Appendix — New York City Housing Authority v. Davis
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TABLE OF CONTENTS TO APPENDIX
PAGE
Order of the United States Court of
Appeals for the Second Circuit,
Gated Janua;xry 3, ZO0Z 222.2622 ccccccccccccese. la
Order of the United States District
Court for the Southern District of
New York, dated June 20, 2000,
supplementing the record.................-.-. Sla
Summary Order of the United States
Court of Appeals for the Second Circuit,
dated February 23, 2000, remanding for
supplementation of the record..............-. 62a
Order of the United States District Court
for the Southern District of New York,
dated August 11, 1989, making the
preliminary injunction permanent............ 67a
Order of the United States Court of Appeals
for the Second Circuit, dated January 22,
1999, vacating the District Court’s
decisions and remanding for more
specific factual findings and application
of the proper legal standard .................. 110a
Order of the United States District Court for
the Southern District of New York, dated
November 13, 1997, denying NYCHA’s
motion for reconsideration and reargument
and modifying the preliminary injunction
to apply to developments with populations
more than 30% white ...........ccccsccccccees 123a
AM Da tts nt
li
PAGE
Order of the United States District Court for
the Southern District of New York, dated
November 18, 1997, amending the District
Court’s November 13, 1997 order............ 135a
Order of the United States District Court for
the Southern District/of New York, dated
July 17, 1997, preliminarily enjoining the
Order of the United States District Court
for the Southern District of New York,
dated December 30, 1992, approving
Bee e rT Pry rer Te Porro erry ETe Te 174a
EPOGED GOROE FOGY 0 BGS sin od nda ta nededncenceddas 185a
Exhibit A: List of Affected Developments... 229a
Exhibit B: NYCHA’s Tenant Selection
ag | Tr rrprrr rer erores 230a
Equal Protection Clause of the Fourteenth
PU Ka Gece cys secs hscsnsnaucsscascaass 265a
42 U.S.C. § 1437d(c)(4)(A)(iv) (1994) ........... 266a
42 U.S.C. § 1437n(b)(2) (1994)..... settee eeeeeees 266a
Balanced Budget Downpayment Act,
I, Pub. L. No. 104-99, § 402(d)(1),
Se Ss is De ioc acisnccaveensicase 267a
Quality Housing and Work Responsibility Act
of 1998, Pub. L. No. 105-276, §§ 502(a)(3),
502(a)(5)(C), and 502(a){5)(D), 112 Stat.
Res BE EA il aka ve nbekndeceiacvesss 267a
42 U.S.C. § 1437(a)(1)(C) (Supp. 1999).......... 269a
ii
PAGE
42 U.S.C. § 1437a(a)(2)(D) (Supp. 1999)......... 269a
42 U.S.C. §§ 1437n(a)(1), 1437n(a)(3)(A), |
and 1437n(a)(3)(B)(i) (Supp. 1999).......... 270a
42 U.S.C. § 3604(a) (2001) .........0... cece eres 271a
24 C.F.R. § 913.104(a) (1992) ........c cece eee. 272a
24 C.F.R. § 960.211(a)(1) (1992) 0.02... eeeeee. 272a
24 C.F.R. § 960.205(a) (2001) .............000ce 272a
24 C.F.R. § 960.206(b)(2) (2001) ..... 0.2.2... 00 8. 272a
59 Fed. Reg. 36616, 36618-19 (July 18, 1994)... 274a
la
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
August Term, 1999
(Argued: February 16, 2000
Final briefs submitted: July 28, 2000
Decided: January 3, 2002)
Docket No. 99-6238
PAULINE DAVIS, CYNTHIA WILLIAMS, CORNELIA SIM-
MONS, and KIM RIVERA, on behalf of themselves and
all others similarly situated,
Plaintiffs-Appellees,
NEW YORK CITY HOUSING AUTHORITY,
Defendant-Appellant.
Before:
WALKER, Chief Judge,
KEARSE and POOLER, Circuit Judges.
a
Appeal from an order of the United States District
Court for the Southern District of New York, Robert W.
Sweet, Judge, permanently enjoining defendant Housing
Authority from altering operations under a consent
decree, entered to remedy racial discrimination in accep-
tance of tenants for public housing, by implementing a
working-family preference at 20 housing projects.
Affirmed in part, reversed in part.
Chief Judge Walker dissents, in a separate opinion.
SCOTT A. ROSENBERG, New York, New York
(Helaine Barnett, The Legal Aid Society,
Civil Division, Civil Appeals & Law
Reform Unit, New York, New York, on
the brief), for Plaintiffs-Appellees.
HENRY SCHOENFELD, New York, New York
(Jeffrey Schanback, General Counsel,
Nancy M. Harnett, Stephen W. Good-
man, Steven J. Rappaport, on the brief),
for Defendant-Appellant.
KEARSE, Circuit Judge:
This case returns to us following remands in 1999 and
2000 to the United States District Court for the Southern
District of New York, Robert W. Sweet, Judge, for fur-
ther findings, clarification, and supplementation of the
record in connection with its issuance of injunctions pro-
hibiting defendant New York City Housing Authority
(“NYCHA” or the “Authority”) from implementing pro-
posed changes in its method of complying with a 1992
consent decree (the “Consent Decree” or “Decree”) set-
a » ene a
3a
tling actions alleging that, in accepting tenants for pub-
lic housing in New York City, the Authority had dis-
criminated against Latinos and African-Americans on the
basis of race. The district court found that NYCHA’s
proposed introduction of a working-family preference
into the tenant acceptance procedures would cause a sig-
nificant perpetuation of past segregation at 20 NYCHA
low-income housing projects, and in 1999 it permanently
enjoined NYCHA from implementing that preference at
those projects. NYCHA appeals, contending principally
that the district court erred (a) in its view of what con-
stitutes segregation, and (b) in finding that segregation
would be significantly perpetuated. For the reasons that
follow, we affirm with respect to 14 of the housing pro-
jects, and we reverse with respect to the remaining six.
I. BACKGROUND
The factual background of this litigation has been
chronicled in several opinions, familiarity with which is
assumed. The prior proceedings are summarized below.
A. The Consent Decree (Davis I)
NYCHA, an independent public corporation created
by New York State Law, operates 322 public housing
projects in New York City. In the early 1990s, parallel
actions were brought by the United States and by plain-
tiffs Pauline Davis et al. on behalf of themselves and
others similarly situated, alleging that NYCHA had
engaged in discrimination in violation of, inter alia, 42
U.S.C. §§ 1981, 1982, and 1983 and the Fair Housing
Act of 1968, as amended, 42 U.S.C. § 3601 ef seq.
(“FHA”), by assigning applicants for public housing to
particular housing projects on the basis of race. NYCHA
ultimately acknowledged that it had engaged in, inter
ee,
4a
alia, “racial steering” (NYCHA Memorandum of Law in
Support of the Fairness and Adequacy of the Davis Set-
tlement and the Entry of the Consent Decree and in
Response to Comments Submitted by Interested Persons,
dated October 30, 1992 (“NYCHA Memorandum Sup-
- porting Consent Decree” or “NYCHA Memorandum”),
at 2!), and it stated that “[t]he Housing Authority con-
cluded that the complaint had merit” (id. at 22).
The parties agreed to settle both actions in 1992 by
entering into the Consent Decree. See Davis v. New York
City Housing Authority, 1992 WL 420923 (S.D.N.Y.
Dec. 31, 1992) (“Davis I’). In urging the district court to
enter the Decree, NYCHA admitted that
[t]he Housing Authority engaged in a number of
policies and practices that had the effect of dis-
criminating against Black and Hispanic applicants.
~ Because the Housing Authority was convinced that
these policies were wrong, and indeed in most
instances were stopped well before the lawsuits
were brought, the Housing Authority believed that
the responsible course was to settle these suits to
remedy these past practices in as fair a manner as
possible.
-
(NYCHA Memorandum at 21.) Describing “a few of
these policies” (id.), the NYCHA Memorandum stated,
inter alia, that the Authority in 1960 adopted an “inte-
gration program” whose “racial steering component
. . continued at a few predominantly white projects
until January, 1988, resulting in a higher proportion of
whites than would have resuited from a race neutral
admissions policy” (id.), and that until 1990, some
NYCHA “employees would expedite applications and
send them to projects to which they would not otherwise
have been sent[,] [o]ften . . . favor[ing] white appli-
5a
cants who sought an apartment at a predominantly white
project” (id. at 22). ’
Following a fairness hearing, then-District Judge
Pierre N. Leval, to whom the case was then assigned,
approved the Consent Decree, making findings of fact
and conclusions of law that included the following:
Plaintiffs’ evidence supports their allegations that
during specified periods. of time the Housing
Authority selected and assigned applicants for pub-
lic housing, and tenants requesting transfers, to cer-
tain housing projects using methods that resulted in
unlawful discrimination against Blacks and His-
panics. These methods included (1) the intermittent
use of codes denoting housing projects to which
only white families could be assigned; (2) the use of
zip code and other geographic restrictions on admis-
sion to projects; (3) the use of racial goals or targets
when new projects were “rented up” and on an
ongoing basis thereafter; and (4) the assignment of
families to projects where vacancies were not
expected to arise.
Davis I, 1992 WL 420923, at *2. The Consent Decree
permanently enjoined [NYCHA] from engaging in
any act or practice which denies equal access to its
housing. . . on the basis of race, color, or national
origin, including[ ] adopting and implementing any
tenant application, selection, assignment, and trans-
fer plan, or any such policy or process, which gives
preference to Applicants or tenants on the basis of
race, color, or national origin.
Consent Decree 9 4(a). Other provisions permanently
enjoined NYCHA from, inter alia, basing denials of
transfers on racial considerations, see id. 4 4(b), making
6a
statements indicating a preference or limitation based on
race, see id. § 4(c), and falsely representing, because of
an applicant’s race, that certain projects were not antic-
ipating vacancies when in fact such vacancies were
anticipated, see id. § 4(d). Although parts of the Decree
were to be dissolved 8'/2 years after its date of entry, the
provision for such dissolution expressly excluded “the
permanent injunctive provisions.” Jd. 4 50.
As part of the injunctive relief granted, the Consent
Decree also required NYCHA to implement a new three-
stage tenant selection and assignment plan (“TSAP”)
that substantialiy revised the Authority’s prior proce-
dures for granting applications for public housing. After
explicitly incorporating the TSAP by reference, the
Decree stated that “[t]he TSAP will be implemented by
the Housing Authority to prevent any unlawful dis-
crimination on the basis of race, color, or national origin,
in compliance with the Housing Authority’s obligations
therewith under Titie VI, the Fair Housing Act and the
implementing regulations and requirements of” the
United States Department of Housing and Urban Devel-
opment (“HUD”). Consent Decree 4 5. HUD “approved
the TSAP for a five-year period as meeting the require-
ments of,” inter alia, HUD’s “regulations governing
non-discrimination on the basis of race, color, or
national origin.” Consent Decree page 5, WHEREAS.
In the TSAP, NYCHA -+ecognizes “federal” prefer-
ences for certain categories of applicants, as required by
certain federal laws, and employs certain of its own pref-
erences (“local preferences”). In the first stage of the
TSAP, applicants are chosen from the overall applicant
pool for interviews as to their eligibility for public hous-
ing. In the second stage, those interviewed who are
found eligible are assigned to waiting lists for vacancies
and are divided into three “Tiers.” Tier III families have
Ta
the highest incomes; Tier I families have the lowest. In
the final stage of the TSAP, NYCHA attempts to allocate
25% of the vacancies to Tier III and to divide the
remaining 75% evenly between Tiers I and II. Under.the
original TSAP’s local preferences, priority is given to
families on the basis of housing need.
The Decree also provided that
[nJo Applicant will be barred or disqualified from
any Project tenanted under the TSAP because of any
minimum income requirements that result in
discrimination on the basis of race, color, or
national origin in violation of Title VI or the Fair
Housing Act; provided, however, that consistent
with HUD’s general occupancy standards, the Hous-
ing Authority may seek to achieve a tenant body in
each Project composed of families with a broad
range of incomes, generally representative of the
range of incomes and rent-paying abilities of lower
income families in its geographic operating area
to the extent permitted under 42 U.S.C.
§ 1437d(c)(4)(A)(iv), 24 C.F.R. § 960.205, and 24
C.F.R. Part 913. . . . If any new minimum income
requirements are added to existing [conventional
housing projects administered by NYCHA], plain-
tiffs shall have the right to challenge such a change
during the five-year period [after full implementa-
tion of the TSAP] orthereafter. .. .
Consent Decree 4 8.
NYCHA was required to have the TSAP fully imple-
mented within one year after entry of the Decree. See id.
q 6(a). If, during the five-year period after full imple-
mentation of the TSAP, NYCHA proposed to modify any
provision of the TSAP, it was to give at least 60 days’
notice to plaintiffs, who were given “the right. . . to
8a
move the court to enjoin the proposed modification as
inconsistent with the terms of th[e] Consent Decree.” Jd.
q 6(b). The Decree also provided that for three years fol-
lowing that five-year period, plaintiffs were allowed to
ask the district court to “modify or otherwise enjoin any
aspect of any TSAP implemented by the Housing
Authority on the ground that it violates the Fair Housing
Act, Title VI and/or HUD implementing regulations.” Jd.
q 6(c).
B. NYCHA’s Proposed Working-Family Preference
(Davis II-IV)
In 1995, NYCHA sought to modify the local prefer-
ences recognized under the TSAP. To the extent material
here, it proposed to introduce a working-family prefer-
ence (“WFP”), altering the factors determining whether
an applicant for public housing is even granted an inter-
view. Under the WFP, federal preference holders who are
working or disabled would receive a priority over those
who are not; as to local preferences, Tier III families and
Tier II families would receive priority, in that order;
thereafter, Tier I applicants who are working or are dis-
abled would be given priority, but other Tier I applicants
would have no priority. See Davis v. New York City
Housing Authority, 1997 WL 407250, at *4 (S.D.N_Y.
July 18, 1997) (“Davis IT’). The proposed WFP would
eliminate applicant housing need as a local priority con-
cern and instead give preference to families who can pay
the most. NYCHA’s goals in proposing this change are to
increase the number of working families in public hous-
ing and increase income integration in public housing, in
order to promote financial and social stability in such
housing. See id. at *14.
Plaintiffs opposed NYCHA’s proposed changes and
moved before Judge Sweet, to whom the case had been
9a
reassigned, for an injunction. While conceding that
NYCHA’s interest in financial stability was legitimate,
plaintiffs contended, supported by affidavits from their
expert Dr. Leonard Cupingood, that the WFP would
favor the admission of white families and thereby have
the effect of perpetuating racial segregation. Plaintiffs
suggested that the WFP be modified so that, while con-
tinuing to give the lowest preference to Tier I (i.e., low-
est-income) families, NYCHA would give all Tier I
applicants equal preference. Under plaintiffs’ proposed
alternative, Tier I families would continue to rank below
Tier II and Tier III families; and thus, because Tier II
and III families by definition have higher incomes than
Tier I families, the number of rentals to higher-income
families would still increase; but desegregation of the
housing projects would be less adversely affected.
NYCHA conceded that plaintiffs’ suggested alternative
might increase income integration but rejected it, stating
that it would frustrate the goal of increasing the pro-
portion of rentals to working families. See Davis II,
1997 WL 407250, at *15.
The district court noted the legitimacy of NYCHA’s
concerns and goals and stated that there was no dispute
that an increase in the proportion of tenants with higher -
incomes was needed in order to safeguard the projects’
stability:
Historically, public housing applicants in the low-
est income categories accounted for approximately
1/3 of all NYCHA rentals. Since 1990, however, an
increase in homeless families applying for housing
has resulted in a significant increase in the number
of rentals to the lowest income applicants. By 1995,
these lowest income applicants accounted for 77.6%
of new admissions. NYCHA states, and plaintiffs do
not dispute, that unless a higher proportion of appli-
10a
cants with higher incomes receive rentals, the sta-
bility of the projects will be jeopardized.
Id. at *4. The court also noted that NYCHA had sub-
mitted its proposed WFP, along with another proposed
modification called “Project Choice,” to HUD for
approval. Although HUD approved Project Choice as
“ ‘not likely to affect the racial identifiability of devel-
opments in New York City,’” Davis II, 1997 WL
407250, at *5 (quoting HUD letter to NYCHA dated
October 24, 1996), HUD’s response to the proposed
WFP, in contrast, was as follows:
“HUD does not approve local preferences, and thus
NYCHA may create these local preferences, so long
as notice and comment requirements are met. How-
ever, NYCHA should be mindful of the injunctive
relief provided for by the Davis consent decree and
its responsibilities under civil rights statutes.”
Davis II, 1997 WL 407250, at *5 (quoting HUD letter to
NYCHA dated July 31, 1996) (emphasis ours).
The district court proceeded to consider the likely
effects of the WFP on NYCHA’s performance of its obli-
gations under the Decree. Noting that in 1995, under the
TSAP’s scheme of priorities, only some 15% of all
applicants for public housing even reached the stage of
being granted interviews, see Davis II, 1997 WL
407250, at *3, the court found that implementation of
the WFP would significantly change
the racial composition of the top 15% of applicants,
who are those likely to be called for interviews.
Under the current TSAP, only 7.2% of the top 15%
of applicants are white. If the new Working Family
Preference were implemented, there would be a sta-
tistically significant increase in the percentage of
lla
white families in the top 15% of the list of appli-
cants. These conclusions are not disputed by
NYCHA.
Id. at *5. The court noted further that Dr. Cupingood had
concluded that if the WFP were implemented at the 11
projects that as of June 1996 remained more than 50%
white, the process of desegregation would be signifi-
cantly slowed at three of the projects, completely
stopped at four projects, and indeed reversed at four pro-
jects. See id.
The court noted, however, that the WFP’s desegrega-
tive effects could easily be lessened:
It also appears that NYCHA could eliminate the
objectionable perpetuation of discrimination by
making revisions to their plan that are even less
drastic than those proposed by plaintiffs. The Work-
ing Family Preference could be instituted in essen-
tially the proposed form, provided white applicants
selected under the preference are not placed in pro-
jects in which whites are over-represented relative
to the applicant pool. The extent to which such a
modification would be administratively feasible or
desirable is, of course, a question for NYCHA.
Id. at *15 (emphases added).
