Full opinion text
FINDINGS OF FACT, CONCLUSIONS OF LAW AND ORDER FOR JUDGMENT The above matter came on for trial before a Special Master, Edward J. Parker, on May 27, 1975, on issues made by the Amended Complaint. The Special Master having heard the evidence, considered the exhibits, the arguments of counsel and being fully advised in the premises, makes the following Findings of Fact and Conclusions of Law. To the extent some of the Findings of Fact contain Conclusions of Law, they are adopted as such. Said Findings of Fact and Conclusions of Law will be submitted to the Court for its Order for Judgment. PROCEDURAL FINDINGS OF FACT The Parties (1) The plaintiffs in this action are the Cedar-Riverside Environmental Defense Fund, a Minnesota non-profit corporation composed of members who live or work in Cedar-Riverside; the individual plaintiffs are persons who live or work within or near the Cedar-Riverside Urban Renewal Area, some of whom are students at the University of Minnesota; the Minnesota Public Interest Research Group — University of Minnesota Local Board, the Model Cities Planning Council, the Model Cities Policy Board, and the Cedar-Riverside Project Area Committee, the citizens advisory committee to the Minneapolis Housing Authority on renewal in the area, all of which are organizations interested in the Cedar-Riverside area. All plaintiffs have proper standing to bring this action, having shown they are directly affected and suffer injury in fact. (2) The defendant Carla Anderson Hills is the Secretary of Housing and Urban Development (HUD); Thomas T. Feeny is the Director of the Minnesota HUD Area Office; Otto Stolz is the Director of the HUD New Communities Office; and Richard H. Jefferson is the Chairman of the Minneapolis Housing and Redevelopment Authority (MHRA). The defendants Cedar-Riverside Associates (CRA) and its affiliated companies, Cedar-Riverside Land Corporation, Cedar-Riverside Land Company, and Cedar-Riverside Properties, collectively referred to in these findings as “Cedar-Riverside Associates”, together with the defendant Batzli Electric Company, are private developers in the urban renewal area. The defendants Augsburg College, Fairview Hospital, and the University of Minnesota are institutions located within the urban renewal area. The Project (3) This action involves the Cedar-Riverside Urban Renewal Area, an area of approximately 336 acres located in the City of Minneapolis, bounded by Interstate 94 on the south, Interstate 35 on the west, and the Mississippi River on the north and east. The area is located between the main campus of the University of Minnesota and downtown Minneapolis. The private development in the urban renewal area consists of approximately 100 acres. It is a part of the New Communities Program and is being constructed pursuant to 42 U.S.C. § 4511 et seq. It is designated as the “Cedar-Riverside New Town in Town.” (4) The Urban Renewal Plan for the Cedar-Riverside area was adopted in 1968, following a period of study and planning by city agencies and community groups that began in the early 1950’s. The adoption of the plan involved a finding that the area was blighted and in need of urban renewal. (5) At one time the Cedar-Riverside area had a population of about 20,000 people, but over the years the deterioration of the neighborhood, university and hospital expansion and freeway construction caused a drop in population to a low of about 4,000 people. Cedar-Riverside Associates owns most of the property in the New Town. Only about 30 to 50 homes are owned by other persons. (6) The development plan for the New Town contemplates a ten-stage residential and commercial development program that will cover the period from about 1972 to 1991. Upon completion, approximately 12,-500 dwelling units and 2,500,000 square feet of commercial or cultural space is anticipated. A population is projected of between 25,000 and 30,000 people. The plan contemplates total clearance and new housing at 125 dwelling units/acre. (7) Stage I of the project has already been built. It consists of approximately 1,299 dwelling units which house about 2,500 people in a combination of high-rise and low-rise structures. On August 30, 1971, HUD filed the first EIS on the project. The Litigation (8) On December 13, 1973, the plaintiffs began this action challenging the adequacy of the first Environmental Impact Statement (EIS), challenging compliance with the National Environmental Policy Act (NEPA), 42 U.S.C. § 4332 et seq., the Clean Air Act of 1970, 42 U.S.C. § 1857 et seq., the Minnesota Environmental Policy Act (MEPA), Minn.Stat. § 116D.01 et seq., and the Minnesota Environmental Rights Act, Minn.Stat. § 116B.01 et seq. (9) At a hearing on March 22, 1974, on motions of defendants to dismiss the suit, HUD indicated to the Court its intention to prepare a second environmental impact