance to the 154,724

families whose housing either is currently owned by

HUD or which is likely to be acquired by HUD in the near

future. Their displacement will be much more than a

simple inconvenience, a fact amply demonstrated in the

legislative activity which culminated in the URA.

Voluminous reports, testimony, and debates repeatedly

describe the financial demands and personal disruption

caused by displacement, and document the particularly

harsh effects upon the poor, the elderly, large families,

and non-whites.* Congress viewed this personal hard-

ship of unassisted displacement as one of two public

policy reasons for passing the bili, the other being the

need for uniformity among federal programs in assist-

ance given to displaced persons. These Congressional

concerns are stated in the Act's declaration of policy:

The purpose of this subchapter is to establish a

uniform policy for the fair and equitable treatment of

persons displaced as a result of Federal and federally

assisted programs in order that such persons shall

not suffer disproportionate injuries as a result of

— designed for the benefit of the public as a

whole.

8 See, eg., Remarks of Senator Muskie, 115 Cong. Rec.

31533 (i969), 116 Cong. Rec. 20463 (1970); — of

Congressman Ashley, 115 Cong. Rec. 36049 (1969 ; Remarks of

. — Cohelan, 116 Cong. Rec. 11223 (1970); Remarks

of Congressman Bennett, 11 Cong. Rec. 11224 1970);

Remarks of Senator Tydings, 115 Cong. Rec. 36049 1969);

1 | oe 1 —— * 1 Cong. Rec. 6101 (1969);

Rep. No, 488, 91st Congress, lst on (1969); H. No.

1656, 91at Congress, 2d Session (1970). a —

URA Sec. 201, 42 U.S.C. Sec. 4621. They are also given life

in the URA's broad definition of “displaced person” and

in the generous benefits provided in the Act.“

Second, this case is of vital importance to local officials

of cities which contain federally-held housing. These

officials need to know whether or not HUD will provide

relocation benefits and services to persons displaced

from HUD-held housing. Should the URA apply to dis-

placees of HUD-held properties, HUD would be required

to assure that decent replacement housing be available,

and would be required to provide assistance in locating

that housing. See, 42 U.S.C. Seca. 4625, 4626. If the URA

does not apply to the persons displaced by HUD, the

burden of insuring decent and affordable housing shifts

from the federal government to local government.

Third, a definitive resolution of the applicability of the

URA to persons displaced from HUD- acquired projects is

of manifest importance to HUD. Should this Court

establish the applicability of the URA to Riverhouse

situations, the cost of relocation would become a factor to

be weighed by HUD in evaluating its various disposition

options. See, Cole v. Harris, supra, Slip Op. at 16.

Consequently, it is not only the scope of the URA, but

also the hardship imposed upon individuals and the

responsibilities placed on local, state and federal govern-

ments resulting from displacement, which urge consider-

ation of this case by the Court. A definitive ruling by this

Court on the applicability of the URA will provide

uniformity in the treatment of persons displaced by the

12

government which is supposed to be the hallmark of the

URA. For these reasons, it is essential that the Supreme

Court grant this petition for a writ of certiorari.

CONCLUSION

Because the judgment of the Seventh Circuit Court of

Appeals directly conflicts with the decision of the District

of Columbia Circuit Court of Appeals, and because

review of this case affords the opportunity to determine

the appropriate interpretation of the URA, this petition

for a writ of certiorari should be granted.

Respectfully submitted,

RICHARD L. ZWEIG

WILLIAM MARSH

PAUL LEVY, Of Counsel

Legal Services Organization

of Indiana, Inc.

107 North Pennsylvania—Suite 300

Indianapolis, Indiana 46204

ATTORNEYS FOR PETITIONERS

APPENDIX

RULINGS BELOW

IN THE DISTRICT COURT OF THE UNITED

STATES

SOUTHERN DISTRICT OF INDIANA

INDIANAPOLIS DIVISION

JOHN BLADES, et al.,

Plaintiffs,

us. CIVIL NO. IP 74-706-C

U.S. DEPARTMENT OF

HOUSING AND URBAN

DEVELOPMENT, et al.,

)

)

)

)

)

)

)

)

Defendants. )

FINDINGS OF FACT, CONCLUSIONS OF LAW,

AND JUDGMENT

This cause came before the Court on defendants’ Mo-

tion To Dismiss and In The Alternative Motion For

Summary Judgment and on Plaintiffs’ Motion for

Partial Summary Judgment, and the Court hereby

makes the following findings of fact, conclusions of law,

and judgment.