Accepting the projections made by Dr. Cupingood, the
district court found that plaintiffs were likely to succeed
on the merits of their WFP challenge with respect to the
housing projects whose tenant populations remained pre-
dominantly white. The court entered a preliminary
injunction prohibiting implementation of the WFP at all
322 NYCHA projects, but it invited NYCHA to offer
suggestions for modifications that would limit the
injunction to the disproportionately white projects. See
id. at *18.
|
12a
Thereafter, the parties “agree[d] that the WFP con-
sidered in Davis [II] w[ould] not perpetuate past dis-
crimination at any of the NYCHA projects other than the
21 projects where greater than 30% of the apartments are
rented to whites (the ‘Disproportionate Projects’),”
Davis v. New York City Housing Authority, 1997 WL
711360, at *4 (S.D.N.Y. Nov. 13, 1997, as amended Nov.
20, 1997) (“Davis IIT’), and “agree[d] that the WFP
should go forward for the non-Disproportionate Pro-
jects,” id. at *5. Accordingly, in Davis III, the court nar-
rowed its prior order and enjoined use of the WFP at
only those 21 housing projects where white families then
occupied more than 30% of the apartments.
NYCHA appealed. This Court was unable to resolve
the merits of the appeal, however, as we concluded that
the district court had not provided an adequate expla-
nation for finding that plaintiffs would likely succeed in
showing that the WFP would perpetuate segregation at
the projects to which the injunction applied. See Davis
v. New York City Housing Authority, 166 F.3d 432, 437
(2d Cir. 1999) (“Davis IV’). We stated that although the
opinions in Davis II and Davis III were
not entirely devoid of detail, Judge Sweet failed to
adequately explain the subsidiary facts and method-
ology underlying the ultimate finding. For instance,
Judge Sweet refers to “existing trends demon-
strat[ing] that many of the[ ] additional white fam-
ilies [admitted under the proposed modification]
will be concentrated in predominantly white devel-
opments,” but does not discuss or attempt to explain
these trends or the data reflecting them. He also
fails to address the time period during which the
purported impact of the proposed TSAP was
assessed and/or how future “trends” might affect
application of the TSAP to developments that are
13a
not currently, but subsequently become, predomi-
nantly white. Further, while he focuses on the racial
imbalance the proposed TSAP will cause at specific
developments within the NYCHA system, he does
not identify them by name or state the number, frac-
tion or percentage of additional white families who
will be admitted to each of the 21 developments as
a result of the proposed TSAP.
Davis IV, 166 F.3d at 436 (footnotes omitted). We also
noted that Dr. Cupingood “d[id] not cite to any precise
numerical data underlying his opinion.” Jd. at 437.
Accordingly, while leaving the preliminary injunction
undisturbed, we remanded for the district court to
address these matters, stating that “[t]he proper standard
to be applied on remand is whether the proposed use of
the working family preference will significantly per-
petuate segregation at the relevant NYCHA develop-
ments.” Jd. at 438 (emphasis in original).
C. The WFP as Significantly Perpetuating Segrega-
tion (Davis V)
Following the remand in Davis IV, the district court
conducted a hearing, received additional evidence and
arguments, and addressed, both broadly and in consid-
erable detail, (1) whether there is a basis on which to
conclude that there is segregation to be dealt with under
the Consent Decree, and (2) whether the WFP would sig-
nificantly perpetuate segregation. In an opinion dated
August 11, 1999, the court rendered a final decision,
answering both questions in the affirmative and con-
cluding that plaintiffs were entitled to a permanent
injunction prohibiting NYCHA from implementing the
WFP at 20 housing projects. See Davis v. New York City
l4a
Housing Authority, 60 F.Supp.2d 220 (S.D.N.Y. 1999)
(“Davis V”).
First, as to the existence of segregation, the court
ruled that, for purposes of this litigation, it is appropri-
ate to deem a project segregated if white families occupy
- more than 30% of its apartments. It pointed out that
throughout this litigation projects have been deemed
“disproportionate” or “predominantly white” if more
than 30 percent of the parties residing there are
white. See, e.g., Davis II, 1997 WL 407250 at *12.
Davis V, 60 F.Supp.2d at 231 (footnote omitted). The
court noted that this benchmark was reflected in the
TSAP, which was incorporated by reference into the
Consent Decree. See, e.g., id. at 232 n.9 (“[T]he TSAP
identifies housing projects that are 30 percent white as
infected by past segregation.”). The TSAP contains a
“Borrowing Provision” that can be used by a housing
project that has more vacancies than willing applicants.
Such a project is allowed to “borrow[ ]” applications
from another pro‘ect, id. at 231; but “ ‘if the borrowing
project’s tenant body is more than 30% white, [the
NYCHA decisionmaker] shall not select a project whose
tenant body is also more than 30% white,’ ” id. at 232
(quoting TSAP at 29). The court pointed out that the
30% benchmark was
not, as NYCHA urges, an arbitrary number, but a
negotiated figure that implies that the parties and
the Court believed that a project was dispropor-
tionately white if more than 30 percent of its fami-
lies are white. . . . An examination of Exhibit A to
the Consent Decree, a list of projects where it was
alleged that discriminatory practices occurred in sta-
tistically significant amounts, reveals that during
15a
the time in question most of these projects were at
least 30 percent white.
Davis V, 60 F.Supp.2d at 232. Further, the court noted
that the injunctive relief ordered was necessarily
premised on a finding that a white tenant population
above the 30% level constituted segregation:
The TSAP must be read as in harmony with exist-
ing law. . . . Under existing law, borrowing of
applications could not have been prohibited at pro-
jects more than 30 percent white (without regard for
claimant relief) unless those projects were still
tainted by past segregation. . . . [R]emedies con-
taining race-conscious relief “must be substantially
related to the objective of eliminating the alleged
instance of discrimination, . . . and must not
unnecessarily trammel the interests of affected third
parties.” Kirkland v. New York State Dept. of Cor-
rectional Serv., 711 F.2d 1117, 1132 (2d Cir. 1983).
Thus, had there been no finding that housing pro-
jects that are greater than 30 percent white were
affected by past segregation, the Borrowing Provi-
sion would be unlawful.
Davis V, 60 F.Supp.2d at 232. Accordingly, having pre-
viously “held that ‘[uJnder the TSAP, a project is con-
sidered disproportionately white if more than 30 percent
of its families are white,’ ” the court concluded that “30
percent will continue to be employed as a measure to
identify segregation in this case.” Davis V, 60 F.Supp.2d
at 232 (quoting Davis I], 1997 WL 407250 at *12).
Second, as to the impacts of the WFP on the desegre-
gation of the disproportionately white projects, the dis-
trict court, largely crediting the analysis of Dr.
Cupingood, made extensive findings. The court noted
that, in predicting the effects of the WFP on the racial
l6a
mix of those likely to move into public housing projects
(“move-ins”), Dr. Cupingood relied on data for the
period 1991-1994 because 1991 is “the first year that is
free of distortion caused by NYCHA’s own discrimina-
tion,” and 1994 is the “last year that is free of distortion
[caused] by” the initial implementation of the Consent
Decree remedies, to wit, the “Davis move-ins.” Davis V,
60 F.Supp.2d at 226. Dr. Cupingood relied on NYCHA’s
records of move-ins and move-outs by race for each pro-
ject, and he proceeded on the assumption that families of
each race will make decisions about which projects to
choose in the same manner, and with the same proba-
bilities, as families of that race have done in the past.
The court concluded that “[w]hile projections about the
future, are by definition, subject to some uncertainty, Dr.
Cupingood has taken reasonable steps, such as the use of
historical averages, to minimize the impact of possible
uncertainties.” Jd. at 239 n.17.
The court credited Dr. Cupingood’s view that the WFP
would have significant impacts on the disproportionately
white projects, either by increasing the percentage of a
project’s white population or by detrimentally affecting
the degree or timing of the project’s desegregation. The
Davis V opinion included tables showing, for each dis-
proportionately white project, inter alia, “Race Distri-
bution of 1995 Rentals Under Original TSAP and WFP”
(Table 1); “Effect of WFP at Disproportionate Projects
After Five Years Assuming Historical [T]urnover by
Race” (Table 3); “Relative Percentage Reduction in
Number of White Families [D]ue to WFP After Five
[Y ]ears Assuming Historical Turnover by Race” (Table
4); “Change in Percentage White Occupancy At Dis-
proportionate Projects After Five Years Assuming His-
torical Turnover by Race” (Table 5); “Effect of WFP at
Disproportionate Projects After Five Years Assuming
ee he eee
17a
Historical Turnover by Race” (Table 7), and “[same]
After Ten Years” (Table 6). See Davis V, 60 F.Supp.2d at
225-31.
In discussing the anticipated percentages of apart-
ments that would be occupied by white families at each
Disproportionate Project after five years, with and with-
out the WFP, the court noted that,
[aJssuming historical turnover by race, after five
years under the WFP, the percentage of white fam-
ilies at Middletown Plaza would rise from 51.85 to
60.1% (instead of falling to 49.4%). At the remain-
ing Disproportionate Projects, white occupancy per-
centages would either stabilize or fall more slowly
under the WFP than under the original TSAP. For
example, at Cassidy-Lafayette, after five years the
percentage of white families in occupancy would
inch down from 53.6% to 50.4% (instead of falling
to 42.4%).
Id. at 228-29. These figures were reflected in Table 5:
Table 5
Change in Percentage White Occupancy At
Disproportionate Projects After Five Years
Assuming Historical Turnover by Race
Project Name Initial 5 Years after Davis Move-Ins
% White Original TSAP WFP
Bay View 34.5% 22.9% 24.7%
Berry 56.2% 45.0% 50.4%
Cassidy-Lafayette 53.6% 42.4% 50.4%
Forest Hills 51.7% 41.3% 44.4%
Glenwood 30.0% 18.1% 18.9%
Haber 53.0% 39.6% 46.4%
Holmes Towers 26.6% 18.6% 21.8%
SE sl ene a Bs 5+ He
18a
Project Name Initial 5 Years after Davis Move-Ins
% White OriginalTSAP WFP
Independence 9% [sic] 63.9% 64.8%
Isaacs 33.1% 24.8% 27.9%
Middletown Plaza 51.8% 49.4% 60.1%
~ New Lane 73.0% 64.8% 71.1%
Nostrand 41.9% 30.0% 32.9%
Pelham Parkway 31.8% 22.1% 23.5%
Pomonok 41.5% 33.3% 36.5%
Robbins Plaza 53.4% 42.6% 52.0%
Sheepshead Bay 35.2% 24.0% 26.8%
South Beach 53.1% 41.6% 47.6%
Straus 28.5% 27.4% [sic] 20.9%
Taylor-Wythe 54.4% 51.0% 52.1%
Todt Hill 46.7% 35.7% 39.7%
Williams 61.6% 57.5% 58.2%
Davis V, 60 F.Supp.2d at 229; see also id. at 227, Table
3 (at Independence, 493 of 715 apartments were initially
occupied by white families, a percentage of 68.95; at
Straus, under the original TSAP five years after the
Davis move-ins, white families would occupy 48 of 263
apartments, a percentage of 18.3); id. at 233, Table 8 (as
of June 1998, before Davis move-ins, Holmes Towers
and Straus were above the 30% level, at 30.6% and
30.4%, respectively). The court noted that Table 6
showed that
[s]imilar trends exist after ten years, except that
at Disproportionate Projects where desegregation
would not essentially stop, the magnitude of the
impact of the WFP would generally become larger.
For example, at Middletown Plaza, where segrega-
tion would increase under the WFP, the white pop-
ulation would climb to 108 instead of falling to 81.
At Berry Houses, where desegregation would be
19a
significantly slowed, the white population would
fall to 231 instead of 186. In the aggregate, after ten
years under the WFP (again assuming historical
turnover by race), the Disproportionate Projects
would be occupied by 722 more white families than
would have resided in those projects in the absence
of the WFP.
Davis V, 60 F.Supp.2d at 229.
NYCHA, proffering the views of its own expert Dr.
David Peterson, argued that Dr. Cupingood’s analysis
was flawed because it was based on the assumption that,
in the absence of the Consent Decree’s injunction, the
percentage of white families admitted to NYCHA’s pub-
lic housing in 1998 would have risen from 4.2% to 9.9%.
The Authority contended that the percentage admitted
would have risen only to 6.48%. However, the district
court found that there were substantial flaws in Dr.
Peterson’s methodology:
[I]n addition to a number of other errors, Dr. Peter-
son did not account for the fact that several thousand
families who moved into NYCHA housing during
1998 were selected for interviews and/or certified to
project waiting lists before the WFP went into oper-
ation. Because families selected under the old TSAP
are still working their way through the “pipeline,”
the white admission rate in 1998 was significantly
lower than would have occurred if all families had
been selected for interviews and certified pursuant to
_the WFP. Moreover, Dr. Peterson[’s] conclusion is
based on an under-representation of 1998 move-ins.
Significantly, even accepting Dr. Peterson’s method-
ology; and adjusting only for the undercount of fam-
ilies to the 21 projects, one obtains a corrected
figure of 8.53 percent white among families who
20a
were placed in 1998 and were “allegedly untainted
by the Pipeline Effect” (Cupingood Sixth Aff. 4 9).
Davis V, 60 F.Supp.2d at 239 n.16. Accordingly, the
court rejected Dr. Peterson’s analysis and credited that of
Dr. Cupingood.
The court also reyected NYCHA’s contention “that so
long as the white occupancy rates would decline under
the WFP, regardless of the rate of decline, then the WFP
cannot be said to perpetuate segregation.” Jd. at 238. The
court noted that to “ ‘perpetuate’ means to extend in
time,” id. (other internal quotation marks omitted), and
that that is precisely the effect that the WFP will have.
Although at the outset of housing discrimination litiga-
tion “the adverse impact of an applicant selection pro-
cess. . .1S determined by whether minority applicants
are chosen at a rate lower than their proportional repre-
sentation in the overall applicant pool,” once remedies
for segregation have been ordered and the defendant pro-
poses to change its method of compliance “[t]he query
. . 1S not whether the [change] would have an adverse
impact On minority applicants, but whether it will
significantly perpetuate segregation.” Davis V, 60
F.Supp.2d at 237 n.14 (emphasis omitted).
Where a court-ordered plan intended to eradicate
past segregation is in effect, and where, as here, a
proposed char ze to the plan is alleged to perpetuate
past segregation, the Supreme Court has compared
the results under the proposed plan with those under
the original, court-ordered plan.
Accordingly, in evaluating whether the WFP sig-
nificantly perpetuates segregation, the relevant com-
parison will be the desegregation that would be
a
2la
achieved under the original TSAP with the projected
effect of the WFP.
The relevant inquiry here is not whether deseg-
regation will occur eventually, but whether the WFP
will significantly delay desegregation at the Dis-
proportionate Projects. See Monroe v. Board of
Commissioners, 391 U.S. 450, 459. . . (1968) (“if
it cannot be shown that such a plan will further
rather than delay conversion to a unitary, nonracial,
nondiscriminatory school system, it must be held
unacceptable.”); Wright[ v. Council of the City of
Emporia}, 407 U.S. [451,] 460. . . [(1972)] (“if the
proposal would impede the dismantling of the dual
system, then the district court. . . may enjoin it
from being carried out’).
Davis V, 60 F.Supp.2d at 237-38 (emphasis in original).
The district court concluded that the WFP would
significantly impede desegregation at NYCHA’s 20
disproportionately white projects, see Davis V, 60
F.Supp.2d at 231 n.7 (of the 21 projects covered by the
preliminary injunction pursuant to Davis III, Glenwood
was omitted because prior to June 1998 it had fallen
“below the 30% threshold”). The court reached this con-
clusion because the WFP will “more than double white
admission rates,” and “because existing trends demon-
strate that many of these additional white families will
be concentrated in predominantly white developments.”
Davis V, 60 F.Supp.2d at 238-39 (internal quotation
marks omitted). It found these effects to have both
“[s]tatistical significance,” which “measures whether a
particular phenomenon is the cause of a specific set of
effects,” and “[lJegal significance,” which “measures
whether, assuming the phenomenon was the cause of
22a
those effects, those effects have any legal import.” /d. at
239. As to statistical significance, the court stated as
follows:
A standard tool for assessing statistical signifi-
cance is the two-standard deviation test. The test is
used to determine whether a deviation from the
expected norm is small enough to be attributable to
chance, or so large that random chance could not
reasonably account for the outcome. “The greater the
number of standard deviations, the less likely it is
that chance is the cause of any difference between the
expected and observed results.” Ottaviani [v. State
Univ. at New Paltz, 875 F.2d 365, 371 (2d Cir. 1989),
cert. denied, 493 U.S. 1021 (1990)]. Courts have fre-
quently adopted a standard of two to three standard
deviations as constituting statistical significance.
See Hazelwood School District v. United States, 433
U.S. 299, 311 n.17. . . (1977) (“if the difference
between the expected value and observed number is
greater than two or three standard deviations, then
the hypothesis that employees were hired without
regard to race would be suspect.”); Castaneda v.
Partida, 430 U.S. 482, 496 n. 17. . . (1977).
Davis V, 60 F.Supp.2d at 239 (footnote omitted). The
court noted that, in terms of the total number of apart-
ments affected by the WFP in the disproportionately
white projects, the magnitude of the effects would be
well in excess of two standard deviations:
For the five year-period, and assuming historical
turnover trends for each race, the WFP would result
in a total of approximately 1,139 white move-ins at
the Disproportionate Projects, as compared to only
625 without the WFP. The difference between these
figures—some 514 excess white move-ins—repre-
23a
sents 15.39 standard deviation units and is highly
significant.
Id. at 239-40 (footnote omitted). And over a period of
“ten years, assuming historical turnover rates for each
race, the WFP would increase white move-ins from
1;217 to approximately 2,240—an increase of 1,023
white move-ins. The difference represents 21.92 stan-
dard deviation units.” Jd. at 240 n.19. The court found
that the magnitude would also be statistically significant
when assessed in terms of individual projects:
[A]fter five years, 18 of the 21 Disproportionate Pro-
jects would have statistically significant white move-
in differential caused by the WFP. At the ten year
mark, again using historical turnover rates for each
race, 20 of the 21 Disproportionate Projects would
have statistically significant reductions in desegre-
gation. At Holmes Towers, for example, the WFP
would result in approximately 75 white move-ins as
opposed to 34 without the WFP, a disparity repre-
senting 4.3 standard deviation units. At Pomonok,
there would be approximately 287 white move-ins
with the WFP and 138 without the WFP in place, a
difference constituting 8.21 standard deviation units.
Id. at 240.
Finally, as to the legal significance of the WFP’s retar-
dation of desegregation, the court noted that
[while . . . many of the cases cited by the par-
ties involve larger discrepancies than in the instant
case, “small” percentage-point differences can
result in significant perpetuation of segregation. At
the Pomonok project, for example, where the WFP
would increase the white occupancy rate by 3.2 per-
centage points after five years, and 5.5 percentage
24a
points after ten years, (see Cupingood Third Aff.
