World Outreach Conference Center v. City of Chicago by Mauck Baker

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No. 13-3669 and 13-3728 ______________________________________________________________________________

IN THE UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT

______________________________________________________________________________ World Outreach Conference Center and Pastor Pamela Blossom, Plaintiffs-Appellants, v. The City of Chicago, Defendant-Appellee. ______________________________________________________________________________ Appeal from the United States District Court for the Northern District of Illinois No. 06-cv-2891, Honorable Judge Joan H. Lefkow _________________________________________________ Brief of the Plaintiffs-Appellants World Outreach Conference Center and Pastor Pamela Blossom _________________________________________________ John W. Mauck Andy Norman Noel W. Sterett Mauck & Baker, LLC One N. LaSalle Street, Suite 600 Chicago, IL 60602 P: (312) 726-1243 F: (866) 619â&#x20AC;&#x201C;8661 Counsel for Appellants Oral Argument Requested

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CIRCUIT RULE 26.1 DISCLOSURE STATEMENT (1) The full name of every party that the attorney represents in this case: World Outreach Conference Center and Pastor Pamela Blossom (2) The name of all law firms whose partners or associates have appeared for the party in the case (including proceedings in the district court or before an administrative agency) or are expected to appear for the party in this court. Mauck & Baker, LLC (3) (i) (ii)

There are no parent corporations. This is a not-for-profit corporation. There are no publicly held companies that own 10% or more of the party’s stock.

Attorney’s Signature: /s/ Andy Norman__________ Date: April 16, 2014_ Attorney’s Printed Name: _Andy Norman____ Counsel of Record pursuant to Circuit Rule 3(d)

Yes:

Address: Mauck & Baker, LLC, One N. LaSalle Street, Suite 600, Chicago, IL 60602 Phone Number: (312) 726–1243

Fax Number: (866) 619–8661

Email Address: anorman@mauckbaker.com

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TABLE OF CONTENTS Page CIRCUIT RULE 26.1 DISCLOSURE STATEMENT .................................................... i TABLE OF CONTENTS ................................................................................................ ii TABLE OF AUTHORITIES ......................................................................................... iv JURISDICTIONAL STATEMENT ............................................................................... 1 ISSUES PRESENTED FOR REVIEW ......................................................................... 4 STATEMENT OF THE CASE....................................................................................... 5 1. The YMCA’s use of the property......................................................................... 7 2. World Outreach Conference Center’s use of the property ............................... 10 3. The involvement of Ninth Ward Alderman Anthony Beale ............................ 14 4. The City’s response to World Outreach’s purchase of the property ................ 16 5. The City approves Alderman Beale’s proposed rezoning and continues the Property inspections ......................................................................................... 19 6. World Outreach notifies the Mayor’s office, and attempts to house Hurricane Katrina victims ................................................................................................. 19 7. The City sues World Outreach and continues its demand for an SUP........... 23 WORLD OUTREACH’S TIMELINE........................................................................... 28 SUMMARY OF ARGUMENT ..................................................................................... 31 ARGUMENT ................................................................................................................ 32 I.

Introduction. ...................................................................................................... 32

II. III.

Standard of Review. .......................................................................................... 32 The District Court erred in measuring RLUIPA substantial burden by the “effectively impracticable” test ......................................................................... 32 ii

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IV.

The District Court erred in imposing an obligation on World Outreach to demonstrate their lawful nonconforming use to the City .............................. 41

The District Court erred in not finding that the City substantially burdened World Outreach by failing to approve the community center license in 2005. .................................................................................................. 47

VI.

The District Court erred in concluding that World Outreach caused the two year delay in licensing by failing to file for licenses and permits. .................. 49

VII.

The District Court erred in concluding that World Outreach caused the two year delay in licensing by not performing repairs ........................................... 51

CONCLUSION............................................................................................................. 53 CERTIFICATE OF COMPLIANCE WITH F.R.A.P. 32(a)(7)(B) ............................... 55 CERTIFICATE OF COMPLIANCE WITH F.R.A.P. 30(d) ........................................ 56 CERTIFICATE OF SERVICE ..................................................................................... 57

iii

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TABLE OF AUTHORITIES FEDERAL CASES

Page

Civil Liberties for Urban Believers v. City of Chicago, 342 F. 3d 752 (7th Cir. 2003) ............................................................................ 34 Creek v. Westhaven, 144 F. 3d 441 (7th Cir. 1998) ............................................................................ 36 Eagle Cove Camp v. Woodboro, 734 F. 3d 673 (7th Cir. 2013) ............................................................................ 32 Kaku Nagano v. Brownell, 212 F. 2d 262 (7th Cir. 1954) ............................................................................ 35 Roman Catholic Bishop v. Springfield, 724 F. 3d 78 (1st Cir. 2013) ........................................................................ 32, 37 Saints Constantine & Helen v. New Berlin, 396 F. 3d 895 (7th Cir. 2005) ................................................................ 33, 41, 51 Shrewsbury Edgemere Associates LP v. Board of Appeals, 565 N.E. 2d 1214 (Mass. 1991) ......................................................................... 43 Waid v. Merrill Area Public Schools, 130 F. 3d 1268 (7th Cir. 1997) .......................................................................... 35 World Outreach Conference Center v. City of Chicago, 2008 U.S. Dist. LEXIS 88747 (N.D. Ill. May 13, 2008) ..................................... 6 World Outreach Conference Center v. City of Chicago, 591 F. 3d 531 (7th Cir. 2009) ............................................................................ 41 World Outreach Conference Center v. City of Chicago, 2013 U.S. Dist. LEXIS 46943 (N.D. Ill. April 1, 2013) .............................passim STATE COURT CASES

Page

Bainter v. Village of Algonquin, 675 N.E. 2d 120 (Ill. App. 1996) ................................................................. 43, 45 Illinois Life Insurance Co. v. City of Chicago, 244 Ill. App. 185 (1927) ............................................................................... 43, 45 iv

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STATUTES, RULES, ORDINANCES, AND OTHER AUTHORITIES 28 U.S.C. § 1291 (2014) ................................................................................................. 1 28 U.S.C. § 1331 (2014) ................................................................................................. 1 28 U.S.C. § 1343 (2014) ................................................................................................. 1 28 U.S.C. § 1367 ............................................................................................................. 1 42 U.S.C. § 1988 (2014) ................................................................................................. 1 Chicago Zoning Ordinance § 17-15-0101 ............................................................................................................. 9, 17 Chicago Zoning Ordinance § 17-15-0103 ............................................................................................................. 9, 17 Chicago Zoning Ordinance § 17-15-0106 ................................................................................................................... 9 Illinois’s Religious Freedom Restoration Act 775 ILCS 35/1 et seq ....................................................................................... 1, 2 Religious Land Use and Institutionalized Persons Act of 2000 (RLUIPA) U.S.C. §§2000cc(a)(1) ............................................................................................passim Religious Land Use and Institutionalized Persons Act of 2000 (RLUIPA) U.S.C. §§2000cc – 3(g) ................................................................................................. 33 Religious Land Use and Institutionalized Persons Act of 2000 (RLUIPA) U.S.C. §§2000cc – 5(7) ................................................................................................. 33 SECONDARY SOURCES Bernstein, Abandoning the Use of Abstract Formulations in Interpreting RLUIPA’s Substantial Burden Provision in Religious Land Use Cases, 36 Colum. J.L. & Arts 283, 285 (Winter 2013) ................................................................................................ 34

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JURISDICTIONAL STATEMENT I.

District Court subject-matter jurisdiction. The district court had federal question jurisdiction. 28 U.S.C. § 1331 and 1343

(2014). Plaintiffs-appellants World Outreach Conference Center and its director, Pastor Pamela Blossom (collectively “World Outreach”) claim that the City of Chicago (“City”) violated their rights under the Religious Land Use and Institutionalized Persons Act of 2000 (“RLUIPA”), 42 U.S.C. §§2000cc(a)(1), and the United States Constitution’s free exercise and equal protection clauses. The Plaintiffs also raise a claim under the Illinois’s Religious Freedom Restoration Act, 775 ILCS 35/1 et seq., over which the district court had supplemental jurisdiction pursuant to 28 U.S.C. § 1367. II.

Court of Appeals jurisdiction. This Court has jurisdiction under 28 U.S.C. § 1291. This is an appeal from the

District Court of a final judgment disposing of all claims. The only matter left in the district court is Plaintiffs’ claim to attorney’s fees under 42 U.S.C. § 1988. (World Outreach’s right to a larger amount of damages is on appeal.) On November 5, 2013, the District Court stayed Plaintiffs’ claim to attorney’s fees pending the outcome of this appeal. [Dkt. 270]. III.

Timeliness of the appeal.

On December 30, 2009, this Court reversed dismissal of Plaintiffs’ amended complaint in part and affirmed it in part. World Outreach Conf. Ctr. v. City of

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Chicago, 591 F.3d 531, 533-37 (7th Cir. Ill. 2009)(“World Outreach I”). This Court held that World Outreach sufficiently stated: 1. A RLUIPA substantial burden claim under, 42 U.S.C. §§2000cc(a)(1), Illinois’s Religious Freedom Restoration Act, 775 ILCS 35/1 et seq., and the Free Exercise Clause of the United States Constitution—all of which, the Court held, involved the same analysis. Id. at 533-534, 538. ; and 2. A class-of-one Equal Protection claim under the Equal Protection Clause of the United States Constitution. Id. at 538. After remand, the parties conducted discovery and filed cross-motions for summary judgment. On April 1, 2013, [Dkt. 246, Dkt. 247] the District Court granted summary judgment for World Outreach in part and denied it in part, and granted summary judgment for the City in part and denied it in part. The Court held the City imposed a substantial burden on World Outreach with its meritless municipal lawsuit in filed on December 14, 2005; and for damages World Outreach was entitled to costs and attorney's fees owed to defend the meritless suit—an amount which was in dispute. The Court granted summary judgment to the City on all other claims to relief and damages. On April 29, 2013, [Dkt. 248], World Outreach filed a motion pursuant to Fed. R. Civ. P. 59(e), which tolled the time to appeal under FRAP 4(a)(4)(A)(iv). On June 10, 2013, the Court amended its judgment in accordance with FRCP 58 [Short App. at B, p. 31], holding again that World Outreach was entitled to fees and costs in

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responding to the meritless lawsuit, but no other relief. Thereafter, the parties settled the amount of those fees and expenses at $15,000. The District Court entered final judgment on November 5, 2013 [Dkt. 270]. World Outreach and Blossom filed their notice of appeal on November 26, 2013, vesting this court with jurisdiction. The City filed a notice of cross appeal on December 6, 2013.

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ISSUES PRESENTED FOR REVIEW 1. Whether the District Court erred in awarding summary judgment in part to the City, and/or erred in failing to award summary judgment to the World Outreach on all of the RLUIPA substantial burden issues. 2. Whether the District Court erred in measuring RLUIPA substantial burden by the â&#x20AC;&#x153;effectively impracticableâ&#x20AC;? test. 3. Whether the District Court erred in imposing an obligation on World Outreach to demonstrate their lawful nonconforming use to the City. 4. Whether the District Court erred in not finding that the City substantially burdened World Outreach by failing to approve the community center license in 2005. 5. Whether the District Court erred in concluding that World Outreach caused the two year delay in licensing by failing to file for licenses and permits or by not performing repairs.

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STATEMENT OF THE CASE This case is about the City’s extended campaign to prohibit World Outreach from continuing the lawful nonconforming uses of the Roseland YMCA for the benefit of the needy in the Roseland community. This Court must decide whether the cumulative burdens imposed by the City on World Outreach, “a small religious organization catering to the poor,” were “substantial” in violation of RLUIPA, 42 U.S.C. §§2000cc(a)(1), so that World Outreach may recover the damages, costs, and attorneys’ fees incurred from the City’s campaign. The City began the litigation controversy on December 14, 2005 by filing a sixcount suit in Cook County Circuit Court seeking inter alia a “finding that World Outreach’s activities [the continued operation of a community center and religious assembly at the property] are illegal and an injunction requiring Defendants to cease their illegal activities immediately” unless it obtains a Special Use Permit (“SUP”). [Dkt. 213-3 at p. 3.] One day after World Outreach showed the City the counterclaim it intended to file asserting its rights to continue the YMCA uses as legal nonconforming uses, the City, on April 7, 2006, voluntarily dismissed its complaint. On April 12, 2006, World Outreach and Blossom filed that proposed counterclaim as a new complaint in Cook County Circuit Court alleging they had a right to continue the community center and 168 Single Room Occupancy (“SRO”) uses as lawful nonconforming uses and without a SUP. The City removed the case to federal court on May 26, 2006, and moved to dismiss on May 31, 2006, continuing to assert that World Outreach must

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have a SUP to operate. World Outreach filed a motion for TRO and preliminary injunction on January 17, 2007, reasserting its right to continue the lawful nonconforming uses without a SUP. [Dkt. 43]. The motion was withdrawn when the District Court urged the City to move forward in issuing the necessary licenses. On January 31, 2007, the Zoning Department issued a “departmental clearance” on World Outreach’s application for the SRO license, although licenses were not issued for six months. On March 16, 2007, with no answer to discovery by the City, the District Court formally stayed discovery. At the Court’s direction, the City withdrew its motion to dismiss on March 19, 2007, but discovery remained stayed. [Dkt. 49]. World Outreach filed a second motion for TRO on July 31, 2007, alleging that its uses were lawful nonconforming uses that did not require a SUP and requesting an order directing the City to issue the SRO license. [Dkt. 58]. Before a ruling was made on that motion, the City issued the SRO license to World Outreach on August 3, 2007. [Dkt. 222-4]. On August 17, 2007, World Outreach amended its complaint, dropping the injunctive relief claims, but retaining the request for damages and attorney fees. [Dkt. 63]. The City filed a motion to dismiss on September 17, 2007. [Dkt. 70]. On May 13, 2008, the District Court granted the City’s Rule 12(b)(6) motion to dismiss Plaintiffs’ amended complaint. [Dkt. 91]. Plaintiffs filed a motion to reconsider the dismissal on June 2, 2008 [Dkt. 94] which the court denied on November 12, 2008,

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[Dkt. 102]. Plaintiffs timely filed a notice of appeal on December 11, 2008, [Dkt. 103]. On December 30, 2009, this Court reversed the dismissal in part and affirmed it in part, and the case proceeded to summary judgment before the District Court. 1. The YMCA’s use of the property. 1 For nearly eighty years, the Young Men’s Christian Association (“YMCA”) “put Christian principles into practice” by serving the Roseland neighborhood with programs nurturing “a healthy spirit, mind and body for all.” 2 [Dkts. 198-203, 205210]. The Greater Roseland YMCA provided these programs at its five-floor community center located at 4 E. 111th Street (the “property”). The undisputed facts include: the building contains a swimming pool in the basement, two gymnasia and other conference and meeting rooms on the first floor. [Dkt. 186 at ¶ 7, p. 3] The second, third, and fourth floors contain single room occupancy (“SRO”) units. [Dkt. 195 at p. 65]. The second floor contains 30-32 single room occupancy (“SRO”) units; the third floor, 68 SRO units; and the fourth floor, 68 SRO units. All but two of the SRO units are designed to accommodate just one person. [Dkt. 186 at ¶ 7, p. 3] The YMCA rented the 168 SRO units to those in need of shelter and temporary housing. Christopher Bielat, Vice President of Real Estate and Senior Housing for the YMCA, testified that though the building was “old” and lacked “modern amenities”, it and the SRO units were “serviceable.” [Dkt. 195 at p. 65]. 1 2

A timeline connecting facts is located at the end of this statement. Learn more about the YMCA’s mission at http://www.ymca.net/about-us.

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In 1999, the property was zoned C1-2, and in that zone both the SROs and community center (“YMCA uses”) were permitted uses; these uses, which began around 1926, have remained in continuous use through and since 1999. At some point between 1999 and 2004 due to sundry changes in the zoning map and adoption of a new, comprehensive zoning code, the YMCA uses became lawful nonconforming uses. [Dkt. 214-2]. The YMCA regularly used the building to host such activities as pre-school and after-school programs for 100-200 children, educational programs for all ages, child care, feeding and clothing programs, computer programs, job training, government assistance and relief, and self-improvement. In addition to all the physical and health related activities, the YMCA hosted programs for wayward youth and those struggling with alcohol and drug addictions. The center often hosted movies, plays, drama classes, and speakers who spoke on religious, political, and social matters of community interest. The YMCA also rented the conference and meeting rooms to a multitude of community and religious groups, including worship services and Bible studies. [Dkt. 195 at pgs. 65, 69 – 71]; [Dkt. 186-2 at pgs. 9 – 11, 49]; [Dkt. 186-5 at pgs. 2-10]. Many churches, including World Outreach, rented at the YMCA.

