Cameron Cty v. Port Isabel

Case: 19-40717 Document: 00515866399 Page: 1 Date Filed: 05/18/2021
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
FILED
May 18, 2021
No. 19-40717 Lyle W. Cayce
Clerk
Cameron County Housing Authority; Community
Housing & Economic Development Corporation,
Plaintiffs—Appellants,
versus
City of Port Isabel; City of Port Isabel City
Commission; Port Isabel Planning and Zoning
Commission,
Defendants—Appellees.
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 1:17-CV-229
Before Smith, Ho, and Oldham, Circuit Judges.
Andrew S. Oldham, Circuit Judge:
Hurricane Dolly severely damaged a public housing development in
Port Isabel, Texas (the “City”). The Cameron County Housing Authority
(“CCHA”) operated the complex and received conditional grant money to
rebuild it. But the grant fell through. CCHA responded by suing the City
under the Fair Housing Act (“FHA”) and other statutes. The district court
dismissed the FHA claims for lack of standing. We affirm.
Case: 19-40717 Document: 00515866399 Page: 2 Date Filed: 05/18/2021
No. 19-40717
I.
Plaintiff CCHA provides affordable housing to low-income families in
Cameron County, Texas. According to its executive director, roughly 99% of
its tenants are “Hispanic/Latino.” Plaintiff Community Housing &
Economic Development Corporation (“CHEDC”) is a public facility
corporation wholly owned by CCHA (collectively “Plaintiffs”). Prior to
2008, CHEDC owned and CCHA operated the 16-unit Neptune Apartment
Complex in Port Isabel, Texas. Then Hurricane Dolly struck the region and
rendered the complex uninhabitable. Plaintiffs lacked funds to redevelop the
property, so the Neptune Apartments sat vacant for several years.
In April 2014, Plaintiffs applied for a federal disaster-recovery grant
through the Lower Rio Grande Valley Development Council (“LRGVDC”)
to rebuild the Neptune Apartments as a 26-unit complex. LRGVDC
approved the project and authorized more than $1.7 million in grant money.
But it conditioned the funds on Plaintiffs’ ability to begin construction by
December 1, 2015.
Plaintiffs failed to perform due diligence on whether their proposed
project complied with City zoning requirements. They eventually discovered
it did not. So in February 2015—10 months after receiving the grant from
LRGVDC—Plaintiffs approached the City and asked for rezoning.
City procedures required Plaintiffs to pass through a two-step process.
Plaintiffs began by submitting their rezoning request to the City’s Planning
and Zoning Commission (“P&Z Commission”). The P&Z Commission
would then make a preliminary recommendation and transmit it to the City
Commission for a final decision. Only the City Commission could make
zoning changes.
The P&Z Commission held a public hearing on Plaintiffs’ rezoning
request in March 2015. Several Port Isabel residents appeared at the hearing
2
Case: 19-40717 Document: 00515866399 Page: 3 Date Filed: 05/18/2021
No. 19-40717
to voice their opposition. A number of these residents, some of whom were
white, expressed concern about the construction of a multi-family, mixed-
income housing complex near their single-family homes. After hearing these
concerns, the P&Z Commission unanimously recommended denying
Plaintiffs’ request. P&Z Secretary Ramona Alcantara explained that the
Commission’s decision was “absolutely not” based on discrimination and
noted that “most of the people on the . . . commission are Hispanics.” She
added that the recommendation was instead “about safety, congestion,
density, [and] parking” and that Plaintiffs’ 26-unit apartment design
“wasn’t a good plan for th[e] neighborhood.”
Rather than push for the City Commission to approve rezoning over
the P&Z Commission’s negative recommendation, Plaintiffs thought it
better to address the public’s opposition directly. They spent the next several
months working with nonprofit housing organizations on a community-
engagement effort that included knocking on doors, handing out flyers, and
meeting with residents and leaders. Based on the feedback they received,
Plaintiffs developed a new plan for the Neptune Apartments that reduced the
number of units from 26 to 16. LRGVDC approved the plan and reduced
funding for the project from $1.7 million to just over $1 million.
Plaintiffs submitted their revised 16-unit plan to the P&Z Commission
for consideration at a hearing on June 10, 2015. Before the scheduled hearing,
City Manager Jared Hockema spoke with CCHA’s executive director Daisy
Flores. Flores was unable to answer Hockema’s questions about the
building’s height, setback, parking, and unit sizes—“the same questions that
the P&Z [Commission] would be asking her.” So Hockema suggested that
Flores delay the hearing, “work on her proposal more,” and come back with
“concrete changes” that would address the P&Z Commission’s questions.
Flores took Hockema to say that the hearing would be “explosive and
embarrassing” if she moved forward, and she decided to cancel it.