[Cupingood’s] Tables 4 and 6), every percentage
point increase in the white population means relin-
quishing 20 apartments to white families that would
have gone to African-American and Hispanic fam-
ilies. At Pomonok alone, the WFP would deprive
non-white families of 66 apartments after five years
(see id. [Cupingood’s] Table 5) and 114 apartments
after ten years (see id. [Cupingood’s] Table 7).
These figures are significant in sheer magnitude.
. . Perhaps more importantly, they are significant
to the families affected. To be sure, the WFP has
numerous benefits, but with respect to the Dispro-
portionate Projects, these are outweighed by its
adverse effects. The WFP markedly inhibits the rate
at which desegregation will occur, adversely affects
the ratios at the Disproportionate Projects, and con-
travenes the purposes of the Consent Decree. In
short, the WFP significantly perpetuates segregation.
Davis V, 60 F.Supp.2d at 240-41 (footnotes omitted).
Accordingly, having determined that the effects of the
WFP in slowing the pace of desegregation at the dis-
proportionately white projects would be significant, the
court enjoined NYCHA from implementing the WFP at
the 20 relevant developments, making its preliminary
injunction permanent.
D. Comparisons of the TSAP With and Without the
WFP (Davis VI-VII)
NYCHA again appealed. This Court again remanded
without resolving the merits, asking for additional infor-
mation. See Davis v. New York City Housing Authority,
2000 WL 232191 (2d Cir. Feb. 23, 2000) (“Davis VI’).
25a
Given that the WFP had been implemented in 1998 at
some 302 projects, i.e., all but the 20 projects covered
by the injunction, we stated that we would benefit from
knowing (1) whether and to what extent actual tenant
move-outs correspond with projected move-outs, and
whether and to what extent the actual numbers would
alter the experts’ conclusions; (2) at each of the 20 cov-
ered projects, how many months it is expected to take to
achieve a white family occupancy rate below 30% with
and without the WFP; and (3) whether figures presented
in the Davis V tables based on Dr. Cupingood’s estimate
of a 9.9% white admissions rate under the WFP should
be revised to reflect a rate of 8.53%, as it appeared Dr.
Cupingood might have suggested in one affidavit, or a
rate of 8.28% as NYCHA suggested.
In June 2000, the district court responded to the ques-
tions posed by Davis VI. As to our first question, the
court found that the expert witnesses for both sides
opined that the use of actual move-out rates for 1998
would not necessarily increase the accuracy of the white
admissions rate projections. See Davis v. New York City
Housing Authority, 103 F.Supp.2d 228, 229 (S.D.N.Y.
2000) (“Davis VII’). As to our last question, the court |
found that the reference in Dr. Cupingood’s prior affi-
davit to a rate of 8.53% was the result of a copying error
and that the intended reference was to a rate of 8.28%.
Id. at 231. However, the court found that Dr. Cupin-
good’s rationale for using the rate of 9.9% for white
move-ins rather than a rate of 8.28% was more persua-
sive than that proffered by Dr. Peterson for the lower
rate. Jd. at 232. The court also found that use of the
8.28% rate would not show any significant decrease in
the WFP’s effects of delaying desegregation in the 20
projects. Jd. “Thus, adoption of the 8.28% rate, and revi-
sion of the calculations, would not change this Court’s
26a
prior conclusion that implementation of the WFP at the
Disproportionate Projects would result in a significant
perpetuation of discrimination.” /d.
As to our second question, requesting a comparison of
the estimated times for desegregation under the TSAP
with and without the WFP, the court set forth the fol-
lowing table:
Months to Reach 30%
Project Without WFP
Bay View 17
Berry 195
Cassidy-Lafayette 195
Forest Hills 149
Haber 146
Holmes
Towers Already below 30%*
Independence 620
Isaacs 18
Middletown
Plaza Will never reach 30%
New Lane Will never reach 30%
Nostrand 57 :
Pelham Parkway 6
Pomonok 84
Robbins Plaza 355
Sheepshead Bay 23
South Beach 163
Straus Already below 30%*
Taylor St./
Wythe Ave. 649
Todt Hill 103
Williams 707
*After Davis Move-lIns.
Id. at 231.
Months to Reach 30%
With WFP
21
Will never reach 30%
Will never reach 30%
246
Will never reach 30%
Already below 30%*
899
29
Will never reach 30%
Will never reach 30%
85
8
171
Will never reach 30%
35
Will never reach 30%
Already below 30%*
1323
198
1066
27a
Following these findings, the appeal by NYCHA was
reinstated.
II. DISCUSSION
On appeal, NYCHA contends principally (1) that nei-
ther the Consent Decree nor the TSAP defined housing
projects with more than 30% white tenant populations as
segregated, and that the district court therefore erred in
using that standard in finding the 20 projects in question
to be segregated; (2) that the district court erred in its
findings as to the WFP’s desegregation delays because
the court (a) accepted the view of Dr. Cupingood rather
than that of Dr. Peterson, (b) failéd to do a project-by-
project analysis, and (c) analyzed the “wrong compara-
bles”; and (3) that the court erred in concluding that the
differences in white tenancy percentages with and with-
out the WFP are legally significant. For the reasons that
follow, we reject most of NYCHA’s contentions, finding
merit only in its challenge to the ruling as to the legal
significance of the WFP’s effects at six projects.
A. Standard of Review
The standard of review is well established. In review-
ing the district court’s judgment and its issuance of a
permanent injunction, we may overturn the court’s find-
ings of fact only if they are clearly erroneous. See Fed.
R. Civ. P. 52(a).
Although the meaning of the phrase “clearly erro-
neous” is not immediately apparent, certain general
principles governing the exercise of the appellate
court’s power to overturn findings of a district court
may be derived from [Supreme Court] cases. The
foremost of these principles. . . is that “[a] finding
28a
is ‘clearly erroneous’ when although there is evi-
dence to support it, the reviewing court on the entire
evidence is left with the definite and firm convic-
tion that a mistake has been committed.” United
States v. United States Gypsum Co., 333 U.S. 364,
395 (1948). This standard plainly does not entitle a
reviewing court to reverse the finding of the trier of
fact simply because it is convinced that it would
have decided the case differently. The reviewing
court oversteps the bounds of its duty under Rule
52(a) if it undertakes to duplicate the role of the
lower court. “In applying the clearly erroneous stan-
dard to the findings of a district court sitting with-
out a jury, appellate courts must constantly have in
mind that their function is not to decide factual
issues de novo.” Zenith Radio Corp. v. Hazeltine
Research, Inc., 395 U.S. 100, 123 (1969). If the dis-
trict court’s account of the evidence is plausible in
light of the record viewed in its entirety, the court of
appeals may not reverse it even though convinced
that had it been sitting as the trier of fact, it would
have weighed the evidence differently. Where there
are two permissible views of the evidence, the
factfinder’s choice between them cannot be clearly
erroneous. United States v. Yellow Cab Co., 338
U.S. 338, 342 (1949); see also Inwood Laborato-
ries, Inc. v. lves Laboratories, Inc., 456 U.S. 844
(1982).
Anderson v. Bessemer City, 470 U.S. 564, 573-74
(1985); see also id. at 577 (the question is not whether a
contrary finding by the court of appeals would be clearly
erroneous, but only whether the finding made by the dis-
trict court was clearly erroneous). These standards apply
whether the district court’s findings are based on oral
29a
testimony or solely on documentary evidence. See, e.g.,
id. at 574; Fed. R. Civ. P. 52(a).
Determinations as to the existence and cause of racial
discrimination are findings of fact, and hence are subject
to the clearly-erroneous standard of review. See, e.g.,
Anderson v. Bessemer City, 470 U.S. 564, 573 (1985);
Pullman-Standard v. Swint, 456 U.S. 273, 287-90
(1982); United States v. Yonkers Board of Education, 837
F.2d 1181, 1218 (2d Cir. 1987), cert. denied, 486 U.S.
1055 (1988). We apply no different standard for the dis-
trict court’s findings as to the likely future discrimina-
tory effects of actual or proposed conduct. Even as to
past events, a trial judge
cannot always be confident that -he “knows” what
happened. Often, he can only determine whether the
plaintiff has succeeded in presenting an account of
the facts that is more likely to be true than not.
Anderson v. Bessemer City, 470 U.S. at 580. Our task as
an “appellate tribunal[]. . . is more limited still: we
must determine whether the trial judge’s conclusions are
clearly erroneous.” Jd. at 580-81. We similarly review
only for clear error the district court’s findings as to
whether particular conduct will more likely than not per-
petuate discrimination.
The district court’s conclusions as to questions of law,
or as to mixed questions of fact and law, are reviewed de
novo. See, e.g., St. Johnsbury Academy v. D.H., 240 F.3d
163, 168 (2d Cir. 2001); United States v. City of Yonkers,
197 F.3d 41, 49 (2d Cir. 1999), cert. denied, 529 U.S.
1130 (2000). A determination of the legal significance of
the effects that the court has found likely to occur is a
conclusion of law. The interpretation of a Consent decree
is also an issue of law that is freely reviewable by the
court of appeals. See, e.g., United States v. O’Rourke,
30a
943 F.2d 180, 186 (2d Cir. 1991); United States v. Inter-
national Brotherhood of Teamsters, 931 F.2d 177, 182-
83 n.1 (2d Cir. 1991); Berger v. Heckler, 771 F.2d 1556,
1568 (2d Cir. 1985); see also id. at 1567-68 (“Consent
decrees are a hybrid in the sense that they are. . . con-
strued largely as contracts, but are enforced as orders.”’).
The propriety of relief in the form of a permanent
injunction is reviewable for abuse of discretion. See,
e.g., Knox v. Salinas, 193 F.3d 123, 128-29 (2d Cir.
1999) (per curiam); General Media Communications,
Inc. v. Cohen, 131 F.3d 273, 278 (2d Cir. 1997), cert.
denied, 524 U.S. 951 (1998); Schulz v. Williams, 44 F.3d
48, 53 (2d Cir. 1994). And “though a court cannot ran-
domly expand or contract the terms agreed upon in a
consent decree, judicial discretion in flexing its super-
visory and enforcement muscles is broad.” EEOC v.
Local 580, International Association of Bridge, Struc-
tural & Ornamental Ironworkers, 925 F.2d 588, 593 (2d
Cir. 1991); see also Berger v. Heckler, 771 F.2d at 1568
(court’s interest in protecting the integrity of a judicially
approved consent decree “justifies any reasonable action
taken by the court to secure compliance” (internal quotes
omitted)). ‘i
B. The 30-Percent Level as the Measure of Segregation
For several reasons, we reject NYCHA’s contention
that the district court erred in using the 30% white fam-
ily population level as the standard for whether a
NYCHA public housing project should be deemed
segregated. —
First, the district court drew the 30% figure directly
from the Consent Decree and the litigation surrounding
it. As set out in Part I1.C. above, the TSAP’s Borrowing
Provision allows an undersubscribed public housing pro-
ject to borrow applications from another project; but it
3la
explicitly forbids an undersubscribed project whose ten-
ant population is more than 30% white from borrowing
applications from another project whose tenant popula-
tion is also more than 30% white. Thus, the Consent
Decree, which expressly incorporated the TSAP by ref-
erence, treated 30% as the significant level.
Second, the Decree identified 31 projects as “Affected
Developments,” see Consent Decree 7 1(b) & Exhibit A,
and required NYCHA to give priority placement at those
31 projects to some 1,990 families who had been
“adversely affected by discrimination since 1985,” Davis
1, 1992 WL 420923, at *2. When Davis I was entered, 24
of those 31 projects, or more than 77%, had white fam-
ily populations in excess of 30% (with three of the
remaining seven having white tenant populations of 29-
29.9%). (See NYCHA Tenant Statistics by Race as of
Dec. 31, 1992.) And those 24 projects constituted 80%
of the 30 NYCHA projects whose white tenant popula-
tions exceeded 30%. (/d.) Thus, it was reasonable for the
district court to use the 30% figure as a reflection of
which projects the parties had agreed were infected by
past segregation.
Third, although NYCHA contends that none of its pro-
jects should be considered “segregated” under the Con-
sent Decree once NYCHA has provided the relief that
the Decree ordered for individual applicants, that con-
tention is belied by the Decree itself. The Decree (a)
allowed plaintiffs, within the first five years of the
TSAP’s operation, to seek an injunction against any pro-
posal to modify the TSAP on the ground that the modi-
fication would be inconsistent with the Decree or with
the FHA, and (b) allowed plaintiffs, within the three
years following that five-year period, to request modi-
fication of the Decree on the ground that NYCHA’s
implementation of the TSAP was violating the FHA.
32a
Accordingly, the existence of segregation in New York
City public housing may properly be measured by FHA
standards, not solely by whether NYCHA has provided
the individualized relief ordered for specific victims of
prior discriminatory practices.
Fourth, when Davis V was decided, NYCHA data
showed that, overall, white families in NYCHA housing
projects constituted just 7.0% of the tenant population.
(NYCHA Research and Policy Development Special
Tabulation of Tenant Characteristics as of Jan. 1, 1999
(“NYCHA 1999 Tenant Characteristics Tabulation”), at
1). Thus, in using the 30% level as the pertinent measure
of segregation, the court generally considered @ project
to be segregated only if its white population was at least
23 percentage points higher than the average white ten-
ant population system-wide, or more than four times the
system-wide average.
The court’s treatment of such wide discrepancies as
indicative of segregation was entirely consistent with
existing law. In United States v. Yonkers Board of Edu-
cation, for example, we upheld findings that housing in
the city of Yonkers was segregated in 1980 where
minorities constituted 40.4% of the residents of one
quadrant of the city, but only 18.8% of the city’s total
population. See 837 F.2d at 1185, 1218; see also id. at
1185-86 (in five of the 10 real estate tracts within that
quadrant, minorities constituted more than 50% of the
residents). We concluded that there was no error in the
district court’s findings that the city’s decision to con-
centrate low-income housing, occupied principally by
minorities, in that quadrant had a discriminatory effect.
See id. at 1219-20. Cf. Brown v. Board of Education, 892
F.2d 851, 870 & n.54 (10th Cir. 1989) (comparing
minority enrollment in particular schools against system-
wide figures and finding vestiges of segregation where
33a
the difference in minority representation between the
actual population and the student population exceeded
15 percentage points), vacated, 503 U.S 978 (1992),
reinstated in full, 978 F.2d 585 (10th Cir. 1992), and
cert. denied, 509 U.S. 903 (1993); Penick v. Columbus
Board of Education, 583 F.2d 787, 799 (6th Cir. 1978)
(same), aff'd, 443 U.S. 449 (1979).
NYCHA attempts to distinguish such authorities by
pointing out that the present litigation was resolved
without a trial on the merits and that the Consent Decree
recited that NYCHA did not concede liability. This
approach is unpersuasive. To establish a violation of the
FHA, a plaintiff need not show discriminatory intent but
need only prove that the challenged practice has a dis-
criminatory effect. See Huntington Branch, NAACP v.
Town of Huntington, 844 F.2d 926, 936 (2d Cir.), aff'd,
488 U.S. 15 (1988) (per curiam); United States v.
Yonkers Board of Education, 837 F.2d at 1217. The FHA
prohibits such practices and authorizes courts to order
“affirmative action to erase the effects of past segrega-
tion and desegregate housing patterns.” Otero v. New
York City Housing Authority, 484 F.2d 1122, 1133 (2d
Cir. 1973). Here, NYCHA’s own records plainly show
segregative housing patterns. In 1992, NYCHA operated
more than 320 public housing projects. Some 62.66% of
the white families (9,731 of 15,530) lived in the 31 pro-
jects that were defined in the Consent Decree as
Affected Developments. (See NYCHA Tenant Statistics.
by Race as of Dec. 31, 1992.) In addition, there are four
projects (Haber, Independence, Taylor-Wythe, and
Williams) that were not defined as Affected Develop-
ments but are covered by the present injunction, whose
respective white tenant populations at the end of 1992
ranged from 42% to 65% (see NYCHA Tenant Statistics
by Race as of Dec. 31, 1992) and in 1998 ranged from
34a
53% to 61.6%, see Davis V, 60 F.Supp.2d at 227, Table
3; id. at 229, Table 5. As of December 31, 1992, those
four projects housed an additional 1,298 white families.
(See NYCHA Tenant Statistics by Race as of Dec. 31,
1992.) Thus, when Davis I was decided, NYCHA had
placed more than 71% of the white public-housirg pop-
ulation in 35 of its 320-odd projects.
In approving the Consent Decree, the district court
found that plaintiffs’ evidence supported their allega-
tions that NYCHA had selected, assigned, and trans-
ferred applicants for public housing to particular projects
using methods that resulted in unlawful discrimination
on the basis of race. Davis I, 1992 WL 420923, at *2.
NYCHA did not appeal those findings. Nor could it
legitimately have done so. In urging the district court to
approve the Consent Decree, NYCHA stated that it had
engaged in a number of practices, some dating back to
1960, and some lasting until 1990,-“that had the effect of
discriminating against Black and Hispanic applicants.”
(NYCHA Memorandum Supporting Consent Decree at
21-22.) NYCHA stated that those policies included
racial steering and favoring white applicants for pre-
dominantly white housing projects (id. at 22), that “these
policies were wrong” (id. at 21), and that “[t]he Housing
Authority concluded that the complaint had merit” (id. at
22). See Part I1.A. above. Having made those statements
to the court in order to secure judicial approval of the
Decree, NYCHA cannot now disavow them.
In sum, only 7% of the families in NYCHA housing
projects system-wide are white; the TSAP, incorporated
into the Consent Decree, treated 30% white family occu-
pancy as a threshold signifying segregation; when the
Decree was entered, more than 62% of the white public-
housing population lived in fewer than 10% of the
NYCHA projects; and nearly all of the projects whose
35a
tenant populations were more than 30% white were tar-
geted by the Decree for placement of individual appli-
cants who had been the victims of past discrimination.
We see no clear error in the district court’s finding that
in negotiating and approving the Consent Decree, the
parties and the court, respectively, had regarded projects
more than 30% of whose apartments were rented to
white families as segregated, nor any error in the court’s
use of the 30%-level as a reasonable standard.
C. The District Court’s Findings of Fact as to the
WFP’s Effects
Nor do we see clear error in the district court’s find-
ings as to the likely percentages of white tenant popu-
lations in the 20 covered projects with and without the
WFP. NYCHA attacks those findings principally by
arguing that the court should have adopted the views
presented by Dr. Peterson rather than those of Dr.