statement on Stage II. The Court ordered an EIS on Stage II and the Cedar-Riverside project at maturity. This was embodied in a subsequent stipulation that was executed by the parties and approved by the Court on July 30, 1974. Thereafter the action was held in abeyance pending the filing of the new EIS on Stage II and the project at maturity. The Federal and State Environmental Impact Statements (10) The Minnesota Environmental Policy Act, Minn.Stat. 116D.01 et seq., empowers the Minnesota Environmental Quality Council to require an EIS for major actions of government agencies in the State of Minnesota. On August 21, 1974, the Minnesota Environmental Quality Council designated the defendant Housing and Redevelopment Authority as responsible agent to prepare an EIS covering the Cedar-Riverside New Town Project, Stages II through X. (11) After HUD prepared a draft of the EIS, it was distributed for review and comment on October 15, 1974. The EIS was circulated to 123 entities, consisting of 15 federal, 13 state, 2 regional, 2 county, 4 city, and 21 institutional and private agencies. Public hearings on the draft EIS were held in Minneapolis on November 25, and 26, 1974, by HUD and by the Housing and Redevelopment Authority, to afford those interested an opportunity to comment on the draft statement. Extensive written comments and oral testimony were received on the draft. HUD filed the final EIS for Stage II and the entire Cedar-Riverside New Community Project on February 10, 1975. After the final EIS was filed, there was no further response or comment on it either by the plaintiffs in this action or by any other persons, other than this litigation which was commenced forthwith. (12) The EIS was prepared over a nine-month period. It involved the services of thirty persons in HUD, plus seven consultants. In addition, other personnel from the Minneapolis Housing and Redevelopment Authority, the City of Minneapolis, Cedar-Riverside Associates, and the Metropolitan Council were involved in developing factual data for the EIS. (13) On March 6, 1975, the Housing and Redevelopment Authority submitted to the Minnesota Environmental Quality Council the final federal EIS. The EIS was forwarded to the Environmental Quality Council for filing without comment by the Housing and Redevelopment Authority. (14) The Minnesota statutes and regulations require additional factors to be considered in a state EIS including: (1) The impact of state government on any federal controls associated with the proposed action; and (2) The multi-state responsibilities associated with the proposed action. These additional state requirements were included in the final federal EIS, at the request of the Housing and Redevelopment Authority. Other additional procedural and substantive requirements of MEPA not satisfied in the HUD EIS are discussed at VII, infra. (15) Under the regulations of the Minnesota Environmental Quality Council, the Council has 45 days from submission to it of the final EIS to take action requiring revision or change. The Minnesota Environmental Quality Council took no action on the adequacy of the EIS within the 45 day period, indicating in its minutes the co-terminus authority of this court to review the EIS’s adequacy. The defendants also concurred in this jurisdiction. SUBSTANTIVE FINDINGS OF FACT I. THE ENVIRONMENTAL IMPACT STATEMENT IS INADEQUATE BECAUSE IT FAILS TO PROVIDE SUFFICIENT DATA ON THE PROJECT’S ECONOMIC FEASIBILITY AND ECONOMIC EFFECTS TO ALLOW ASSESSMENT OF COUNTERVAILING INTERESTS, THE FEASIBILITY OF ALTERNATIVES OR A FULL ANALYSIS OF THE ENVIRONMENTAL EFFECTS. A. Economic considerations relating to the feasibility of this project as proposed and the range of reasonable alternatives are not discussed. The EIS is inadequate in the absence thereof because of the notice to HUD of the need for major changes in the financing of the project provided by the Landauer Report. 1. The EIS, Section 2.2.2.3(f), identified an intimate relationship between land economics and the high-rise character of development. The Landauer Report, a financial evaluation of the feasibility of the Cedar-Riverside project prepared by Landauer Associates real estate consulting firm for HUD in October, 1974, confirms the burden of land costs for this development and their effect in predetermining a development proposal calling for high-rise, very high density housing. 