A Year Later, Justice Department Continues Housing Investigation

In September of 2010, that the U.S. Department of Justice was investigating the Town of Darien for possible violations of the Fair Housing Act.

Four months earlier, documents showed, the DOJ's Housing and Civil Enforcement Section had sent a letter to First Selectman Dave Campbell announcing that an inquiry into Darien's inclusionary zoning regulations was under way.

Though details remain scarce about the exact scope of that investigation, a department spokeswoman confirmed last week that it remains ongoing, and correspondences between the DOJ and the town show that investigators have sought additional records from Darien as recently as May.

All of which begs the question: when — and how — will it end?

What It's All About

In the DOJ's initial letter, the department said that it was "interested in understanding the reasons why the Town adopted Section 586 of the Regulations, entitled 'Priority Populations.'"

Darien's inclusionary zoning regulations, approved in 2009 by the Planning and Zoning Commission, require new multifamily developments and subdivisions of five or more houses to set aside at least 12 percent of their units as affordable ("below-market-rate").

The "priority populations" clause highlighted by the DOJ — by P&Z in November — established certain town-centric categories of applicants for those units who would be given preference over others. The list included local first responders, those employed by the town or school system, and various classes of people who work, live, or have previously lived in Darien.

But in a town , such a residency policy could potentially run afoul the FHA by making it exceptionally difficult for those of minority status to access affordable housing. The act forbids housing bias on the basis of race, color, national origin, and other protected categories.

Town officials have said that — far from shutting out would-be minority residents — the goal of the section was to increase local housing opportunities.

"This particular part of the regulation was strongly urged by SWRPA [South Western Regional Planning Agency] in particular, because a lot of the constituency in the town was concerned about the fact that people had to travel so far, and that was very inefficient—particularly inefficient—for emergency services," said P&Z vice chair Joe Spain in November, as the commission met to rewrite the provision.

"The intentions by passing this were completely genuine, and were focused on a very specific need, and were not designed to be exclusionary but rather to address that specific need," P&Z Chairman Fred Conze said at the time.

Notably, the priority populations clause was never applied, because no qualifying developments were approved during its brief existence.

And as a result of November's vote, that section of the regulations now simply states that "all dwelling units shall be offered for sale or rent in compliance with all applicable federal and state Fair Housing laws."

'What is the History?'

But Diane Houk, an attorney who specializes in housing discrimination matters, said that the body of evidence in such cases isn't necessarily limited to the specific ordinance or regulation in question.

"I can say that when a plaintiff is challenging a town's zoning ordinances ... one of the types of evidence that courts look at is 'What is the history of that town's decision-making in similar situations?'" Houk said.

"Have proposals for affordable housing been rejected before? Have residency preferences been required as part of a plan with the developer?" Houk added.

Houk, who served in the DOJ's Housing & Civil Enforcement Section from 1991 to 2004, said the department might look favorably on a town's decision to revise a law targeted in an investigation.

"If the town has since amended the ordinance to remove or change the reisdency preferences in a way that has a concrete positive impact, then those are facts that I think anyone would want to take into account," Houk said. But, she added, "It may be they've made it a little better but not enough better."

And depending on the case, Houk said, a law or regulation might be considered discriminatory "on its face" such that "you don't have to wait until the harm happens."

"The very fact of having these residential preferences may chill the efforts of developers of affordable housing from ever coming forward and ever creating housing opportunities," Houk said.

What's Next?

Since the DOJ's initial letter, documents show there have been at least a dozen communications between the Department of Justice and Town Counsel Wayne Fox — several coming as recently as May.

The exchanges include a list of records provided to the DOJ, questions about federal funding received — or not received — by the town, a FOIA request for complaints filed against Darien, and a discussion as to whether documents relevant to the investigation had been destroyed by the Town Clerk. (See below for a full account of the exchanges.)

Fox said in an inteview last week that the town has given investigators "virtually everything" requested of them.

"What is sometimes a little disappointing is they appear to obtain information from inviduals that may have had an unpleasant experience with the town" who make "claims with no factual foundation," he said.

"I can't control that ... we deal with them one issue at a time," Fox added.

Despite the fact that the correspondences cover a period of more than a year, Houk said it's not a clear sign that a lawsuit is forthcoming.

"It does not necessarily mean there will be a lawsuit," Houk said. "Investigations can take a long time, particularly when it involves local governments."

Houk said that an inquiry of this nature normally ends in one of two ways: a letter to the town stating that the department is closing its investigation, or a "pre-suit notice letter" announcing that it wants to discuss a settlement.

But "there's no timeline in particular" to that process, she added, meaning closure on the investigation may just have to wait.

Investigation Timeline

The following is a timeline of communications between the Department of Justice and Town Counsel Wayne Fox since the beginning of the DOJ's investigation:

• May 4, 2010: The DOJ announces in a letter to First Selectmen Dave Campbell that it has begun an investigation and requests a wide range of records pertaining to inclusionary zoning and affordable housing.
• June 15: Town Counsel Wayne Fox submits DVDs, minutes, memos, regulation drafts, and other information to the DOJ. He writes that he is not aware of any federal housing or community development grants/subsidies that Darien has received since 2007.
• September 23: Under the Freedom of Information Act, Fox requests a copy of "any and all complaints that were filed with the Department of Justice or other federal agency alleging a violation ... of the Federal Fair Housing Act or any other federal statement."
• October 1: Fox responds to questions from trial attorney Neta Borshansky as to whether the town had, in fact, received any federal housing or community development grants/subsidies. Fox offers more detail but says it his still his understanding that no such funds were received.
• October 7: Borshansky responds to Fox's FOI request stating that there were no complaints matching his description (and that such complaints would be exempt from FOIA anyway due to their role in an ongoing enforcement action).
• November 9: Fox notifies Borshansky that the P&Z commission is considering a change to the priority populations clause.
• November 26: Investigators meet with four current and former town officials: First Selectman Dave Campbell, former First Selectman Evonne Klein, P&Z director Jeremy Ginsberg, and Charlotte Suhler, former chair of the Darien Affordable Housing Advisory Commission.
• December 17: Borshansky writes to ask if Fox is representing four individuals in the matter: Suhler, Katherine Molgano (executive director of the Darien Housing Authority), Jennifer Schwartz (former chair of the Darien Housing Authority), and Andrea Aldrich (former manager of community development services).
• January 4, 2011: Fox responds that he is, in fact, representing all four people.
• May 6: Borshanksy asks for clarification about documents relevant to the case that "may have been destroyed" and that "were not disclosed to our office by the Town of Darien."
• May 12: Fox responds that while the town received routine permission from the state to destroy certain nonessential documents, no meeting minutes have been destroyed. But "it does appear that in some instances [DAHAC] failed to file minutes with the Town Clerk," he writes, apparently including four meetings from late 2008 and early 2009. Fox states that developer Chris Hamer — who unsuccessfully applied to build ten affordable housing units on Oak Crest in 2008 — had sent a May 2 email claiming that minutes were "trashed." (Reached by phone last week, Hamer declined to comment on the matter other than to say that he never accused the town of trashing minutes.)
• May 18: Borshansky follows up a conversation between her and Fox to confirm that "as discussed, the Town will not destory documents that relate to the subject of our investigation or to our request of May 2010." On the same day, Fox sends a letter to Borshanksy and encloses a copy of the authorization given by the state to destroy certain documents.