Cupingood; that the court failed to conduct a project-by-
project analysis; and that it erred in comparing the pro-
jected effects under the WFP to the projected effects
under the original TSAP rather than to the then-current
racial composition of the projects. We disagree.
As discussed in Part II.A. above, decisions-as to which
witness to credit and which of two permissible infer-
ences to draw lie strictly within the province of the dis-
trict court as factfinder. As discussed in Parts I.C. and D.
above, the district court found that Dr. Cupingood had
extrapolated data from a reasonable period—one that
was free of distortion either by NYCHA’s discriminatory
practices or by the implementation of decretal remedies
for those practices—and that his assumptions, “us[ing]
historical averages, to minimize the impact of possible
uncertainties,” Davis V, 60 F.Supp.2d at 239 n.17, were
reasonable. Further, in response to the remand in Davis
36a
VI, both sides’ experts agreed that use of actual turnover
data for the available period would not change their
views as to the likely effects of the WFP in the future.
Although predictive analysis is generally more specu-
lative than statistical analysis of existing data—which
the district court recognized, see, e.g., Davis V, 60
F.Supp.2d at 239 n.17 (“projections about the future, are
by definition, subject to some uncertainty”)—the need
for predictions in this case, in order to determine the
WFP’s likely effects, was inescapable.
The district court found that Dr. Peterson’s analysis
was flawed in several respects. It is immaterial to appel-
late review whether the views proffered by Dr. Peterson
were nonetheless permissible. The views proffered by
Dr. Cupingood were permissible, and we thus see no
basis on which to conclude that the court’s acceptance of
his analysis, rather than that of Dr. Peterson, is clearly
erroneous.
NYCHA also contends that Dr. Cupingood’s analysis
is flawed because it would automatically produce sta-
tistical significance over time. We disagree because the
present inquiry falls outside the realm in which ordinary
statistical analysis, and the need for inquiry into sig-
nificance from a purely statistical standpoint, are
needed. Ordinarily, such an inquiry is used when observ-
able data are compared against expected data, or when
two sets of observations are compared, and the question
is whether the differences between the two data sets are
attributable to a factor other than chance. In the present
case, there is no question as to what causes the differ-
ences between the projections of the pace of desegre-
gation with and without the WFP: the differences are
caused simply by the contrasting hypotheses.
Nor is there any merit in NYCHA’s contention that the
district court failed to analyze the likely effects of the
37a
WFP on a project-by-project basis. Most of the district
court’s analyses were conducted at both the project level
and the aggregate level. See, e.g., Davis V, 60 F.Supp.2d
ai 240 (“Statistical significance can also be analyzed at
the project level.”) Although the court did not discuss
every project in detail, its inclusion of the numerous
tables in Davis V and Davis VII, showing the levels of
white-family concentration at each project for various
time periods, provides adequate assurance that each pro-
ject was considered individually. Thus, while we dis-
agree with some of the court’s conclusions as to the legal
significance of the WFP differential at certain of the pro-
jects, see Part II.D. below, we see no indication that the
court failed to give each project individual attention.
Finally, the court did not err in comparing the antici-
pated desegregation effects under the WFP against the
anticipated effects under the original TSAP rather than
against the racial composition of the projects without the
TSAP. The remedies implemented under the TSAP were
designed to alleviate past racial discrimination. It was
both consistent with Supreme Court cases, as the district
court discussed in Davis V, 60 F.Supp.2d at 237, and
eminently reasonable for the court to compare the effects
of NYCHA’s proposed changes against the anticipated
status of the projects under the original TSAP.
D. The Legal Significance of the WFP’s Effects
The matter of whether the differences in the pace of
desegregation under the original TSAP and the TSAP as
it would be modified by the WFP are legally significant
is a question of law that we review de novo. The caselaw
give us little guidance as to what constitutes legal sig-
nificance. The district court focused primarily on the
issue of desegregation and the differences between the
existing and the proposed procedures in achieving deseg-
38a
regation. In so doing, the court adopted the reasonable
premise that past segregation may be perpetuated by
actions that slow the pace of desegregation, even though
they do not reverse it, see, e.g., Arthur v. Nyquist, 712
F.2d 816, 822 (2d Cir. 1983) (affirming suspension of
hiring and layoff rules that delayed desegregation of
public school faculty), cert. denied, 467 U.S. 1259
(1984); Sarabia v. Toledo Police Patrolman’s Ass’n, 601
F.2d 914 (6th Cir. 1979) (affirming suspension of civil
service rule that restrained growth in African-American
representation on the police force). Were the court not to
consider the effects of proposed conduct on the pace of
desegregation, desegregation could be delayed to such
an extent that it effectively would never be achieved.
And were there no worthy countervailing considerations,
the court’s correct findings that proposed modifications
would substantially delay desegregation would likely
end our inquiry.
In the present case, however, NYCHA has proposed
the WFP in pursuit of a valid countervailing interest that
is, to some extent, in tension with the goal of expeditious
desegregation and that is worthy of consideration. As
discussed in Part I.B. above, NYCHA’s goal in propos-
ing a preference for working families is to increase the
number of such families, increase income integration in
public housing, and thereby promote financial and social
stability in such housing. There can be no doubt that this
is a legitimate objective. In providing federal funding for
low-income housing, Congress has prohibited recipient
public housing agencies from “concentrat[ing] very low-
income families (or other families with relatively low
incomes) in public housing dwelling units in certain
public housing projects or certain buildings within pro-
jects,” 42 U.S.C. § 1437n(a)(3)(A) (Supp. V 1999), and
Di i i in ele pee hts nade ae) dies *
a ee
39a
has required such agencies to adopt plans for decon-
centration:
A public housing agency shall submit with its
annual public housing agency plan. . . an admis-
sions policy designed to provide for deconcentration
of poverty and income-mixing by bringing higher
income tenants into lower income projects and
lower income tenants into higher income projects.
This clause may not be construed to impose or
require any specific income or racial quotas for any
project or projects,
42 U.S.C. § 1437n(a)(3)(B)(i) (Supp. V 1999). See also
42 U.S.C. § 1437d(c)(4)(A)(iv) (1994) (which, at the
time the WFP was proposed, provided that public hous-
ing authorities “to the maximum extent feasible, . . .
will include families with a broad range of incomes and
will avoid concentrations of low-income and deprived
families with serious social problems”), repealed, Bal-
anced Budget Downpayment Act, I, Pub. L. No. 104-99,
§ 402(d)(1), 110 Stat. 26, 41 (1996). As amended in
1998, § 1437n provides that “[a] public housing agency
may establish and utilize income-mix criteria for the
selection of résidents for dwelling units in public hous-
ing projects, subject to the requirements of this section,”
42 U.S.C. § 1437n(a)(1) (Supp. V 1999).
Consistent with these statutory provisions, HUD reg-
ulations explicitly permit a preference for “working fam-
ilies.” See 24 C.F.R. § 960.205(a) (2001); 24 C.F.R.
§ 960.206(b)(2) (2001). In issuing § 960.205(a), HUD
commented that “[t]he Department is convinced that
housing agencies must have the flexibility to give pref-
erence to working families to assure diversity in the res-
idency of projects and to include families who can serve
40a
as role models for other families.” 59 Fed. Reg. 36,618
(July 18, 1994).
Notwithstanding that conviction, HUD did not endorse
NYCHA’s proposed WFP. Nor, however, despite having
responsibility under § 602 of Title VI of the Civil Rights
Act of 1964 to review plans for federally funded public
housing to ensure compliance with federal civil rights
law, see 42 U.S.C. § 2000d-1 (1994), did HUD criticize
the WFP. Rather, when NYCHA sought HUD’s approval
for the WFP and Project Choice, HUD’s response with
respect to the WFP—unlike its reaction to Project
Choice, which HUD found “ ‘not likely to affect the
racial identifiability of developments in New York City
for the remaining period of the Davis TSAP,’ ” Davis II,
1997 WL 407250, at *5 (quoting HUD letter to NYCHA
dated October 24, 1996)—was to remind NYCHA that it
must give notice of the proposed WFP and that it must
“ ‘be mindful of the injunctive relief provided for by the
Davis consent decree and its responsibilities under civil
rights statutes.’” Davis II, 1997 WL 407250, at *5
(quoting HUD letter to NYCHA dated July 31, 1996).
We too are mindful of NYCHA’s responsibilities under
the Decree and the civil rights laws, and we conclude
that the assessment of whether the effects of the WFP
are legally significant involves a balancing of the inter-
est in eradicating the past effects of segregation against
the interest in achieving financial stability in public
housing. The latter is reflected in the public housing
statutes discussed above. The district court acknowl-
edged that interest, see Davis II, 1997 WL 407250, at
*14, as well as the existence of cause for concern on the
part of NYCHA, see id. at *4 (noting that the percentage
of applications from families who are homeless or in the
lowest income category had risen from approximately
33% to 77.6%). And plaintiffs did “not dispute, that
4la
unless a higher proportion of applicants with higher
incomes receive rentals, the stability of the [NYCHA]
projects will be jeopardized.” Jd.
At the same time, we think it plain that Congress did
not mean to cause public housing agencies to implement
plans for financial deconcentration in a way that would
violate the civil rights laws. And we take into account
the fact that, in the present case, the concentration of
most of the white families in a small percentage of the
projects was the consequence of NYCHA policies and
practices that—as acknowledged by NYCHA in urging
judicial approval of the Consent Decree—included racial
steering, withholding of information that could have led
minority applicants to rent apartments in predominantly
or disproportionately white projects, misrepresentations
that deterred such integrated rentais, and favorable treat-
ment for white applicants seeking housing in predomi-
nantly or disproportionately white projects. As a result,
when the Decree was entered, NYCHA had placed more
than 71% of its white families in 35 of its 320-odd pro-
jects. (See NYCHA Tenant Statistics by Race as of Dec.
31, 1992.) More than 51% of the white families (7,929
of 15,530) lived in the 20 projects that are at issue on
this appeal (see id.); and that concentration level
declined little after the implementation of the TSAP. As
of January 1, 1999, there were a total of 12,185 white
families residing in NYCHA projects (see NYCHA 1999
Tenant Characteristics Tabulation at 1), and 5771 of
them lived in the 20 projects covered by the injunction
(see id. at 25, 29, 59, 104, 119, 126, 133, 136, 177, 192,
193, 203, 207, 223, 236, 241, 251, 258, 262, 297). Thus,
when the permanent injunction was. entered, 20 of
NYCHA’s 322 housing projects (6.2%) still housed
47.36% of the white families.
42a
Balancing all of the factors, we conclude that in the
circumstances of this litigation, the district court deter-
mined correctly, with respect to most—although not
all—of the 20 projects in question, that the desegrega-
tion delays that would be caused by implementation of
the WFP are legally significant. In reaching this con-
clusion, we consider the delays not just in terms of per-
centages but also as real-time intervals. With that focus,
which is somewhat broader than that of the district court,
we see significant distinctions between certain cate-
gories of projects: There are two projects that were in
effect desegregated prior to the entry of the permanent
injunction, four projects at which the WFP is predicted
to delay the achievement of desegregation by very small
intervals of real time, several others at which desegre-
gation will be delayed for a large number of years, still
others that would otherwise eventually be desegregated
but that will never reach the 30% level under the WFP,
and two projects that will never reach the 30% level with
or without the WFP. ;
The projects covered by the injunction, see Part I.D.
above, and Davis VII, 103 F.Supp.2d at 231, are ranked
below in order of the time it will take their white tenant
populations to decline to the 30% level under the WFP,
with the last column showing the differential between
that time and the time each would need to reach that
level without the WFP.
Months to Months to
Reach 30% Reach 30%
Project Without WFP With WFP Differential
Holmes
Towers Already below 30 None n/a
Straus Already below 30 None n/a
Months to Months to
_Reach 30% Reach 30%
Project Without WFP WithWFP Differential
Pelham
Parkway 6 8 2 months
Bay View 17 21 4 months
Isaacs 18 29 11 months
Sheepshead Bay 23 35 12 months
Nostrand 57 85 2.33 years
Pomonok 84 171 7.25 years
Todt Hill 103 198 7.92 years
Forest Hills 149 246 8.08 years
Independence 620 899 23.25 years _
Williams 707 1066 29.92 years
Taylor/Wythe 649 1323 56.17 years
Haber 146 Will never reach 30%
South Beach 163 Will never reach 30%
Berry 195 Will never reach 30%
Cassidy-
Lafayette 195 Will never reach 30%
Robbins Plaza 355 Will never reach 30%
Middletown
Plaza Never 30% Will never reach 30%
New Lane’ Never 30% Will never reach 30%
Although Holmes Towers and Straus, respectively, had
white populations of 30.6% and 30.4% as of June 1998,
see Davis V, 60 F.Supp.2d at 233, Table 8, they were,
factoring in the Davis move-ins, at 26.6% and 28.5%
respectively, by the time the injunction was made per-
manent, see id. at 229, Table 5; Davis VII, 103 F.Supp.2d
at 231. There was no prediction that the white tenant
populations in those two projects would rise above the
30% level as a result of the WFP. In Davis III, plaintiffs
agreed that the WFP should not be enjoined at projects
44a
whose white tenant population was not above 30%. See
1997AWEL-711360, at *4-*5. More importantly, 30% has
been used by the district court throughout as the measure
of segregation. In the circumstances, we conclude that
Holmes Towers and Straus should not have been deemed
still segregated. The effects of the WFP in delaying fur-
ther integration of those projects should not have been
found legally significant, and implementation of the
WFP at those projects should not have been enjoined.
At four projects, the desegregation delays caused by
implementation of the WFP would range from two
months to 12 months. The delays of two months and four
months for Pelham Parkway and Bay View, respectively,
are not legally significant but rather are de minimis. Nor
do we view the delays of 11 and 12 months for Isaacs
and Sheepshead Bay, respectively, as impermissibly
long. Substantial strides in desegregating those projects
have been made since entry of the Consent Decree, caus-
ing them to approach the 30% level. Thus, whereas on
December 31, 1992, Isaacs and Sheepshead Bay, respec-
tively, had white tenant populations of 52.9% and 54.1%
(see NYCHA Tenant Statistics by Race as of Dec. 31,
1992), by January 1, 1999, their respective white tenant
populations were 36.3% and 35.0% (see NYCHA 1999
Tenant Characteristics Tabulation at 136, 236). Given
this history and the valid objective of financial stability,
we conclude that the delays of 11 and 12 months at those
two projects are not legally significant. In sum, we con-
clude that implementation of the WFP at Pelham Park-
way, Bay View, Isaacs, and Sheepshead Bay should not
be enjoined.
The WFP’s effects at the 14 remaining projects, sub-
stantially delaying their desegregation, are legally sig-
nificant. Although the law tolerates some “reasonable
delay” in achieving desegregation, nearly a decade has
45a .
passed without these projects’ nearing the 30% deseg-
regation level. All of these 14 projects had white tenant .
populations substantially in excess of 30% when the
Consent Decree was entered in 1992, and they still had
white populations substantially in excess of 30% in
1999. Indeed, nine of them remain more than 50% white.
The anticipated pace of desegregation under the original
TSAP in most cases already provided for additional
“reasonable” delay. For example, even without the WFP,
the projected time remaining after 1999 for desegrega-
tion of the Pomonok and Todt Hill projects was some
seven or eight years, i.e., some 13-14 years after entry of
the Decree. We regard NYCHA’s proposed expanded
delays, most ranging from more than seven years to eter-
nity, as legally significant, and we see no abuse of dis-
cretion in the district court’s permanent injunction
against implementation of the desegregation-delaying
WFP at these remaining projects.
We recognize that it is predicted that three projects
(Independence, Williams, and Taylor/Wythe) even under
the original TSAP would not be desegregated for more
than a half-century. Those target dates are indeed distant.
But the WFP’s impact, delaying the ultimate desegre-
gation of those projects for an additional 23-56 years, is
a perpetuation of desegregation that we cannot deem
insignificant. Further, though the anticipated dates of
desegregation of five projects (South Beach, Berry, Cas-
sidy-Lafayette, Robbins Plaza, and Haber) are also more
than a decade away without the WFP, under the WFP
desegregation would never be achieved. We cannot view
such “delays” as not legally significant.
Lastly, at Middletown Plaza and New Lane, a reduc-
tion to the 30% level is not expected under either plan.
Although the WFP thus would not prevent the actual
desegregation of those projects, its implementation
|
46a
would have legal significance, for it would impede or
reverse the expected five-year decreases in white-fam-
ily concentration. According to Table 5 in Davis V, 60
F.Supp.2d at 229, white family tenancy at New Lane
would decrease from 73% to 64.8% without the WFP;
but it would decline only to 71.1% with the WFP. And at
Middletown Plaza, which is projected for only a modest
decrease from 51.8% to 49.4% without the WFP, adop-
tion of the WFP would actually increase the percentage
of white families from 51.8% to 60.1%. Thus, though
Middletown Plaza and New Lane would not reach deseg-
regated levels even without the WFP, the degree of seg-
regation would be significantly greater with the WFP.
In sum, we conclude that at those six projects where
the WFP will not delay the reduction of the white tenant
population to 30% either at all or by more than 12
months, the effects of the WFP are not legally signifi-
cant. At the remaining 14 projects, the delays that would |
be caused by the WFP are legally significant, and imple-
mentation of the WFP at those projects was properly
enjoined.
It is, of course, well established that a district court
has the power, in the exercise of its discretion, to mod-
ify its past injunctive decrees in order to accommodate
changed circumstances. See, e.g., United States v. United
Shoe Machinery Corp., 391 U.S. 244, 248-49, 251
(1968); System Federation No. 91, Railway Employees’
Department v. Wright, 364 U.S. 642, 646-48 (1961);
Fed. R. Civ. P. 60(b)(5). It remains open to NYCHA to
move for a modification of the present injunction against
implementation of the WFP at any of the remaining 14
projects in the event that the number of apartments
rented to white families at such project declines to the
30% level.
47a
CONCLUSION
We have considered all of NYCHA’s contentions on
this appeal and, except as indicated above, have found
them to be without merit. The order of the district court
is reversed to the extent that it enjoined NYCHA from
implementing the WFP at the Bay View, Holmes Towers,
Isaacs, Pelham Parkway, Sheepshead Bay, and Straus
projects; in all other respects, the injunction is affirmed.