Pastor

Blossom testified that so many churches rented for worship services that World Outreach was never able to rent space from the YMCA on a Sunday. [Dkt. 192-1 at p. 10] From May 2004 through the first half of 2005 Pastor Blossom personally observed a number of non-church assembly uses at the YMCA, what appeared to be

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full capacity use of the SROs, an always full conference room, child care, AA meetings, drug treatment programs, gym activities, as well as, feeding and clothing programs. [Dkt. 186-2 at pgs. 9 – 11, 49]. The YMCA operated its community center and rented 168 SRO’s for eighty years without being told by the City to obtain a SUP, because its use of the building was classified either as permitted or, in more recent years, as a “legal nonconforming use.” 591 F.3d 531, 535 (7th Cir. 2009)(“If a particular land use is begun at a time when the use conformed to the existing zoning regulations, and the zoning regulations are later changed to forbid such use, the user can continue his (no longer) conforming use without a Special Use Permit. See Chicago Zoning Ordinance §§ 17-15-0101, 0103.”) This legal “nonconforming status runs with the land and is not affected by changes of tenancy, ownership, or management.” Id. at § 17-15-0106. Between October 11, 1984 and November 10, 2004, Chicago conducted no less than 195 extensive inspections of the property. Exhibit 13, generally, [Dkt. 193-203; Dkt 205-210]. 3 Over the years, the City routinely and annually renewed the YMCA’s two business licenses to operate the SROs and community center, a process the YMCA found “very easy” as the YMCA “had been providing SRO rooms for a very long period of time.” [Dkt. 220-4]; Exhibit 13, generally, [Dkt. 193-203; Dkt 205-210] 4 ; [Dkt. 195 at p. 76] The City’s process was: “make application, and pay Citations are to City Bates Numbers which begin with C00 and the following numbers ## 50, 102-04, 109-46, 219-401, 406, 410-11, 413, 442, 513-26, 556-57, 563, 593-94, 596-98, 61229 4 Bates ## 546, 508-12, 498-501, 212-18, 486-91, 453-70 3

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the fee and obtain the license.” [Dkt. 195 at p. 76] From 2000 to 2005, the YMCA had no difficulty obtaining the SRO license each year. [Dkt. 195 at p. 66]. The YMCA had no difficulty obtaining the SRO and community center licenses even in 2000-01 when there were 27 open building code violations, most of which pertained to the SROs. Exhibit 13, generally, [Dkt. 193-203; Dkt 205-210]. By 2005, the YMCA decided continued ownership of the building was “impractical” given its inability to “address [the] long term provision of housing for this [poor] population in the neighborhood”. [Dkt. 186-4 at p. 42]. The YMCA was prompted to sell after obtaining a study showing that a “facility upgrade” to meet “YMCA programmatic objectives” for the future, would require expenditure of more than $9 million over an unspecified number of years; the study also was designed to address applicable “code requirements,” and cited only one code violation, and did not recommend any immediate repairs. ]Dkt. 186-5 at pgs. 11-21]; [Dkt. 186-4 at p. 39]. 2. World Outreach Conference Center’s use of the property. On July 13, 2005, World Outreach Conference Center (“World Outreach”), a religious not-for-profit corporation like the YMCA, purchased the property with intent to use it as a place where Christian principles were practiced for the benefit of the community. World Outreach sought to continue operating the community center, renting the 168 SROs to those in need of housing, and providing worship services to proclaim to the Roseland community the good news of God’s kingdom and Jesus the Messiah. [Dkt. 212]; [Dkt. 186-2 at p. 31]. Pamela Blossom pictured

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in the building, [Short App. at E, p. 66], is Pastor and head of World Outreach and oversees all operations property. [Dkt. 186-2 at pgs. 3 -6]; [Dkt. 211]. The YMCA elected to sell to World Outreach, because “Pastor Blossom’s proposal was more aligned with the needs of the community.” [Dkt. 195 at p. 76]. A requirement of sale imposed by the YMCA was “that World Outreach was to provide the same services to the community that the YMCA had previously provided.” [Dkt. 212-8 at ¶ 7, p. 3]. Prior to purchase, on May 16, 2005, Blossom informed the YMCA that “[o]ur congregation is full of builders, concrete contractors, electricians, and painters. All of them are licensed, bonded and own their own businesses. They have promised to assist.” World Outreach was “fully equipped to do the upkeep of the building” with “plenty of volunteers.” [Dkt. 212-2]. Upon completing the purchase on July 13, 2005, World Outreach intended to continue the same community center and SRO uses of the property as the YMCA, and many of the same programs.” [Dkt. 186-2 at p. 32]. In inspections of World Outreach’s property dated September 14, 2005, September 18, 2005, and January 6, 2006, the City Zoning Department confirmed that World Outreach intended to continue the same community center and SRO uses as the YMCA. For example, the Zoning Department’s notes from 9/14/05 showed—“Illegal Religious Assembly w/o special use permits; community center, offstreet parking.”; “formerly Greater Roseland YMCA”; “1st Fl.-Large Fitness Center Full Stocked w/ Equipment”; and as to the SROs “2nd to 5th Fl.”—“Owner states she

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wants to clean, paint/remove carpet.” [Dkt. 186-7 at pgs. 1 – 4]; [Dkt. 186-7 at pgs. 5-7]; [Dkt. 219]. On August 3, 2005, World Outreach applied to renew the license for the community center, seeking the same “Limited Business License” which the YMCA had. On November 16, 2005, World Outreach first applied to renew the license for the SROs, as a lawful nonconforming use of the property, seeking the same “Single Room Occupancy Class I or II” license which the YMCA had. [Dkt. 186 at ¶ 46, p. 14]; [Dkt. 186-8 at pgs. 25, 28]. However, the City first accepted the applications but then failed to approve them. After many trips to City Hall proved fruitless in getting the licenses approved, on May 16, 2006, World Outreach reapplied for the community center and SRO licenses. [Dkt. 220-2]. Again, however, the City failed to approve the license applications. After even more trips to City Hall again proved fruitless in getting the licenses approved, on February 2, 2007, World Outreach applied again for the community center and SRO licenses. [Dkt. 220-3]. (These licenses were not approved until August 3, 2007, after World Outreach filed their second emergency motion for a TRO. [Dkt. 222-3 – 222-4].) On January 22, 2007, Elizabeth McGuan, a Mauck & Baker paralegal, went to City Hall regarding the status of the applications. [Dkt. 221-1]. A supervisor in the Department of Business Affairs and Licensing, Betsy Gonzalez, insisted to McGuan that no application ever had been filed. After meeting with Gonzalez, McGuan spoke with Dennis Connolly, another employee in the same Department, who

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described the application process. Connolly advised that after the license is applied for it “is then sent to the Zoning Department.” If the Zoning Department approves the application, all that is required to be licensed is “the applicant returns to the Department of Business Affairs and Licensing, shows photo identification, signs the permit, and pays the fee.” But, as to World Outreach’s application Connolly advised “that it had been received into his office, gone up to the Zoning Department, and not come back.” [Dkt. 221-1]. The City’s computer records reveal from November 2005 reveal the City was withholding approval of World Outreach’s license applications because World Outreach had not sought a SUP. [Dkt. 186-8 at pgs. 25, 28]. Because World Outreach was unable to rent its community center and SROs for two years, it lost revenue of $231,794. World Outreach lost an additional $591,026 from its inability to house Katrina evacuees. 5 World Outreach incurred $15,840 in unnecessary utility expenses to heat 168 SRO units through the winter months of 2005-06 and 2006-07, and $5,745 in insurance costs, for empty units. They also spent $2,639.90 to repair broken, frozen pipes and resulting water damage after they were unable to pay the gas bill on time in 2005-06 due to lack of income. Because of Alderman Beale’s interference with their water bill exemption, World Outreach was required to pay approximately $11,000 during the 22 months

World Outreach also faces a bill for hundreds of thousands of dollars for attorney’s fees. [Dkt. 223-2]. Notably, the District Court lauded World Outreach for bringing the federal lawsuit: “the pending lawsuit put the parties on a path to resolution of both the zoning and building code issues.” World Outreach at 850.

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September 1, 2005 – August 3, 2007. [Dkt. 223-1 at ¶¶26-56, pgs. 4-7]. According to Pastor Blossom, things “got pretty discouraging.” [Dkt. 186-2 at p. 43]. 3. The involvement of Alderman Anthony Beale. In the months prior to purchase, Pastor Blossom talked with Alderman Anthony Beale of the Ninth Ward (the ward in which the property lies), his staff and other City officials about World Outreach’s intent to purchase the property and continue the YMCA’s activities and uses. On June 8, 2005, Pastor Blossom notified Beale in writing that World Outreach would continue the YMCA’s operation of a community center with 168 SRO’s, offering similar programs. [Dkt. 186-5 at pgs. 2-10] At his deposition Alderman Beale admitted receiving and reviewing Pastor Blossom’s letter of June 8, 2005 [Dkt. 186-5 at pgs. 2-10], and confirmed that World Outreach’s proposed programs were substantially the same as the YMCA programs. [Dkt. 194 -1 at pgs. 11 – 13, 20]; [Dkt. 194-2 at p. 3]. Pastor Blossom first met with Alderman Beale and his staff shortly afterward. Alderman Beale testified that he had been in the building hundreds of times, including as a child, as a teenager, and later as alderman. He was thoroughly familiar with the community center and SRO uses for which the building was designed. [Dkt. 194 -1 at pgs. 8-9]. He said he considered the YMCA’s programs a great asset to Roseland. [Dkt. 194 -1 at p. 10]. However, after learning of World Outreach’s plans, Beale actively opposed their efforts to purchase the building, pushing two other entities to purchase the property—Chicago State University and the Provider Realty Corporation. [Dkt. 194

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at p. 7]. When he learned that the YMCA agreed to sell to World Outreach, Beale twice demanded that the YMCA reopen bidding on the building. Blossom Declaration of November 11, 2011, [Dkt. 223-1 at ¶¶ 3-19, pgs. 2 – 4]. At his deposition, Beale conceded he sought to prevent the sale to World Outreach so that “one of the clients [Beale] favored could bid on the property.” [Dkt. 194-1 at p. 20]. Beale’s interference in World Outreach’s purchase cost them $80,000. His demand that bidding be reopened for his favored developer, Provider Realty, caused the cost to World Outreach of purchase to be bid up from $300,000 to $380,000. [Dkt. 223-1 at ¶¶ 9-23, pgs. 3 – 4]. Earlier, by letter dated May 3, 2005, [Dkt. 212-1 at p. 2] World Outreach made its initial offer to purchase the building for $300,000, followed by a letter (dated May 16, 2005), [Dkt. 212-2 at pgs. 2 – 9], which included an eight-page attachment confirming World Outreach’s intent to continue the same programs and uses the YMCA had conducted at the property. [Dkt. 212-1]. In early June 2005, the YMCA approved the sale to World Outreach for $300,000. However, the bidding was reopened after Beale demanded that Provider Realty be allowed to bid. Provider Realty offered $330,000. To avoid losing the property to a higher bidder, on June 24, 2005 World Outreach increased its bid to $380,000 which the YMCA accepted. [Dkt. 223-1]; [Dkt. 212-1 – Dkt. 212-5]. According to Pastor Blossom, both times she met with Alderman Beale in June and July 2005, Beale screamed at her and threatened her that she was going to lose the property. [Dkt. 186-2 at pgs. 18, 19-20, 35]. Shortly after purchase on July 13,

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2005, Alderman Beale refused all communication attempts from Pastor Blossom and others at World Outreach. [Dkt. 193 at pgs. 18-19]. (“Pastor Blossom wanted to reach out to the alderman”; we kept “running into a brick wall all the time”); [Dkt. 222-9]. According to Blossom, Beale was angry at her because he believed World Outreach was coming into the community without his approval. [Dkt. 186-2 at p. 35]. Alderman Beale was familiar with the 2005 Chicago Zoning Ordinance (“CZO”) provisions regarding lawful, nonconforming uses. [Dkt. 194 at p. 5]. But, Beale never looked into or even considered the possibility that under the CZO, WOCC might have a lawful non-conforming use at the subject property. [Dkt. 194 at p. 6]; [Dkt. 194-1 at p. 1]. 4. The City’s response to World Outreach’s purchase. On June 29, 2005, five days after World Outreach outbid Provider Realty, Beale introduced in the City Council a proposed ordinance to change the zoning of the single parcel (a/k/a a “map amendment”) from B3-2 to M1-1 (no other parcels of property were affected). [Dkt. 213-6]. Map amendments such as this, when proposed by the alderman of the ward in which the property is located, are always passed by the City Council regardless of the property owner’s wishes, objections or testimony presented at a hearing. In twelve years as alderman (at the time of his deposition), Beale had proposed about 75 map amendments for property within his ward. The City Council had never turned one down, though Beale testified he had withdrawn five or six over the years. [Dkt. 194 at p. 14]

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According to the CZO § 17-15-0101, because the property had long been used for the particular, “legal nonconforming” land uses (specifically the community center and SROs), which were to be continued by World Outreach, the “legal nonconforming status” of these uses ran with the land, and were not to be affected by the change in ownership or by any subsequent zoning regulation forbidding such uses. See CZO §§ 17-15-0101, 0103. After World Outreach bought the building on Wednesday, July 13, 2005, the City sent inspectors to the property on Thursday, Friday, and Saturday. [Dkt. 186-2 at p. 19]. In the coming weeks the City then conducted what appear to be dozens of inspections, which revealed a building which was being operated, and, unless dramatically altered internally could only be operated, as a community center with 168 SROs. Exhibit 13, generally, [Dkt. 193-203; Dkt 205-210]. 6 These included “task force inspections” in which multiple inspectors from different City departments were sent simultaneously. According to Alderman Beale a “task force inspection” is “[w]hen a group of inspectors go out, fire, building, health, different departments.” [Dkt. 194-1 at p. 4]. By this time, World Outreach already had accepted a donation of “over 70 beds” from a hotel for the SROs. [Dkt. 186-2 at p. 37]. According to Pastor Blossom, “we decided that it would be beneficial to the community if we utilized the SRO rooms also.” [Dkt. 186-2 at p. 31]. “[I]t was brought to our attention that the rooms were needed in the community. It was a low income, crime-ridden community, and that it

Bates ## 147-205, 88-101, 105-08, 557-62, 571-90 17

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would be, to their best interest and our interest, to utilize the rooms as low income.” [Dkt. 186-2 at p. 32]. On July 29, 2005, Alderman Beale requested the Commissioner of Buildings, Rafael Hernandez, “to have a hold placed on any and all permit application requests for [4-28 E. 111th Street] due to a pending zoning change.” [Dkt. 194 at p. 22]; [Dkt. 219-1 at p. 2]. As a result, the City’s computers were updated to reflect “No Building Permit” for World Outreach’s address. [Dkt. 219-1 at p. 3]. This hold on permits was communicated to the Department of Buildings and a host of other city departments and offices with jurisdiction over World Outreach, including the Zoning Department and the Department of Construction and Permits. [Dkt. 194-1 at pgs. 1-2]. Beale knew this action would prevent World Outreach from receiving business licenses and prevent them from using or renting out any part of the property. [Dkt. 194 at p. 22]. As a matter of practice when Alderman Beale sends out letters requesting permit holds he never requests that the holds be removed. [Dkt. 194-1 at p. 1]. Ronald Carter, then Director of Strategic Planning for the Illinois Department of Human Services overseeing the Illinois Katrina Assistance Relief Effort, testified that when he inspected the SROs in September 2005 regarding whether they were fit for victims of Hurricane Katrina, they needed only “cosmetic” corrections and “minor repairs.” [Dkt. 196 at pgs. 68, 74]. He estimated that since there were no major problems all the units could be ready to house Katrina victims in 30-60 days. [Dkt. 196 at p. 74]. By November, 2005, World Outreach volunteers had these items fixed. [Dkt. 196 at pgs. 68, 74]; [Dkt. 214-9].

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On September 14 and 18, 2005 inspectors from the City Zoning Department advised Pastor Blossom that she would need a SUP in order to operate a business at the property. [Dkt. 186-7 at pgs. 1-4]; [Dkt. 186-7 at pgs. 5-7]. On September 27, 2005, the City Council Committee on Zoning held a hearing on Alderman Beale’s proposed zoning change. Beale was present. [Dkt. 194 at p. 18]. World Outreach attorney Richard C. Baker advised the Committee that World Outreach intended to continue the YMCA’s lawful nonconforming uses. [Dkt. 214 at pgs. 7-8]. In response, the City through Chairman Alderman Banks advised World Outreach it could not receive licenses because it first had to obtain a SUP from the Chicago Zoning Board of Appeals to operate a community center and SROs. [Dkt. 214 at pgs. 6-7,9]. 5. The City approves Alderman Beale’s rezoning and continues the property inspections. On October 6, 2005, the full City Council approved Beale’s rezoning of the property to M1-1, Exhibit 31, a zone in which the established community center and SRO uses were prohibited. [Dkt. 214-8]; [Dkt. 186-2 at p. 19]. There are no manufacturing districts contiguous to the Property, and the zones surrounding World Outreach’s property only include neighborhood shopping, neighborhood commercial, and residential uses. 6. World Outreach notifies the Mayor’s office, and attempts to house Hurricane Katrina victims. On October 12, 2005 Blossom sent a letter informing Mayor Daley of the actions the City was taking to prevent its use of the property. Neither Mayor Daley nor anybody else responded to the letter. [Dkt. 214-9]

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In September 2005, World Outreach was contacted by the Illinois Department of Human Services (“IDHS”) about its need for emergency shelter for 150 Hurricane Katrina refugees for a year. By the end of October 2005, World Outreach had made arrangements with IDHS to house and feed the 150 refugees for up to a year at $750 per month per SRO unit. [Dkt. 186-2 at pgs. 36-37, 39, 41-44]; [Dkt. 196 at pgs. 71, 88]; [Dkt. 197 at p. 29]. With World Outreach’s agreement to provide food as well, $750 per month (for a one year lease of an SRO unit) was a reasonable price. [Dkt. 197 at p. 27]. Additionally, Pastor Blossom was told that “FEMA would help me repair anything I needed to repair,” [Dkt. 186-2 at p. 36], pay for new carpeting, [Dkt. 186-2 at p. 42]; and provide “beds, mattresses, and bed sheets, pillow cases…[as it did] all the time.” [Dkt. 196 at pgs. 85-88]. World Outreach was an appealing location to IDHS because they “could house a significant number of people in one place;” “had the ability to feed, with a dining facility that could feed multiple people at one time;” and Roseland was a good fit “because it was largely an African-American and Latino neighborhood, and these were largely African-American evacuees.” The gymnasium, swimming pool, and recreational equipment also were big pluses according to Ronald Carter. [Dkt. 196 at p. 71]. Carter testified that IDHS “couldn’t understand why [World Outreach] couldn’t get a license. The place looked fine, and it was an establishment. And then all of a sudden, they couldn’t get a license. So I don’t – and it was a YMCA at one time. … I mean, at the time that we – when we first went over, we didn’t think it wasn’t going