2. Mr. Broun, Director of the HUD office of Environmental Quality, testified that while economics of a project were not an environmental impact per se, they determined the range of reasonable alternatives to be considered in the environmental impact statement. Here, the Landauer Report makes clear the “fundamental problem with the Cedar-Riverside development centers about the cost of the land,” and indicates that the project may not be able to go forward unless land costs are written down by a significant percentage. That report also indicates the financial unfeasibility of the project as presently proposed, even at very high densities. That conclusion is the essence of the Wiles Memorandum dated May 1, 1974, which indicates the precarious financial status of the project and the need for exploration of various options to take over the project by HUD. 3. Lower density alternatives, with possibilities of low-rise design, are far more feasible if the burden of high land costs is reduced. A knowledge that significant land write-downs were necessary to continue the project increases the range of reasonable alternatives and makes it necessary to discuss in far greater detail lower density alternatives which might ameliorate adverse environmental impact and which become increasingly feasible as the land cost declines. A discussion of the feasibility of alternatives would require an analysis of land cost per acre at various densities and different types of construction coupled with an estimate of the amount of subsidy (land write-down) necessary to make each feasible. Only in this way could a subsequent decision maker balance the benefit and cost of each alternative on the environment. 4. The absence of any discussion of the New Community financial feasibility and the likelihood of land write-downs allows the predetermination of high-density, highrise construction that resulted in the proposed project to remain unexplored for the subsequent decision maker. Given the notice on which the agency was placed before the draft EIS by the Wiles Memorandum and before the final EIS by the Landauer Report, a full discussion of the effects of significant land write-downs in increasing the feasibility and range of alternatives is necessary to permit a reasoned choice of alternatives. B. The EIS fails to provide sufficient data on the Project’s economic effects to allow assessment of countervailing interests, or a full analysis of the environmental effects. 1. Public costs and benefits. Witnesses Hartman and Kirschner testified that a calculation of the fiscal impact of development on public agencies was very closely related to calculation of environmental effects resulting from the level at which those agencies can provide services, maintenance and amenities. The public interest which encourages density of development in urban renewal is in part ascribable to the expected resulting increase in the property tax base. An accurate assessment of environmental effects of lower density design and this countervailing consideration would require a detailed analysis of public costs as well as benefits. Such an analysis is lacking in the EIS. The HUD EIS team made no attempt to analyze the economic cost and benefits generally and specifically made no attempt to analyze government revenue increases versus the increased costs of providing services. 2. Irreversible and irretrievable commitments of resources. There is a limited amount of low interest or governmentally insured housing mortgage money available and a limited amount of housing subsidy money available. Investment in housing is thus a commitment of scarce resources. Mr. Kirschner testified that there is a significant difference among housing types as to the amount of housing which can be built for a given investment. Kirschner and Downs both testified that high-rises cost significantly more than low-rises to build. Given the scale of this project, that difference would appear significant should emphasis be shifted to lower rise construction. The EIS provides no information on per unit or per square foot costs of Cedar Square West and the proposed Stage II building compared to other construction prototypes. Thus, basic information is lacking which is necessary to make important environmental judgments regarding the cost effectiveness of the public subsidy dollars in the Cedar-Riverside project. II. THE ENVIRONMENTAL IMPACT STATEMENT IS INADEQUATE BECAUSE IT FAILS TO FULLY AND ACCURATELY DISCUSS A FULL ARRAY OF ALTERNATIVES WHICH COULD SIGNIFICANTLY ALTER THE ENVIRONMENTAL IMPACT OF THE PROJECT. A. The range of alternatives discussed in the EIS omits reasonable options that would have significantly different environmental effects and could reduce negative environmental aspects of the project as proposed. 1. In order to allow a decision maker to evaluate the environmental effects of various alternatives and to prevent the premature foreclosure of alternatives which may reduce environmental impact, it is necessary for the EIS to present all reasonable options to the project as proposed. Testimony shows that four prototypical alternatives which would significantly alter environmental impact were not discussed: low-rise, high-density cluster housing, a mixture of densities and designs, ownership alternatives and the combination alternative proposed by plaintiff Cedar-Riverside Environmental Defense Fund (CREDF). 