JOHN M. WALKER, JR., Chief Judge, dissenting:
I am concerned that the majority, in its effort to more
rapidly rectify the past discriminatory practices of the
New York City Housing Authority (““NYCHA”), has
endorsed a questionable attempt at social engineering
and, in doing so, has reached a decision that may well
have the practical effect of making several of the hous-
ing projects in New York City worse. Although the
majority acknowledges the importance of working fam-
ilies to the financial and social stability of public hous-
ing, its treatment of the working family preference
(“WFP”) leaves the impression that those interests must
always yield to a desegregation remedy, however
crafted. I disagree with any such implication, and with
the majority’s rejection of the position in favor of the
WFP taken by the NYCHA.
As the agency charged with administering public
housing, the NYCHA should generally be allowed to
implement critical objectives such as the WFP even
though it might slow the pace of desegregation some-
what. The NYCHA has acknowledged the wrongfulness
of its past practices of segregation and is now working to
promote desegregation. In my opinion, the WFP repre-
48a
sents a good faith effort by the NYCHA to maintain the
viability of public housing in New York City by striking
a balance between rapid desegregation and the values
promoted by social and financial stability. That such a
balance needs to be struck cannot be doubted. As
Congress found in the “Findings and Purposes” section
of the Quality Housing and Work Responsibility Act of
1998, “the public housing system is plagued by a series
of problems, including the concentration of very poor
people in very poor neighborhoods and disincentives for
economic self-sufficiency.” Pub. L. No. 105-276,
§ 502(a)(3), 112 Stat. 2518, 2520. Congress further made
the significant finding that the “public interest[] will
best be served by a reformed public housing program
that,” among other things, “vests in public housing agen-
cies that perform well the maximum feasible authority,
discretion, and contro] with appropriate accountability
. [and that] rewards employment and economic
self-sufficiency of public housing residents.” Id.
§ 502(a)(5)(C) & (D), 112 Stat. at 2521 (emphasis added).
The plaintiffs themselves have acknowledged the
important values promoted by the WFP in the consent
decree. The consent decree authorizes the NYCHA to
“seek to achieve a tenant body in each Project composed
of families with a broad range of incomes, generally rep-
resentative of the range of incomes and rent-paying abil-
ities of lower income families in its geographic
operating area to the extent permitted under 42 U.S.C.
§ 1437d(c)(4)(A)(iv), 24 C.F.R. § 960.205, and 24 C.F.R.
Part 913.” (Majority Op. at 7 (quoting Consent Decree
4 8)). Section 1437d(c)(4)(A)(iv) in turn requires every
contract for contribution to provide that the public hous-
ing agency will comply with requirements prescribed by
the Secretary of Housing and Urban Development,
ee
including the selection of tenant criteria that “are
49a
designed to ensure that, to the maximum extent feasible,
the projects of an agency will include families with a
broad range of incomes and will avoid concentrations of
low-income families and deprived families with serious
social problems.” 42 U.S.C. § 1437d(c)(4)(A)(iv) (1992)
(emphasis added). Similarly, 24 C.F.R. § 960.205 man-
dates that tenant selection criteria “shall be reasonably
related to individual attributes and behavior of an appli-
cant and shall not be related to those which may be
imputed to a particular group or category of persons
of which an applicant may be a member.” 24 C.F.R.
§ 960.205 (1992) (emphasis added).
Although we should never blindly defer to agency
decisions, I do not think that the NYCHA’s congres-
sionally-authorized WFP should be enjoined without a
project-by-project and in-depth examination of the rel-
ative importance of project stability and the other values
promoted by the WFP, on the one hand, and the rate at
which desegregation targets are met, on the other. The
majority's adherence to the district court’s talismanic
number of 30% for whites is no substitute for such an
examination. While the 30% figure was accepted by the
NYCHA as an aspirational goal in the consent decree,
that was long before it could have been known that the
30% figure would be a barrier to the implementation of
the WFP. The 30% number seems to have been picked
out of thin air. Why not 25% or 35% or 40%? Why not a
different number for different projects? In my view, the
30% figure amounts to an arbitrary number that is being
used to frustrate the considered policy of the NYCHA.
Putting aside the counter-intuitive notion that permeates
the district court’s analysis, affirmed by the majority,
that a project with more than 30% white-occupied apart-
ments is “predominantly white” (Majority Op. at 13) and
thus is segregated, it is clear that the color-blind WFP
50a
would not perpetuate such “segregation” but, except for
Middletown Plaza which is located in a largely white
area, would reduce it, albeit more slowly than under the
tenant selection and assignment plan (“TSAP”). More-
over, under the district court’s and the majority’s hold-
ings, the 30% figure sheds its aspirational character and
effectively becomes a quota which, should the NYCHA
fail to meet it with sufficient dispatch, penalizes a hous-
ing project by denying to it the WFP.
In sum, the practicai effect of the majority’s decision
is to deny housing to people who deserve it because of
their hard work or other merit solely on the basis of their
race or ancestry, to frustrate the worthwhile efforts of
the NYCHA to reward and promote employment and
economic self-sufficiency in its tenants, and to deny the
existing tenants the obvious benefit of having working
families as their neighbors. I am concerned that by over-
riding the NYCHA’s policy decision for the sake of more
rapid desegregation, the majority’s decision could result
in the deterioration of the New York City housing pro-
jects that remain under the injunction to the point where
the achievement of its desegregation targets would be a
Pyrrhic victory.
I respectfully dissent.
dicteeltinebite da Vesa athena
S5la
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
90 Civ. 628 (RWS)
PAULINE DAVIS, CYNTHIA WILLIAMS, CORNELIA
SIMMONS, and KIM RIVERA, on behalf of themselves
-and all others similarly situated,
Plaintiffs,
—against—
THE NEW YORK CITY HOUSING AUTHORITY,
; Defendant.
92 Civ. 4873 (RWS)
UNITED STATES OF AMERICA,
Plaintiff,
—against—
THE NEW YORK CITY HOUSING AUTHORITY,
Defendant.
52a
APPEARARNGLE S: ~
THE LEGAL AID SOCIETY CIVIL DIVISION
Attorney for Plaintiff Class in Davis
90 Church Street, 15th Floor
New York, NY 10007
By: SCOTT A. ROSENBERG, Director of Litigation
HELAINE BARNETT, Esq., Attorney-in-Charge
Of Counsel
THE NEW YORK CITY HOUSING AUTHORITY
Attorney for Defendant
75 Park Place, 11th Floor
New York, NY 10007
By: JEFFREY SCHANBACK, General Counsel
HENRY SCHOENFELD, ESQ.
NANCY M. HARNETT, ESQ.
STEPHEN W. GOODMAN, ESQ.
Of Counsel
OPINION
Sweet, D.J.,
This action has been remanded to this Court for sup-
plementation of the record, see Davis v. New York City
Hous. Auth., No. 99-6238 (2d Cir. Feb. 23, 2000) (sum-
mary order), following the appeal of defendant The New
York City Housing Authority (“NYCHA”) from this
Court’s grant of a permanent injunction to plaintiffs
Pauline Davis et al. (the “Davis Plaintiffs”) enjoining
NYCHA from implementing the Working Family Pref-
erence (“WFP”) at NYCHA housing projects with a dis-
proportionately high rate of white occupancy (the
“Disproportionate Projects”), see Davis v. New York City
Hous. Auth., 60 F. Supp.2d 220 (S.D.N.Y. 1999). The
Kot tat es Ax ——T ee Se
—
a“
dite o/ ath 6 casted,
PS ee
53a
Court of Appeals has directed further factual develop-
ment as to three questions: (1) how actual move-out
rates in 1998 under the WFP affect the analyses of the
expert witnesses; (2) a comparison of how many months
it is expected to take to achieve a white occupancy rate
below 30% at each of the Disproportionate Projects
under the original Tenant Selection and Assignment Plan
(“TSAP”) versus under the TSAP as modified by the
WFP; and (3) whether the tables presented in this
Court’s prior opinion of August 11, 1999, see Davis v.
New York City Hous. Auth., 60 F. Supp.2d 220 (S.D.N_-Y.
1999), should be revised to reflect a projected white
admissions rate below 9.9%.
The background and prior proceedings in this action
have been set forth in previous opinions and will not be
recounted here. See Davis v. New York City Hous. Auth.,
1992 WL 420923 (S.D.N.Y. Dec. 31, 1992) (Davis 1);
Davis v. New York City Hous. Auth., 1997 WL 407250
(S.D.N.Y. July 18, 1994) (Davis II); Davis v. New York
City Hous. Auth., 1997 WL 711360 (S.D.N.Y. Nov. 13,
1994) (Davis II1); Davis v. New York City Hous. Auth.,
166 F.3d 432 (2d Cir. 1999) (Davis IV); Davis v. New
York City Hous. Auth., 60 F. Supp. 2d 220 (S.D.N-Y.
1999) (Davis V); Davis v. New York City Hous. Auth.,
No. 99-6238 (2d Cir. Feb. 23, 2000) (summary order)
(Davis VI). Following remand, briefs and affidavits were
submitted addressing the questions raised by the Court
of Appeals. Oral argument was heard on May 3, 2000.
I. Actual 1998 Move-out Rates and Their Effect
on the Experts’ Conclusions
The first question raised by the Court of Appeals was
“whether and to what extent actual move-outs corre-
spond with projected move-outs and whether and to what
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extent the actual numbers influence the experts’ con-
clusions.” Davis VI, at 2.
Plaintiffs’ expert, Dr. Leonard A. Cupingood (“Dr.
Cupingood”) has set forth the relevant data in Table 1 of
his April 13, 2000 Affidavit. NYCHA’s expert, Dr.
- David W. Peterson (“Dr. Peterson”) has set forth com-
parable data in Tables 2a and 2b of his Seventh Affi-
davit. The 1998 numbers differ slightly between the two
sets of data because Dr. Peterson used a methodology to
adjust NYCHA’s internally inconsistent data, while Dr.
Cupingood used the NYCHA data without making the
adjustment. (See Peterson Eighth Aff. § 10 n.3; Cupin-
good April 28, 2000 Aff. ¢19 n.1.) It is not clear
whether the adjusted or the non-adjusted data is better
for the comparison made here. (See Cupingood April 28,
2000 Aff. 919 n.1.) In any event, as explained below, the
experts agree that use of the actual 1998 data does not
necessarily increase accuracy nor does it influence their
conclusions; thus, differences between the two sets of
data are immaterial. For convenience, both Dr. Cupin-
good’s and Dr. Peterson’s data are reproduced below in
Table 1.
Table 1
Overall White _ Non-White
Project* Rate(%)** Rate (%) Rate ( %)
1991- 1998 1991- 1998 1998 1991- 1998 1998
94 _ 94 \(Cup.) (Pet.) 94 (Cup.) (Pet.)
Bay View , 6.5 | 4.9, 9.1) 7.5) 7.7) 2.9) 3.4 | 4.5)
Berry + 6.5 |10.0) 7.4) 10.1 | 9.4) 3.5) 9.8 |13.7.
\Cassidy- | | | | |
Lafayette | 10.3 | 12.9 12.9 | 13.5 |14.0; 4.5 12.4 | 14.7 |
t ———
\ForestHills; 4.5 | 2.5) 5.8) 3.3 | 7.4) 2.5) 16 | 0.0)
EE ee
Haber | 8.7 | 82/100 63 7.3| 74/103 (12.1.
i
a ee ee
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Overall White Non-White
Project* Rate(%)** Rate (%) Rate (%)
1991- 1998 1991- 1998 1998 1991- 1998 1998
94 94 (Cup.) (Pet.) 94 (Cup.) (Pet.)
Holmes
Towers 8.3 8.1 9.7 10.1 Do | teh i: tom 8.6
Independ-
ence 1.6 3.7 ®, kt Be = 6 49 40.8
Isaacs 6.0 6.3 8.0 8.3 6.3 a4 1: 35 6.9
Middletown
Plaza 12.0 10.9 10.4 14.7 14.7 (15.4 > 63 ° 7.5
‘New Lane 8.7 9.5; 9.5 | 10.6 ($11.1 4.2: 68 | 8.1
Nostrand LR. 7.0: 8.2 8.7 | 89) 46; 5.7 | 6.8
Pelham
Parkway 6.2 6.2) 80 66: 62 3.9! 5.9: 8.7
Pomonok 5.5 6.9 6.1 7.5 74 46 > 6.4 9.0
Robbins
Plaza 11.4 | 15.3 ' 12.7 | 20.5 ‘20.5 |} 8.5; 9.0 ;11.9
Sheepshead
Bay 7.5 7.4; 95; 94: 9.1 ; 4.8; 6.2 | 8.1
South Beach 7.4 65 | 84; 5.7 | 6.1 3.3 | Fae | 7
Straus 4.4 34; $9 | 2.35 | 2.5 | £.2| 3.8 | 44
Taylor St./
Wythe Ave; 2.2 | 2.7 | -1.5 1.1 R.3 i 2.8) OF ; 7
Todt Hill | 6.0 5.8: 76; 66) 7 3.31 32 | $8
Williams 2.0 24| Hi 28 i 2a! 2.8) 2H i 2A
‘Overall*** 68 7.3, 86 8.8 4.4 6.5
* Peterson includes Glenwood, but it is no longer a Dispropor-
tionate Project, so it is omitted here.
** Peterson does not include statistics on the overall rate.
*** Weighed by the Number of Move-Outs; Peterson does not cal-
culate this figure.
Dr. Cupingood has concluded that using actual 1998
turnover rates, as opposed to historical turnover rates
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from the period 1991 to 1994, “does not necessarily lead
to more accurate projections of future occupancy levels
because the 1998 rates reflect a single year, rather than
a four-year period.” (Cupingood April 13, 2000 Aff. ¢
3(a).) Turnover rates for a single year “can be expected
to have a higher variation than during a four-year
period.” (Jd. ¢4.) Dr. Peterson has concluded that use of
1998 turnover rates “is generally typical of the values
that occurred in 1991-94,” and therefore “the effect of
knowing the actual turnover rates for 1998 is not so
much to change the projections into the future as it is to
emphasize the fact that they are uncertain.” (Peterson
Seventh Aff. ¢ 12.) Dr. Peterson, nevertheless, agrees
with Dr. Cupingood that use of the actual 1998 numbers
does not necessarily increase the accuracy of the pro-
jections. (Peterson Eighth Aff. 49.)
Use of the actual 1998 numbers did not influence the
experts’ conclusions. '
' Dr. Cupingood did, however, note that use of actual 1998
rates “causes an increase in the expected segregative impact of the
WFP.” (Cupingood April 13, 2000 Aff. € 3(a).) Dr. Cupingood esti-
mates that, using the 1998 data, a white admissions rate of 9.9%, and
separate turnover rates by race would result in 497 more white fam-
ilies at the 20 Disproportionate Projects after five years, as compared
with 422 using the 1991-1994 rates. (See id. ¢7.) After ten years, the
1998 data would result in 816 more white families as opposed to 696
using the 1991-1994 rates. (See id. ¢ 10.)
Dr. Peterson, by contrast, concludes that use of the 1998 turnover
rates would cause an increase in the time required to reach 30% white
occupancy under the WFP for certain of the Disproportionate Pro-
jects, and a decrease in the time for certain other Disproportionate
Projects. (See Peterson Eighth Aff. ¢ 13.)
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Il. Expected Delay in Reaching 30% White Occu-
pancy Rate Under TSAP Versus WFP
The second question raised by the Court of Appeals
was “(a) under the original Tenant Selection and Assign-
ment Plan (“TSAP”), how many months [is it] expected
to take to achieve a white occupancy rate below 30% at
[each of the Disproportionate Projects]; and (b) under
the modified TSAP incorporating the WFP, how many
months [is it] expected to take to achieve a white occu-
pancy rate below 30% at [each of the Disproportionate
Projects?]” Davis VI, at 2.
The Court of Appeals did not specify whether it
wished this question to be answered using projections
from the 1998 move-out rates or from the 1991-94 rates.
As set forth above, because the experts agree that the
1991-94 rates are as acceptable as the 1998 rates, the
data set forth here is based on projections from the 1991-
94 rates. Data using the 1998 rates has also been calcu-
lated and is contained in the affidavits of Dr. Cupingood
and Dr. Peterson. In addition, for the reasons set forth
below in Section III of this opinion, the calculations of
delay assume a 9.9% white admissions rate. Finally, it is
appropriate to utilize statistics based on turnover by
race, as opposed to overall turnover.
Dr. Cupingood has set forth the relevant data in Table
6A of his April 13, 2000 Affidavit. For convenience, the
portion relevant to the question raised by the Court of
Appeals is reproduced below as Table 2. Dr. Peterson’s
calculations are rejected because they were done assum-
ing a 6.28% white admissions rate without the WFP and
an 8.28% rate with the WFP. (See Peterson Seventh Aff.
§ 19.) The calculations previously adopted by this Court
in Davis V were made assuming a 4.2% white admis-
sions rate without the WFP, see Davis V, 60 F. Supp. 2d
58a
at 238 n.16, and the Court of Appeals did not remand for
the purpose of reconsidering that rate.
Table 2
Project Months to Reach Months to Reach
30% Without WFP 30% With WFP
Bay View 17 21
Berry 195 Will Never Reach 30%
Cassidy-Lafayette 195 Will Never Reach 30%
Forest Hills 149 246 |
'Haber 146 Will Never Reach 30%
Holmes Towers Already Below 30%* Already Below 30%*
Independence | 620 899
Isaacs | 18 = 29
Middletown
Plaza Will Never Reach 30% Will Never Reach 30%
New Lane Will Never Reach 30% Will Never Reach 30%
Nostrand 57 85
Pelham Parkway | 6 8
-Pomonok 84 171
Robbins Plaza 355 _ Will Never Reach 30%
Sheepshead Bay | 23 | 35 |
South Beach 163 - Will Never Reach 30%
Straus _ Already Below 30%* Already Below 30%* |
Taylor St./ | |
Wythe Ave. 649 i 1323 |
Todt Hill | 103 198 |
‘Williams | 707 if 1066 |
* After Davis Move-Ins.
Ill. The Tables in Davis V Will Not Be Revised
The third request of the Court of Appeals was that this
Court “consider whether the tables presented in its opin-
ion that relied on the 9.9% admissions rate should be
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revised in light of Dr. Cupingood’s July 27, 1999 affi-
davit.”” Davis VI, at 3.
The 9.9% projected white admission rate under the
WFP was arrived at by Dr. Cupingood using a computer
simulation and 1995 data, before the WFP went into
effect. Using actual data from 1998, adjusted for the
“pipeline effect” and other factors, Dr. Peterson con-
cluded that the actual white admission rate would be
6.88%. (Peterson Seventh Aff. 45.) Dr. Cupingood dis-
puted this figure, asserting that the proper rate would be
8.53%. (Cupingood July 27, 1999 Aff. 4 10.) Dr. Cupin-
good acknowledges that the calculation of the 8.53% rate
was based on a copying error and that the correct rate
using that methodology should have been 8.28%.