3
Case: 19-40717 Document: 00515866399 Page: 4 Date Filed: 05/18/2021
No. 19-40717
Plaintiffs subsequently developed a 16-unit plan that didn’t require
any rezoning. Flores met with City officials to discuss the plan in September
2015—a mere three months before LRGVDC’s December 1 deadline. The
City responded that it wouldn’t issue the required building permits unless
Plaintiffs “reduced the number of units on the Neptune site from 16 to 10.”
So Plaintiffs came up with a new plan and presented it for LRGVDC’s
approval. On September 28, LRGVDC sent Flores a letter stating that
funding for the project would be reduced by more than $400,000. The letter
reiterated that “[t]he project must have closed and have permitting approved
by 12/1/15” and informed Flores that “LRGVDC w[ould] need to withdraw
[all] funds” if Plaintiffs failed to comply.
Plaintiffs submitted their 10-unit plan to City Building Inspector Larry
Ellis on October 28. Ellis joined Hockema and the City Mayor for a meeting
with Plaintiffs on November 10. The officials told Plaintiffs at the meeting
that the City “would not issue any permits for any multi-family buildings”
and “would only issue permits for four single-family houses.” So Plaintiffs
returned to LRGVDC once more and requested that the organization amend
the project to four units. Plaintiffs reported that the City would issue the four
building permits later that week.
This time LRGVDC refused. Its executive director told Flores on
November 24 that the organization would stand by its prior approval of the
10-unit project as well as the December 1 permitting deadline. Flores
responded that Plaintiffs could “not close on the . . . grant award [by]
December 1” because “the City of Port Isabel has indicated that they will
only approve building permits for four single family houses.” December 1
came and went, and LRGVDC never issued the funds. The Neptune project
died.
4
Case: 19-40717 Document: 00515866399 Page: 5 Date Filed: 05/18/2021
No. 19-40717
Plaintiffs filed this lawsuit against the City, the City Commission, and
the P&Z Commission two years later. They asserted violations of the Fair
Housing Act and various other federal statutes. The district court granted
summary judgment to the City Commission and the P&Z Commission after
finding they were not independent entities that could be sued. The district
court granted summary judgment to the City after determining that Plaintiffs
lacked standing to bring their FHA claims and that their other claims failed
on the merits.
Plaintiffs timely appealed. Because they limit their appeal to the
district court’s dismissal of their FHA claims against the City, the only issue
before us is whether Plaintiffs have standing to bring those claims. See United
States ex rel. Drummond v. BestCare Lab’y Servs., L.L.C., 950 F.3d 277, 284
(5th Cir. 2020). We review the district court’s standing determination de
novo. Williams v. Parker, 843 F.3d 617, 620 (5th Cir. 2016).
II.
A plaintiff that “invok[es] federal jurisdiction bears the burden of
establishing” standing. Lujan v. Defs. of Wildlife, 504 U.S. 555, 561 (1992).
The familiar elements of standing are (1) an injury in fact that (2) is fairly
traceable to the challenged conduct of the defendant and (3) is likely to be
redressed by a favorable judicial decision. Ctr. for Biological Diversity v. EPA,
937 F.3d 533, 536 (5th Cir. 2019) (citing Gill v. Whitford, 138 S. Ct. 1916, 1929
(2018)). Because we are at the summary judgment stage, Plaintiffs “must set
forth by affidavit or other evidence specific facts” that create a genuine
dispute as to their standing. Lujan, 504 U.S. at 561 (quotations omitted);
Fed. R. Civ. P. 56(a).
A.
Injury in fact is the starting point. “To establish injury in fact, a
plaintiff must show that he or she suffered an invasion of a legally protected
5
Case: 19-40717 Document: 00515866399 Page: 6 Date Filed: 05/18/2021
No. 19-40717
interest that is concrete and particularized and actual or imminent, not
conjectural or hypothetical.” Ctr. for Biological Diversity, 937 F.3d at 537
(quotation omitted).
Plaintiffs have taken great care to specify the nature and timing of the
injury in this case. Their opening brief describes their injury as an inability to
use any federal grant funds to “rebuild[] the Neptune Apartments.” Blue Br.
20–21. Their reply brief clarifies that “Plaintiff[s’] claims under the . . . Fair
Housing Act were not ripe until December 2015, when Plaintiffs lost the
federal grant funds” in their entirety. Grey Br. 12–13. Thus, Plaintiffs do not
claim injury from the reduction in LRGVDC funding that would’ve occurred
had the City approved their alternative 16- or 10-unit plans. Plaintiffs assert
instead that they “did not have a complete and present cause of action” until
all the funds disappeared on December 1, 2015. Id. at 15 (quotation omitted).
