[Editors' Note: This posting is reprinted with permission from the Inverse Condemnation blog.]
Ah, Williamson County. We've ranted about it before, so we won't do so here (again). But takings mavens know that a property owner must meet two tests before she can raise a takings claim against a state or local government in federal court: the state or local government must have reached a final decision on the uses to which her property may be put, and she must seek (and be denied) just compensation via state procedures.
We've always viewed both parts of the test as very "takings-specific" and not really applicable to other areas. The rationale supporting the final decision requirement is that a court really can't tell whether property has been "taken" until it understands what uses may be allowed by the state or local government. Absent such a decision, the government may allow some economically beneficial use. Similarly, the state procedures test rationale is that a property owner has not had its property taken "without just compensation" until the state has denied recovery via an inverse condemnation or regulatorty takings claim in state court. We don't agree with that reasoning, but there it is. But the courts have not read the final decision requirement of Williamson County so strictly, and have, as of late, applied it to a variety of non-takings claims, including substantive due process, RLUIPA, and others.
Now, the Second Circuit, has extended it to claims under the Americans With Disabilities Act in Sunrise Detox V, LLC v. City of White Plains, No. 13-2911 (Oct. 2, 2014). There, the plaintiff was denied permission to operate a treatment facility, and it brought suit under the ADA, asserting intentional discrimination and failure to offer a reasonable accommodation on the part of the City, and seeking an injunction. The district court dismissed because Sunrise had not sought a variance. The Second Circuit agreed.
While it acknowledged that Williamson County was a takings doctine ("The argument is not without appeal."), it held that because Sunrise was seeking an injunction and not money damages:
We need not address here whether a property owner who claimed that a local official vetoed his or her development project out of hostility based on the owner's race, gender, disability, or the like, in violation of federal statutory or constitutional law, could seek immediate recompense in federal court from that official for the dignitary or emotional harm inflicted by the official even in the absence of a final decision on the development proposal or without pursuing an administrative appeal of that action. That question is not presented in this case, because Sunrise does not seek compensatory damages from the official who it claims acted out of discriminatory motivation, but rather seeks an injunction blocking the disapproval and authorizing construction of its project. Regardless of the basis of the claim that the local action violated federal rights, the relief sought brings the case squarely within the compass of Williamson County and its progeny.
Even if it were true that the challenged rejection by the Building Department was the product of a discriminatory motivation on the part of the official who issued it, that illegal act would not necessarily require, as a remedy, the issuance of a permit to Sunrise. If Sunrise proceeds with its application, the rejection may be reversed, and the project may be permitted to proceed—or the application may be rejected on other, non-discriminatory grounds. Only after Sunrise completes the process will it be known whether the allegedly discriminatory decision of the official had any effect at all on Sunrise's application.
Slip op. at 12-13.
We can't quite agree with the statement that "[e]ven if it were true that the challenged rejection by the Building Department was the product of a discriminatory motivation on the part of the official who issued it, that illegal act would not necessarily require, as a remedy, the issuance of a permit to Sunrise." Why not? If the only reason the permit was denied was a bad one, then wouldn't an injunction requiring the Building Department to stop using that bad reason as the reason to deny a permit mean that the permit must be issued? And how is the availability of a "variance" or administrative relief from the Building Department’s denial — if, indeed, the administrative process is even capable of remedying intentional misconduct by agency officials — a true remedy for the (allegedly) discriminatory conduct?
The court tried to carve out exceptions to this rule:
We think, therefore, that a plaintiff alleging discrimination in the context of a land-use dispute is subject to the final-decision requirement unless he can show that he suffered some injury independent of the challenged land-use decision. Thus, for example, a plaintiff need not await a final decision to challenge a zoning policy that is discriminatory on its face, Jackson v. Okaloosa Cnty., Fla., 21 F.3d 1531, 1541 (11th Cir. 1994), or the manipulation of a zoning process out of discriminatory animus to avoid a final decision, Groome Res. Ltd. v. Parish of Jefferson, 234 F.3d 192, 199–200 (5th Cir. 2000). In those cases, "pursuit of a further administrative decision would do nothing to further define [the] injury," and the "claim should not be subject to the application of the Williamson ripeness test." Dougherty, 282 F.3d at 90.
Slip op. at 13-14.
In other words, it's OK to intentionally discriminate in the land entitlement process, as long as the only harm is denial of the entitlement sought, and there's some possible administrative relief down the line that might correct the result in the issuance of the permissions.
Until then, don't come crying to federal court, at least not in the Second Circuit.