(Cupingood April 13, 2000 Aff. 4 25.)
Dr. Cupingood does not believe, however, that his cal-
culations should be adjusted for an 8.28%, rather than
9.9%, rate, as the existence of this Court’s injunction at
the Disproportionate Projects could have led to white
“turndowns,” i.€., certain white families may have
declined offers to live in public housing unless they
could live in a predominantly white project. (Cupingood
April 13, 2000 Aff. § 26.) To buttress this proposition the
Davis Plaintiffs cite to John Yinger, Closed Doors,
Opportunities Lost: The Continuing Costs of Housing
Discrimination 13-14 (1995) (noting that many white
families prefer neighbors who are also white), and to
various cases, see United States v. Starrett City Assocs.,
840 F.2d 1096, 1099 (2d Cir. 1988); Gladstone Realtors
v. Village of Bellwood, 441 U.S. 91, 110 (1979); Barrick
Realty, Inc. v. City of Gary, 354 F. Supp. 126, 135 (N.D.
Ind. 1973), aff’d 491 F.2d 161 (7th Cir. 1974). NYCHA,
though it disputes the admissibility of the Yinger cite as
evidence, is unable to contravene the unfortunate fact of
the underlying proposition.
aaa aii aici aati.
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Dr. Cupingood also asserts that Dr. Peterson invalidly
compared data between 1997 and 1998, because the
applicant pools differ each year. (Cupingood April 28,
2000 Aff. 4 2(c).)
Dr. Peterson responds that Dr. Cupingood has pro-
vided no evidence to support the assertion that the WFP
would artificially lower the system-wide intake rate for
white families below 9.9%. (See Peterson Eighth Aff.
44.) Moreover, Dr. Peterson contends that Dr. Cupin-
good’s calculation method already accounts for the pos-
sibility of such an artificial depression, because Dr.
Cupingood assumed that the percentages of white and
non-white families placed in one of the Disproportion-
ate Projects in the years 1991-94 would be the same as
the percentages of white and non-white qualified fami-
lies which in the future would desire to be placed in a
Disproportionate Project, regardless of the policy under
which they would qualify. (See id. 45.)
Dr. Cupingood’s reasoning is more persuasive. Com-
bination of the 1997 and 1998 data, which is drawn from
two separate applicant pools, introduces new uncer-
tainties into the calculations. Also, it is not clear from
Dr. Peterson’s affidavit whether Dr. Cupingood’s
methodology did in fact already account for the possi-
bility of artificial depression due to the WFP. Dr. Cupin-
good’s computer simulation using the 1995 data remains
the best means of estimating the expected white admis-
sions rate under the WFP, and consequently the 9.9%
rate used in the previous findings of fact will not be
revised.
However, regardless of the conclusions reached in the
preceding paragraph, Dr. Cupingood, in his April 13,
2000 Affidavit, has already calculated the effect of rely-
ing upon a 8.28% rate revision. (See Cupingood April
13, 2000 Aff., Tables 8A-13B.) As the calculations set
EO a.
6la
forth in Tables 8A-13B of that affidavit demonstrate, uti-
lization of an 8.28% rate does not significantly decrease
the WFP’s effect of delaying the desegregation of the
Disproportionate Projects. Thus, adoption of the 8.28%
rate, and revision of the calculations, would not change
this Court’s prior conclusion that implementation of the
WFP at the Disproportionate Projects would result in a
significant perpetuation of discrimination.
It is so ordered.
New York, NY
June 20, 2000
ROBERT W. SWEET
ROBERT W. SWEET
U.S.D.J.
62a .
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
No. 99-6238
Filed February 23, 2000
SUMMARY ORDER
THIS SUMMARY ORDER WILL NOT BE PUB-
LISHED IN FHE FEDERAL REPORTER AND MAY
NOT BE CITED AS PRECEDENTIAL AUTHORITY
TO THIS OR ANY OTHER COURT, BUT MAY BE
CALLED TO THE ATTENTION OF THIS OR ANY
OTHER COURT IN A SUBSEQUENT STAGE OF THIS
CASE, IN A RELATED CASE, OR IN ANY CASE FOR
PURPOSES OF COLLATERAL ESTOPPEL OR RES
JUDICATA.
At a Stated term of the United States Court of Appeals
for the Second Circuit, held at the United States Court-
house, Foley Square, in the City of New York, on the 23
day of February two thousand.
PRESENT:
Hon. Amalya L. Kearse,
Hon. John M. Walker, Jr.,
Hon. Rosemary S. Pooler,
Circuit Judges.
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PAULINE DAVIS; CYNTHIA WILLIAMS; BLANCA IRIS
HERNANDEZ, on behalf of themselves and all others
similarly situated; GINA CAMPBELL, on behalf of
themselves and all others similarly situated; JEANETTE
VARGAS, on behalf of themselves and all others sim-
ilarly situated; CORNELIA SIMMONS; KIM RIVERA,
Plaintiffs-Appellees,
NEW YORK CITY HOUSING AUTHORITY,
Defendant-Appellant.
APPEARING FOR APPELLANT:
HENRY SCHOENFELD, of Counsel!
(Jeffrey Schanback, General
Counsel, on the brief),
New York City Housing Authority,
New York, NY
APPEARING FOR APPELLEES:
SCOTT A. ROSENBERG, Director of
Litigation (Helaine Barnett,
Attorney-in-Charge, on the brief),
The Legal Aid Society, Civil
Appeals & Law Reform Unit,
New York, NY
Appeal from the United States District Court for the
Southern District of New York (Sweet, J/.).
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UPON DUE CONSIDERATION, IT Is HEREBY ORDERED,
ADJUDGED AND DECREED that this matter is remanded
to the district court for supplementation of the record.
Defendant-appellant New York City Housing Author-
ity (“Authority”) has appealed from the August 11, 1999
judgment of the district court granting the motion by
plaintiffs-appellees Pauline Davis et al. (“plaintiffs”) for
an order permanently enjoining the Authority from
implementing the working family preference (“WFP”) at
housing projects whose tenant body is more than 30%
white.
Following consideration of the briefs and oral argu-
ments of the parties and the record on appeal, the panel
has determined that it would benefit from further factual
development in three areas. First, we would like to know
how the actual figures for move-outs under the WFP, to
the extent such data are available, affect the analysis of
the expert witnesses. For example, plaintiff's expert’s
projections were based on historical move-out rates from
the period 1991-94. However, beginning in 1998, the
WFP has been implemented at all projects not covered
by the injunction, so that data as to actual move-outs by
race or ethnicity may be available. Plaintiff’s counsel
indicated at oral argument that actual move-out figures
from 1998 were not available at the time of the hearing
below. If these data are currently available, we would
like to know whether and to what extent actual move-
outs correspond with projected move-outs and whether
and to what extent the actual numbers influence the
experts’ conclusions.
Second, because the legal significance of the impact
of the WFP on the rate of desegregation of the sites
covered by the district court’s injunction may turn in
substantial part on the expected delay, if any, in deseg-
regating each project if the WFP is implemented there,
en 4 Seem Meee
65a
we would like to have data as to each project bearing on
the following questions: (a) under the original Tenant
Selection and Assignment Plan (“TSAP”), how many
months it is expected to take to achieve a white occu-
pancy rate below 30% at that project; and (b) under the
modified TSAP incorporating the WFP, how many
months it is expected to take to achieve a white occu-
pancy rate below 30%.
Third, we suggest that the district court revisit the
question of whether to credit projections that relied on
an estimation that white admissions under the WFP
would increase to approximately 9.9%. Plaintiff’s
expert, Dr. Leonard Cupingood, on whose data the dis-
trict court relied, appears to suggest in an affidavit dated
- July 27, 1999 that using actual figures on white admis-
sions under the WFP, after accounting for the so-called
“pipeline effect” and other factors, reduces the projected
white admissions rate to 8.53%. The Authority notes in
response that correction of a calculation error by Dr.
Cupingood would lower this figure to 8.28%. Although
Dr. Cupingood states that the revised figure of 8.53%
would not alter his “fundamental conclusion that the
WFP will significantly slow or reverse desegregation at
the 21 Disproportionate Projects,” the effect of the WFP
at each housing project should be evaluated on the basis
of tables that rely on an estimated white admissions rate
that is as accurate as possible. We therefore ask the dis-
trict court to consider whether the tables presented in its
opinion that relied on the 9.9% admissions rate should
be revised in light of Dr. Cupingood’s July 27, 1999 affi-
davit.
Accordingly, we remand this case to the district court
for supplementation of the record, pursuant to the pro-
cedures described in United States v. Jacobson, 15 F.3d
19, 21-22 (2d Cir. 1994). We request that, within sixty
66a
days of this order, the district court, after receiving any
additional submissions from the parties and their experts,
make further express findings and, if warranted, modify
its existing findings.
The mandate shall issue forthwith and shall state that
the parties are to inform the clerk of this court when the
district court has issued its supplementation of the
record in accordance with this order. Following such
notification, jurisdiction of the appeal will be automat-
ically restored to this court, and the clerk will reassign
the appeal to this panel, without a need for either party
to file a new notice of appeal. After jurisdiction is
restored, the clerk shall set an expedited briefing sched-
ule, and the parties may, if they wish, submit supple-
mental letter briefs not to exceed 10 single-spaced pages
confined to the implications on the case of the data
requested in this order and the district court’s findings
with respect thereto. It is unlikely that further oral argu-
ment will be necessary.
FOR THE COURT:
Roseann B. MacKechnie, Clerk
By: LUCILLE CARR
Lucille Carr, Deputy Clerk
eee a — per el
_—_ a ee
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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
90 Civ. 0628 (RWS)
PAULINE DAVIS, et al., on behalf of themselves
and all others similarly situated,
Plaintiffs,
—against—
THE NEW YORK CITY HOUSING AUTHORITY,
Defendant.
92 Civ. 4873 (RWS)
UNITED STATES OF AMERICA,
Plaintiff,
—against—
THE NEW YORK CITY HOUSING AUTHORITY,
Defendant.
68a
APPEARANCES:
THE LEGAL AID SOCIETY CIVIL DIVISON
Attorney for Plaintiffs
90 Church Street, 15th Floor
New York, New York 10007
By: HELAINE BARNETT, Esq., Attorney-in-Charge
SCOTT A. ROSENBERG, ESQ.,
Director of Litigation
JUDITH GOLDINER, ESQ.
Of Counsel
HONORABLE MARY JO WHITE
United States Attorney for the
Southern District of New York
100 Church Street
New York, New York 10007
Attorney for the United States of America
By: NEIL M. CORWIN
Assistant US Attorney
Of Counsel
JEFFREY SCHANBACK, General Counse! \
Attorney for Defendant New York City
Housing Authority
75 Park Place, 11th Floor
New York, New York 10007
By: HENRY SCHOENFELD, Esq.
NANCY M. HARNETT, Esq.
STEPHEN W. GOODMAN, Esq.
JAMES R. ADOLF, ESQ.
Of Counsel
69a
OPINION
Sweet, D.J.
Once again before the Court, this time on remand, is
the motion by Pauline Davis, et al (the “Davis Plain-
tiffs”) to enjoin the defendant New. York City Housing
Authority (“NYCHA” or the “Authority”) from imple-
menting the Working Family Preference (“WFP”) con-
tained in its proposed changes to its Tenant Selection
and Assignment Plan (“TSAP”) incorporated by refer-
ence in the Consent Decree in this action. In addition,
NYCHA has moved to lift the preliminary injunction
previously issued. Upon the findings and conclusions set
forth below, the motion of the Davis Plaintiffs is
granted, and the preliminary injunction is made perma-
nent. The NYCHA’s motion is denied.
As will appear in greater detail below, this action from
its inception has been hard fought, and the issues have
been difficult and complicated. As the Consent Decree
approaches its sunset,' the Davis Plaintiffs seek to
employ its provisions to achieve remediation of the con-
ditions which gave rise to the action, while NYCHA
contends that the Consent Decree has achieved its pur-
pose. While there clearly are conflicting contentions
concerning the proposed changes in the TSAP, the
underlying questions during this phase of the litigation
concern the continued viability and scope of the Consent
Decree. The resolution of those issues overshadow and
underlie the specifics of the WFP controversy.
' By its terms, the Consent Decree entered on July 1, 1992, to
which the United States of America was a party, will expire on Jan-
uary 1, 2001.
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Prior Proceedings
The description of the prior proceedings contained in
the opinion of the Court of July 18, 1997 (the “July 18
Opinion”) remain relevant but need not be repeated.
Prior decisions include Davis v. New York City Housing
Authority, 1992 WL 420923 (S.D.N.Y. Dec. 31, 1992)
(Davis 1); Davis v. New York City Housing Authority,
1997 WL 407250 (S.D.N.Y. July 18, 1994) (Davis II);
Davis v. New York City Housing Authority, 1997 WL
711360 (S.D.N.Y. Nov. 13, 1994) (Davis III); Davis v.
New York City Housing Authority, 166 F.3d 432 (2d Cir.
1999) (Davis IV), familiarity with which is assumed.
Those facts and prior proceedings relevant to the instant
motion are set forth below.
The July 18 Opinion held that while the proposed
WFP did not have an “adverse impact” on minority
applicants, it would perpetuate past segregation in pre-
dominantly white projects and granted the Davis Plain-
tiffs a preliminary injunction prohibiting the adoption of
the proposed WFP. The Court also granted NYCHA
leave to apply for a modification of the injunction “upon
a showing that the Working Family Preference will be
implemented in a manner that will not affect desegre-
gation in projects with a disproportionately high rate of
white occupancy.” Davis II, 1997 WL 407250 at *18.
The NYCHA filed a notice of appeal and moved for
reconsideration. The motion for reconsideration was
denied on November 13, 1997 on the grounds that on a
motion to reconsider, the NYCHA “may not advance
new facts, issues or arguments not previously presented
to the court.” Davis III, 1997 WL 711360 at *3 (internal
quotations and citations omitted). However, the injunc-
tion was modified to permit NYCHA to implement the
WFP “as proposed in any project where white families
do not constitute more than 30 percent of the families at
Tla
the project.”? Jd. at *5. NYCHA filed another notice of
appeal.
On January 22, 1999, the Court of Appeals filed its
opinion by Chief Judge Morey L. Sear, sitting by des-
ignation, vacating the July 18 Opinion, but leaving the
preliminary injunction intact, “until the district court has
had the opportunity to address these matters on remand.”
Davis IV, 166 F.3d at 438. In particular, the Second Cir-
cuit noted that paragraph 13 of plaintiffs’ expert Dr.
Cupingood’s (“Dr. Cupingood”) Second Affidavit,’ and
the July 18 Opinion, were deficient because:
‘ The July 18 opinion was narrowed to enjoin the WFP at only
21 NYCHA developments classified as “predominantly white” in the
TSAP which was incorporated in the Consent Decree. “Predominantly
white” is the term used for projects where more than 30% of the units
are rented to white families. These projects are referred to as “Dis-
proportionate Projects” and/or “Affected Developments” and these
terms have become terms of art in this litigation.
In paragraph 13 of Dr. Cupingood’s Second Affidavit he
States:
I was also asked to calculate the effect that the proposed
changes to the TSAP would have on slowing down the deseg-
regation in projects which were more than 50 percent white
as of June 1996. Information supplied to me indicated that
the following 11 projects were more than 50 percent white as
of June 1996—Berry, Cassidy-Lafayette. Forrest Hills, Inde-
pendence, Middletown Plaza, New Lane, Robbins Plaza,
South Beach, Taylor-Wythe, Todt-Hill, and Williams. Some
of these projects are affected by the Davis Consent Decree.
For these “Davis” projects, I first conservatively assumed
that all units set aside for Davis tenants would represent
replacement for white tenants. Then assuming the turnover
rates and move-in rates from Appendix E of [NYCHA
expert] Dr. Peterson's affidavit continued and that the pro-
posed changes to the TSAP were adopted, I calculated that a)
there would be no further desegregation at four of the pro-
jects, b) the desegregation would be reversed at four other
72a
(a) “it is unclear to which proposed change—project
choice or working family preference, or both—
plaintiffs’ expert attributes the perpetuation of seg-
regation.” Davis IV, 166 F.3d at 437;
(b) the time period during which the purported
impact of the proposed TSAP changes will allegedly
occur is not specified. See id. at 436;
(c) there is no discussion of, or data reflecting, the
so-called “existing trends” allegedly showing that
additional white families admitted under the WFP
will concentrate in predominantly white develop-
ments. /d.;
(d) the subsidiary facts and methodology underlying
the ultimate finding are not adequately explained.
See id.;
(e) plaintiffs’ expert does not identify the precise
numerical data underlying his opinion. See id at 437;
(f) the names of the developments at which the WFP
will allegedly perpetuate segregation is not identi-
fied. See id at 436;
(g) plaintiffs’ expert expressed no opinion as to
whether the WFP will perpetuate segregation at ten
of the developments covered by the injunction. See
id; and
(h) the number, fraction, or percentage of additional
white families who will be admitted to each of the
21 developments as a result of the WFP is not
stated. See id.
projects, and c) the desegregation would be slowed signifi-
cantly at three projects. Thus, adoption of the proposed
changes to the TSAP would adversely affect the desegrega-
tion at these majority white projects.
:
&
f
73a
The remand was filed on February 18, 1999, a pretrial
conference was held, and a hearing was held on June 18,
1999. Additional affidavits, memoranda and arguments
were received through July 27, 1999, at which time
which the matter was deemed fully submitted. Although
offered, neither party sought to examine or cross-exam-
ine any of the witnesses, expert or otherwise.
The Scope of the Remand
Initially the Court of Appeals stated: “we consider
Judge Sweet’s findings on the issue of perpetuation of
segregation insufficient under Rule 52(a). While not
entirely devoid of detail, Judge Sweet failed to ade-
quately explain the subsidiary facts and methodology
underlying the ultimate finding.” Davis IV, 166 F.3d at
436. In particular, the number of white families pro-
jected to be admitted to the projects at issue was found
wanting.
The Court of Appeals was also unable to determine
whether paragraph 13 of the affidavit of Dr. Cupingood,
which was adopted by the district court as a finding,
reflected changes discussed were attributable to which
proposed change—project choice, the WFP, or both.
The Court of Appeals also had difficulty in deter-
mining the source of statistics underlying Dr. Cupin-
good’s ultimate finding that the proposed WFP would
perpetuate segregation at certain NYCHA developments.
For these reasons, the Court concluded Dr. Cupingood’s
affidavit was so “vague and conclusory” as to permit the
discovery of relevant matters from the record and
required remand “for proceedings consistent with this
opinion.”