FINDINGS OF FACT

1. Riverhouse Tower Apartments, is a 294 unit apart-

ment complex, located at 1150-1152 White River Park-

way, West Drive, Indianapolis, Indiana.

A-1

A-2

2. The mortgage on Riverhouse Tower Apartments

was insured by the Secretary of the Department of Hous-

ing and Urban Development in accordance with pro-

visions of 221(d)(3) of the National Housing Act, as

amended, 12 USC Sec. 1715 d) 3).

3. Under the 221(d)(3) program, private industry is

encouraged to invest in multifamily projects through the

provision of mortgage insurance which protects lenders

against the risk of default by the mortgagor. In addition,

upon completion of the project, mortgage interest rate is

reduced to 3% per annum and is purchased by the

Government National Mortgage Association.

4. Riverhouse Tower Apartments encountered finan-

cial difficulty and, the loan went into default on July 1,

1970.

5. The note and mortgage were assigned to the

Secretary of the Department of Housing and Urban

Development by the Goverment National Mortgage

Association on December 22, 1970.

6. On May 9, 1973, the United States filed a complaint

to foreclose the mortgage on Riverhouse Tower Apart-

ments in the United States District Court for the

Southern District of Indiana.

7. From May 11, 1973 through September 24, 1974, the

project was in the possession of a court-ordered receiver.

8. The Secretary acquired title to Riverhouse Tower

Apartments through a resulting Marshal’s sale, and the

deed to the Secretary of the Department of Housing and

Urban Development was recorded on September 24, 1974.

9. At the time of acquisition, all of the plaintiffs were

tenants of Riverhouse Tower Apartments.

A-3

10. Subsequent to acquisition, the Department of

Housing and Urban Development attempted to keep

Riverhouse Apartments occupied, but by the time of

November 18, 1974, that Department decided to close the

building because of the concern for the safety of the

residents.

11. On November 18, 1974, the Department of Hous-

ing and Urban Development caused notices to quit by

December 31, 1974 to be served on all tenants of

Riverhouse Tower Apartments.

12. All tenants vacated Riverhouse Tower Apart-

ments by February, 1975.

13. The Department of Housing and Urban Develop-

ment did not provide relocation payments to tenants of

Riverhouse Tower Apartments.

14. Each of the named plaintiffs paid the Department

of Housing and Urban Development or the former owner

of Riverhouse Tower Apartments a security deposit in the

amount of $100.00 at the time of initial tenancy.

15. As of November 30, 1974, plaintiff Young was

current in her rent, and the Department of Housing and

Urban Development has returned the amount of her

security deposit to plaintiff Young.

16. The defendants have admitted that they did not

collect any rents for the month of December, 1974, and

therefore,they have agreed to return the security deposits

of plaintiffs Danforth, Robinson, Washington, and

Whitney.

17. The defendants have also agreed to return to

plaintiff Holland the sum of $16.75 to reimburse him for

the difference between the amount of his security deposit

and the amount of his rental delinquency as of November

30, 1974.

A-4

18. The records of the Department of Housing and

Urban Development show that the remaining plaintiffs,

Alexander, Hood, Jackson, and Pippens, were not

current in their rent payments, and that their security

deposits were kept to make up the deficiency. The sum of

$83.25 of the scurity deposit of plaintiff Holland is also

being kept by that Department to make up the deficiency

in his rent, after returning the sum of $16.75 as previously

described.

19. The plaintiffs argue that they were not obligated

to pay all the rent which was due under the terms of their

leases, alleging a breach of a warranty of habitability.

CONCLUSIONS OF LAW

1. Plaintiffs are not entitled to relocation assistance

and payments under the Uniform Relocation Act of 1970,

42 USC 4601, et seg. and following sections. Caramico v.

Secretary of the Department of Housing and Urban

Development, 509 F.2d 694 (2nd Cir. 1974), Harris, etal. v.

Lynn, St. Louis Housing Authority, et al., E.D. Mo.,

Cause No. 74-124-C, decided February, 1976 (copy

attached).

2. The type of federal financial assistance received by

Riverhouse Tower Apartments under the National

Housing Act is excluded from the definition of “federal

financial assistance” set forth in the Uniform Relocation

Act, 42 USC 4601(6).

3. The termination of the present use of Riverhouse

A-5

4. Whether there is a warranty of habitability in

plaintiffs’ leases is a question to be determined by federal

law.

