946 F.3d 649
5th Cir.2019Background
- The Low-Income Housing Tax Credit (LIHTC) program allocates federal tax credits to state/local Housing Credit Agencies (HCAs) which adopt Qualified Allocation Plans (QAPs) to choose specific projects; Treasury issues program-wide regulations and can recapture credits, but HCAs allocate credits to projects.
- Texas Department of Housing & Community Affairs (TDHCA) uses a comprehensive scoring QAP favoring projects serving lowest-income communities and considering community support; private sponsors choose project sites.
- Inclusive Communities Project (ICP), a Dallas fair-housing nonprofit, alleges LIHTC projects remain racially segregated in Dallas and sued Treasury and the OCC under the Fair Housing Act §3608 and the Fifth Amendment, claiming federal regulators failed to require LIHTC rules that would promote fair housing.
- District court granted summary judgment for Treasury and OCC: ICP lacked Article III standing to sue OCC; the court lacked jurisdiction under the APA for the §3608 claim (no final agency action identified); and ICP’s Fifth Amendment claim failed on the merits.
- On appeal, the Fifth Circuit held ICP lacks standing to sue either Treasury or OCC, affirmed summary judgment as to OCC and the §3608 claim against Treasury, vacated the Fifth Amendment merits ruling, and rendered judgment of dismissal for lack of jurisdiction.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing as to Treasury (causation/redressability) | Treasury has plenary LIHTC authority and could coerce TDHCA and investors via regulation or enforcement, so ICP’s placement costs and project-location injuries are traceable and redressable by injunctive relief. | Causation is too attenuated: TDHCA’s QAP and private sponsors’ site/investor choices break the chain; any Treasury regulation or enforcement likely would not determinatively change project locations; redress is speculative. | No standing: ICP failed to show the required causal chain or that relief would likely redress its injuries. |
| Standing as to OCC (causation/redressability) | OCC’s approval of national banks’ public-welfare investments (PWIs) materially enables bank investment in LIHTC projects sited in minority areas, causing ICP’s injuries. | OCC only approves bank PWIs after TDHCA tentatively allocates credits; OCC does not control TDHCA, sponsors, or other investors; the link is more attenuated and speculative. | No standing: chain of causation is even more attenuated than for Treasury; ICP cannot show relief would likely affect project siting. |
| §3608 / APA jurisdiction (final agency action) | Treasury/OCC have abdicated §3608 duties to ensure LIHTC furthers fair housing; ICP sought agency action under the APA. | ICP did not identify any discrete final agency action subject to judicial review under the APA. | Court affirmed dismissal of the §3608 claim against Treasury (on standing grounds); district-court APA reasoning was noted but the appellate decision rested on lack of standing. |
| Fifth Amendment discrimination claim | Treasury’s inaction amounted to intentional discrimination violating the Fifth Amendment. | ICP provided no evidence of discriminatory intent by Treasury. | Appellate court vacated the district court’s merits ruling and rendered dismissal for want of jurisdiction due to lack of standing. |
Key Cases Cited
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (establishes injury-in-fact, causation, redressability and summary-judgment proof requirements for standing)
- Bennett v. Spear, 520 U.S. 154 (1997) (agency action that has a determinative or coercive effect on a third party can satisfy causation)
- Allen v. Wright, 468 U.S. 737 (1984) (attenuated links between government action and plaintiff injury defeat standing)
- Simon v. Eastern Kentucky Welfare Rights Org., 426 U.S. 26 (1976) (standing lacking where causation and redressability are speculative concerning IRS rulings)
- Town of Chester v. Laroe Estates, Inc., 137 S. Ct. 1645 (2017) (standing rules protect separation-of-powers by preventing courts from usurping political-branch functions)
- Steel Co. v. Citizens for a Better Environment, 523 U.S. 83 (1998) (party invoking jurisdiction bears burden to establish standing)
- Friends of the Earth v. Laidlaw Envtl. Servs., 528 U.S. 167 (2000) (redressability requires that relief likely, not merely speculatively, remedy the injury)
- Texas Dep’t of Housing & Community Affairs v. Inclusive Communities Project, Inc., 135 S. Ct. 2507 (2015) (federal LIHTC policy recognizes distributional preference for low-income areas)