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to happen. Because it was pretty like a no-brainer situation; they were rehabbing; they seemed to be – everything seemed to be okay. They were in the process of getting a license, and that usually isn’t something that is a problem. … So we didn’t think there was going to be a problem, so we were looking forward on – okay, this is what we need to do to get the people there, just – you know.” [Dkt. 197 at p. 29]. “In the early discussions we were looking at this site as a potential emergency shelter facility. The fact that it could feed people was important. That probably was the single most important – next to housing them, the fact that we could feed them on site. … As time went on, we got our deadlines for permanent housing, when people would have to be taken out of emergency housing. So it became clear that at some point, this would not be an emergency housing relationship, but more of a permanent housing relationship if we could get things worked out [with the City].” [Dkt. 196 at p. 81]. According to Carter, IDHS approval of the location was contingent upon receipt of an SRO license from the City. [Dkt. 196 at p. 86]. “We were actively and aggressively looking for housing and this 150 units refers specifically to that building. So I was saying we need units.” [Dkt. 196 at p. 87]. Upon the City’s approval of World Outreach’s SRO license “[Carter’s] office was prepared to request final inspection approval of the site.” [Dkt. 196 at p. 86]. One of Carter’s assistants even applied on behalf of World Outreach for an SRO license. [Dkt. 193 at p. 13]. According to Carter, he personally called the City regarding approval of the SRO

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license and a staff person, who “clearly had some knowledge of this property and what was going on with the alderman” suggested that he talk to Beale. “Not a thing” would have prevented IDHS outreach workers from “sending people right to World Outreach.” [Dkt. 197 at p. 26]. When asked whether she would have referred evacuees to World Outreach had the City issued an SRO license to them, IDHS outreach worker White stated “Yes. I didn’t see any reason why I would not use them as a referral.” [Dkt. 197 at p. 27]. Had the City granted World Outreach’s SRO license, they would have been at the top of the list to receive Katrina refugees. Hurricane Katrina left the Illinois and federal governments desperate to find and rent large facilities with food services such as World Outreach provided. [Dkt. 197 at p. 16]; [Dkt. 197 at p. 8]. Estimates of how many evacuees actually came to the Chicago area range from 6,000-10,000. [Dkt. 197 at p. 3]; [Dkt. 196 at p. 99]; [Dkt. 197 at p. 10]. In the weeks and months after Katrina there was mass chaos as multiple federal and Illinois agencies frantically searched for places to house “up to 10,000 evacuees.” [Dkt. 197 at p. 12]; [Dkt. 197 at pgs. 72, 24]. The arrangement between World Outreach and IDHS was a done deal. [Dkt. 196 at pgs. 71, 74]; [Dkt. 197 at p. 29]. The only impediment was the City’s refusal to issue the same license they routinely issued the YMCA over the years. [Dkt. 196 at pgs. 71, 74-75, 86]; [Dkt. 221 at ¶, p. 4]. Over several months in 2005-06, Ron Carter and others tried on multiple occasions to persuade the City to issue the license, but the City would not budge. [Dkt. 221], including Carter’s

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Declaration and emails; see, also [Dkt. 196 at p. 86], authenticating his Declaration. World Outreach tried everything it could to get the City to issue the license but kept “hitting a dead wall”. [Dkt. 186-2 at p. 43]. 7. The City sues World Outreach and continues its demand for an SUP. On November 3, 2005, writing on City Council letterhead, Alderman Beale wrote the City Water Department requesting that World Outreach’s charitable exemption be denied. [Dkt. 219-4]; [Dkt. 194-1 at p. 13]. The City’s records show that on November 16, 2005, Pastor Blossom applied in person for an SRO license and was told that an SRO could not be used without a SUP in the a C1-1 (sic) (commercial district). The Zoning Department entered the following comments into the City’s computers: “11-16-05 A SRO is a special use in a C1-1 (Commercial District). A Special Use requires a determination and a public hear (sic) by the ZBA” [Dkt. 209 at p. 34] and “Property is currently pending legal action for operating an illegal church w/o a ZBA special use and sufficient off-street parking, and abandon signs and canopies over the public way.” [Dkt. 209 at p. 31]. On December 14, 2005, the City filed a six-count suit in Cook County Circuit Court against World Outreach seeking a “finding that Defendants’ activities [i.e., the continued operation of the community center and religious assembly at the property] are illegal and an injunction requiring Defendants to cease their illegal activities immediately.” [Dkt. 213-3]. The suit, filed a month after the City Council had rezoned the single parcel to M-1, making a SUP impossible, alleged that the property was zoned as a B3-2 Community Shopping District and that World

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Outreach could not operate a community center or religious assemblies without obtaining a SUP from the Zoning Board of Appeals. The suit asked that Defendants be fined up to $1,000.00 for each day. The suit made no mention, though well known to the City, that the YMCA’s uses had long been lawful nonconforming uses, or that World Outreach acquired the property with the right to continue the uses. The suit also did not mention that the City had just rezoned the parcel to M-1, wherein community centers and religious assembly uses were not permitted, either as of right or by SUP. On April 6, 2006, World Outreach presented the City with the affirmative defenses and counterclaims it intended to file, including its right to lawful nonconforming uses. On April 7, 2006, the City voluntarily dismissed its complaint. Therefore, on April 12 World Outreach filed the counterclaims as a new lawsuit in Circuit Court. The City removed it to federal court. On May 31, 2006, in District Court, the City filed a memorandum in the name of Corporation Counsel Mara S. Georges. [Dkt. 221-1]. The City’s attorneys made the argument that World Outreach had made no effort to prove they possessed a lawful nonconforming use (“But plaintiffs overlook their obligation to establish that their use of the property is a lawful, nonconforming use….”). [Dkt. 8-2 at p. 14]. The City continued to argue they were entitled to refuse World Outreach a license for the SROs because no application for an SUP had been filed. At a June 6, 2006 meeting between Pastor Blossom and other World Outreach representatives, Alderman Beale’s liaison “Saleem” advised that “[Beale] was very

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dissatisfied with how we came into the community. He stated that we needed to come into the community before we bought the building.” [Dkt. 223]; [Dkt. 186-2 at p. 46]. As cold weather came in December 2006, World Outreach had “over 50 members” from their church alone who needed shelter, plus others in Roseland on a “Housing Request List,” who were homeless and facing winter on the streets. World Outreach got “daily requests from people wanting to rent out a room and/or who need[ed] shelter depending on their financial condition. On December first alone [we] had four different persons who sought to rent out a room.” [Dkt. 212-8 at ¶¶ 7]. On January 18, 2007, Plaintiffs filed their first “Emergency Motion for Temporary Restraining Order and Preliminary Injunction on Behalf of Plaintiffs” seeking an order of Court requiring the City to issue the SRO license. [Dkt. 221-3]. On January 31, 2007, the City’s counsel emailed World Outreach’s counsel to inform them that the Zoning Department had “signed off” on World Outreach’s continued use of the SROs and community center. [Dkt. 222-2]. With zoning approved for use of the SRO units, World Outreach asked the City to issue the SRO license. The City continued to refuse to issue World Outreach a business license, so on July 31, 2007 World Outreach filed its second “Emergency Motion for Temporary Restraining Order and Preliminary Injunction on Behalf of Plaintiffs.” On August 3, 2007, the City issued to World Outreach its community center and SRO licenses. [Dkt. 222-4].

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Prior to licensing, on January 10 and April 19, 2007 the City brought administrative enforcement actions against World Outreach for operating their community center without a business license. [Dkt. 222 and 222-2].; Exhibit 13, generally, [Dkt. 193-203; Dkt 205-210]. 7 On August 28, 2007, the City filed an administrative law complaint against World Outreach for failure to post occupancy cards in its property. [Dkt. 222-5].On multiple occasions World Outreach representatives went to City Hall to obtain the occupancy cards but each time were told that M1-1 zoning prevented World Outreach from using the property or receiving occupancy cards. [Dkt. 193 at p. 16]; [Dkt. 186-8 at pgs. 9-14]. On September 27, 2007, Counsel for World Outreach wrote to Corporation Counsel. [Dkt. 222-7]. It was not until November 28, 2007 that World Outreach’s attorneys were able to convince Patti Gregory, Senior Counsel in the City’s Law Department, to cause the City to non-suit the administrative law complaint. [Dkt. 222-5]. On occasions from May 3-July 9, 2010 City inspectors went to World Outreach looking for occupancy cards and demanding that World Outreach obtain them. Each time the City made a demand, a representative from World Outreach went to the City Zoning Department to obtain the occupancy cards; but each time the Zoning Department turned World Outreach away, claiming M1-1 zoning prevented use of the property or receiving occupancy cards, including resurrecting the claim that World Outreach “may need special use approval.” [Dkt. 222-6]. 7

Bates ##471-72, 474-75, 476-77

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On July 13, 2010, Corporation Counsel wrote World Outreach’s attorneys reiterating the City’s refusal to issue occupancy cards, demanding that World Outreach provide “a detailed description of the proposed uses for the specific rooms” in the community center, and declaring church services not allowed because a church service “is a prohibited use.” [Dkt. 222-8]. Thereafter, the City regularly sent inspectors demanding that World Outreach post occupancy cards, but refusing to issue them when World Outreach representatives sought to purchase them. [Dkt. 186-2 at pgs. 49-50]. In its Answer to the Amended Complaint, the City answers ¶ 11: “Defendant admits that some uses of the property might constitute a lawful, nonconforming use of the property today, but Plaintiff has not provided an adequate and comprehensive description of such uses to enable Defendant to form a belief as to the truth of such allegations….” In answer to ¶ 13 the City adds “Defendant denies that at all relevant times World Outreach has been entitled to use the property as a community center with SRO units, however, without first establishing that all of its proposed uses of the property are in conformity with previous, nonconforming uses by the Roseland YMCA, and other provisions of the [CZO].” In answer to ¶ 15 the City “denies that use of the property as a church or for church services would constitute a legal, nonconforming use of the property as established over eight years.” [Dkt. 213-2 at pgs. 6-8]. Reference is made to Argument § III below, in which World Outreach’s substantial burdens are aggregated.

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Dates

1926 – July, 2005

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Actual or Intended Use of Property

YMCA operates community center with 168 SRO’s at 4 E. 111th Street

June 9, 2005

World Outreach (“WOC”) met with Alderman Beale regarding purchase and intended use.

June 29, 2005

Beale introduces map amendment to change zoning of property from B32 to M-1 manufacturing

July 13, 2005

WOC purchases property with the intent to continue YMCA legal nonconforming uses

July 29, 2005

Beale tells Commissioner of Buildings, Rafael Hernandez, “to have a hold placed on any and all permit application requests for [428 E. 111th Street] due to a pending zoning change.”

August 3, 2005

WOC applies for license to continue legal nonconforming use of community center

Sept. 27, 2005

City Committee on Zoning holds hearing at which 28

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City’s Zoning & Position As To Community Center/SRO Uses City was aware of and allowed the use of property as a community center and for SRO’s and had inspected the property for various reasons and at various times from 1984 to 2004. Multiple changes in Chicago ordinance and zoning map category make YMCA’s uses legal nonconforming uses sometime between 1999 and 2004 rather than legal permitted uses. Zoning amendment introduced to change zoning map from B3-2 to M1-1

City’s computers now reflect “No Building Permit” for World Outreach’s address and hold on permits is communicated to the Department of Buildings and other city departments preventing World Outreach from using or renting out any part of its property. City informs WOC that it could not receive license for community center and SRO units without a SUP Chairman Alderman Banks tells WOC that it must obtain a SUP

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Sept. 2005

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WOC asserts legal nonconforming status of uses IDHS contacts Blossom regarding housing 150 hurricane victims for a year Property now zoned M1-1 and community center and SRO uses now expressly prohibited and application for a SUP legally impossible

Oct. 6, 2005

City Council passes map amendment rezoning property from B3-2 to M1-1

Nov. 16, 2005

WOC applies for a license to operate SROs

City officials tell Pastor Blossom that without a special use permit WOC may not rent out SRO’s.

City sues WOC & YMCA in state court for operating community center without a SUP

City asserts WOC must obtain a SUP pursuant to requirements of B3-2 zoning although property now zoned M-1

IDHS advocates with City for SRO license to use 150 SROs to house Katrina victims

IDHS Official Carter is told he had to speak with Alderman Beale

Dec. 14, 2005

December 2005 – January 2006

March 17, 2006

April 6, 2006 April 7, 2007

City amends state complaint to add count for conducting prohibited uses in M1-1 while keeping count alleging conducting uses in B-32 zone without SUP

WOC serves affirmative defenses and counterclaims indicating lawful nonconforming status of uses City dismisses state suit 29

City adds count asserting WOC’s continuation of uses at Property prohibited under current M1-1 zoning

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April 12, 2006 May 26, 2006

May 31, 2006

August 4, 2006

Jan. 17, 2007

Jan. 31, 2007

July 31, 2007

August 3, 2007 August 17, 2007 September 17, 2007 May 13, 2008

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WOC files suit for declaratory relief in state court City removes to Federal Court City files motion to dismiss maintaining demand that WOC obtain an SUP to use property even though it has been zoned M1-1 since Oct. 2006 City files reply reiterating SUP demand. Dkt. 20 at p. 5.

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City continues to contend WOC “must” apply for special use permit before it can continue uses of Property. Dkt. 8 at p. 9.

WOC files for TRO and preliminary injunction alleging WOC’s lawful nonconforming use status of community center with SROs and no need for SUP Zoning Department issues approval of SRO license application without SUP but takes no action on Community Center WOC files second motion for injunction regarding legal non-conforming use of community center without SUP and issuance of SRO license City issues license for use of SRO’s and community center without SUP WOC files amended complaint regarding legal non-conforming use status City files Motion to Dismiss District Court Grants Motion to Dismiss

Zoning approval is given for use of SRO’s without SUP but no approval given for use of Community Center and no licenses issued

Licenses for use of SRO’s and Community Center issued

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SUMMARY OF ARGUMENT The City violated the Free Exercise and Equal Protection clauses of the United States Constitution and the substantial burden provision of RLUIPA by prohibiting World Outreach’s religious mission to serve the homeless and other needy people at its property, without a compelling governmental interest for that prohibition. The District Court erred in holding that World Outreach was not substantially burdened by the City’s insistence, at every turn for over two years, that a SUP was a prerequisite for its continued use of the community center and SRO’s, when for most of that time the granting of a SUP was legally impossible under M-1 zoning. That error of law resulted from the District Court analyzing each City action as an unconnected, independent occurrence, rather than considering as a totality the cumulative effect of the multiple burdens the City imposed on this small religious organization over several years. The District Court also erred in granting summary judgment to the City on all the remaining claims other than the frivolous municipal court lawsuit. World Outreach seeks reversal of the holdings with instructions to enter judgment for World Outreach on the substantiality of the burden imposed by the totality of the City’s actions and a declaration of World Outreach’s entitlement, as the prevailing party in this action, to the damages, attorneys’ fees and costs reasonably incurred as a result of the City’s unconstitutional and unlawful actions.

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ARGUMENT I.

Introduction.

This case ultimately is about whether people freeze to death in the streets or inner city kids waste their lives in gangs, death at 17, in murder, or in prison. What will happen to evacuees when the next “Katrina” inevitably occurs? These are some of the costs and dangers of the City of Chicago’s extended campaign to deny World Outreach the freedom to carry on the ministry and services of the Roseland YMCA. II.

Standard of review.

The district court’s grant of summary judgment for the City is to be reviewed de novo. See Eagle Cove Camp v. Woodboro, 734 F.3d 673, 679 (2013). To determine whether summary judgment for the City was appropriate, all conflicting evidence and reasonable inferences drawn from it are to be construed in favor of World Outreach. Id. Summary judgment for the City is proper only if, in considering all evidence in favor of World Outreach, this Court finds that “there is no genuine dispute as to any material fact and [the City] is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). On an appeal from cross-motions for summary judgment, the standard does not change; all reasonable inferences are to be drawn in favor of the respective non-moving party. Roman Catholic Bishop v. Springfield, 724 F.3d 78, 89 (2013). III.

The District Court erred in measuring RLUIPA substantial burden by the “effectively impracticable” test.

RLUIPA prohibits the imposition or implementation of any land use regulation in a manner that: 32

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“…imposes a substantial burden on the religious exercise of a person, including a religious assembly or institution, unless the government demonstrates that imposition of the burden on that person, assembly, or institution --(A) is in furtherance of a compelling governmental interest; and (B) is the least restrictive means of furthering that compelling governmental interest.” RLUIPA defines “religious exercise” to include “[t]he use, building, or conversion of real property for the purpose of religious exercise.” Id. § 2000cc-5(7). It defines religious exercise broadly to include “any exercise of religion, whether or not compelled by, or central to, a system of religious belief." Id. 2000cc-5(7)(A). RLUIPA also provides that its terms are to be construed broadly, “to the maximum extent permitted by the terms of this chapter and the Constitution.” Id. § 2000cc-3(g). There is no question that World Outreach’s religious exercise has been substantially burdened by the City. As this Court said in World Outreach I: The building is not a church as such. The premises mainly contain recreational and living facilities, but there is also space for religious services, and there is no doubt that even the recreational and other nonreligious services provided at the community center are integral to the World Outreach’s religious mission, just as the rehabilitation centers operated by the Salvation Army are integral to the Salvation Army’s religious mission. World Outreach I, 591 F.3d at 535. (Emphasis added.) When World Outreach last was before this Court in 2009 (“World Outreach I”) the Court cited Saints Constantine & Helen v. New Berlin, 396 F.3d 895 (7th Cir. 2005), but did not adopt the abstract “delay, uncertainty, and expense” test, or any of the other tests used earlier by Seventh Circuit panels. Instead, this Court held that “determining whether a burden is substantial (and if so whether it is 33

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nevertheless justifiable) is ordinarily an issue of fact….” World Outreach I 591 F.3d at 539. At the same page this Court then provided a functional, case and factspecific test holding: substantiality is a relative term—whether a given burden is substantial depends on its magnitude in relation to the needs and resources of the religious organization in question. This Court also found, in World Outreach I, that “[t]he burden imposed on a small religious organization catering to the poor was substantial (for burden is relative to the weakness of the burdened), … and there was no possible justification for it.” World Outreach I at 537-38. Thus, in World Outreach I this Court mandated that on remand the District Court consider the cumulative effect of the multifarious burdens the City imposed on World Outreach over the totality of time as reflected in the evidence; and determine the effect this had on this “small religious organization catering to the poor.” However, the District Court erroneously disregarded the test pronounced in World Outreach I, choosing instead to apply the abstract 8 “effectively impracticable” standard. World Outreach at 949 F.Supp.2d 836, 846, 852 (N.D.IL. 2013), referencing Civil Liberties v. Chicago, 342 F.3d 752 (7th Cir. 2003). The Court offered no explanation, simply adopting the standard from another case instead of following the ruling of the Seventh Circuit in this specific case. Thus, despite the

See, also Bernstein, Abandoning the Use of Abstract Formulations in Interpreting RLUIPA’s Substantial Burden Provision in Religious Land Use Cases, 36 Colum. J.L. & Arts 283, 285 (Winter 2013).