5. Under federal law, there is no implied vraag of

itability i intiffs’ leases. United States v. Neu-

— A . Davis v. Romney, 490 F. 2d 1360

(3rd Cir. 1974); Jackson v. Lynn, 506 F.2d 233 (D. C. Cir.

1973); Patricia White, et al. v. Romney, et al., C.D. Calif.,

Cause No. 72-2646, decided December 18, 1972 (copy

attached).

6. As there is no implied warranty of habitability

with respect to property acquired by the Secretary

pursuant to the National Housing Act, plaintiffs are not

entitled to withhold rent because of an alleged breach of

such a warranty, even if plaintiffs presented evidence,

which they did not, that the alleged breach was, in fact,

the reason for their non-payment of rent.

7. The Secretary of the Department of Housing and

Urban Development was entitled to apply the amount of

security deposit to the amount of each tenant’s rental

delinquency.

JUDGMENT

It is therefore ORDERED, ADJUDGED and DE-

CREED that judgment be and is hereby entered for the

defendants.

Dated this 1 day of July, 1976.

Tower Apartments is not a “program or project under-

taken by a federal agency” to which the provision of the

Uniform Relocation Act append.

/s/ CALE J. HOLDER

JUDGE, United States District

Judge

A-6

Genanett ALEXANDER et al.,

Plaintiffs-Appellants,

v.

U.S. DEPARTMENT OF HOUSING AND

URBAN DEVELOPMENT and Carla A.

Hills, Secretary, Defendants-Appellees.

No. 76-1993.

United States Court of Appeals,

Seventh Circuit.

Argued April 13, 1977.

Decided May 20, 1977.

Rehearing and Rehearing En Banc

Denied Sept. 19, 1977.

Before CUMMINGS and PELL, Circuit Jud

CAMPBELL, Senior District Judge.* *

WILLIAM J. CAMPBELL, Senior District Judge.

This is an appeal from an order of the district court

granting defendants' motion for summ j

ary judgment.

The facts are not in dispute. :

The seventeen plaintiffs are former tenants of the

Riverhouse Tower Apartments (Riverhouse), a complex

consisting of two 12-high story buildings containing 294

apartments units located in Indianapolis,Indiana. The

Project was constructed by Riverhouse Apartments, Inc.

a Private nonprofit corporation and former mortgagor of

Riverhouse. Repayment of a loan secured by the

mortgage was insured by the Secretary of the Depart-

ment of Housing and Urban Development (HUD) under

Sec. 221(d)(3) of the National Housing Act, as amended

12 U.S.C. Sec. 171 5vd)(3). In accordance with that

* Senior District Jud e Willi

Northern District of nüinols is sitting by PR mas — *

A- 7

section, upon the completion of the Ri verhouse Project,

the interest rate on the loan was reduced to 3%, and the

mortgage was purchased by the Government National

Mortgage Association.

Riverhouse Apartinents, Inc. defaulted on the loan in

July, 1970, In December of that year the mortgagee

(Government National Mortgage Association) assigned

the note and mortgage to HUD. Three years later, in face

of the mortgagor’s continuing default, HUD initiated a

foreclosure action in the Southern Distict of Indiana.

From May, 1973 until September,1974 Riverhouse wasin

possession of a court-appointed receiver. A Marshal’s

sale ensued, and HUD acquired title to Riverhouse.

After the acquisition, HUD emloyed the Federal Prop-

erty Management Corporation to manage Riverhouse

and to secure needed repairs.However, the condition of

Riverhouse had so deteriorated that HUD determined to

terminate the project. Affidavits in the record attest to

the deplorable condition into which Riverhouse had

fallen. The project was infested with roaches and vermin;

elevators were often inoperable; security was poor; hot

water and heat were inadequate or non-existent; the

buildings were often flooded; lighting was poor in the

narrow hallways which were often cluttered with

garbage; plumbing was deficient, and some tenants had

electrical problems.

Recognizing that Riverhouse was plagued by unsafe

conditions, nonpayment of rents, and the excessive costs

of bringing the project into good condition, HUD caused

notices to quit to be served on all tenants. These notices

were issued on November 18, 1974, requiring the tenants

to vacate Riverhouse by December 31, 1974. By February,

1975 Riverhouse was vacant.

A-8

During the time the project was operating, all tenants

were required to post a $100.00 security deposit at the

time of their initial tenancy. When Riverhouse was

terminated, HUD returned the security deposits to all

tenants who were current in their rent payments. In the

case of five of the plaintiffs, however, HUD applied the

amount of their security deposits to the balance of any

rent arrears.