2. Low-rise, high-density cluster housing. Testimony of Prof. Clare Cooper, Professor of Architecture and Landscape Architecture at the University of California —Berkeley, described at length the concept of low-rise, high-density cluster housing and discussed its advantages, for some population groups. One such basic advantage over high-rise construction cited was preservation of important features of the single family home within a multi-family context. Individual entrances or entrances shared by only six or eight units without internal hallways and private or semi-private open space were described as encouraging stability, commitment to place, proprietary feelings and feelings of community, all revolving around common concerns for shared space over which people exert territorial claims. 3. A second such basic advantage is that low-rise, high-density cluster housing avoids most problems of childrens’ play associated with high-rise living. Prof. Cooper testified that, while there are ways to improve the lot of children in high-rises, e. g. wide, outdoor corridors viewed from apartment windows or supervised play areas, low-rise cluster housing is a clearly superior solution to these problems. In such housing, childrens’ outdoor play is easily observable and accessible in an area which is part of the parents territorial domain. Prof. Cooper testified that this type of housing is a necessary alternative for families with children. Similar recommendations for low-rise buildings to foster better surveillance of play were made by the developer’s social consultant, Professor David Cooperman. 4. Other witnesses also testified that low-rise housing had positive advantages for families if it involved semi-private or private open space; that the Model Cities program was encouraging the development of moderate density cluster housing reminiscent of single family homes with a goal of attracting families back to Minneapolis; and that low-rise cluster housing was a reasonable alternative to the Cedar-Riverside project as proposed. 5. Testimony indicated that such housing could be developed at 40 to 60 du/acre. This range, in the middle between the 30-35 and 60-80 du/acre range presented in the EIS, maximizes the number of units in a low-rise setting. Its feasibility is significantly increased if a land write-down occurs. The high-rise housing in The Costs of Sprawl, discussed in the EIS, was at 30 du/acre and the so-called “high density” mix in that report is at 19 du/acre. Therefore, the advantages in terms of effect on urban systems described in The Costs of Sprawl would be present in this 40-60 du/acre alternative, without going beyond diminishing returns into the negative social effects and environmental effects such as the high carbon monoxide levels and the high energy use which characterize very high densities. 6. The testimony indicated that reduced construction costs per unit in the low-rise, high-density alternative would make up for increased land costs per unit in comparison with high-rises; thus such an alternative maximizes units per capital dollar and minimizes commitments of irretrievable and irreplaceable resources. 7. Because of its preferability as an environment for families with children, low-rise cluster housing represents a practical way significantly to increase the number of larger units in the project and thereby more closely meet the pressing housing needs of the city and region for family housing (as described in the EIS) in a relatively high density context. This type of housing meets the standards of the Urban Renewal Plan to provide “through public and private efforts, various types of housing, thereby insuring a heterogeneous population in age, marital status, education, income and family size”. 8. Low-rise, high-density cluster housing is a reasonable and feasible alternative which combines the positive effects on urban systems of high density with the avoidance of the negative social effects of highrises and poorly planned high density which the EIS identifies (4.1.1). While “low-rise build out” is a term used in Table IV — 1, it does not appear in the text and there is no discussion of design features possible in low-rise construction, which makes it an alternative with potentially important positive effects. The 30-35 du/acre alternative in the text could be townhouses (one design prototype) but also could be one high-rise tower. At 60+ du/acre, high-rises generally become necessary to fit all units on the site. Without information in the text on design, there is no basis for knowing what the writer of the EIS intended or to gauge environmental effects. There is no description of a low-rise, high-density cluster alternative and no comparison of that alternative with the proposed project in terms of sociological or psychological effects. Such an alternative must be considered if the alternative section is to meet the requirements of NEPA. 9. A mixture of densities and designs. Table IV-1 compares the mature Cedar-Riverside community as “built out” at four different densities. There is no comparison of these with a mature community comprised of some areas at each density. While the discussion in the text implies such a possibility (i. e. building different stages with different designs and densities) there is no discussion of specifics nor of the environmental effects of such an option. The deposition of Mr. Stein, the HUD official who directed the EIS team, shows that HUD made no attempt to evaluate such an alternative. 