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ruling in World Outreach I the Court did not attempt to measure “the magnitude of the burden(s) in relation to the needs and resources of ” World Outreach. In World Outreach I this Court found that World Outreach was a “small religious organization catering to the poor”. 591 F.3d at 537-38. Because World Outreach I required the District Court to determine the “magnitude [of the burden] in relation to the needs and resources of the religious organization in question”, the District Court had an obligation to follow the “law of the case” on this issue. See Creek v. Westhaven, 144 F.3d 441, 445-446 (7th Cir. 1998) (“[t]he law of the case doctrine ‘is a rule of practice, based on sound policy [and recites] that, when an issue is once litigated and decided, that should be the end of the matter.’”)(internal citations omitted); see also Waid v. Merrill Area Public Schools, 130 F.3d 1268, 1272 (7th Cir. 1997). Likewise, “matters decided on appeal become the law of the case to be followed . . . on second appeal, in the appellate court, unless there is plain error of law in the original decision.” Kaku Nagano v. Brownell, 212 F.2d 262, 263 (7th Cir. 1954). The cumulative effect of the burdens the City imposed clearly were substantial. As the record in the immediate appeal shows, World Outreach is run by Pastor Pamela Blossom and relies heavily upon the donations of time, work, and funds offered by its members. For example, World Outreach put all 168 SROs into good (and code compliant) condition by “expend[ing] over $10,000 and over 2000 hours of volunteer labor”. [Dkt. 212-8 at ¶ 5, p.3]. All or most of the units were ready for occupancy in November 2005. [Dkt. 196 at pgs. 68, 74]; [Dkt. 214-9]. As Pastor

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Blossom testified, in the winter of 2006 (when the City still was refusing to allow her to use the SRO units), over 50 of World Outreach’s members needed shelter as they did not have homes of their own. [Dkt. 212-8 at ¶ 8, at p. 3]. Since so many of its members had only their time and work to give while the City was refusing to allow World Outreach to derive income from renting the community center and SRO units, World Outreach often could not even afford to continue heating the SRO units. Rather than serving its members and the community in a self-sustainable way, World Outreach and Pastor Blossom had to expend what funds, time, and energy they had to overcome the City’s campaign in and out of Court to prohibit their use of the property. For example, World Outreach incurred $15,840 in unnecessary utility expenses to heat 168 SRO units through the winter months of 2005-06 and 2006-07, and $5,745 in insurance costs, although the units were empty. They also incurred $2,639.90 in costs to repair broken, frozen pipes and resulting water damage after they were unable to pay the gas bill on time in 2005-06 due to lack of income. [Dkt. 223-1 at ¶¶ 54-56, p. 7]. Unfortunately, the District Court’s opinion seems to have weighed the needs and limited resources of World Outreach and its members against them, when it appears to take Pastor Blossom to task for planning “to rely on volunteer skilled parishioners to make repairs” and for refusing “to disclose to Beale any information about her financial capability to accomplish her proposal.” See, 949 F.Supp.2d at 840-41. The decision even countenances Alderman Beale’s exculpatory claim that

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“he would have supported any buyer with the financial capability to rehabilitate the building, including Blossom if she could do so.” Id. Without considering World Outreach’s lack of finances, the Court commented that “[Blossom] did not contact an architect, engineer, inspector, or other knowledgeable professional to learn what was needed or what it would cost to repair the building for her purposes. She made no effort to obtain financing for the rehabilitation project.” Id. at 840-41. Beale’s intervention in the purchase process with the YMCA to reopen the bidding already had cost World Outreach $80,000. Why would Blossom share financial information with him? As the needs, limited resources, and weaknesses of World Outreach make the burden imposed by a meritless lawsuit more substantial, they also should make the cumulative effect of the burdens imposed by the City through August 3, 2007, and even afterward, more substantial. The First Circuit has strongly commended this Court’s lead in World Outreach I to move away from an “abstract test” in favor of a more “functional approach to the facts of a particular case”—identifying “relevant factors” to guide the analysis. Roman Catholic Bishop v. Springfield, 724 F.3d 78, 95 (1st Cir. 2013) citing passim to World Outreach, 591 F.3d 531 (7th Cir. 2009) (“Springfield”). In Springfield, the First Circuit made the sort of functional analysis of substantial burden that the District Court in this case should have made. Drawing from World Outreach I, Springfield identified three factors for district courts to consider:

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1) “[W]hether a given burden is substantial depends on its magnitude in relation to the needs and resources of the religious organization in question.” Id. verbatim from World Outreach I, 591 F.3d at 537-538; 2) The manner in which the burden(s) were imposed. Id. citing World Outreach I, 591 F.3d at 537-538; and 3) Whether as a whole the “different types of burdens … cumulate to become substantial.” (emphasis added) Springfield, 724 F.3d at 95, citing World Outreach I, 591 F.3d at 539. The record demonstrates that the accumulation of burdens on World Outreach was far beyond substantial for this small religious organization catering to the poor. Most substantial was the City’s unrelenting and frivolous, two-year demand that World Outreach obtain a SUP 9. This demand began months before the City’s frivolous lawsuit was filed, and delayed the issuance of World Outreach’s limited business license for the basement and floor 1, and Class I SRO license for floors 2, 3 and 4, until August 3, 2007. That is two years for the limited business license, which World Outreach first applied for on August 3, 2005, and 21 months for the SRO license, which World Outreach first applied for on November 16, 2005. [Dkt. 186 at ¶ 46, p. 14]; [Dkt. 186-8 at pgs. 25, 28].

The City’s demand for a SUP was frivolous in two respects. It was frivolous from start because it disregarded the World Outreach’s lawful, nonconforming use. After October 31, 2005 it was frivolous too because a SUP could not be obtained for SROs in an M-1 district. Yet as late as 5/31/06 the City wrote in a memo to the Court “plaintiffs’ burden of proving that their use of the property is a lawful, nonconforming use applies regardless of whether they apply for a special use permit, which the City contends they must do, ….” (Emphasis added.) [Dkt. 225].

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Because World Outreach was unable to rent its community center and SROs for these two years, it suffered damages of $231,794, apart from the loss of the Katrina evacuees. World Outreach lost a cumulative $591,026 from its inability to house Katrina evacuees. 10 World Outreach also incurred $15,840 in unnecessary utility expenses to heat 168 SRO units through the winter months of 2005-06 and 2006-07, and $5,745 in insurance costs, although the units were empty. They incurred $2,639.90 in costs to repair broken pipes and resulting water damage after they were unable to pay the gas bill on time in 2005-06, due to lack of income from the City’s failure to license the community center and SROs. Accumulating upon this, because of Alderman Beale’s interference with their water bill exemption, World Outreach was required to pay approximately $11,000 during the 22 months September 1, 2005 - August 3, 2007. [Dkt. 223-1 at ¶¶ 26-58, pgs. 4-7]. According to Pastor Blossom, things “got pretty discouraging.” [Dkt. 186-2 at p. 43]. Because World Outreach was unable to use their community center and SROs to generate income for two years, and because of the City’s continual denials of World Outreach’s license applications, they were unable to obtain real estate tax exempt status. So, cumulating on all the foregoing, on July 20, 2009 World Outreach’s building and parking lot were sold at a tax sale. World Outreach had until March 2012 to pay $113,331.16, which they were unable to pay. It is only by the miraculous grace of God that they own their property today, because shortly World Outreach also faces a bill for attorney’s fees of many hundreds of thousands of dollars. [Dkt. 223-2]. Notably, the District Court lauded World Outreach for bringing the federal lawsuit, finding that “the pending lawsuit put the parties on a path to resolution of both the zoning and building code issues.” World Outreach at 850.

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before the tax deadline the tax-buyer forgave World Outreach. [Dkt. 223-1 at ¶¶ 5962, p. 7]. And it should be remembered that Alderman Beale’s interference in World Outreach’s purchase of the property cost them $80,000 at the outset. His demand that bidding be reopened for his favored developer, Provider Realty, caused the cost to World Outreach of purchase to be bid up from the originally agreed $300,000 to $380,000. [Dkt. 223-1 at pgs. 3-4]. And once Alderman Beale learned that World Outreach had won the bidding, he arranged to have the zoning changed to M1-1, which caused the community center and SRO uses to appear to be prohibited to the City bureaucracy. [Dkt. 214-1]. Cumulating significantly on all the foregoing, on December 19, 2005 the City sued World Outreach in the lawsuit which both this Court and the District Court found to be frivolous and a substantial burden under RLUIPA. [Dkt. 213-3]. Beyond the aforementioned burdens, in the winter of 2006 World Outreach was unable to house approximately 50 homeless members of its organization because the City would not approve its licenses, including four who sought shelter on December 1, 2006 alone. [Dkt. 212-8 at ¶¶ 7-11, p. 3]. And the City brought no less than four frivolous administrative lawsuits or actions against World Outreach. [Dkt. 186-8 at pgs. 9-14]; [Dkt. 193 at p. 16]; [Dkt. 222] Exhibit 13, generally, [Dkt. 193-203; Dkt 205-210]. 11 In addition to the two year delay in issuing licenses and the other cumulative burdens, the City’s frivolous SUP demand reflects a lack of good faith on the City’s 11

Bates ##471-72, 474-75, 476-77.

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part. New Berlin at 899. (“The repeated legal errors by the City’s officials casts doubt on their good faith.”) Finally, World Outreach faced the regular interruption of its business from continual City inspections, from inspections on each of the first three day after purchase on July 13, 2005, to an Alderman Beale-ordered “Task Force” inspection from a multitude of City departments, to multiple unplanned inspections from the City Zoning Department. IV.

The District Court erred in imposing an obligation on World Outreach to demonstrate their lawful nonconforming use to the City.

In World Outreach I this Court made clear that World Outreach did not have an obligation to convince the City that they had a lawful nonconforming use, holding: [World Outreach] was told [by the City] that it couldn’t have [an SRO] license because it lacked a Special Use Permit to allow it to operate a community center in a Community Shopping District. Yet the City had voluminous files, including files of SRO licenses obtained by the YMCA after the rezoning, which showed that no Special Use Permit was required because the use made of the building, including single-room occupancy, was a legal nonconforming use. 591 F.3d at 536. (Emphasis added.) Had World Outreach obtained the [special use] permit before the rezoning, it would have been entitled to continue the permitted use as a lawful nonconforming use. But it was already entitled to continue the use of the center for single-room occupancy as a lawful nonconforming use, provided only that it obtained an SRO license, which it had applied for and the City had no grounds for denying. 591 F.3d at 537. (Emphasis added.) And the record shows that in 2005 the City did, indeed, have “voluminous files, including files of SRO licenses obtained by the YMCA after the rezoning which showed that no Special Use Permit was required”. Exhibit 13, generally, [Dkt. 19341

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203; Dkt 205-210]. 12 Likewise, the evidence shows that on August 3, 2005 World Outreach applied for the required business license to operate the community center, and on November 16, 2005 World Outreach applied for the required SRO license; but the City did not approve them until August 3, 2007. Notwithstanding the Seventh Circuit’s clear direction, at multiple points in its opinion the District Court held that World Outreach was obligated before licensing to convince the City of its lawful nonconforming use. 949 F.Supp.2d at 847-48. But, the City’s argument that World Outreach had to prove functional equivalence is nonsensical and incoherent, and further evidence of a lack of good faith by the City. It is impossible to “prove” the future. If instead of operating a community center and SROs World Outreach had received its license and had operated a grocery store, City inspectors and Alderman Beale would have uncovered that quickly. World Outreach only asked to be licensed as the YMCA had been. Moreover, World Outreach offered the City something better than functional equivalence: repeated affirmations that the community center and SRO uses, would be identical! Accordingly, in each of their four applications, August 3 and November 16, 2005, May 16, 2006, and February 2, 2007, World Outreach promised to operate the identical community center and SRO uses. [Dkt. 186-8 at pgs. 25, 28]; [Dkt. 193-4 at pgs. 11-22]. Plus, in the Zoning Department’s three inspections, September 14 and 18, 2005 and January 6, 2006, the City confirmed that World Outreach was Bates ## C00147-205, 88-101, 105-08, 557-62, 571-90. ## 50, 102-04, 109-46, 219-401, 406, 410-11, 413, 442, 513-26, 556-57, 563, 593-94, 596-98, 612-29. 12

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operating a community center, and in the first inspection that World Outreach intended to operate the SROs as soon as they could get them ready. [Dkt. 186-7 at pgs. 1-4]; [Dkt. 186-7 at pgs. 5-7]; [Dkt. 186-7 at p. 8]. Then, in the City’s lawsuit in December 2005, the City itself confirmed that World Outreach was operating a community center. And at the Zoning hearing on September 27, 2005, World Outreach’s attorney, Richard Baker, confirmed on three occasions that they intended to operate the community center and SRO uses. [Dkt. 214 at pgs. 7-8]. In multiple trips to City Hall over more than two years, Pastor Blossom and Claudette Doss repeatedly advised the City of their intentions to operate the community center and SROs. [Dkt. 193 at p. 16]. Thus, World Outreach’s message to the City over the two years always was the same: “we intend operate the identical community center and SROs that the YMCA operated.” So, the District Court imposed an impossible standard for World Outreach to meet: convince “the Zoning Committee or the Zoning Department” of your lawful nonconforming use. 949 F.Supp.2d at 847. When, in World Outreach I, this Court reversed the final judgment of the District Court dismissing World Outreach’s substantial burden claim it held World Outreach had a constitutionally-derived, property right to continue the established, legal nonconforming uses at the property. World Outreach I, 591 F.3d at 535 citing Bainter v. Algonquin, 675 N.E.2d 120, 125 (Ill. App. 1996); Illinois Life Insurance v. Chicago, 244 Ill. App. 185, 195-97 (1927); Shrewsbury Edgemere Associates LP v. Board of Appeals, 565 N.E.2d 1214, 1216-17 (Mass. 1991).

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This Court’s legal conclusion was necessary (i.e. not dicta) to the resolution of the issues before it in 2009, and the law of the case doctrine required that the District Court conform to the conclusion. The Seventh Circuit decided World Outreach was entitled as a matter of law to continue the lawful nonconforming uses of the property. In short, World Outreach’s “substantial burden” claim hinged on whether it was entitled to continue the lawful nonconforming uses of the center upon purchase with no obligation to seek a SUP. After substantial analysis of the District Court’s decision and the City’s arguments to the contrary, this Court concluded that the operation of a community center and 168 SRO units were established, lawful nonconforming uses of the property before World Outreach purchased it in July, 2005 and before the City rezoned the parcel in October 2005. 591 F.3d at 535. And because the lawful “nonconforming status [of a use] runs with the land and is not affected by changes of tenancy, ownership, or management,” World Outreach was “entitled” to continue operating the community center and SRO’s when it acquired the property. Id. (“But [World Outreach] was already entitled to continue the use of the center for singleroom occupancy as a lawful nonconforming use, provided only that it obtained an SRO license, which it had applied for and the City had no grounds for denying.”) (Emphasis in original.) This Court expressly rejected the City’s argument that World Outreach had to first obtain the City’s approval (in the form of a SUP or Zoning Department or Board of Appeals decision) before it could continue the lawful nonconforming uses.

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Id. The three state cases cited by this Court strongly support its conclusion. In Bainter, the Illinois Appellate Court held “[a] legal nonconforming use is a nonpermitted use under currently applicable zoning ordinances which predates the applicable zoning ordinance and is legalized on that basis.” 285 Ill. App. 3d 745, 750-51 (Ill. App. 1996). In Illinois Life Insurance, the Court held the right to continue a lawful nonconforming use is “not derived from either [Chicago’s] Zoning Law or the zoning ordinance,” but rather is “a constitutional right wholly independent of either [Chicago’s] Zoning Law or the zoning ordinance.” 244 Ill. App. 185, 193 (1927) (Emphasis added, noting further that the provisions in Chicago’s then Zoning Law “permitting the continuance of a nonconforming

use,

are

provisions

merely

declaratory

the

constitutional right of property owners.”) (Emphasis added.) And in Shrewsbury, the Supreme Judicial Court of Massachusetts rejected the town’s claim that a developer needed a SUP to continue the legal nonconforming use of a drive-in theater. 565 N.E.2d 1214 (Mass. 1991). However, after this Court resolved these questions of law and allowed World Outreach to proceed against the City on its “substantial burden” claim, the City continued to reassert the same specious arguments before the District Court on summary judgment. The City continued arguing that World Outreach was not entitled to continue the legal nonconforming uses, because it had failed to prove its nonconforming uses to the City’s satisfaction! The City continued to make this claim even after conceding on summary judgment that operation of a community

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center and 168 SRO units were lawful nonconforming uses before World Outreach purchased the property in July, 2005. 949 F.Supp.2d at 846. Because World Outreach I required a determination regarding World Outreach’s rights to continue the lawful nonconforming uses, and because this Court’s decision resolved the issue by declaring that World Outreach was entitled as matter of law to continue the uses, the District Court had an obligation to follow the “law of the case” on this issue. The District Court erred on the question of whether World Outreach needed to convince the City of its lawful nonconforming use for a second reason. Of its own accord, the Chicago Zoning Department itself conducted three inspections of the community center and SROs, on 9/14/05, 9/18/05 and 1/5/06. [Dkt. 186-7 at pgs. 1-4]; [Dkt. 186-7 at pgs. 5-7]; [Dkt. 186-7 at p. 8]. Thus, the City cannot claim legitimately that World Outreach needed to prove its lawful nonconforming uses. These inspections all took place after World Outreach had applied, on August 3, 2005, for the limited business license necessary to operate the community center, and shortly before November 16, 2005, when World Outreach applied for the requisite SRO license. But neither license was approved until August 3, 2007. As the Zoning Department records reflect, the City is charged with knowledge that World Outreach intended to operate a community center as soon as they were licensed, and would operate the SROs as soon as they could clean, paint and remove the old carpeting.