In the district court, plaintiffs sought relocation

benefits as provided by the Uniform Relocation Assist-

ance and Real Property Acquisition Policies Act, 42

U.S.C. Sec. 4601 et seg. (URA). In support of this

contention, plaintiffs asserted that the November 18,

1974 order to vacate Riverhouse made them eligible for

benefits afforded to “displaced persons” within the

meaning of URA. Further, the five plaintiffs whose

security deposits were not returned due to rent arrears

sought the return of those monies, alleging that HUD

had breached a warranty of habitability which is to be

implied in their leases. Owing to this breach, plaintiffs

contended, the obligation to pay rent was relieved, and

thus HUD wrongfully withheld those security deposits

and applied them to the balance of rent arrears. The

district court held URA inapplicable to the closing of the

Riverhouse Project, and held there is no implied

warranty of habitability in plaintiffs’ leases. We affirm.

I,

Prior to the enactment of URA, there appear to

have been two major legislative provisions for handling

most relocation benefits: the Amendments to the Federal

Housing Act, 42 U.S.C. Sec. 1465, which provided

relocation assistance benefits to persons displaced by

urban renewal projects, and the Highway Relocation

Assistance Act, Pub.L. 91-605, 84 Stat. 1724, which

A-9

provided assistance benefits in connection with Federal

Aid highway construction projects. In addition to urban

renewal and highway construction projects, other legis-

lative provisions dealt with relocation assistance to

owners and tenants of land acquired by federal agencies

for governmental purposes.’ All of these relocation

assistance provisions were repealed, 84 Stat. 1903, by the

enactment of URA. Recognizing the disparities and

inconsistencies existing among federal and federally

assisted programs with respect to the amount and scope

of benefits and other assistances, Congress sought to

provide uniform treatment for those forced to relocate as

a result of federal and federally aided public improve-

ments programs. House Report No. 91-1556, 91st Cong.

2d Sess.; 1970 U.S. Code Cong. & Admin. News. pp. 5582-

5583. See also: 42 U.S.C. Sec. 4621.

Relocation assistance under URA is afforded to

“displaced persons”. 42 U.S.C. Sec. 4601(6) defines a

“displaced person” as:

“Any person who ... moves from real property, or

moves his personal property from real property, as

the result of the acquisition of such real property..

or as the result of the written order of the acquiring

agency to vacate real property, for a program or

project undertaken by a ny agency, or with

Federal financial assistance;. .

Several cases have discussed the Anme aspects of

URA. Even though persons were displaced by an urban

renewal project, URA was held inapplicable to that

project because the federal government had not executed

E. g. 43 U.S.C. Secs. s 717 „

Interior 442 U.S.C, Sec. “re OG N NAS

) (Urba 2 Transpor-

49 U.S.C, Sec. 1

2080 (Mil 42 20 8&8 Sec. 3074 (Condemnation for Development

Programs), and 42 U.S.C. 3307(b), (c) (Demonstration

Cities an ‘Metropolitan Development).

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a contract for a loan or grant—an activity held to be

determinative of the federal nature of the project.

Feliciano v. Romney, 363 F.Supp. 656, 672 (S. D. N. V.

1973). But see: LaRaza Unida v. Volpe, 337 F.Supp. 221

(N.D.Cal. 1971), af d., 488 F.2d 559 (9th Cir. 1973).

Further, a person displaced by a project undertaken by a

private institution receiving federal financial assistance

for that project was found ineligible to receive relocation

benefits. Parlane Sportswear Company, Inc. v. Wein-

berger, 381 F.Supp. 410 (D. Mass. 1974), ff d., 513 F.2d

835 (Ist Cir. 1975), cert. denied, 423 U.S. 925, 96 8.Ct. 269,

46 L.Ed.2d 252. See also Jones v. HUD, 390 F.Supp. 579

(E.D.La.1974).

Eligibility for URA benefits is also based on the

requirement that a person be displaced “for a program

or project undertaken by a Federal agency, or with

Federal financial assistance.” 42 U.S.C. Sec. 4601(6).

This requirement has been interpreted to mean construc-

tion of new federal projects. Jones bv. HUD, supra, 390

F.Supp. at 583." In a case closely resembling the present,

the Second Circuit intimated that Congress intended the

program or project requirement of 42 U.S.C, Sec. 4601(6)

to mean “construction” programs or projects. Caramico

v. HUD, 509 F.2d 694, 698 (2d Cir. 1974).