Although the Authority did not appeal on the basis of
a failure to conduct an evidentiary hearing, the Court
74a
pointed out “when a factual issue is disputed, oral tes-
timony is preferable to affidavits.”
The Court recognized that NYCHA’s position that the
effect of the TSAP on segregation was de minimis was
advanced after the filing of the notice of appeal and had
not been dealt with by the district court, but noted that
on remand the proper standard to be applied is “whether
the proposed working family preference will signifi-
cantly perpetuate segregation at the relevant NYCHA
developments.” Davis IV, 166 F.3d at 438 (emphasis in
original).
The Facts
Based upon the hearing, the facts set forth in the affi-
davits of Dr. Cupingood and Dr. David W. Peterson
(NYCHA’s expert witness) (“Dr. Peterson”) are sup-
ported by the data cited and are credible, although cer-
tain of the conclusions drawn from these facts remain in
contention. The facts as set forth below are found on the
basis of the prior proceedings and the affidavits of the
parties and the experts. Neither of the parties sought a
hearing to challenge the process by which the following
facts were established.
A. The Consent Decree
In 1992, NYCHA, the Davis Plaintiffs and the United
States entered into a Consent Decree permanently
enjoining various racially discriminatory tenant selection
and assignment practices at NYCHA’s public housing
projects. (Consent Decree {§ 4(a)-(h)). The Consent
Decree provided inter alia for: (1) injunctive relief bar-
ring future housing discrimination on the basis of race,
color or national origin, (Consent Decree 4 4); (2) the
implementation of a new TSAP which substantially
revised NYCHA’s tenant selection and assignment sys-\
aT
75a
tems, and which prohibits further discrimination, (Con-
sent Decree 945-9); (3) remedial relief for 2,190
claimants of NYCHA’s past discrimination,* (Consent
Decree 9§ 10-39); and (4) significant record keeping and
reporting by NYCHA regarding tenant selection and
assignment practices. (Consent Decree 4 43-48).
The Consent Decree also requires NYCHA to “adopt
and implement the TSAP. . . to prevent any unlawful
discrimination on the basis of race, color, or national ori-
gin, in compliance with the Housing Authority’s obli-
gations therewith under Title VI, the Fair Housing Act
and the implementing regulations and requirements of
HUD.” (Consent Decree 45). In adopting and imple-
menting the TSAP with “respect to existing projects and
new projects to be opened in the future,” NYCHA
agreed that it would use “no racial quota system, or
other practice technique or device to house Applicants in
particular projects, buildings, or apartments, or to oth-
erwise limit the availability of housing, on account of
race, color, or national origin.” (Consent Decree 4 7(a)).>
Under the Consent Decree, NYCHA’s TSAP must
remain in effect for at least five years (Consent Decree
{ 6(a)) and during that time, the Plaintiffs may not chal-
lenge actions by NYCHA that comply with the TSAP as
racially discriminatory. Jd. However, the Consent Decree
permits challenges to any amendments to the TSAP
adopted or proposed by NYCHA during the five year
period ( 6(b)).
4 The remedial relief consisted of awarding HUD Section 8
housing vouchers to 200 claimants; the remaining 1,990 victims
received priority placement at any of 31 so-called “Affected Devel-
opments” where past segregation occurred.
> The TSAP was designed “to assure that [the Housing Author-
ity] receives and processes applications for conventional public hous-
ing efficiently and in accordance with the laws.” TSAP, § J at 1.
76a
B. The Working Family Preference
In July 1995, NYCHA proposed to change the TSAP
by adopting the WFP. The essential difference between
the original TSAP and the WFP is the WFP’s elimination
of the “applicant’s need for housing” as a priority.
Instead, the WFP gives preference to families based on
income. Thus, under the original TSAP, priority was
afforded to families who needed housing the most.
Under the WFP, in contrast, priority is afforded to fam-
ilies who can pay the most, regardless of their housing
need.
In Davis II, this Court described the operation of the
WFP as follows:
NYCHA would establish new local priorities as part
of the applicant selection process. The highest local
priority would be assigned to the highest income,
Tier III applicants. The second priority is given to
Tier II families. The lowest priority is given to Tier
I families, but only to those who are working or are
disabled. Tier I families receiving public assistance
would receive no local priority. In addition, the pro-
posed TSAP would categorize federal preference
holders as working (including the disabled) or “non-
working.” The federal preference holders who are
working or disabled would receive a priority over
those who are not. NYCHA also proposes to
increase to 50% the proportion of new rentals to
local preference holders and to reduce the propor-
tion of rentals to federal preference holders to 50%
Davis II, 1997 WL 407250, at *4.
As set forth in Davis IJ, 1997 WL 407250 at *14, local
preferences favoring working families are permitted, see
24 C.F.R. § 960.205(a) (1995), and such preferences do
not require approval by the Department of Housing and
77a
Urban Development (“HUD”). The Davis Plaintiffs con-
cede the proposed objectives of the WFP, namely,
income integration in public housing and increasing the
number of working families in public housing, are legit-
imate, but contend that the NYCHA has not sustained its
burden of demonstrating that there is no less discrimi-
natory means of advancing the same interests. Plaintiffs
proposed an alternative method of increasing the repre-
sentation of upper income families that would have a
less racially discriminatory effect than the proposed
WEP, a method which NYCHA has rejected.
C. The Effect of the Working Family Preference
According to NYCHA’s computer tapes, 5,885 fami-
lies moved into NYCHA apartments during 1995. The
racial breakdown of those families, along with the racial
breakdown that would have occurred if the WFP had
been in effect during that year, are summarized in the
following table:
Table 1
Race Distribution of 1995 Rentals Under
Original TSAP and WFP
African- Puerto Other
White American’ Rican Hispanic Other Total
Original
TSAP 250 2703 1768 860 340 5885
WFP 580 2594 1339 835 537 5885
Difference 330 -109 —429 -—25 233 0
For future projections, Dr. Cupingood assumed that
families of each race will make decisions about which
projects to choose in the same manner, and with the
same probabilities, as families of that race have done in
the past.
78a
NYCHA records move-outs and move-ins by race for
each project in a report entitled, “Tenant Statistics by
Race.” NYCHA’s expert, Dr. Peterson, annexed such
reports as Exhibit E to his January 7, 1999 affidavit. Dr.
Cupingood relied on these reports in his original affi-
davit and in this report in calculating expected move-out
and move-in rates.
To calculate the probable number of white move-outs
at each Disproportionate Project, Dr. Cupingood began
by selecting a period for historical reference. Since
Davis claimants began moving into Affected Develop-
ments in August 1995, the last year that is free of dis-
tortion by Davis move-ins 1s 1994. Additionally, since
the bulk of NYCHA’s discriminatory practices ended in
1990, the first year that is free of distortion caused by
NYCHA’s own discrimination was 1991. Thus, Dr.
Cupingood selected the years 1991 through 1994 as a
period for historical reference.
For each Disproportionate Project, Dr. Cupingood then
calculated move-out rates based on NYCHA’s Tenant
Statistics by Race for the period 1991 through 1994. For
example, if the population of a project at the beginning
of 1991 was 100, and if 5 families moved out during
1991, then the move-out rate for 1991 at that project was
5 percent (Cupingood Report, 4 8). Based on calculations
like these for each Disproportionate Project for each
year from 1991 to 1994, Dr. Cupingood determined the
average move-out rate for each project. As a further
refinement, Dr. Cupingood also calculated race-specific
move-out rates for each Disproportionate Project (/d.).
He then determined the probable number of white move-
outs at each project in a given year by applying the
appropriate turnover percentage to the population at the
end of the year. (Cupingood Report, 4 9).
79a
Using the historical period 1991-1994, Dr. Cupingood
determined the total number of move-ins of each race
into each project. He then determined the percentage of
the total for white and non-whites who moved into each
Disproportionate Project.° For example, there were 1,775
‘white move-ins during the four year period, 67 of whom
moved into New Lane. The relative likelihood of a white
family selection New Lane was therefore 67 divided by
1775, or 3.78% (Cupingood Report; ¢ 10 & Table 3).
Among all non-white move-ins from 1991 to 1994,
8.35 percent moved into one of the Disproportionate
Projects.
Table 2
Clustering by White Families in Disproportionate Projects
Project Name White Non-White
Bay View 2.14% 1.18%
Berry 1.92% 0.03%
Cassidy-Lafayette "3.78% 0.19%
Forest Hills 0.73% 0.16%
Glenwood 0.56% 0.85%
Haber 1.86% 0.27%
. Three Disproportionate Projects in the Williamsburg area of
Brooklyn required special consideration during this analysis. On
April 17, 1991, NYCHA settled a contempt motion with the plaintiffs
in Williamsburg Fair Housing Comm. v. New York CityHousing Auth.,
76 Civ. 2125 (S.D.N.Y.). As part of that settlement, NYCHA agreed
to provide relief to identified victims of racial quotas that NYCHA
enforced at the Independence, Williams, and Taylor Wythe projects
between 1980 and February 1988. During the 1992-94 time period,
over a third of all apartments rented at the three Williamsburg area
projects were to victims of discrimination who moved in pursuant to
that settlement. All victims in the Williamsburg case were families of
color. In calculating move-in rates at these projects for the 1991-94
time period, Dr. Cupingood excluded move-ins that were made pur-
suant to the Williamsburg settlement. (See Cupingood Report, 4 11).
80a
Project Name White Non- White
Holmes Towers 0.90% 0.44%
Independence 0.17% 0.08%
Isaacs 1.30% 0.33%
Middletown Plaza 1.92% 0.14%
New Lane 3.78% 0.10%
Nostrand 2.48% 0.87%
Pelham Parkway 1.13% 0.90%
Pomonok 3.89% 1.14%
Robbins Plaza 1.69% 0.12%
Sheepshead Bay 1.92% 0.85%
South Beach 1.80% 0.23%
Straus 0.68% 0.10%
Taylor-Wythe 0.11% 0.07%
Todt Hill 1.35% 0.25%
Williams 0.11% 0.10%
Total 34.19% 8.38 %
Dr. Cupingood applied these figures to determine the
probable impact on the WFP on move-in and move-out
rates at each Disproportionate Project. He began by
assuming that the WFP would have the racial impact cal-
culated in his original November 14, 1996 affidavit, and
adopted by this Court in its findings in Davis IJ. That is,
he assumed that white admissions would comprise 9.9
percent of all admissions; African-Americans 44.1 per-
cent; and so forth. See Davis II, 1997 WL 407250, at *4
(Cupingood Report, 4 12).
Next, using the historical move-in and move-oui rates
described above, he calculated the number of white
move-ins and move-outs that would occur at each Dis-
proportionate Project with the WFP operating. He per-
formed these calculations for each of the next five years,
and each of the next ten years. Each calculation was per-
formed using two alternative assumptions. The first
assumption posits that move-out probabilities for each
race at each project will follow historical trends for that
8la
particular race and project. The second assumption
which Dr. Cupingood employed in preparing his original
affidavit posits that move-out probabilities for each race
at each project will track overall historical turnover rates
for that project. Dr. Cupingood then repeated these cal-
culations on the assumption that the WFP was not oper-
ating. Again, these calculations were performed for the
next five and ten years. Based on these figures, Dr.
Cupingood quantified the impact the WFP would have
on desegregation at each of the 21 Disproportionate Pro-
jects. He did so both in terms of the number of white
families affected, and the percentage of white families
affected. A summary of changes in the white population
at each Disproportionate Project appears below in
Table 3.
Table 3
Effect of WFP at Disproportionate Projects After Five Years
Assuming Historical turnover by Race
Project Total Initial Five Years After Davis Move-Ins
Name Apts White Original TSAP WFP
Bay View 1491 514 341 368
Berry $02 282 226 253
Cassidy-
Lafayette 349 187 148 176
Forest Hills 383 198 158 170
Glenwood 1172 352 212 222
Haber 364 193 144 169
Holmes
Towers $27 140 98 115
Independence 715 493 457 463
Isaacs 634 210 157 177
Middletown
Plaza 168 87 83 101
New Lane 270 =197 175 192
Nostrand 1118 469 335 368
82a
Project Total Initial Five Years After Davis Move-Ins
Name Apts White Original TSAP WFP
Pelham
Parkway 1240 394 274 292
Pomonok 2047 ~=850 682 748
Robbins
Plaza 148 79 63 77
Sheepshead
Bay 1032 363 248 277
South Beach 416 221 173 198
Straus 263 65 48 55
Taylor-Wythe 520 283 266 271
Todt Hill 501 234 179 199
Williams 565 348 326 329
Total 14436 6099 4740 5172
Table 4
Relative Percentage Reduction in Number of
White Families Due to WFP After Five years
Assuming Historical Turnover by Race
Project Name Reduction in White Families Percentage
No WFP WFP
Bay View 173 146 ~ 15.6%
Berry 56 29 48.2%
Cassidy-Lafayette - 39 11 71.8%
Forest Hills 40 28 30.0%
Glenwood 140 130 7.1%
Haber 49 24 51.0%
Holmes Towers 42 25 40.5%
Independence 36 30 16.7%
Isaacs 53 33 37.7%
Middletown Plaza 4 -14 n/a
New Lane 22 3 77.3%
Nostrand 134 101 24.6%
Pelham Parkway 120 102 15.0%
Pomonok 168 102 39.3%
Robbins Plaza 16 2 87.5%
Sheepshead Bay 115 86 25.2%
83a
Project Name Reduction in White Families Percentage
No WFP WFP
South Beach 48 23 52.1%
Straus 17 10 41.2%
Taylor-Wythe 17 12 29.4%
Todt Hill 55 35 36.4%
Williams 22 19 13.6%
Total 1366 938
As the table indicates, at most projects where the WFP
would not cause actual increases in segregation, the
impairment in desegregation is at least 25 percent
(Cupingood Report, 4 15).
The impact on desegregation can also be seen in terms
of the percentage of white families who would reside in
each Disproportionate Project. Assuming historical
turnover by race, after five years under the WFP, the per-
centage of white families at Middletown Plaza would
rise from 51.85 to 60.1% (instead of falling to 49.4%).
At the remaining Disproportionate Projects, white occu-
pancy percentages would either stabilize or fall more
slowly under the WFP than under the original TSAP. For
example, at Cassidy-Lafayette, after five years the per-
centage of white families in occupancy would inch down
from 53.6% to 50.4% (instead of falling to 42.4%). Table
5 below summarizes the changes in white occupancy
percentages caused by the WFP after five years (assum-
ing historical turnover by race).
84a | ;
Table 5
/ Change in Percentage White Occupancy At
Disproportionate Projects After Five Years
Assuming Historical Turnover by Race
Project Name Initial Five Years after Davis Move-Ins
% White Original TSAP WFP
Bay View 34.5% 22.9% 24.7%
Berry 56.2% 45.0% 50.4%
Cassidy-Lafayette 53.6% 42.4% 50.4%
Forest Hills 51.7% 41.3% 44.4%
Glenwood 30.0% 18.1% 18.9%
Haber 53.0% 39.6% 46.4% ~
Holmes Towers 26.6% 18.6% 21.8%
Independence 9.0% 63.9% 64.8%
Isaacs 33.1% 24.8% 27.9%
Middletown Plaza 51.8% - 49.4% 60.1%
New Lane 73.0% 64.8% 71.1%
Nostrand 41.9% 30.0% 32.9%
Pelham Parkway 31.8% 22.1% 23.5%
Pomonok 41.5% 33.3% 36.5% |
Robbins Plaza 53.4% 42.6% 52.0% =
Sheepshead Bay 35.2% 24.0% 26.8% 4
South Beach 53.1% 41.6% 47.6% :
Straus 28.5% 27.4% 20.9%
Taylor-Wythe 54.4% 51.0% 52.1%
Todt Hill 46.7% 35.7% 39.7%
Williams 61.6% 57.5% 58.2%
Similar trends exist after ten years, except that at Dis-
essentially stop, the magnitude of the impact of the WFP
would generally become larger. For example, at Mid-
dletown Plaza, where segregation would increase under
the WFP, the white population would climb to 108
instead of falling to 81. At Berry Houses, where deseg-
regation would be significantly slowed, the white pop-
ulation would fall to 231 instead of 186. In the
aggregate, after ten years under the WFP (again assum-
proportionate Projects where desegregation would not | ;
|
85a
ing historical turnover by race), the Disproportionate
Projects would be occupied by 722 more white families
than would have resided in those projects in the absence
of the WFP. (Cupingood Report, § 16). Table 6 summa-
rizes white occupancy figures after ten years of opera-
tion with and without the WFP.
Table 6
Effect of WFP at Disproportionate Projects After Ten Years
Assuming Historical Turnover by Race
Project Name Total Initial Ten Years after Davis Move-Ins
Apts White Original TSAP WFP
Bay View 149] 514 230 272
Berry 502 282 186 231
Cassidy-
Lafayette 349 187 123 168
Forest Hills 383 198 128 148
Glenwood 1172 352 130 145
Haber 364 193 114 154
Holmes Towers 527 140 73 100
Independence 715 493 425 436
Isaacs 634 210 121 154
Middletown
Plaza 168 87 81 108
New Lane 270 197 159 188
Nostrand 1118 469 245 — 298
Pelham
Parkway 1240 394 193 222
Pomonok 2047 850 $58 672
Robbins Plaza 148 79 54 76
Sheepshead
Bay 1032 363 175 200
South Beach 416 221 141 183
Straus 263 65 36 47
Taylor-Wythe 520 283 250 259
Todt Hill 501 234 140 174
Williams 565 348 305 312
Total
14436
6099
3819
86a
Table 7 below summarizes the impact of the WFP on
the white population of the Disproportionate Projects,
assuming that move-out patterns for each race at each
project would reflect the overall historical move-out
trend for that project. For all the Disproportionate Pro-
jects, the WFP would boost the white population after
five years from 5,176 to 5,680—an increase of 504 white
families. After ten years, the WFP would boost the white
population at the 21 Disproportionate Projects from
4,433 to 5,288—an increase of 855 white families.