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Thus, the Zoning Department was fully aware of many continuous years of YMCA community center/SRO use and World Outreach’s lawful nonconforming uses, and the Zoning Department’s demand for a SUP or other proof was at least unfounded, and quite possibly in response to Alderman Beale’s hostile notification. For example, the Zoning Department’s notes from September 14, 2005 showed— “Illegal Religious Assembly w/o special use permits; community center, off-street parking.”; “formerly Greater Roseland YMCA”; “1st Fl.-Large Fitness Center Full Stocked w/ Equipment”; and as to the SROs “2nd to 5th Fl.”—“Owner states she wants to clean, paint/remove carpet.” (Emphasis added.) The Zoning Department notes from September 18, 2005 and January 6, 2006 strengthen these conclusions. Accordingly, on three separate occasions the Zoning Department made its own inspections and confirmed World Outreach’s lawful nonconforming uses of the community center and SROs. After this, the City had no legitimate basis upon which to demand a SUP, or withhold licenses for two years. V.

The District Court erred in not finding that the City substantially burdened World Outreach by failing to approve the community center license in 2005.

As noted in the previous section, on 8/3/05 World Outreach applied for the business license that it needed to operate the community center, which comprised the first floor and basement. Indeed, the City computers show 8/3/05 as the “Activity Start Date” for World Outreach. [Dkt. 208 at pgs. 3, 42]. As also noted above, the Zoning Department confirmed in its September 2005 inspections that

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World Outreach was proceeding with the “community center” use, and that the property was “formerly Greater Roseland YMCA”. In World Outreach I, this Court concluded that World Outreach was entitled to proceed with its community center use as a lawful nonconforming use after purchase from the YMCA. And in its opinion, the District Court concluded: “After November 1, 2005, World Outreach was entitled in an M-1 district to operate a community center and a religious assembly….” 949 F.Supp.2d at 848 (Emphasis added.) Yet, the City refused to approve World Outreach’s community center license for two years, until 8/3/07. The evidence is unrefuted that this cost World Outreach hundreds of thousands of dollars, as detailed above, resulted in loss of the building in a tax sale, and imposed multiple, cumulative substantial burdens. Notably, there were no building code violations affecting use or licensing of the community center. Six weeks after purchase, on August 26, 2005, the Chicago Building Department inspected the property. [Dkt. 198 at p. 49]. The City found only five violations, all pertaining to the SROs, and having nothing to do with the community center. 13 Accordingly, from the day it bought the “Y”, July 13, 2005, World Outreach was entitled to operate its community center. But the City persisted in its frivolous, if not hostile, SUP demand, and refused to license World Outreach’s community center.

The five SRO violations were “Fire escape panic hardware defective 3rd & 4th Floor”; “Carpet stained and torn 4th, 3rd 2nd”; “Cracked plaster through out all vacant rooms & stairwells; “Missing handrail 2nd floor south stairwell”; and “All 168 SRO’s vacant.” 13

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Licensing the community center when the YMCA owned the building was simple and quick, essentially pay the fee and immediately receive the license. [Dkt. 195 at p. 76]. And once the City dropped its SUP demand in 2007, the same quick and simple procedure became true with World Outreach. [Dkt. 220-4 at pgs. 19-24]. The City substantially burdened World Outreach by delaying approval of the community center license for two years. VI.

The District Court erred in concluding that World Outreach caused the two year delay in licensing by failing to file for licenses and permits.

At 949 F.Supp.2d 851-52 the District Court held: There is no dispute of material fact that by the time the federal suit was filed World Outreach had not filed for all of the needed licenses and permits … to become licensed as an SRO, a recreational facility, or any other use for which it sought to qualify. This is inaccurate. The federal suit was filed in Cook County Circuit Court on April 12, 2006. But World Outreach filed on August 3, 2005 for the only license it needed to operate the community center. And on November 16, 2005 World Outreach filed for the only license it needed to operate the SROs, well before April 12, 2006. The District Court incorrectly blamed World Outreach instead of the City for the twoyear delay in issuing licenses. The license for the community center is called “Limited Business License”. World Outreach specifically identified this license and requested that the City issue it in its 8/3/05 application. The license for the SROs is called “Single Room Occupancy Class I”. [Dkt. 220-4 at pgs. 19-24].World Outreach requested this when it applied for the SRO license on 11/16/05. 49

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By May 2006 the City had failed to grant either license. Accordingly, on May 16, 2006 World Outreach reapplied for both licenses. [Dkt. 220-2]. By January 2007 the City still had failed to grant either license. So, on February 2, 2007 World Outreach once again reapplied for both licenses. [Dkt. 220-2]. Six months later, finally, the City approved the licenses. On January 22, 2007, Elizabeth McGuan, a Mauck & Baker paralegal, went to City Hall regarding status of the application. A supervisor in the Department of Business Affairs and Licensing, Betsy Gonzalez, insisted to McGuan that no application had been filed. McGuan then spoke with Dennis Connolly, in the same Department, who described the application process, advising that after applying it “is then sent to the Zoning Department.” If the Zoning Department approves the application, all that is required for licensing is “the applicant returns to the Department of Business Affairs and Licensing, shows photo identification, signs the permit, and pays the fee.” But, as to World Outreach’s application Connolly advised “that it had been received into his office, gone up to the Zoning Department, and not come back.” [Dkt. 221-1]. Thus, World Outreach’s applications were “buried”. The City’s own computer records reveal the truth of what took place in the Zoning Department prior to August 3, 2007, when the licenses were issued. For example, on November 16, 2005 Pastor Blossom appeared at the Zoning Department to apply for the SRO license, generating two Zoning Department computer entries. One reads: “11-16-05 A SRO is a special use in a C1-1

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(Commercial District). A Special Use requires a determination and a public (sic) hear by the ZBA.” [Dkt. 186-8 at p. 28]. Thus, not only did the Zoning Department use incorrect zoning for World Outreach’s property, indicating a lack of good faith— New Berlin at 899. (“The repeated legal errors by the City’s officials casts doubt on their good faith.”)—it completely ignored decades of continuous SRO and community center licensing for the property. The second computer entry supports the same conclusions: “11-16-05 Applicant present, Pamela M. Blossom. Property is currently pending legal action for operating an illegal church w/o a ZBA special use and sufficient off-street parking, and abandon signs and canopies over the public way.” [Dkt. 186-8 at p. 25]. (In reality, the large parking lot just west of the building provided more than sufficient parking, and World Outreach removed the signs and canopy.) VII.

The District Court erred in concluding that World Outreach caused the two year delay in licensing by not performing repairs.

At 949 F.Supp.2d 851-52 the District Court made the following holding: There is no dispute of material fact that by the time the federal suit was filed World Outreach had not … performed the repairs to become licensed as an SRO, a recreational facility, or any other use for which it sought to qualify. The premise to this section is similar to the last, that the District Court incorrectly blamed World Outreach instead of the City for the two-year delay in issuing licenses. The Court’s conclusion that World Outreach failed to make needed repairs, was incorrect.

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From the time of purchase on July 13, 2005 World Outreach intended to use the SROs to house the poor. Confirming this, upon taking possession of the property World Outreach immediately accepted a donation of over 70 beds for the SROs. [Dkt. 186-2 at pgs. 31-32]. In September 2005 officials from the State of Illinois inspected World Outreach’s facilities, and advised Pastor Blossom that they were interested in renting 150 of the SROs to house Hurricane Katrina victims, initially on an emergency basis and later on a permanent basis. In August 2005 the City cited five SRO violations. [Dkt. 198 at p. 49]. These violations were cosmetic in nature, and easily repaired. According to Pastor Blossom the SROs needed “painting and replacing the carpet” and “minor repairs to walls and doors.” [Dkt. 214-9]. Ron Carter, from IDHS, testified his assessment in September 2005 was that only “cosmetic” corrections were needed. [Dkt. 196 at pgs. 68, 74]. (“Mostly cosmetic stuff. The things you do when a unit vacates. You usually paint, minor repairs”). “So it didn’t appear to be anything major, any major problems with getting those units ready. It was probably something that could have happened in 30 days, 60 days.” Sixty days would have been in November 2005. The District Court’s conclusion that World Outreach delayed in making repairs was incorrect.

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CONCLUSION Welfare, food stamps, social workers, jobs programs, public schools, Affordable Health Care. Americans expend enormous amounts and considerable efforts to love the poor, the sick, children, the unemployed and the elderly. But God (and the Seventh Circuit) help the inner city poor if they dare come together to help each other in defiance of ruthless government. When charitable works are suppressed because a city chooses to litigate ad infinitum to preserve even the most outrageous prerequisite of the corrupting aldermanic zoning hegemony, the little guy suffers--we all bleed. World Outreach requests this court reverse the District Court and rule: 1.

The District Court erred in measuring RLUIPA substantial burden by the “effectively impracticable” test, instead of the test ordered by this Court in World Outreach I.

The District Court erred in imposing an obligation upon World Outreach to demonstrate their lawful nonconforming use to the City.

The District Court erred in not finding that the City substantially burdened World Outreach by failing to approve the community center and SRO licenses in 2005 when they were applied for.

The District Court erred in concluding that World Outreach caused the City’s two-year delay in issuing licenses, by failing to file for licenses and permits or by not performing repairs.

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Reverse the District Court’s award of summary judgment to the City for all RLUIPA claims other than as to the frivolous municipal court lawsuit; and

Grant summary judgment to World Outreach on all RLUIPA claims, award damages to World Outreach and remand the matter for an award of reasonable attorney’s fees, expenses and costs; or in the alternative remand the case for trial and post-trial relief on these matters.

Award other appropriate relief. Respectfully Submitted, World Outreach Conference Center and Pamela Blossom By: /s/ Andy Norman__________ Counsel for Plaintiffs-Appellants

John W. Mauck Andy Norman Noel W. Sterett Mauck & Baker, LLC One N. LaSalle Street, Suite 600 Chicago, IL 60602 P: (312) 726-1243 F: (866) 619–8661 Counsel for Plaintiffs-Appellants

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No. 13-3669 and 13-3728 CERTIFICATE OF COMPLIANCE WITH F.R.A.P. 32(a)(7)(B) The undersigned, counsel of record for the Plaintiffs-Appellants World Outreach Conference Center and Pamela Blossom, hereby certifies that this brief conforms to the rules contained in F.R.A.P. Rule 32(a)(7)(B) for a brief produced with a proportionally spaced font. The length of this brief as counted by the wordprocessing system used to prepare this brief is 13,953. Dated: April 16, 2014 By: /s/ Andy Norman__________ Counsel for Plaintiffs-Appellants John W. Mauck Andy Norman Noel W. Sterett Mauck & Baker, LLC One N. LaSalle Street, Suite 600 Chicago, IL 60602 P: (312) 726-1243 F: (866) 619â&#x20AC;&#x201C;8661 Counsel for Plaintiffs-Appellants

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No. 13-3669 and 13-3728 CERTIFICATE OF COMPLIANCE WITH F.R.A.P. 30(d) The undersigned, counsel of record for the Plaintiffs-Appellants World Outreach Conference Center and Pamela Blossom, hereby certifies that the materials required by Circuit rule 30(a) are included in the Short Appendix accompanying the brief, and that the items required by Circuit Rule 30(b) are included in the Appellant’s Separate Appendix. Dated: April 16, 2014 By: /s/ Andy Norman__________ Counsel for Plaintiffs-Appellants

John W. Mauck Andy Norman Noel W. Sterett Mauck & Baker, LLC One N. LaSalle Street, Suite 600 Chicago, IL 60602 P: (312) 726-1243 F: (866) 619–8661

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CERTIFICATE OF SERVICE The undersigned, an attorney, certifies that on April 16, 2014, he caused the Plaintiffs-Appellantsâ&#x20AC;&#x2122; Brief and Short-Appendix to be filed with the Seventh Circuit Court of Appeals electronic filing system, which electronically served notification and copies of such filing upon all attorneys who have appeared and are of record. By: /s/ Andy Norman__________ Counsel for Plaintiffs-Appellants John W. Mauck Andy Norman Noel W. Sterett Mauck & Baker, LLC One N. LaSalle Street, Suite 600 Chicago, IL 60602 P: (312) 726-1243 F: (866) 619â&#x20AC;&#x201C;8661 Counsel for Plaintiffs-Appellants

F:\Clients\1971\11_Second Appeal\2_Brief\Opening Brief\Final documents\Opening Brief 20140415.docx

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No. 13-3669 and 13-3728 ______________________________________________________________________________ IN THE UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT ______________________________________________________________________________ World Outreach Conference Center and Pastor Pamela Blossom, Plaintiffs-Appellants, v. The City of Chicago, Defendant-Appellee. ______________________________________________________________________________ Appeal from the United States District Court for the Northern District of Illinois No. 06-cv-2891, Judge Joan H. Lefkow _________________________________________________________________________ Short Appendix of the Plaintiffs-Appellants Word Outreach Conference Center and Pastor Pamela Blossom _________________________________________________________________________

John W. Mauck Andy Norman Noel W. Sterett Mauck & Baker, LLC One N. LaSalle Street, Suite 600 Chicago, IL 60602 P: (312) 726-1243 F: (866) 619â&#x20AC;&#x201C;8661 Counsel for Appellants Oral Argument Requested

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SHORT APPENDIX Table of Contents

Page

Appendix A Minute Order Entry of March 29, 2013 (Dkt. 245) ........................................... 2 Minute Order Entry of April 1, 2013 (Dkt. 246) ................................................ 3 Memorandum Opinion and Order of April 1, 2013 (Dkt. 247) .......................... 4 Appendix B Minute Order Entry of June 10, 2013 (Dkt. 255) ............................................ 31 Amended Memorandum Opinion and Order of June 10, 2013 (Dkt. 256)...... 34 Appendix C Minute Order Entry of July 2, 2013 (Dkt. 266) .............................................. 61 Appendix D Agreed Final Judgment Order of November 5, 2013 (Dkt. 270) .................... 63 Appendix E Picture from the Declaration of Pamela Blossom (Dkt. 223-1) ...................... 66

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APPENDIX A

001

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UNITED STATES DISTRICT COURT FOR THE Northern District of Illinois − CM/ECF LIVE, Ver 5.1.1 Eastern Division

World Outreach Conference Center, et al. Plaintiff, v.

Case No.: 1:06−cv−02891 Honorable Joan H. Lefkow

City of Chicago Defendant.

NOTIFICATION OF DOCKET ENTRY

This docket entry was made by the Clerk on Friday, March 29, 2013: MINUTE entry before Honorable Joan H. Lefkow:The motion by plaintiffs Pamela Blossom and World Outreach Conference Center for summary judgment [191] is granted in part and denied in part. The motion by the defendant City of Chicago for summary judgment [183] is granted in part and denied in part. Opinion to follow. Mailed notice(mad, )

ATTENTION: This notice is being sent pursuant to Rule 77(d) of the Federal Rules of Civil Procedure or Rule 49(c) of the Federal Rules of Criminal Procedure. It was generated by CM/ECF, the automated docketing system used to maintain the civil and criminal dockets of this District. If a minute order or other document is enclosed, please refer to it for additional information. For scheduled events, motion practices, recent opinions and other information, visit our web site at www.ilnd.uscourts.gov.

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Order Form (01/2005)

United States District Court, Northern District of Illinois

Name of Assigned Judge or Magistrate Judge

Joan H. Lefkow

CASE NUMBER

06 C 2891

CASE TITLE

Sitting Judge if Other than Assigned Judge

DATE

4/1/2013

World Outreach Conference Center vs. City of Chicago

DOCKET ENTRY TEXT

Enter Memorandum Opinion and Order. For the reasons stated in the memorandum Opinion and Order, plaintiffâ&#x20AC;&#x2122;s motion for summary judgment [191] is granted in part and denied in part. Defendantâ&#x20AC;&#x2122;s motion for summary judgment [183] is granted in part and denied in part. This case will be called for a status hearing on April 30, 2013 at 8:30 a.m. The parties are directed to confer to determine whether the issue of damages can be resolved without a trial.

O [ For further detail see separate order(s).]

Notices mailed by Judicial staff.

Courtroom Deputy Initials:

06C2891 World Outreach Conference Center vs. City of Chicago

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IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

WORLD OUTREACH CONFERENCE ) CENTER ) ) Plaintiffs, ) ) v. ) ) CITY OF CHICAGO, ) ) Defendant. )

Case No. 06-2891 Judge John H. Lefkow

MEMORANDUM OPINION AND ORDER Plaintiff World Outreach Conference Center (“World Outreach”), an Illinois not-forprofit corporation, is a religious assembly or institution protected by the Religious Land Use and Institutionalized Persons Act of 2000 (“the Act”), 42 U.S.C. § 2000cc(a)(1). See World Outreach Conference Ctr. v. City of Chicago, 591 F.3d 531, 535 (7th Cir 2009). (“[E]ven the recreational and other nonreligious services provided at the community center are integral to World Outreach’s religious mission[.]”). Plaintiff Pamela Blossom is World Outreach’s senior pastor and registered agent. World Outreach currently owns the building located at 4 East 111th Street in Chicago, Illinois (“the building”). Constructed in 1926 by the YMCA,1 the building was owned and operated as the Greater Roseland YMCA until the YMCA sold it in July 2005 to World Outreach. This dispute arises from roadblocks World Outreach encountered in obtaining authorization from the City of Chicago to use the building for a community center with a religious ministry.