In Caramico, a mortgagee of low income dwellings was

required by FHA regulations to deliver possession of the

mortgage property unoccupied in order to recover federal

mortgage insurance. Upon default of the mortgagor and

subsequent foreclosure, the mortgagee sought to evict the

tenants in order to comply with the vacant delivery

2. The Jones opinion refers to an earlier unpublished

opinion of the same district court. The reported decision lacks

any analysis of the requirement that the claimant of URA

penetits be displaced for a program or agent undertaken by a

ed assistance.

eral agency or with Federal financia

A-11

requirement. The Court found that the evicted tenants

were not displaced within the meaning of 42 U.S.C. Sec.

4601(6) since, although there may have been an acquisi-

tion within the meaning of that section, the tenants did

not show that the acquisition was for a program or

project. Id., at 697. Finding a crucial difference between

mortgage insurance acquisitions and acquisitions under

programs covered by URA, the Second Circuit charac-

terized the former as “random and involuntary while

normal urban renewal contemplates a conscious govern-

ment decision to dislocate some so that an entire area

may benefit.” Jd. at 698.

The tenants in this case contend that Caramico is

distinguishable factually since in Caramico HUD was

not the mortgagee, did not foreclose on the mortgage, and

did not purchase the property from which the tenants

were evicted. Further, plaintiffs argue Caramico in-

volved the acquisition aspect of 42 U.S.C. Sec. 4601(6),

whereas here plaintiffs rely on the aspect of that section

dealing with the written order to vacate by the acquiring

agency. Finally, plaintiffs seek to distinguish Caramico

by arguing that the mortgagee in that case was FHA, and

since under 12 U.S.C. Sec. 1717(b), the FHA had to convey

to HUD, the conveyance was involuntary. But in this

case, HUD was not compelled to purchase Riverhouse,

nor was HUD required to issue the order to vacate.

Although distinguishable with respect to particular

facts, Caramico involved the same inquiry as presented

by this case, i. e., whether the activity of the govern-

mental agency was “for a program or project undertaken

by a Federal agency, or with Federal financial assist-

ance.” In this case, we conclude HUD’s written order to

the tenants of Riverhouse to vacate by December 31, 1974

was not for such a program or project.

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The terms “program” and “project” are not defined in

URA, nor does the legislative history illuminate Con-

gress’ intent with respect to those terms. Without any

express indication from Congress as to what it meant by

the use of these terms, we look to the objectives sought

to be accomplished through the enactment of URA. 42

U.S.C. Sec. 4621 states:

“The purpose of this subchapter is to establish a

uniform policy for the fair and equitable treatment of

persons displaced as a result of Federal and

Federally assisted programs in order that such

persons shall not suffer disproportionate injuries as

a result of programs designed for the benefit of the

public as a whole.”

As this declaration of policy indicates, programs and

projects are those activities designed for the benefit of the

public as a whole. Thus, persons displaced by such

programs are persons displaced by governmental activi-

ties involving the acquisition of land to accomplish an

objective benefiting the public or fulfilling a public need.

In this regard, an order by HUD to vacate a public

housing project because that project had become an

irretrievable failure cannot be considered such a program

or project. HUD’s decision to abandon the Riverhouse

Project and its order to the tenants to vacate the facility

cannot be characterized as a program or project under-

taken by a federal agency to accomplish an objective

benefiting the public as a whole. Rather, at best, HUD’s

decision and order to vacate represent a sad recognition

that the Riverhouse Project failed to accomplish the

government's objective of providing adequate public

housing for the needy.

3 In intimating that these terms were intended by Congress

to mean “construction” programs and projects, the Second

Circuit relied on various provisions of URA alluding to that

type of activity. See: Caramico, supra, 509 F.2d at 698.

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Plaintiffs point out that the purpose behind HUD’s

decision to order the tenants to vacate Riverhouse is

undisclosed from the record, and that the Secretary has

several options: rehabilitation, demolition, or sale of the

facility. Plaintiffs argue that these undisclosed plans

constitute a program or project within the meaning of

URA. Riverhouse is a conceded failure as a project to

provide public housing. We fail to see how a decision to

terminate a project can itself become a project in the

absence of some indication that the decision to terminate

and the order to vacate constitute a prelude to some

governmental undertaking amounting to a program

designed for the benefit of the public as a whole.

II.

Five plaintiffs in this action claim that their obli-

gation to pay rent was relieved by HUD’s breach of a

warranty of habitability which, plaintiffs contend, is to

be implied in their leases. Thus, plaintiffs argue, their

security deposits were wrongfully withheld by HUD,

which applied those funds to rent arrears.