Table 7
Effect of WFP at Disproportionate Projects After Five Years
Assuming Historical Turnover by Race
Project Name Total Initial Five Years after Davis Move-Ins
Apts White Original TSAP WFP
Bay View 1491 517 401 440
Berry 502 283 244 274
Cassidy-
Lafayette 349 187 177 209
Forest Hills 383 198 171 184
Glenwood 1172 356 252 267
Haber 364 193 153 179
Holmes Towers 527 144 109 127
Independence 715 493 460 465
Isaacs 634 219 185 211
Middletown
Plaza 168 87 75 93
New Lane 270 197 187 205
Nostrand - 1118 471 367 409
Pelham
Parkway 1240 403 310 333
Pomonok 2047 852 709 780
Robbins Plaza 148 78 69 83
Sheepshead
Bay 1032 365 279 314
South Beach 416 221 185 212
87a
Project Name Total Initial Five Years after Davis Move-Ins
Apts White Original TSAP WFP
Straus 263 65 48 55
Taylor-Wythe 520 283 257 261
Todt Hill 501 235 199 222
Williams 565 348 317 321
Total 14436 6099 4740 5172
Discussion
I. The Issues
As noted, the Second Circuit has held that the proper
standard to be applied on remand is “whether the pro-
posed working family preference will significantly
perpetuate segregation at the relevant NYCHA devel-
opments.” Davis IV, 166 F.3d at 438. NYCHA has urged
that the remediation required by the Consent Decree has
been achieved and that therefore there is no perpetuation
of segregation which could result from the WFP and no
discrimination remaining to be remediated under the
Consent Decree. In addition, the Authority contends that
if there is segregation extant under the Consent Decree
the WFP does not significantly perpetuate it. The Davis
Plaintiffs take the contrary view of the issues. The ques-
tions to be resolved therefore are:
1. Is there a basis upon which to conclude that
there is segregation to be dealt with under the
Consent Decree?
2. Does the WFP significantly perpetuate segre-
gation?
88a
II. There is Segregation to be Dealt with under
the Consent Decree
A. 30 Percent Will Be Used as the Metric By
Which Segregation Will Be Determined in
this Case
As an initial matter, the parties disagree as to the
appropriate measure for assessing whether segregation
exists. As noted, throughout this litigation projects have
been deemed “disproportionate” or “predominantly
white” if more than 30 percent of the parties residing
there are white.’ See, e.g., Davis II, 1997 WL 407250 at
*12. The Authority contends that there is nothing in the
Consent Decree that supports the inference that if a pro-
ject is 30 percent white it is disproportionate or segre-
gated.
The sole reference to the 30 percent figure is con-
tained in the TSAP, incorporated by reference in the
Consent Decree. Section VIII(A) of the TSAP, entitled
the “Project Outreach Plan,” states in relevant part that:
“if the OCD [Occupancy Control Division] determines
that borrowing applications from a nearby project is
likely to solve the project’s need for applications, it shall .
select the nearest project that has a sufficient number of
applications for that size apartment. However, if the bor-
rowing project’s tenant body is more than 30% white,
OCD shall not select a project whose tenant body is also
: more than 30% white.” (TSAP at 29, hereinafter the
“Borrowing Provision’”).®
7 There are now 20 Disproportionate Projects as in the past
year, the Glenwood project fell below the 30 percent threshold. As
such, this Court’s injunction no longer applies to Glenwood.
8 The revised TSAP of December 15, 1997 contains an iden-
tical provision except that OCD is now referred to as the Field Liai- |
son Division (“FLD”). .
89a
The 30 percent figure set forth in the Borrowing Pro-
vision is not, as NYCHA urges, an arbitrary number, but
a negotiated figure that implies that the parties and the
Court believed that a project was disproportionately
white if more than 30 percent of its families are white.
See Armour & Co., 402 U.S. at 681 (“Consent decrees
are entered into by parties to a case after careful nego-
tiation has produced agreement on their precise terms’’).
An examination of Exhibit A to the Consent Decree, a
list of projects where it was alleged that discriminatory
practices occurred in statistically significant amounts,
reveals that during the time in question most of these
projects were at least 30 percent white. Plaintiffs aver
that the parties adopted the 30 percent figure because “it
described in a simple manner that could easily be imple-
mented in the TSAP which projects had been...
affected by past segregation.” (Tr. of June 18, 1999
Hearing at 59).
The TSAP must be read as in harmony with existing
law. See, e.g., Prate v. Freedman, 583 F.2d 42 (2d Cir.
1978) (before a consent decree can be approved, the
court must assure itself that the terms of the decree are
not unlawful, unreasonable, or inequitable). Under exist-
ing law, borrowing of applications could not have been
prohibited at projects more than 30 percent white (with-
out regard for claimant relief) unless those projects were
still tainted by past segregation. As will be discussed
more fully below, remedies containing race-conscious
relief “must be substantially related to the objective of
eliminating the alleged instance of discrimination, . . .
and must not unnecessarily trammel the interests of
affected third parties.” Kirkland v. New York State Dept.
of Correctional Serv., 711 F.2d 1117, 1132 (2d Cir.
1983). Thus, had there been no finding that housing pro-
jects that are greater than 30 percent white were affected
90a
by past segregation, the Borrowing Provision would be
unlawful.
This Court has held that “[uJ]nder the TSAP, a project
is considered disproportionately white if more than 30
percent of its families are white.” See Davis II, 1997 WL
- 407250 at *12.° This finding was not disturbed by the
Second Circuit on appeal. Accordingly, 30 percent will
continue to be employed as a measure to identify seg-
\regation in this case.
B. The Consent Decree Extends Beyond
Remediation of Davis’ Victims
It is the position of the Authority that the Court may
no longer consider whether the Disproportionate Projects
remain segregated once NYCHA has fully complied with
its court-ordered obligations to render remedial relief to
the specific victims of its prior discriminatory practices.
Specifically, NYCHA urges that “Once remedial relief
has been provided under the Davis consent decree the
Developments can no longer be considered segregated
and the WFP cannot, as a matter of law, be said to per-
petuate segregation there.” (Letter to the Court, dated
May 10, 1999, from Henry Schoenfeld, Esq. at 1).
The Authority made this precise argument to the Court
of Appeals in this case, and the Second Circuit declined
to adopt it. See Davis IV, 166 F.3d 432.'° As a factual
9 This does not mean, as NYCHA posits, that the TSAP
imposes a “quota” or requires that any particular project achieve any
specific level of desegregation. Rather, the TSAP identifies housing
projects that are 30 percent white as infected by past segregation.
Thus, with regard to these identified projects, changes to the TSAP
that significantly perpetuate segregation violate the Fair Housing Act.
10 In the Authority’s brief to the Second Circuit, four pages
were devoted to this argument. Page 16 of the Authority’s brief reads,
“[o]nce the remedial relief under the consent decree is fully imple-
9la
matter, an examination of NYCHA’s own statistics
reveals that victim relief in this case will not desegregate
the Affected Developments.''’ As the following table
demonstrates, even after claimant relief is completed,
every Affected Development will still have white pop-
ulations significantly greater than the prevalence of
whites in the relevant applicant pool.
,
Table #8
Project Total June 1998 After Davis Relief % White
Name Apts #White ZWhite #White % White In App.
Pool
Bay View 1491 520 34.9% 514 34.5% 4.3%
Berry 502 286 §=57.0% 282 56.2% 6.9%
Cassidy-
Lafayette 349 187 53.6% 187 53.6% 35.8%
Forest ;
Hills 383 200 50.9% 198 51.7% 23.1%
Glenwood 1172 362 30.9% 352 30.0% 4.3%
Holmes
Towers 527 161 30.6% 140 26.6% 5.2%
Isaacs 634 234 36.9% 210 33.1% 5.2%
Middletown
Plaza 168 87 51.5% 87 51.8% 1.9%
New Lane 270 197 73.0% 197 73.0% 35.8%
Nostrand 1118 474 42.4% 469 41.9% 4.3%
Pelham
Parkway 1240 420 33.9% 394 31.8% 1.7%
Pomonok 2047 869 42.5% 850 41.5% 3.4%
Robbins
Plaza 148 79 53.4% 79 53.4% 5.2%
Sheepshead
‘Bay 1032 368 35.7% 363 35.2% 4.3%
mented, the working family preference cannot, as a matter of law,
perpetuate segregation.”
” See NYCHA Tenant Statistics By Race, June 30, 1998.
92a
Project Total June 1998 After Davis Relief % White
Name Apts #White %White #White %White In App.
Pool
South Beach 416 223 53.6% 221 53.1% 6.9%
Straus 263 80 30.4% 65 24.7% 5.2%
Todt Hill 501 238 47.5%. 234 46.7% 6.9%
As the table indicates, virtually all of the Affected
Developments will remain at least 30 percent white even
after relief for Davis claimants ends. Thus, these pro-
jects are not desegregated merely because the process of
locating and offering apartments to past victims of dis-
crimination will soon end.
Significantly, the Authority’s interpretation is incon-
sistent with the record upon which the Consent Decree is
based. At the time the Consent Decree was entered in
1992, the NYCHA “admitted to race-conscious admis-
sions practices that led to ‘racial steering’ of white appli-
cants to predominantly white housing projects. Move-in,
move-out data also demonstrated a consistent pattern of
white families being replaced by other white families
over time, a pattern the United States, in its memorandum
in support of the Decree concluded ‘could only occur as
a result of a deliberate racial quota system.’ ” Davis II,
1997 WL 407250 at *10. The Authority has admitted that
its discriminatory practices began as early as 1960, (see
NYCHA Mem. In Support of Fairness and Adequacy of
Consent Decree, at 21 (Oct. 30, 1992)), and the Honor-
able Pierre N. Leval found that these practices persisted
and resulted in segregation in New York City public
housing as late as 1991. See Davis v. New York City
Housing Authority, 1992 U.S. Dist. LEXIS 19965, 1992
WL 420923, *2 (S.D.N.Y. December 30, 1992).!? Under
12 Judge Leval found that:
Plaintiffs’ evidence supports their allegations that during
specified periods of time the Housing Authority selected and
93a
the Consent Decree, however, NYCHA has been required
to extend relief only to plaintiff class members who were
victims of discriminatory practices between 1985 and
1990. See Consent Decree at 9§ 1(g)&(1), 10-39. Because
the victim relief afforded by the Consent Decree is lim-
ited to a subset of the years in which NYCHA practiced
racial steering, the Consent Decree’s remedial relief pro-
visions only go part of the way toward effectuating
desegregation.
NYCHA’s position is also belied by the text and struc-
ture of the Consent Decree. As the Supreme Court has
stated, “the scope of a consent decree must be discerned
within its four corners, and not by reference to what
might satisfy the purposes of one of the parties to it.”
United States v. Armour & Co., 402 U.S. 673, 681-82
(1971). The Consent Decree is not limited to the relief to
be provided to the Davis class members. It also includes
extensive injunctive relief designed to address the past
discriminatory actions of the NYCHA and to ensure the
achievement of a non-discriminatory system and the
elimination of segregation.
assigned applicants for public housing, and tenants request-
ing transfers, to certain housing projects using methods that
resulted in unlawful discrimination against Blacks and His-
panics. These methods included (1) the intermittent use of
codes denoting housing projects to which only white families
could be assigned; (2) the use of zip code and other geo-
graphic restrictions on admission to projects; (3) the use of
racial goals or targets when new projects were “rented up”
and on an ongoing basis thereafter; and (4) the assignment of
families to projects where vacancies were not expected to
arise. The evidence submitted by plaintiffs also supports their
allegations that one or more of these practices continued dur-
ing the period addressed in the Consent Decree (1983 through
1990, and on Staten Island through May 1991). Davis v. New
York City Housing Authority, 1992 WL 420923 at *2.
94a-
For example, NYCHA is “permanently enjoined from
. . adopting and implementing any tenant application,
selection, assignment, and transfer plan, or any such pol-
icy or process, which.gives preference to Applicants or
tenants on the basis of race, color, or national origin.”
Consent Decree, 4 4(a). Other permanent injunctive pro-
visions bar NYCHA from refusing to make rentals or
transfers on the basis of race (¢ 4(b)); making statements
indicating a preference or limitation based on race
({ 4(c)); representing on account of race that apartments
are not anticipating vacancies when they are, in fact,
anticipating vacancies (§ 4(d)); and a number of other
limitations.
These injunctions apply not just to the Affected
Developments as defined in § 1(b)—and indeed, not
just to “Conventional Public Housing” as defined in
q 1(h)—but to all of NYCHA’s housing, “conventional or
otherwise” (44), by requiring NYCHA to operate a race-
neutral tenant-selection system at all of its housing pro-
jects.
Under the Consent Decree, these permanent injunctive
provisions may not be construed to bar remedial relief to
others who do not receive relief under the Consent
Decree. Paragraph 4(j) of the Consent Decree provides:
Nothing in this paragraph shall be deemed to pro-
hibit the provision of remedial relief under this
Consent Decree or remedial relief to any identified
victims of past discrimination on the basis of race,
color or national origin who do not receive relief
under this Consent Decree.
Consent Decree, 4(j).
In addition to the injunctive decrees in 4, NYCHA is
also enjoined to adopt a TSAP and implement it “to pre-
vent any unlawful discrimination on the basis of race,
a ae Pe ee
95a
color, or national origin, in compliance with the Housing
Authority’s obligations therewith under Title VI, the Fair
Housing Act and the implementing regulations and
requirements of HUD.” (45). In implementing the TSAP,
NYCHA is barred from using racial quota systems
(q 7(a)) and neighborhood preferences (4 7(b)). NYCHA
is also enjoined from referring applicants out of turn to
particular projects because of race (4 7(c)). Where a dis-
pute arises concerning whether a change by NYCHA to
the TSAP violates these provisions, as happened here,
NYCHA is permitted, pending resolution by this Court,
to:
implement the proposed modification at its own
risk, but without prejudice to the right of the plain-
tiffs to move the court to enjoin the proposed mod-
ification as inconsistent with the terms of this
Consent Decree, and to seek full and complete relief
for persons harmed by the changes, and any other
appropriate relief authorized by the Fair Housing
Act.
Consent Decree, 9 6(b). This language permits plaintiffs
to seek relief for persons other than and in addition to
those who may have been claimants affected by
NYCHA’s past discrimination.
Unlike other portions of the Consent Decree, which
“sunset” after a period of time, the permanent injunctive
portions of the Decree have no sunset date. Paragraph 50
of the Consent Decree provides:
With the exception of the permanent injunctive pro-
visions, this Consent Decree shall be dissolved eight
years and six months after the date of entry.
Therefore, as these provisions make clear, changes to
the TSAP that violate Title VI and the Fair Housing Act
96a
may be enjoined, and the Court may order any other
relief authorized by those statutes, even after victim-
relief at the Affected Developments expires. Paragraph
4 (j) of the Consent Decree states that the permanent
injunctions may not be construed so as to bar relief for
- persons “who do not receive relief under this Consent
Decree.”
The permanent injunctions in 44 apply not just to the
31 Affected Developments listed in Exhibit A to the
Consent Decree—and, as noted, not just to “Conven-
tional Public Housing” as defined in § 1(h)—but to
all NYCHA housing, “conventional or otherwise.” If
NYCHA were correct that TSAP changes causing
increases in segregation are not actionable after victim-
relief at the Affected Developments ends, then the
extension of the injunction beyond the Affected Devel-
opments to all NYCHA housing, “conventional or oth-
erwise,” would be meaningless.
Paragraph 6(b) of the Consent Decree authorizes the
plaintiffs to seek “full and complete relief” for persons
harmed by changes to the TSAP that violate the Fair
Housing Act. If the Court could not find that increases in
segregation caused by changes to the TSAP violate the
Fair Housing Act after victim-relief ends, as NYCHA
claims, then 4 6(b) would be extraneous, since the Court
could not order full and complete relief once victim-
relief ended. The completion of victim-relief at some
Affected Developments has no bearing on whether a
TSAP change that increases segregation in NYCHA’s
projects are actionable under the Consent Decree.
NYCHA attempts to conflate relief for identified vic-
tims of discrimination with relief designed to effect
desegregation. However, victim relief and relief intended
to eradicate segregation stand on different footings.
-A preference based on race to identified victims of
97a
discrimination is always a permissible equitable remedy.
As the Ninth Circuit has stated, “when. . . a state gives
the identified victims of state discrimination jobs or con-
tracts that were wrongly denied them, the beneficiaries
are not granted a preference ‘on the basis of their race’
but on the basis that they have been individually
wronged.” Coalition for Economic Equity v. Wilson, 122
F.3d 692, 700 n.7 (9th Cir.), cert. denied, 118 S. Ct. 397
(1997); see also City of Richmond v. J.A. Croson CO.,
488 U.S. 469, 526 (1989) (Scalia, J. concurring) (“Noth-
ing prevents Richmond from according a contracting
preference to identified victims of discrimination. While
most of the beneficiaries might be black, neither the ben-
eficiaries nor those disadvantaged by the preference
would be identified on the basis of their race.’’).
By contrast, race-conscious relief designed to eradi-
cate the effects of past segregation is permissible under
both Title VII,'* see Local No. 93, Int’l Ass’n of Fire-
fighters v. City of Cleveland, 478 U.S. 501, 516 (1986),
and the Fourteenth Amendment, see Wygant v. Jackson
Bd. Of Educ., 476 U.S. 267, 287 (1986) (O’Connor, J.,
concurring), even if the relief benefits a class that
includes non-victims, so long as it is narrowly tailored to
serve a compelling state interest. See Milliken v. Bradley,
418 U.S. 717 (1974); United States v. Yonkers Board of
Educ., 837 F.2d 1181, 1236 (2d Cir. 1987). The predicate
for this type of relief is that past segregation actually
affected the class of persons to whom the relief runs,
even if the class includes persons who are not them-
selves victims of discrimination. See e.g., Local No. 93,
13 Title VII and Title VII “are part of a coordinated scheme of
federal civil rights laws enacted to end discrimination; the Supreme
Court has held that both statutes must be construed expansively to
implement that goal.” Huntington Branch, NAACP v. Town of Hunt-
ington, 844 F.2d 926, 934 (2d. Cir.) (noting relevance of Title VII
case law to Title VIII cases), aff’d, 488 U.S. 15 (1988).
98a
478 U.S. at 516 (“It is equally clear that the voluntary
action available to employers and unions seeking to
eradicate race discrimination may include reasonable
race-conscious relief that benefits individuals who were
not actual victims of discrimination.”) (citing Steel-
workers v. Weber, 443 U.S. 193, 61 L. Ed. 2d 480, 99
S. Ct. 2721 (1979)).
The Consent Decree in this case incorporates both
forms of relief. The injunctive provisions of 44 4-8 are
intended to eradicate the effects of past segregation at
NYCHA’s projects, “conventional or otherwise.” The
beneficiaries of the permanent injunctions include both -
victims and non-victims of discrimination. The victim-
specific relief provisions, in contrast, are intended to
afford relief to actual victims of discrimination at 31
designated Affected Developments.
Given that the Consent Decree adopted a comprehen-
sive package of remedies designed to correct segregation
that occurred over decades, it is premature to assume
that segregation has been e
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