The exact YMCA corporate entity which owned the property is not of record, but it does not matter here.

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World Outreach (including the Reverend Blossom) claims that the City violated the Act when, without a compelling governmental interest, it imposed a substantial burden on World Outreach’s religious exercise and irrationally discriminated against it in violation of the equal protection clause of the Fourteenth Amendment.2 See 42 U.S.C. § 2000cc(a)(1). World Outreach seeks damages and attorney’s fees. This court’s jurisdiction rests on 28 U.S.C. §§ 1331 (federal question) and 1343 (civil rights), as well as 42 U.S.C. § 2000cc-2(a) (creating private right of action to assert violation of the Act). Venue is proper in this district under 28 U.S.C. § 1391(b) as the events at issue occurred within the Northern District of Illinois. Cross motions for summary judgment are now before the court for decision. BACKGROUND3 For many decades, the YMCA operated a community center and single room housing facility (“SRO”) at the building. The building contained, in addition to meeting and recreational facilities in the basement and on the ground floor, 30 SROs on the second floor, 68 SROs on the

World Outreach also relies on the Illinois Religious Freedom Restoration Act, P.A. 90-846 § 15,775 Ill. Comp. Stat. 35/15. The Seventh Circuit, ruling on an appeal from dismissal of the complaint, stated that the state law is, “so far as relates to this case, materially identical to section (a)(1) of the federal law, and so it need not be discussed separately.” World Outreach, 591 F.3d at 533 (internal citations omitted). The court also pointed out that plaintiffs’ claims under the First Amendment’s free exercise clause, the equal protection clause for religious discrimination, and the Act are indistinguishable. See id. at 534-35 (“[W]e cannot see any point in a plaintiff’s pitching a religious discrimination claim on any provision of the Constitution other than just on the statute.”) (emphasis in original.) The court also affirmed dismissal of plaintiffs’ religious discrimination claims. Id. at 538 “[T]here was no discrimination against World Outreach on religious grounds.”). The issues now pending before the court are the “substantial burden” claim under the Act and a class-of-one equal protection claim. 3

On a motion for summary judgment, the facts are to be stated in a light most favorable to the non-movant. Naficy v. Ill. Dept. Of Human Servs., 697 F.3d 504, 509 (7th Cir. 2012). Because cross motions are pending, the court will identify any disputes of fact that are potentially material to the outcome. Plaintiffs’ statement of material facts, however, is rife with assertions that are not documented in exhibits or depositions. Many facts rely on Blossom’s understanding of the intentions of others or characterize rather than report facts. These statements are thus inadmissible as are the numerous hearsay assertions. Facts which are not submitted in compliance with Local Rule 56.1(b)(3) are disregarded.

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third floor, and 68 SROs on the fourth floor. Each of the three SRO floors had a single bathroom. As of 2004, the YMCA’s community participation and revenue had significantly declined. The YMCA commissioned an engineering/architectural study to assess its options for the building in light of declining community participation and revenue. According to the ensuing report, an estimated $10 million in repairs would have been required to upgrade the building to the YMCA’s then-current program requirements.4 Financial issues such as this led to the YMCA’s decision to close the community center and sell the building. Demolition costs were estimated at $1 million. The appraised value of the land, as of 1999, was $500,000. The YMCA informed the City by letter dated May 31, 2005 that it would close. Ninth Ward Alderman Anthony A. Beale had spoken publicly that he believed the YMCA should stay in the Roseland community. But once the decision to close was made, he supported two entities interested in purchasing the building: Chicago State University (“CSU”) and Provider Realty Company, a developer. CSU wanted to use the building for a recreation facility. The developer wanted to use it for senior citizen housing. Both represented to Alderman Beale that they had funds to rehabilitate the building. Alderman Beale stated that he supported either of them because they planned to rehabilitate the building. Ultimately, CSU withdrew its interest in the property. In May, 2005, Blossom on behalf of World Outreach presented to the YMCA a written proposal to purchase the building for “a multi-faceted ministry.” World Outreach planned to include a GED placement and training center, a bookstore, office rental space, a performing arts

The City had issued more than 100 code violation citations during the period May, 1986 to December, 2002.

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center/school of music, a day care center, a Bible college, a communications center (for training in advanced television/radio, communications production, and training for the hearing- and visually-impaired community), a Christian night club, and a conference and educational center. (See generally Pls. Ex. 3, Beale Dep.) World Outreach had used space in the building once a week for approximately 15 months before these negotiations began. Blossom had seen the basement and first floor (not the upper floors with the SROs) before World Outreach made its first offer, and she knew the areas she had seen were filthy, full of roaches and rats or mice, and had plaster falling from the walls. She had been given a copy of the YMCA engineering report reflecting the need for a multi-million dollar renovation. She discussed the report with a friend who handled insurance and the elders of World Outreach, but she did not contact an architect, engineer, inspector, or other knowledgeable professional to learn what was needed or what it would cost to repair the building for her purposes. She made no effort to obtain financing for the rehabilitation project. Rather, she planned to rely on volunteer skilled parishioners to make repairs. During June, 2005, Blossom met with Alderman Beale about her desire to purchase the building. In advance, she sent him a copy of World Outreachâ&#x20AC;&#x2122;s proposal.5 Alderman Beale warned Blossom about the condition of the building and the anticipated cost of repairs, suggesting that she lacked means to fund them. Blossom told Beale that she would â&#x20AC;&#x153;rely on the Lord to give her the money.â&#x20AC;? She refused to disclose to Beale any information about her financial capability to accomplish her proposal. Alderman Beale testified that he would have

Alderman Beale testified that at the meeting Blossom was not clear about her plans for the building, and he received the proposal after the meeting. A letter from Blossom to Alderman Beale dated June 8, 2005 suggests that Blossom is correct that he had the proposal before the meeting.

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supported any buyer with capability to rehabilitate the building, including Blossom if she could do so. (See Pls. Ex. 3, Beale Dep. at 12-13.) Blossom believed Alderman Beale opposed it because he was angry at her and World Outreach for coming into the community without his approval (she hadn’t “reached out to him.”). Ultimately, however, the YMCA accepted World Outreach’s offer of $380,000, and World Outreach took possession of the building on July 13, 2005. On June 29, 2005, Alderman Beale submitted a zoning amendment to the City Council to “down zone” the use of the land from B3 Community Shopping District to M1 Limited Manufacturing/Business Park District. Beale said he normally proposes such amendments when it appears a building will become vacant. He chose the designation on the advice of a Zoning Department administrator because the building is located in a commercial area. On August 2, 2005, according to normal practice, Alderman Beale placed a hold on permit applications (including building permits) pending the zoning change. No building permit could be issued while the zoning amendment was pending. World Outreach proceeded to work in the building without a building permit. Blossom believed that Alderman Beale had no reason to offer the zoning amendment or place holds on permit applications because the building would not be vacant where there were two outstanding offers to purchase it (presumably the other was Provider Realty), and Alderman Beale had no intention of withdrawing the holds after the amendment passed (implying that he was merely thwarting World Outreach’s plans).6

World Outreach has not offered evidence that holds continued past the effective date of the zoning amendment.

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At the end of July, Alderman Beale directed the Department of Buildings to inspect the whole building. (See Pls. SOF Ex. 13, part 1, at C00095.) (Internal city memo indicating “the Alderman wanted a Tasc [sic] Force out there inspecting the whole building.”) A public hearing before the Zoning Committee of the City Council was held on September 27, 2005. Chairman William J.P. Banks stated his opinion that a special use permit would be needed to operate a community center in a B3 district. World Outreach’s counsel argued that, because World Outreach was continuing the same use as the YMCA, it was a legal nonconforming use for which a special use permit was not needed. Alderman Bernard Stone stated that if World Outreach believed it was “grandfathered in” because it was continuing the same use as the YMCA, it had produced no evidence of it.7 Blossom attended the hearing and spoke of her intention to create a business center on the second floor and apartments and condos on the third and fourth floors. She did not indicate a plan to operate an SRO. The Zoning Committee recommended to the City Council that the zoning amendment be adopted. (See generally Pls. Ex.13, part 1, Partial Transcript of Zoning Comm. Hearing.) The City Council passed the amendment on October 6 and it became effective November 1, 2005. Although World Outreach did not include offering SRO accommodations in the proposal to the YMCA, although Blossom did not discuss that possibility with the YMCA or with Alderman Beale, and although in September, 2005 Blossom told a building inspector that she was not operating an SRO, Blossom testified at her deposition that she decided shortly after 7

“A doctrine of Illinois law allows in some circumstances a land use to continue after a zoning change that would ban it, but only if the use was authorized by the zoning ordinance as it stood before the change.” Petra Presbyterian Church v. Vill. of Northbrook, 489 F.3d 846, 848 (7th Cir. 2007) (citations omitted). See CHICAGO MUNI. CODE, § 17-1-1404 (“Any nonconformity under the previous Zoning Ordinance will also be a nonconformity under this Zoning Ordinance, as long as the situation that resulted in the nonconforming status under the previous regulation continues to exist.”)

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taking possession of the building that World Outreach would use the building for SRO housing. Blossom applied to the City for an SRO license on November 16 of that year.8 The storm known as Hurricane Katrina struck the Gulf Coast on August 29, 2005 causing the President to declare a national emergency. That triggered a series of actions by the State of Illinois and other states to respond. One response was the reception of thousands of evacuees from Louisiana to other communities. About a week after the storm, continuing for seven-to-ten days, the Federal Emergency Management Agency (“FEMA”) flew evacuees to Chicago. Approximately 4,500 people arrived in Chicago and the collar counties. The Illinois Department of Human Services (“IDHS”) was in charge of Illinois’ response for human services needs. Ronald Carter, Director of Strategic Planning for IDHS, led the effort, in conjunction with FEMA, the Illinois Emergency Management Agency, and other governmental agencies. IDHS worked with the Chicago Housing Authority, many nongovernmental organizations such as Catholic Charities, the Heartland Institute, churches, and others to locate temporary housing and other needed services. This effort continued until approximately mid-October. Carter’s focus then turned to locating suitable permanent housing for evacuees. Under the United States Department of Housing and Urban Development (“HUD”) rules, people had to be moved to permanent housing by the end of the year or early 2006. When a location was

Blossom testified that World Outreach applied for a business license to operate a community center and SRO on August 3, 2005. Plaintiffs’ citations to Exhibits 51-53 and 71 do not reflect an application for an such a license dated August 3, 2005. The City correctly recites that the application of August 3 was for a limited business license to operate only the building’s fitness center on a membership basis. (See Pls. Ex. 2e (Dkt. No. 193-4, page ID 2735).) Thus, the allegation on which the court of appeals relied in stating that the application was filed in August, 2005, 591 F.3d at 536, is not borne out by the evidence.

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identified, Carter would assess whether the unit appeared to meet standards for section 8 housing (a program administered by HUD). During October, 2005, Carter visited World Outreachâ&#x20AC;&#x2122;s facility with a view to finding permanent housing for approximately 50 single men who had been in temporary quarters in the Tinley Park Mental Health Facility. To Carter, the building was not yet, but could be made, ready to house these individuals. He liked that he could house a significant number of people at one place, that the facility had the ability to feed large numbers of people at one time, and that it had a recreational equipment on site. The City sent inspectors to the building on five dates from August 19 to September 14, 2005. An August inspection revealed cracked plaster through all vacant rooms and stairwells, defective fire escape panic hardware on the third and fourth floors, no notification of proposed use for the 168 vacant SROs, stained and torn carpet on the second, third, and fourth floors, and a missing handrail on the second floor south stairwell. On September 13 and 14, City inspectors found an illegal religious assembly and community center without a special use permit, and, among other problems, SRO rooms in disrepair.9 Timing was critical because the evacuees needed to be housed permanently as soon as possible. For World Outreach, meeting the threshold requirements was daunting at best. World Outreach, at a minimum, would need a certificate of occupancy for a licensed SRO, signifying that all HUD section 8 habitability requirements were met. Multiple repairs and a series of

World Outreach argues in its brief that by October 30 the problems were corrected. This assertion is without citation to the record and is therefore disregarded.

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inspections would have been required to achieve this. Blossom began to repair SRO units after she was contacted about housing Katrina evacuees.10 About a month after his first visit, Carter returned and saw that about one-third of the units appeared ready for occupancy, although he knew nothing about the plumbing, electrical and structural condition of the building. On that visit, Blossom told him that Alderman Beale was opposed to having evacuees in Roseland and opposed to the building’s being used for SROs. Blossom asked Carter to advocate for World Outreach with the Alderman. Carter may have spoken briefly to Beale, as Beale recalled an inquiry to which he responded that the building was not suitable to house people at that time. During this period, Alderman Beale demanded from the YMCA information about closing community YMCA’s in poor areas. He also wrote to the Department of Water saying that he was “not in support of the World Outreach Center,” requesting that it deny a charitable exemption on its water bill. (Pls. SOF Ex. 49, ¶ 26.) On December 3, Blossom wrote Carter that the renovation process was complete. Carter responded that an SRO license was still essential. Carter went to City Hall to learn whether it was likely that World Outreach could get an SRO license soon. On December 13, Carter reported back to Blossom that “after discussions with city officials it appears a follow up discussion with Alderman Beale is critical. It is my intent to reach out to him today.” (Pls. SOF Ex. 6. (unmarked document within Exh. 1 to Carter dep.)

In a letter to then-Mayor Richard M. Daley dated October 12, 2005, Blossom stated that World Outreach was in the process of painting and replacing carpet in the SRO rooms for evacuees. (Pls. SOF Ex. 39, p,3.)

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On December 14, 2005, the City filed a lawsuit in the Circuit Court of Cook County seeking an injunction prohibiting World Outreach from using its property as a church and a community center without a special use permit as required for B3 zoning. On March 17, 2006, the City filed an amended complaint adding counts for operating a community center and a church in an M1 district. The City also alleged off-street parking zoning violations, improper signage and a public nuisance based on the alleged improper use and other ordinance violations. In response, World Outreach did not apply for a special use permit because it believed itself a legal nonconforming use. On January 9, 2006, Carter wrote to Blossom that he would seek the assistance of State Senator James Meeks in reaching out to Alderman Beale, stating, â&#x20AC;&#x153;The need for 150 units for evacuees is as strong and necessary as ever.â&#x20AC;? Id. On January 25, 2006, Carter received an email from Blossom saying she was still working on getting an SRO license. Id. By then, Carter had already concluded that the building was not a usable resource but assured Blossom that, if she got an SRO license, he would still be interested in referring evacuees to the building. Even if World Outreach had obtained an SRO license and passed all required inspections, IDHS would not have moved anyone into the building but would have added it to a list of potential housing options for IDHS outreach workers to refer clients to. Meanwhile, although IDHS had turned its attention elsewhere, Blossom and World Outreach continued to work on the building and made contacts with city officials about getting an SRO license. Inspectors from various City departments inspected the building for various reasons over this period. The earliest document indicating that an application for an SRO was prepared is dated February 2, 2007. (Pls. SOF Ex. 51.) (The document is not authenticated and

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does not bear any stamps indicating that the City received it.) During the summer of 2006, World Outreach was working with the City to compile the architectural drawings and other materials necessary for the SRO license (Pls. SOF Ex. 2, Doss Dep. at 55), which meant that the application was not yet ready. The City voluntarily dismissed the lawsuit without prejudice in April, 2006. The City has since admitted that a “church assembly” or “community center” use of the building would not have been subject to special use provisions of the zoning code while the parcel was zoned M1. (Def. Resp. To Pls.SOF at 9-10, ¶ 11.) This federal litigation, filed May 24, 2006, led to the court’s efforts to resolve the dispute. On January 19, 2007, the parties agreed that if World Outreach could prove to the Zoning Administrator that it had a legal nonconforming use and, if inspectors found the building to be in proper order, the building could be licensed as an SRO. World Outreach agreed to submit to the Zoning Administrator all the evidence that it believed proved continuous nonconforming use for the SRO. On January 31, 2007, the Zoning Department signed off on World Outreach’s SRO license application. Inspections and numerous repairs to the building had yet to be completed before the SRO license could issue. After necessary inspections were made and requirements met, the City granted World Outreach nonconforming status as a community center and SRO and an SRO license was issued on August 3, 2007. World Outreach began providing SRO rooms 4 to 6 months thereafter. Currently, 30 to 32 units on the second floor and 35 to 40 units on the third floor are being rented at a rate of

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$375 per unit per month.11 The City continued to find code violations as late as November 3, 2009 (broken plaster in corridors and rooms on the third and fourth floors, missing covers on electric junction boxes in the basement, a missing battery on a carbon monoxide detector in the boiler area, and other items). ANALYSIS I.

The Class of One Equal Protection Claim “[A] deliberate, irrational discrimination, even if it is against one person (or other entity)

rather than a group, is actionable under the equal protection clause.” World Outreach Conference Ctr., 591 F.3d at 538, citing, inter alia, Vill. of Willowbrook v. Olech, 528 U.S. 562, 564, 120 S. Ct. 1073 (2000) (per curiam). “The paradigmatic ‘class of one’ case . . . is one in which a public official, with no conceivable basis for his action other than spite or some other improper motive (improper because unrelated to his public duties), comes down hard on a hapless private citizen.” Woodruff v. Mason, 542 F.3d 545, 553 (7th Cir.2008), quoting Lauth v. McCollum, 424 F.3d 631, 633 (7th Cir. 2005). To establish its “class of one” claim, World Outreach must show that “(1) it has intentionally been treated differently from other similarly situated facilities; and (2) there is no rational basis for the difference in treatment or the cause of the differential treatment is a ‘totally illegitimate animus' ” towards it. Woodruff, 542 F.3d at 554, quoting Maulding Dev., LLC v. City of Springfield, Illinois, 453 F.3d 967, 970 (7th Cir. 2006) (emphasis added in Woodruff).