Plaintiffs had a reason to frame their injury this way: they needed a
theory that would make their November 2017 lawsuit timely under the
FHA’s two-year statute of limitations. See 42 U.S.C. § 3613(a)(1)(A).
Focusing on December 1, 2015, gave them a few weeks to spare. What’s
more, Plaintiffs doubled and then tripled down on their December 1 injury
theory at oral argument. This exchange took place during Plaintiffs’ top-side
argument:
The Court: . . . [W]hat I’m trying to figure out is where
exactly does the injury in fact for Article III purposes kick in.
Counsel: When the funds go away entirely.
The Court: On December 1 is when you get injured?
Counsel: Precisely.
The Court: So if [the City] had come to you and said “four
units is good,” and you had said “okay great,” and the third-
party lender had said “great, we’re going to close on four,” and
you closed on November 30, you wouldn’t be injured?
6
Case: 19-40717 Document: 00515866399 Page: 7 Date Filed: 05/18/2021
No. 19-40717
Counsel: I think that’s right, Your Honor. I think that’s
right. . . .
Oral Argument at 19:34–20:03. And this exchange took place during
Plaintiffs’ rebuttal:
The Court: . . . Could your client have sued [in March 2015
after the initial P&Z hearing] . . . ?
Counsel: The damages at that time I think weren’t clear,
Your Honor, because we still had access to the funding; we
still—we had time, we had months to go and try and make this
come to fruition.
The Court: So you didn’t have a claim in March?
Counsel: I don’t think it was ripe at that time, Your Honor.
The Court: What about June?
Counsel: I don’t believe so.
The Court: And not July—really not until December 1?
Counsel: That’s my—that’s our position. On December 1,
when the Federal Government says these funds are gone, our
claim becomes fully ripe. . . .
Id. at 56:58–57:41.* We take Plaintiffs at their word. See Bernhard v. Whitney
Nat’l Bank, 523 F.3d 546, 551 (5th Cir. 2008). Thus the “injury in fact” of
which they complain is the total elimination of federal funding that occurred
on December 1, 2015. Competent summary judgment evidence supports that
asserted injury. So the next question is whether the injury is fairly traceable
to the City.
*
The block quotations have been modified for clarity but are materially identical to
the discussion that took place at argument. The full discussion is available at
https://www.ca5.uscourts.gov/OralArgRecordings/19/19-40717_1-8-2021.mp3.
7
Case: 19-40717 Document: 00515866399 Page: 8 Date Filed: 05/18/2021
No. 19-40717
B.
It is not. Standing requires a “causal connection between the injury
and the conduct complained of.” Lujan, 504 U.S. at 560. This connection is
lacking where “the challenged action of the defendant [is] . . . the result of
the independent action of some third party not before the court.” Ibid.
(quotation omitted). Obviously, it’s also lacking where the plaintiff’s injury
is self-inflicted. See Ctr. for Biological Diversity, 937 F.3d at 540–41.
Here, the summary judgment record makes clear that Plaintiffs’
December 1 loss of federal funding was the combined result of third-party
actions and self-inflicted harm. LRGVDC, not the City, set the December 1
deadline for Plaintiffs to begin construction. Plaintiffs let half of their allotted
time evaporate before they requested rezoning. That was not the City’s fault.
When the P&Z Commission recommended denying Plaintiffs’ request, they
did not pursue a favorable ruling from the City Commission; they opted
instead to conduct a community-engagement effort and submit a new plan to
the P&Z Commission three months later. On the day of the P&Z
Commission’s scheduled hearing to consider the revised plan, Plaintiffs
withdrew it. Then they waited until September 2015 to present a new 16-unit
plan to City officials. At that point, 17 months had passed since LRGVDC
conditionally granted funding to the Plaintiffs. And three months remained
until the December 1 deadline. Plaintiffs were in a pinch—but it was a pinch
of their (and LRGVDC’s) own making.
It’s true that the City assumed a more active role during the last few
months of Plaintiffs’ scramble to secure funding: City officials rejected the
16-unit plan in September and rejected a subsequent 10-unit plan in
November. But it’s also irrelevant. As discussed above, Plaintiffs have
repeatedly disclaimed any injury predating the complete loss of funds that
occurred on December 1. And when we focus on that December 1 injury, it’s
8
Case: 19-40717 Document: 00515866399 Page: 9 Date Filed: 05/18/2021
No. 19-40717
clear the City had nothing to do with it. In fact, the City took steps to help
Plaintiffs avoid their asserted injury by agreeing to approve a four-unit
project. It was LRGVDC that sank the four-unit proposal, and it was
LRGVDC that enforced the December 1 deadline. Thus, Plaintiffs’ injury is
not fairly traceable to the City. See Lujan, 504 U.S. at 560.
AFFIRMED.
9