Plaintiffs have drawn our attention to a substantial

number of reported decisions from various state jurisdic-

tions which have revolutionized the law of landlord-

tenant relationships by adopting a theory that in every

residential lease, absent a valid contrary agreement,

there is an implied warranty of habitability.‘ The courts

adopting this theory have tended to treat leases of

residential property as both a conveyance of an interest

in real property and as an agreement giving rise to a

4 E. g. Pines b. Perssion, 14 Wis.2d 590, 111 N.W.2d 409

(1961); Jack Springs, Inc. b. Little, 50 III. 2d 351, 280 N.E.2d 208

72). Develo nt Company uv. Langford, 349

Ne 2d 940 ( nd 40 1 5 Firet National Realty

d.App. 19

Corp., 138 Soe 0 369, 428 F.2d 1071 (1970), cert. denied,

400 U.S. 925, 91 S.Ct. 186, 27 L.Ed.2d 185 (1970).

A-14

contractual relationship in which the landlord’ ind

tenant's obligations are mutually dependent. Most of

the adopting jurisdictions analyzed the basic rationale

underlying the old common law rule absolving the lessor

from all obligation to repair the leased premises in favor

of the lessee assuming such an obligation during the term

of the lease, and concluded that such a rule was never

really intended to apply to urban residential leaseholds.

See: Javins b. First National Realty Corp., 138 U.S. App.

D.C. 369, 428 F.2d 1071, 1080 (1970) cert. denied, 400 U.S.

925, 91 S.Ct. 186, 27 L.Ed.2d 185 (1970). Recognizing that

the rule of decision governing this case must be federal,

plaintiffs suggest that we look to these state court

decisions for guidance in developing a federal landlord-

tenant law imposing a warranty of habitability in leases

between federally owned low income housing projects

and their tenants. Cf. Illinois v. Milwaukee, 406 U.S. 91,

107, 92 S.Ct. 1385, 31 L.Ed.2d 712 (1972).

We decline plaintiffs’ invitation to follow these state

court decisions implying a warranty of habitability in

urban residential leases in the private sector. We decline

to do so because we are not persuaded that such

warranties should be implied in leases of dwelling units

constructed and operated as public housing projects. In

contrast to housing projects in the private sector, the

construction and operation of public housing are projects

established to effectuate a stated national policy “to

remedy the unsafe and insanitary housing conditions

and the acute shortage of decent, safe, and sanitary

dwellings for families of low income”. 42 U.S.C. Sec. 1401.

5 Illinois b. Milwaukee, supra, involved a federal common

law of nuisance in a water pollution context. The Court

indicated that a state's environmental quality standards are

relevant but not conclusive sources of federal common law. Cf.

also: Textile Workers v. Lincoln Mills, 353 U.S, 448, 456-457, 77

S.Ct. 912, 1 L.Ed.2d 972 (1957).

A-15

As such, the implication of a warranty of habitability in

leases pertaining to public housing units is a warranty

that the stated objectives of national policy have been

and are being met. We feel that the establishment of any

such warranty that national policy goals have been

attained or that those goals are being maintained is best

left to that branch of government which established the

objectives.

Plaintiffs further contend that the rationale of the

various state court decisions implying the warranty in

urban residential leases was advanced years ago by

Congress when it enacted the United States Housing Act

of 1937, 42 U.S.C. Sec. 1401 et seg. Pointing to the

Congressional declaration of national housing policy

contained in 42 U.S.C. Sec. 1441, the “comprehensive”

regulatory scheme imposed on mortgagors of Section

221(d)(3) projects® and the various chapters of HUD’s

Property Disposition Handbook, Multifamily Properties,

RHM 4315. 1(February 17, 1971), plaintiffs argue that

these multiple obligations unon HUD, its mortgagors,

and management agents to make repairs and generally

maintain public housing facilities in decent, safe, and

sanitary conditions must implicitly run to the benefit of

the tenant as an implied term in their leases. We reject

this contention for reasons similar to our rejection of

plaintiffs’ suggestion that we follow state court decisions

in implying a warranty of habitability.

The stated Congressional purpose of providing a

“decent home and a suitable living environment for

6. Plaintiffs cite as examples of this comprehensive“

scheme 24 C.F.R. Secs. 221.530(b), 221.545(c), and 221.529. We

note that these sections pertain to the — general

duty to maintain facilities constructed under . 221(d)(3)

rograms in the context of a much more comprehensive

nancial scheme relating to federally insured mortgages.