The City disputes this fact, stating that World Outreach’s operation, on average, has never involved more than 36 to 37 SRO units.

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The City argues that is entitled to summary judgment because World Outreach has not identified any other potential buyer of the building who had the Alderman’s backing and was treated more favorably. By purchasing the building, it contends, World Outreach became dissimilar from others who did not purchase it, as any other purchaser would have had to apply and qualify for the same licenses and permits. Plaintiffs’ theory of liability (based mostly on Blossom’s opinion and hearsay confirming her opinion) seems to be that the City’s demand that World Outreach obtain a special use permit, its rezoning the building into a manufacturing zone, its delay and obstruction of World Outreach’s license requests, and its suing World Outreach all reflect that Alderman Beale vindictively tried to block World Outreach’s efforts to obtain licenses because Blossom did not reach out to him. To whatever extent Blossom’s evidence is admissible, however, it all goes to the second element of proof, the “totally illegitimate animus.” World Outreach’s evidence of disparate treatment is lacking. There is no evidence that the other two potential buyers whom Alderman Beale favored had made campaign contributions or otherwise “supported” him. There is no evidence, other than Blossom’s opinion, rebutting Alderman Beale’s statement that he favored the other two candidates because they had funding to make needed repairs while World Outreach did not. Setting aside these two comparators, World Outreach has submitted no evidence of what “reaching out” to the Alderman means. If it means an implicit demand for a campaign contribution or an illicit quid pro quo, there is certainly no evidence of it, as even Blossom made no such assertion, nor does World Outreach have evidence that it occurred in a similar situation at another time. There is no evidence that, in a similar situation, Alderman Beale did not request rezoning and/or put a hold on licenses while the zoning amendment was pending. Without a comparator of any sort, World Outreach cannot

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proceed to the second element of proof. Thus, no reasonable jury could conclude based on the admissible evidence that Alderman Beale was acting out of totally illegitimate animus against World Outreach unrelated to his public duties. The City is entitled to summary judgment on this claim. II.

The RLUIPA Claim The Act “provides that a government land-use regulation ‘that imposes a substantial

burden on the religious exercise of a . . . religious assembly or institution’ is unlawful ‘unless the government demonstrates that imposition of the burden . . . is in furtherance of a compelling governmental interest; and it is the least restrictive means of furthering that compelling governmental interest.’” World Outreach Conference Ctr. v. City of Chicago, 591 F.3d at 533 quoting 42 U.S.C. § 2000cc(a)(1). “[I]n the context of RLUIPA’s broad definition of religious exercise, a land-use regulation that imposes a substantial burden on religious exercise is one that necessarily bears direct, primary, and fundamental responsibility for rendering religious exercise– including the use of real property for the purpose thereof within the regulated jurisdiction generally–effectively impracticable.” Civil Liberties for Urban Believers v. City of Chicago, 342 F.3d 752, 761 (7th Cir. 2003) (hereafter “CLUB”). Substantial burden “mean[s] something different from [a] ‘greater burden than imposed on secular institutions.’” Sts. Constantine & Helen Greek Orthodox Church, Inc. v. City of New Berlin, 396 F.3d 895, 900 (7th Cir. 2005). “If a land-use decision . . . imposes a substantial burden on religious exercise (the statute defines ‘religious exercise’ to include the ‘use, building, or conversion of real property for the purpose of religious exercise,’ 42 U.S.C. § 2000cc-5(7)(B)), and the decision maker cannot justify it, the inference arises that hostility to religion, or more likely to a particular sect,

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influenced the decision.” Id. at 900. At the same time, a religious institution is not entitled to more favorable treatment than a secular institution. Id. “Unless the requirement of substantial burden is taken seriously, the difficulty of proving a compelling governmental interest will free religious organizations from zoning restrictions of any kind.” Petra Presbyterian Church, 489 F.3d at 851. Plaintiffs argue as follows: It is undisputed that during the period from 1999 to July, 2005, the YMCA operated a community center with 168 SRO units, which was at the time of sale a lawful nonconforming use; that World Outreach was entitled under the Zoning Ordinance to continue to operate a community center with 168 SROs as a nonconforming use; and that World Outreach started as early as June, 2005, to demonstrate its lawful nonconforming use, but the City did everything in its power to obstruct the effort. Therefore, the City has imposed a substantial burden on World Outreach in violation of the Act without a compelling governmental interest. The City does not dispute that, during the period from 1999 to July, 2005, the YMCA operated a community center with168 SRO units as a lawful nonconforming use in a B3 district. The City argues that, even so, World Outreach’s right to continue that use was not automatic; rather, World Outreach had to demonstrate to the City that its use of the building was the functional equivalent of the YMCA’s use as long as the B3 classification applied. The City does not dispute that a special use permit was not needed for a community center or church in an M1 district but it does not concede that an SRO was permitted as of right in an M1 district. Principally, however, once the zoning issue was clarified, the delay was caused by World Outreach’s failure to comply with the City’s requirements for licenses and permits.

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CONCLUSIONS OF FACT AND LAW The court reaches the following conclusions of fact and law based on uncontroverted evidence: A.

During the period from 1999 to July, 2005, the YMCA operated a community center with 168 SRO units, which was at the time of sale a lawful nonconforming use in a B3 district.

Before the zoning amendment became effective on November 1, 2005, World Outreach was obligated to demonstrate that its intended use of the building was functionally similar to the YMCA’s use. The Zoning Ordinance controls land use according to a rather complicated system of use

classifications. “[It] broadly divides the city into R, B, C, and M zones for residential, business, commercial, and manufacturing uses, respectively. Each zone, in turn, is subdivided into numbered districts and subdistricts.” CLUB v. City of Chicago, 342 F.3d at 755 (7th Cir. 2003). Community Center is a subcategory of Parks and Recreation. See MUNICIPAL CODE OF CHICAGO, ILLINOIS (“CODE”) § 17-2-0207.12 Religious Assembly is a separate category. Single Room Occupancy is a subcategory of Residential. Id. In a B3 district, a special use permit13 is needed for an SRO, community center, and religious assembly. Id. § 17-3-0207. Operation of an SRO requires a business license, annual inspections and fees, and the landowner must meet all building code requirements applicable to a Residential A2 district multiple dwelling building.

Citations to CODE are found at American Legal Publishing Corporation’s website: www.amlegal.com/library/il/chicago.shtml (last visited Apr. 1, 2013). 13

“Special Use approval is expressly conditioned upon the design, location, and operation of the proposed use consistent with the protection of public health, safety, and welfare, and the proposed use must not substantially injure the value of neighboring property.” CLUB, 342 F.3d at 755-56, citing CODE § 11.10-4.

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See generally, id. § 4-4-005. Thus, nonconforming use status was required to continue to operate a community center or SRO in the B3 district. The same was true for Religious Assembly, or church. As such, without a special use permit and SRO license, World Outreach could operate only as a nonconforming use in the B3 district. C.

During the period from July to November 1, 2005, World Outreach did not satisfy requirements to demonstrate a nonconforming use. “Nonconforming status runs with the land and is not affected by changes of tenancy,

ownership, or management.” Id. § 17-15-0106. But “[t]he burden of proving that a nonconformity exists rests with the subject landowner.” Id. § 17-15-0104 (emphasis omitted). Thus, to continue a nonconforming use, World Outreach had to show that its use was “functionally similar” to the previous use. Id. § 17-15-302-B. A “use substitution application” is to be filed with the Zoning Administrator and notice is to be given the alderman. Id. § 17-15302-C. Although World Outreach insists on one hand that it did not have to get approval and, on the other, that it endeavored to prove its nonconforming use, the evidence submitted contains no documentary submission to the Zoning Department dated before the zoning amendment was adopted attempting to demonstrate functional similarity to the previous nonconforming community center with SRO use or, if World Outreach intended to follow its initial proposal, to demonstrate that the intended multi-purpose use was nonconforming. (At the time World Outreach bought the property, its proposed use of the building was not necessarily “functionally similar” to that of the YMCA.) Therefore, any claim of “substantial burden” for this period of time is without merit.

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After November 1, 2005, World Outreach was entitled in an M1 district to operate a community center and a religious assembly but not an SRO unless it had nonconforming status. After the zoning amendment was adopted, World Outreach appeared to be abandoning

the proposal it submitted to Alderman Beale and described to the Zoning Committee in favor of operating an SRO. Although the City has conceded that a special use permit was not needed for a community center or religious assembly in an M1 district, it has not conceded that an SRO is permitted. As indicated above, a community center is distinct from SRO. SRO is a subcategory under Residential Use and is not a residential use permitted as of right in an M1district. See CODE § 17-5-0204 (“Uses that are not listed in the table are . . . prohibited.”); § 17-5-0207 (M-1 Table and Standards). Thus, the City was not imposing a substantial burden on World Outreach by continuing to demand compliance with the Zoning Code by establishing its status as a nonconforming use.14 The City does not seem to stand on the existence of a SRO in a M1 zone, however, but rests at least primarily on the evidence that the SRO units in the building did not meet Building Code standards for issuance of an occupancy permit.

The court of appeals stated, “A community center is not a special use in a limited manufacturing district, which means that no Special Use Permit could be granted to permit the World Outreach center to operate.” World Outreach Conference Ctr., 591 F.3d at 536 (emphasis in original). It did not distinguish SRO from community center, presumably because it relied on the allegation that World Outreach was going to use the building in the same manner as the YMCA. See id. at 535 (“World Outreach wanted to operate the center just the way the YMCA had done for the previous 80 years[.]”).

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The City’s conduct toward World Outreach in large part was directed towards enforcement of the Building Code and licensing requirements. There is record evidence that Alderman Beale injected himself into the City’s dealings

with World Outreach, even if the disputes of fact between Alderman Beale and Blossom about their conversations are set aside. Alderman Beale explicitly did not support World Outreach, he called for a full-scale inspection after he learned that the building had been sold to World Outreach, and he tried to get the Water Department to deny World Outreach’s charitable exemption. One can rather clearly infer that Beale was upset that his “aldermanic privilege” had been treaded upon (although he denied it). But whatever Beale’s attitude, World Outreach has not demonstrated that Beale took any action that was both unjustified and interfered with the ability of World Outreach to bring the building up to standards. See CLUB, 342 F.3d at 761 (inherent political aspects of the Special Use, Map Amendment, and Planned Development approval processes are not a substantial burden). As for the City, it filed the lawsuit in December 2005, which insofar as it contended that operating a “church assembly” and a “community center” violated the Zoning Ordinance, was meritless. As framed by the court of appeals’ opinion, if, as pleaded, the City filed a frivolous (or malicious) lawsuit against World Outreach, it imposed a substantial burden on a religious organization. The court of appeals likened World Outreach’s allegations to a claim of malicious prosecution, or “harassment by frivolous legal claims.”15 World Outreach Conference Ctr., 591 F.3d at 537, citing Reed v. Doctor’s Assoc., Inc., 824 N.E. 2d 1198, 1205 (2005); 355 Ill. App. 3d 865, 291 Ill. Dec. 948, Smart v. Bd. of Trus., 34 F.3d 432, 434 (7th Cir. 1994).

“That is an exact description of the conduct alleged in the complaint.” World Outreach Conference Ctr., 591 F.3d at 537.

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The evidence, however, does not support a finding of malicious prosecution. As stated in Reed, The elements of malicious prosecution are as follows: (1) the institution and prosecution of judicial proceedings by the defendant, (2) a lack of probable cause for those proceedings, (3) malice in instituting the proceedings, (4) a termination of the prior cause in the plaintiff's favor, and (5) suffering by the plaintiff of damage or injury from the prior proceeding. Reed, 824 N.E.2d at 1205. The first, second, and fourth elements are satisfied by the evidence. World Outreach believes the City acted with malice.16 But even if malice is assumed, World Outreach has suffered no damage or injury that would entitle it to relief for malicious prosecution. Reed recites “[t]he long-standing rule [] that without the arrest of a person or the seizure of a person's property or some other special injury, a cause of action for malicious prosecution will not lie. Id. At 1205, citing Cult Awareness Network v. Church of Scientology, Intl., 685 N.E.2d 1347,1354; 177 Ill. 2d at 267, 226 Ill. Dec. 604 (Ill.1997); Smith v. Mich. Buggy Co., 51 N.E. 569,175 Ill. 619 (Ill. 1898). In Cult Awareness Network, the Court reiterated that a plaintiff who claims malicious prosecution suffers no “special injury” where it is subjected to the ordinary trouble and expenses which arise from ordinary forms of legal controversy. 685 N.E.2d at 1354-55. By contrast, where the defendant refuses to accept an adverse judgment and continues to file lawsuits to harass the same opponent about the same issues, the plaintiff has suffered special injury. Id. at 1355.

Presumably, if World Outreach could prove actual malice, it could prove substantial burden, but the court is persuaded that there is insufficient evidence of malice to go to a jury. The City argues that the lawyers merely overlooked the recent zoning amendment when the complaint alleged improper use in a B3 zone. And the complaint and amended complaint contained other counts that may have been well grounded in fact and law even though abandoned. There is no documentary evidence supporting World Outreach’s allegations of malice. Plaintiffs support their position with Blossom’s opinion, hearsay statements, and innuendo based on Alderman Beale’s hostility. Such “evidence” would be inadmissible at a trial.

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Nonetheless, to the extent the meritless lawsuit caused World Outreach expense and delay, the inference of hostility to religion without justification could be drawn. This is similar to Sts. Constantine and Helen Greek Orthodox Church, where a city denied a church’s application for rezoning in order to allow it to construct a church on a 14-acre parcel that it owned, and the church was willing to agree not to later sell the land for a nonreligious institutional use. The city had expressed no other concern about use of the land, but refused to allow the church to build. The court held that the city had imposed a “substantial burden” within the meaning of the Act. 396 F.3d at 901. Having to respond to a meritless lawsuit, as the court of appeals has already stated, is a substantial burden. World Outreach Conference Ctr., 591 F.3d at 537-38 (“The burden imposed on a small religious organization catering to the poor was substantial (for burden is relative to the weakness of the burdened), and there was no possible justification for it.”). The City has offered no justification other than its allegation that only two counts of the complaint were meritless. Still World Outreach had to respond and there is no evidence that the City would have filed solely because the signage at the site was improper. Thus, the court concludes that there is no genuine issue of material fact that the City imposed a substantial burden on World Outreach by filing and maintaining the meritless lawsuit. Damages would be measured by the costs and attorney’s fees actually paid by World Outreach and/or Blossom.

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World Outreach was not entitled to operate an SRO until it met all requirements of the Building Code and obtained relevant licenses and permits. While World Outreach contends that the City, through its official departments and

Alderman Beale, purposefully and maliciously obstructed and delayed the licensing process to prevent World Outreach from housing Katrina evacuees during the fall of 2005 to early 2006 and to prevent World Outreach from operating a community center in the building, the City contends that its conduct was solely to obtain compliance with the Zoning Ordinance and Building Code and to ensure the health and safety of citizens of Chicago who would use the building. See CODE § 17-1-050 (“This Zoning Ordinance is adopted for the purposes of . . . promoting the public health, safety and general welfare . . . .”). World Outreach lays out long paragraphs of facts from which it infers that the City’s conduct was punitive rather than administrative. The City contends that, because World Outreach failed to file applications for appropriate licenses and permits and to meet the City’s requirements for those licenses and permits, World Outreach caused its own difficulty and delay. Although the City appears to concede that Blossom began early but unsuccessfully to get support from Alderman Beale and others, it disputes that the City did everything (or anything) in its power to obstruct World Outreach. The material facts are those found in the chronology of events. In general, events fall into two categories, that of World Outreach’s effort to house Katrina evacuees and that of general delay and difficulty in navigating the licensing and permit process before the pending lawsuit put the parties on a path to resolution of both the zoning and building code issues. Habitability is without question a compelling governmental interest. Even where a nonconforming use is sought, the owner must demonstrate that the building is safe and in good repair. (See Pls. SOF Ex. 23.) Indeed, these rules apply to all landowners throughout the City of 22

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Chicago. Plaintiffs do not take the position that World Outreach as a religious organization is exempt from compliance with building codes or that the codes impose a greater burden on World Outreach than is imposed on secular institutions. Indeed, World Outreach early on started to make repairs in order to make the building code-compliant. 1.

Katrina Evacuees

Before the YMCA closed the building, the City had cited it for numerous code violations and for operating with an expired SRO license, among other things.17 No knowledgeable witness, including Carter, considered the building habitable at that time. When Blossom met with the alderman in June, 2005, her proposal did not include a plan to use the building for SROs. Rather, she planned to use the building for a GED placement and training center, a bookstore, office rental space, a performing arts center/school of music, a day care center, a Bible college, a communications center (for training in advanced television/radio, communications production, and training for the hearing- and visually-impaired community), a Christian night club, and a conference and educational center. Despite these ambitious plans, for financing, she intended to rely on faith and volunteers in her church community to do repairs. Nearly a month after the Katrina storm, when Blossom appeared before the Zoning Committee, she did not indicate a plan to operate an SRO in the building. Neither was there any mention of a desire to house Katrina evacuees. World Outreach did not apply to the City for a SRO license until mid-November of 2005. At no time during the fall of 2005 through the early 17

World Outreach relies on the deposition testimony of Christopher Bielat, the YMCA corporate executive, for the statement that “[t]here were no building code violations anywhere in the building from 2000-2005.” (Pls. SOF ¶ 5.) Mr. Bielat merely stated that he knew of none. (Pls. SOF Ex. 4, Bielat Dep. At 9:9-14.). The City has documented 35 citations issued from 2000 to 2003 in addition to the license violations (Defendant’s Statement of Material Facts ¶ 15, dkt. #186, para. 15 and referenced exhibits). World Outreach’s statement of fact is not supported by the evidence.