10. A number of witnesses testified that different designs were most appropriate for different life styles or stages of the life cycle. The HUD EIS regulations require alternatives to consider the environmental effects of such different populations. Mr. Chester Hartman testified that a mixed density and design alternative was desirable and workable and would allow housing options within the New Town which the present proposal and other alternatives discussed would not. Prof. Cooper testified that she felt such a combination alternative was the best way to build a community open to all persons (e. g. Paragraph 2.2.4.7.-10), and to allow greater freedom of choice through greater variety of design forms. The Metropolitan Council’s comments on the draft EIS include a statement that a greater variety of housing should be available in the New Town: “ . . . Stage II proposes one predominate housing type, the high-rise building. This design type has been necessitated by the physical constraints of the site. However, continued reliance upon one housing type in future stages is not consistent with Metropolitan Council, city, or Cedar-Riverside stated objectives for a broad range of multi-family housing types. Furthermore, future stages should also include ownership options for residents such as condominium or cooperatives if feasible. The Council would strongly urge that in the future stages of the Cedar-Riverside New Town more diversity of housing types within a high density setting be included such as townhouses, terrace housing, and low-rise apartments. These housing developments should, furthermore, include units of sufficient size to accommodate larger families with a range of incomes, and provide ownership options for residents. This may require a re-evaluation of public incentives in order to accomplish.” 11. Mr. Jorvig, former executive director of the Metropolitan Council, testifying for defendants, stated that such a mixture was a reasonable alternative. Prof. David Cooperman testified that a reasonable alternative would involve one area at high density for singles and students (perhaps as high as 200 du/acre) and another area at lower density for families with children with low-rise design. Mayor Hofstede’s letter to the MHRA and the response of the MHRA Board in accepting his recommendations, show concern for this question among the public policy makers and is evidence that the EIS does not provide an adequate analysis. 12. Such an alternative appears more closely to meet the objectives of the urban renewal plan to insure “heterogeneous population in age, marital status, education, income, and family size” and of the new community project agreement for a “broad range of multi-family housing types” so as to produce a “socially and economically balanced community,” than the project as proposed. 13. No rational decision on Stage II can be made without knowing if density/design changes will occur as in a combination alternative. If such a plan with high and low-rise stages or areas were to be pursued, evaluation of the Stage II site to decide if it is a better location for low-rise than others should be done at this point in the development, because of the aesthetic effect of high-rises on the river bluff location. 14. Ownership Alternatives. Considerable evidence was adduced as to the environmental implications of ownership of housing as it influences satisfaction of residents, community stability, concern for the environment, maintenance levels and the economic advantages of cooperatives or condominiums for residents. Exhibit 16, a Federal Housing Administration (FHA) memo on cooperatives, strongly reinforces these points. 15. Mr. Kirschner, an expert on cooperative housing, testified that ownership form has definite environmental effects and therefore, different ownership options should be evaluated as part of the weighing of alternatives. The Mayor’s letter to MHRA and the MHRA Board response indicated that public officials in Minneapolis considered cooperative ownership alternatives worth investigating. The EIS does not undertake such an evaluation. 