A-16

every American family,” 42 U.S.C. Sec. 1441, expresses

general Congressional objectives in instituting public

housing programs. We fail to see how these objectives can

be interpreted to impose upon HUD or its agent an

absolute, fixed obligation to maintain suitable dwellings.

Moreover, like many declarations of Congressional

policy, 42 U.S.C. Sec. 1441 sets forth broad future

objectives on a grand scale which are to be accomplished

over a period of many years. The establishment of

Congressional objectives, while certainly affording bene-

fits to those eligible to partake of programs designed to

attain those objectives, is not tantamount to a warranty

that such objectives will be attained.

Accordingly, the judgment of the district court is

affirmed.

AFFIRMED.

United States Court of Appeals

For the Seventh Circuit

Chicago, Illinois 60604

September 19, 1977.

Before

Hon. Thomas E. Fairchild, Chief Judge*

Luther M. Swygert, Circuit Judge

Hon. Walter J. Cummings, Circuit Judge

Wilbur F. Pell, Jr., Circuit Judge

Hon. Robert A. Sprecher, Circuit Judge

Philip W. Tone, Circuit Judge

William J. Bauer, Circuit Judge

Harlington Wood, Jr., Circuit Judge

William J. Campbell, Sr., District Judge**

GENANETT ALEXANDER, et al.,

Plaintiffs-Appellants, Appeal from the United

States District Court for

)

)

)

No. 76-1993 ) the Southern District of

) Indiana, Indianapolis

vs. ) Division.

)

UNITED STATES DEPARTMENT OF HOUSING )

AND URBAN DEVELOPMENT and CARLA )

ANDERSON HILLS, Secretary of the )

Department of Housing and Urban )

Development, ) No. IP 74-706-C

)

Defendants- Appellees. Cale J. Holder, Judge

* Chief Judge Thomas E. Fairchild voted to grant a

rehearing in banc.

** Senior District Judge William J. Campbell of the

Northern District of Illinois is sitting by designation.

A-17

A-18

On consideration of the petition for rehearing and

suggestion for rehearing in banc filed in the above-

entitled cause by counsel for the plaintiffs-appellants, a

vote of the active members of the Court was requested,

and a majority of the active members of the Court have

voted to deny a rehearing in banc. All of the judges on the

original panel have voted to deny the petition for

rehearing. Accordingly,

IT IS ORDERED that the aforesaid petition for

rehearing be, and the same is hereby, DENIED.

A-19

STATUTORY PROVISIONS INVOLVED

Section 4601. Definitions

As used in this chapter—

(1) The term “Federal agency” means any depart-

ment, agency, or instrumentality in the executive branch

of the Government (except the National Capital Housing

Authority), any wholly owned Government corporation

(except the District of Columbia Redevelopment Land

Agency), and the Architect of the Capitol, the Federal

Reserve banks and branches thereof.

(4) The term “Federal financial assistance” means a

grant, loan, or contribution provided by the United

States, except any Federal guarantee or insurance and

any annual payment or capital loan to the District of

Columbia.

(5) The term “person” means any individual, part-

nership, corporation, or association.

(6) The term “displaced person” means any person

who, on or after January 2, 1971, moves from real

property, or moves his personal property from real

property, as a result of the acquisition of such real

property, in whole or in part, or as the result of the written

order of the acquiring agency to vacate real property, for

a program or project undertaken by a Federal agency, or

with Federal financial assistance; and solely for the

purposes of sections 4622(a) and (b) and 4625 of this title,

as a result of the acquisition of or as the result of the

written order of the acquiring agency to vacate other real

property, on which such person conducts a business or

farm operation, for such program or project.

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Section 4621. Declaration of policy

The purpose of this subchapter is to establish a uniform

policy for the fair and equitable treatment of persons

displaced as a result of Federal and federally assisted

programs in order that such persons shall not suffer

disproportionate injuries as a result of programs de-

signed for the benefit of the public as a whole.

Section 4622. Moving and related expenses—

General provision

(a) Whenever the aquisition of real property for a

program or project undertaken by a Federal agency in

any State will result in the displacement of any person on

or after January 2, 1971, the head of such agency shall

make a payment to any displaced person, upon proper

application as approved by such agency head, for—

(1) actual reasonable expenses in moving him-

self, his family, business, farm operation, or other

personal property;

(2) actual direct losses of tangible personal prop-

erty as a result of moving or discontinuing a business

or farm operation, but not to exceed an amount equal

to the reasonable expenses that would have been

required to relocate such property, as determined by

the head of the agency; and

(3) actual reasonable expenses in searching for a

replacement business or farm.