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months of 2006, when housing for Katrina evacuees was critically needed, did the building meet section 8 habitability standards as was necessary to house evacuees either temporarily or permanently. Blossom stated to Carter in early December that the SRO units were ready but, even if true, the essential SRO license application had been filed but two weeks earlier. Although there is evidence that Beale was refusing to give his blessing to the project, Beale did not interfere with the repairs, and no reasonable jury would conclude that the SRO could have been licensed by early 2006. The City did not obstruct World Outreach with regard to Katrina evacuees. Rather, World Outreach did not have enough time and resources to come into compliance with building and licensing codes. 2. Licenses and Permits As evidence of substantial burden, World Outreach also relies on Chairman Banks’ assertion at the Zoning Committee hearing that a community center was not a proper use in a B3 district and that World Outreach would need a special use permit, Alderman Beale’s statement in his deposition that a special use permit was needed to operate a church in a B3 district, and the City’s position in its lawsuit that World Outreach had the burden to prove that its use of the property was a lawful nonconforming use even if they did not apply for a special use permit. All of these statements and positions are, in fact, correct, as set out above. Moreover, contrary to World Outreach’s argument, downzoning to M1 lightened World Outreach’s burden of proof, because M1 was a less restrictive zone than B3. World Outreach was made to jump through a number of hoops to obtain City approvals, but there is no evidence that this burden was any different from any secular applicant’s obligation. See CLUB, 342 F.3d at 761 (“[Scarcity of affordable land, costs, procedural

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requirements, and inherent political aspects of the Special Use, Map Amendment, and Planned Development approval processes]–which are incidental to any high-density urban land use–do not amount to a substantial burden on religious exercise.”). There is no dispute of material fact that by the time the federal lawsuit was filed World Outreach had not filed for all of the needed licenses and permits, and it had not performed the repairs to become licensed as an SRO, a recreational facility, or any other use for which it sought to qualify. In summary, World Outreach has not demonstrated that the City’s enforcement of the Zoning Ordinance and Building Code imposed a substantial burden that bears direct, primary, and fundamental responsibility for rendering religious exercise effectively impracticable. As in Vision Church v. Village of Long Grove, 468 F.3d 975, 998 (7th Cir. 2006), the City’s land use requirements are “wholly neutral and apply generally to all property owners.” World Outreach has not offered any evidence other than Blossom’s mere assertion that, while permit and license applications were pending, World Outreach could not use the building for its ministry in any use for which it had complied with requirements but the City had denied the necessary license or permit. Although the licensing process took, as World Outreach claims, approximately two years, once World Outreach came into compliance, its activities, including religious exercise broadly defined, were not impaired, much less made effectively impracticable. For these reasons, plaintiffs are entitled to recover their fees and expenses for responding to the meritless lawsuit but, otherwise, they are entitled to no relief under the Act and the City is entitled to summary judgment on all other claims. G.

The Monell claim.

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World Outreach has not proffered evidence that would support its allegation that it was the policy of the City to impose a substantial burden on a religious organization.18 ORDER Plaintiff’s motion for summary judgment (191) is granted in part and denied in part. Defendant’s motion for summary judgment (183) is granted in part and denied in part. This case will be called for a status hearing on April 30, 2013 at 8:30. The parties are directed to confer to determine whether the issue of damages can be resolved without a trial.

ENTER: April 1, 2013

_______________________________ Judge Joan Humphrey Lefkow United States District Judge

The City is correct that the Illinois Tort Immunity Act, 745 ILL. COMP. STAT. 10/2-104, bars World Outreach’s claim under the Illinois Religious Freedom Restoration Act.

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Filed: 04/09/2014

APPENDIX B

030

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Order Form (01/2005)

United States District Court, Northern District of Illinois

Name of Assigned Judge or Magistrate Judge

Joan H. Lefkow

CASE NUMBER

06 C 2891

CASE TITLE

Sitting Judge if Other than Assigned Judge

DATE

6/10/2013

World Outreach Conference Center vs. City of Chicago

DOCKET ENTRY TEXT

Plaintiff’s motion under Rule 59(e), Fed. R. Civ. P., to alter or amend the court’s judgment (Dkt. No. 248) is denied. An Amended Opinion and Order will be entered to correct immaterial inaccuracies. The parties are directed to confer to determine whether the issue of damages can be resolved without a trial. This case will be called for status on July 2, 2013 at 8:30 a.m. See Statement section for details.

O[ For further details see text below.]

Notices mailed by Judicial staff.

STATEMENT Plaintiffs, World Outreach Conference Center and Pamela Blossom (together, “World Outreach”), have moved to alter or amend the order of this court granting summary judgment to defendant, City of Chicago, on all but one issue presented for decision. See Memorandum Opinion and Order of April 1, 2013 (Dkt. No. 247). World Outreach asserts that (1) the court erred in not finding that the City’s demand for a special use permit was frivolous and a substantial burden on its exercise of religion; and (2) the court misread the Zoning Code so as to impose on World Outreach an obligation the law did not impose. World Outreach believes the court should grant summary judgment in its favor or, at least, set the case for trial on its RLIUPA claim. A motion under Rule 59(e) is a vehicle to direct the court’s attention to newly discovered evidence or a manifest error of law or fact. Russell v. Delco Remy Div. of Gen. Motors Corp., 51 F.3d 746, 749 (7th Cir. 1995). The rule enables a district court to correct its own errors, sparing the parties and the appellate court the burden of unnecessary appellate proceedings. Charles v. Daley, 799 F.2d 343, 348 (7th Cir. 1986). A Rule 59(e) motion may be appropriate when “the [c]ourt has patently misunderstood a party, or has made a decision outside the adversarial issues presented to the court by the parties, or has made an error not of reasoning but of apprehension.” Bank of Waunakee v. Rochester Cheese Sales, Inc., 906 F.2d 1185, 1191 (7th Cir. 1990) (citation omitted). A Rule 59(e) motion is not a mechanism to re-argue issues that have already been decided or to present new issues that could have been presented but were not. See Bordelon v. Chicago Sch. Reform Bd. of Trs., 233 F.3d 524, 529 (7th Cir. 2000). 1.

Whether the court erred in not finding that the City’s demand for a special use permit was frivolous World Outreach argues that the court should have found the City’s requirement of a special use

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Case: 1:06-cv-02891 Document #: 255 Filed: 06/10/13 Page 2 of 3 PageID #:4787 Case: 13-3669 Document:STATEMENT 22 Filed: 04/09/2014 Pages: 132 permit frivolous. The court did, in fact, find that the City’s decision to file a lawsuit, which occurred on December 14, 2005, on that basis was frivolous because after the zoning amendment on November 1, a special use permit was not needed. But, as set out it considerable detail in the opinion, the City’s requirement of a special use permit for the period from July to November, 2005 was justified under the Zoning Ordinance. World Outreach’s principal argument for the period starting the fall of 2005 through the dismissal of the City’s law suit focused on its professed readiness to house Katrina evacuees, a position that was not demonstrated in the record. Therefore, there is no error of material fact. In any event, World Outreach is simply rearguing its motion for summary judgment, which is inappropriate under Rule 59(e). As before, it relies largely on Pamela Blossom’s deposition testimony which, because it was often inconsistent with the documented record, as explained in the Opinion: Plaintiffs’ statement of material facts, however, is rife with assertions that are not documented in exhibits or depositions. Many facts rely on Blossom’s understanding of the intentions of others or characterize rather than report facts. These statements are thus inadmissible as are the numerous hearsay assertions. Facts which are not submitted in compliance with Local Rule 56.1(b)(3) are disregarded. Opinion at 2 n.3. See Scott v. Harris, 550 U.S. 372, 380, 127 S. Ct. 1769, 167 L. Ed. 2d 686 (2007) (“When opposing parties tell two different stories, one of which is blatantly contradicted by the record, so that no reasonable jury could believe it, a court should not adopt that version of the facts for purposes of ruling on a motion for summary judgment.”) Moreover, this court is not inclined to sift through the voluminous record again looking for references to the record that World Outreach has not bothered to attach to its motion (Exhibits 61 p.15, 62, 64), particularly where World Outreach failed in the first instance adequately to cite to the record, causing the court to expend an inordinate amount of time in its effort to present an accurate statement of facts. Nothing World Outreach presents on this issue persuades the court that it has materially misapprehended the record in the case. 2.

Whether the court misapplied the Zoning Ordinance

World Outreach challenges the court’s finding that “[d]uring the period from July to November 1, 2005, World Outreach did not satisfy requirements to demonstrate a nonconforming use.” Opinion at 17. It faults the court for citing sections 17-15-0302 B and C of the Zoning Ordinance which, it contends, would have been applicable only if World Outreach had intended not to continue the YMCA’s (nonconforming) use. The court had concluded that, during the period from July to November of 2005, “without a special use permit and SRO license, World Outreach could operate only as a nonconforming use in the B3 district.” The court stated, “Nonconforming status runs with the land and is not affected by changes of tenancy, ownership, or management.” Id. § 17-15-0106. But “[t]he burden of proving that a nonconformity exists rests with the subject landowner.” Id. § 17-15-0104 (emphasis omitted). Opinion at 17. It added, Thus, to continue a nonconforming use, World Outreach had to show that its use was “functionally similar” to the previous use. Id. § 17-15-302-B. A “use substitution application” is to be filed with the Zoning Administrator and notice is to be given the alderman. Id. § 17-15302-C.

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Case: 1:06-cv-02891 Document #: 255 Filed: 06/10/13 Page 3 of 3 PageID #:4788 Case: 13-3669 Document:STATEMENT 22 Filed: 04/09/2014 Pages: 132 Opinion at 17. As the City acknowledges, § 17-15-302-B does not apply to the proof required by § 17-15104. Thus, the Ordinance would not have required World Outreach to prove functional similarity to the previous use had it intended to continue the same use as the YMCA. Rather, presumably, it would have had to prove the same use. Thus, this court’s application of § 17-15-302-B was incorrect. It still remains that, once the City challenged World Outreach’s effort to operate the facility by requiring a special use permit, World Outreach did not submit to the Zoning Department any proof of its intention to continue the nonconformity. Rather, during the July - November 2005 period, World Outreach’s intended use of the building was not the same as that of the YMCA, as reflected in its proposal submitted to Alderman Beale and the Zoning Committee. Moreover, during that period, World Outreach did not have, nor had it applied for, a license to operate an SRO. The Opinion will be modified to reflect the court’s misapprehension of the Zoning Ordinance.1 Finally, to the extent World Outreach disagrees with the court’s findings with respect to the date of its application for an SRO license, to other events or the sequence thereof, or with the court’s reasoning, the court believes it is substantially accurate on the facts. Objections to the court’s reasoning are best addressed to the court of appeals. World Outreach’s motion does not demonstrate either that it is entitled to judgment as a matter of law or that a genuine issue of material fact exists for trial.

1. Reference to World Outreach’s Monell claim will be deleted from the Amended Opinion as World Outreach states that it does not assert such a claim at this time.

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IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

WORLD OUTREACH CONFERENCE ) CENTER ) ) Plaintiffs, ) ) v. ) ) CITY OF CHICAGO, ) ) Defendant. )

Case No. 06-2891 Judge John H. Lefkow

AMENDED MEMORANDUM OPINION AND ORDER Plaintiff World Outreach Conference Center (“World Outreach”), an Illinois not-forprofit corporation, is a religious assembly or institution protected by the Religious Land Use and Institutionalized Persons Act of 2000 (“the Act”), 42 U.S.C. § 2000cc(a)(1). See World Outreach Conference Ctr. v. City of Chicago, 591 F.3d 531, 535 (7th Cir 2009). (“[E]ven the recreational and other nonreligious services provided at the community center are integral to World Outreach’s religious mission[.]”). Plaintiff Pamela Blossom is World Outreach’s senior pastor and registered agent. World Outreach currently owns the building located at 4 East 111th Street in Chicago, Illinois (“the building”). Constructed in 1926 by the YMCA,1 the building was owned and operated as the Greater Roseland YMCA until the YMCA sold it in July 2005 to World Outreach. This dispute arises from roadblocks World Outreach encountered in obtaining authorization from the City of Chicago to use the building for a community center with a religious ministry.

The exact YMCA corporate entity which owned the property is not of record, but it does not matter here.

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The City had issued more than 100 code violation citations during the period May, 1986 to December, 2002.

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World Outreach has not offered evidence that holds continued past the effective date of the zoning amendment.

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World Outreach argues in its brief that by October 30 the problems were corrected. This assertion is without citation to the record and is therefore disregarded.

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The Class of One Equal Protection Claim “[A] deliberate, irrational discrimination, even if it is against one person (or other entity)

The City disputes this fact, stating that World Outreach’s operation, on average, has never involved more than 36 to 37 SRO units.

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The RLUIPA Claim The Act “provides that a government land-use regulation ‘that imposes a substantial

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CONCLUSIONS OF FACT AND LAW The court reaches the following conclusions of fact and law based on uncontroverted evidence: A.

During the period from 1999 to July, 2005, the YMCA operated a community center with 168 SRO units, which was at the time of sale a lawful nonconforming use in a B3 district.

Citations to CODE are found at American Legal Publishing Corporation’s website: www.amlegal.com/library/il/chicago.shtml (last visited Apr. 1, 2013). 13

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ownership, or management.” Id. § 17-15-0106. But “[t]he burden of proving that a nonconformity exists rests with the subject landowner.” Id. § 17-15-0104 (emphasis omitted). Although World Outreach insists on one hand that it did not have to get approval and, on the other, that it endeavored to prove its nonconforming use, the record contains no documentary submission to the Zoning Department dated after the City demanded a special use permit until the zoning amendment was adopted attempting to prove its nonconforming use. As it was World Outreach’s burden to prove its nonconforming use, the only permissible inference is that World Outreach did not follow the Ordinance by presenting proof to the Zoning Committee or the Zoning Department. More importantly, during that period, World Outreach’s proposed use of the building was not the same as that of the YMCA, as reflected in its proposal submitted to Alderman Beale and the Zoning Committee. Furthermore, during that period, World Outreach did not have, nor had it applied for, a license to operate an SRO. Therefore, any claim of “substantial burden” for this period of time is without merit. D.

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“That is an exact description of the conduct alleged in the complaint.” World Outreach Conference Ctr., 591 F.3d at 537.

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Katrina Evacuees

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The City is correct that the Illinois Tort Immunity Act, 745 ILL. COMP. STAT. 10/2-104, bars World Outreach’s claim under the Illinois Religious Freedom Restoration Act.

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ORDER Plaintiffâ&#x20AC;&#x2122;s motion for summary judgment (191) is granted in part and denied in part. Defendantâ&#x20AC;&#x2122;s motion for summary judgment (183) is granted in part and denied in part.

ENTER: June 10, 2013

_______________________________ Judge Joan Humphrey Lefkow United States District Judge

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APPENDIX C

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UNITED STATES DISTRICT COURT FOR THE Northern District of Illinois − CM/ECF LIVE, Ver 5.1.1 Eastern Division

World Outreach Conference Center, et al. Plaintiff, v.

Case No.: 1:06−cv−02891 Honorable Joan H. Lefkow

City of Chicago Defendant.

NOTIFICATION OF DOCKET ENTRY

This docket entry was made by the Clerk on Tuesday, July 2, 2013: MINUTE entry before Honorable Joan H. Lefkow:Motion hearing held on 7/2/2013. Plaintiff's motion for extension of time requirements [261] is denied without prejudice. Plaintiff's motion for order recognizing status [263] is denied. Status hearing held on 7/2/2013 and continued to 7/30/2013 at 08:30 AM.Mailed notice(mad, )

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APPENDIX D

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IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF'ILLINOIS EASTERNDIVISION WORLD OUTREACH CONFERENCE

CENTER,

)

et al.,

No.06 C289t

Plaintiffs,

Judge Joan H. Lelkow

CITY OF CIIICAGO, Magistrate Judge Susan Cox Defendant.

AGREED FINAL JUDGMENT ORDER

Plaintiffs World Outreach Conference Center ('WOCC") and Pamela Blossom (collectively, '?laintiffs"), by their attorneys, Mauck & Baker, LLC, and Defendant City of Chicago, by its aftorney, Stephen R. Patton, Corporation Counsel of the City of Chicago, hereby

stipulate that Plaintiffs' damages for defending against the state court lawsuit brought by the City, measured by the costs and attorney's fees actually paid by Plaintiffs for that lawsuit, per the Court's June 10, 2013 Arnended Memorandum Opinion and Order (Dckt. #256), p. 21, shall be in the amount of $15,000.00. This Agreed Final Judgment Order reincorporates the Court's June 10, 2013 Amended Memorandum Opinion and Order (Dckt. 11256). The parties frrrther stipulate

that they reserve all rights to seek review of the ruling(s) supporting this award of damages should either party choose to appeal this ot any part of the linaljudgment. This stipulation'shall not be read to prejudice any party on any attomey fee issues in this case.

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Also, the attorney fee petitioning process contemplated by LR 54 upon the enhy of this final judgment order is stayed, pending the outcome of Plaintiffs' appeal, and further scheduling order of this Court.

Respectfully submitted,

'of the attor:leys for

Dared:

rrtsl

(' l ",r

Plaintiffs

One of the attomeys for the City of Chicago

Dated: November 5,

Dated:

lt / < /

2OI3

istrict

Andrew S. Mine Rebecca A. Hirsch

City of Chicago Department of Law Constitutional and Commercial Litigation Division 30 North La Salle Street, Suite 1230 Chicago IL 60602 (312)742-0260 Attorney No. 90909 John Mauck Noel Sterett AndyNorman

MAUCK & BAKER, LLC

I N. LaSalle Street, Suite 600 Chicago IL 60602 (312)726-1243 F:\Clients\l9?l\06 .Posa 7th Ckcuit\AgreedFinatJudgmentorder2Ol3I

tos.docx

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APPENDIX E

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Image of Pastor Pamela M. Blossom. [Dkt. 223-1 at p. 2].

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