(b) Any displaced person eligible for payments under

subsection (a) of this section who is displaced from a

dwelling and who elects to accept the payments author-

ized by this subsection in lieu of the payments authorized

by subsection (a) of this section may receive a moving

expense allowance, determined according to a schedule

A-21

established by the head of the Federal agency, not to

exceed $300; and a dislocation allowance of $200.

Section 4624. Replacement housing for tenants

and certain others

In addition to amounts otherwise authorized by this

subchapter, the head of the Federal agency shall makea

payment to or for any displaced person displaced from

any dwelling not eligible to receive a payment under

section 4623 of this title which dwelling was actually and

lawfully occupied by such displaced person for not less

than ninety days prior to the initiation of negotiations for

acquisition of such dwelling. Such payment shall be

either—

(1) the amount necessary to enable such displaced

person to lease or rent for a period not to exceed four

years, a decent, safe, and sanitary dwelling of

standards adequate to accommodate such person in

areas not generally less desirable in regard to public

utilities and public and commercial facilities, and

reasonably accessible to his place of employment,

but not to exceed $4,000, or

(2) the amount necessary to enable such person

to make a downpayment (including incidental

expenses described in section 4623(a)(1)(C) of this

title) on the purchase of a decent, safe, and sanitary

dwelling of standards adequate to accommodate

such person in areas not generally less desirable in

regard to public utilities and public and commercial

facilities, but not to exceed $4,000, except that if such

amount exceeds $2,000, such person must equally

match any such amount in excess of $2,000, in

making the downpayment.

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Section 4625. Relocation assistance advisory serv-

ices—Program for displaced persons and econom-

ically injured occupants of adjacent property.

(a) Whenever the acquisition of real property for a

program or project undertaken by a Federal agency in

any State will result in the displacement of any person on

or after January 2, 1971, the head of such agency shall

provide a relocation assistance advisory program for

displaced persons which shall offer the services de-

scribed in subsection (c) of this section. If such agency

head determines that any person occupying property

immediately adjacent to the real property acquired is

caused substantial economic injury because of the

acquisition, he may offer such person relocation advisory

services under such program.

(b) Federal agencies administering programs which

may be of assistance to displaced persons covered by this

chapter shall cooperate to the maximum extent feasible

with the Federal or State agency causing the displace-

ment to assure that such displaced persons receive the

maximum assistance available to them.

(c) Each relocation assistance advisory program

required by subsection (a) of this section shall include

such measures, facilities, or services as may be necessary

or appropriate in order to—

(1) determine the need, if any, of displaced

persons, for relocation assistance;

(2) provide current and continuing information

on the availability, prices, and rentals, of comparable

decent, safe, and sanitary sales and rental housing,

and of comparable commercial properties and loca-

tions for displaced businesses;

— — —

— —

A-23

(3) assure that, within a reasonable period of time,

prior to displacement there will be available in areas

not generally less desirable in regard to public

utilities and public and commercial facilities and at

rents or prices within the financial means of the

families and individuals displaced, decent, safe, and

sanitary dwellings, as defined by such Federal

agency head, equal in number to the number of and

available to such displaced persons who require such

dwellings and reasonably accessible to their places of

employment, except that the head of that Federal

agency may prescribe by regulation situations when

such assurances may be waived;

(5) supply information concerning Federal and

State housing programs, disaster loan programs, and

other Federal or State programs offering assistance

to displaced persons; and

(6) provide other advisory services to displaced

persons in order to minimize hardships to such

persons in adjusting to relocation.

(d) the heads of Federal agencies shall coordinate

relocation activities with project work, and other planned

or proposed governmental actions in the community or

nearby areas which may affect the carrying out of

relocation assistance programs.

Section 4626. Housing replacement by Federal

agency as last resort

(a) If a Federal project cannot proceed to actual

construction because comparable replacement sale or

rental housing is not available, and the head of the

Federal agency determines that such housing cannot

otherwise be made available he may take such action as

is necessary or appropriate to provide such housing by

use of funds authorized for such project.

A-24

(b) No person shall be required to move from his

dwelling on or after January 2, 1971, on account of any

Federal project, unless the Federal agency head is

satisfied that replacement housing, in accordance with

section 4625(c)(3) of this title, is available to such person.