16. While Section 4.3 of the EIS is entitled “Changes in Design or Form of Ownership” it is devoid of content; there is no discussion of ownership form in the entire Alternative Section. This total lack of discussion would prevent the decision maker from seriously evaluating ownership options in the decision making process and thus prematurely forecloses such alternatives without investigation as to their environmental effect. Cooperative ownership is allowed by the Urban Renewal Plan and the New Community Project Agreement, was specifically mentioned by the Mayor in his message on Cedar-Riverside alternatives and was suggested by the Metropolitan Council. 17. The specific combination alternative proposed by CREDF. CREDF has outlined a specific alternative to carrying out the New Town development presently proposed. This alternative emphasized incremental planning; cooperative ownership; a mixture of rehabilitation and in-fill new housing in the area of the existing community; new high-density, low-rise housing in areas now largely vacant land; a more sensitive treatment of the river bluff area which would preserve public access and the aesthetics of the river gorge; more emphasis on low-income units and units for families with children; a commercial focus on meeting neighborhood needs largely through rehabilitated facilities. Witnesses Cooper and Hartman testified specifically as to the reasonableness and feasibility of the CREDF alternative. 18. This alternative appears to meet public policy goals of intensive usage of the area; eliminating substandard conditions; and providing variety of population, housing design and ownership patterns. It was not considered at all in the alternative section; there was no response to it, nor any acknowledgement that it was made, in the responses to comments in Appendix C. In Appendix F, the response to Mr. Parliament’s suggestions for incremental planning is called “meritorious” but the concept is not discussed and nowhere appears in the body of the EIS. 19. Changes in the Urban Renewal Plan. There is no discussion in the EIS of the probable environmental consequences of alternative courses of action such as changes in the Urban Renewal Plan. Two paragraphs in the Alternative Section focus on alternative courses of action rather than the type of development they would lead to. None of these is discussed in sufficient detail to be useful in guiding the decision maker, nor are any of the environmental effects of these alternative courses of action explored in any but the must cursory ways. 20. The EIS, paragraph 4.2.1 discusses possible changes in the Urban Renewal Plan. The section is vague and conclusory in so far as it relates to questions of density and institutional demand for housing. There is no discussion of the substance of possible changes or the environmental effects of such changes. In the succeeding paragraph, 4.2.2, there is no discussion of the environmental effects of changes in the Urban Renewal Plan, merely references to the inadequate discussion contained in paragraph 4.1.3. 21. Financial inability to carry forward the project as proposed. The EIS gives no consideration to the most probable alternative, the inability to carry forward the project as planned for financial reasons. The Landauer report makes two major points; first, the New Town developer is in serious financial difficulties, second, this trouble centers around the very high cost of land. If those conclusions are correct they must have serious ramifications for the course of redevelopment, but those consequences are not discussed at all in the EIS. The evidence establishes that HUD was aware of such express reservations months before the final EIS was published. 22. Problems with the developer’s finances were apparent at the time the EIS was being drafted. The Wiles memorandum shows that HUD was contemplating a take-over of the project in May of 1974. The Landauer report was available to the New Communities administration in October, 1974, immediately after the draft EIS was released, but months before the final EIS was published. The Landauer report indicates that similar conclusions had been previously reached by the New Communities board at an earlier date. This information placed HUD on notice that a change in development entity was a very real possibility; it would have consequences for project timing, planning style, interim management of properties and marketing strategy; that changes in the New Town financing plan, e. g. land write-downs, with implications for the feasibility of alternatives, were almost certain. 23. Sections 4.2.3 and 4.2.4 in the EIS Alternative Section make vague and cursory mention of the possibility that the developer will be unable to continue sometime “in the future.” There is no discussion of what to do about that possibility, what the options are, what the consequences of those options would be. This is a completely unsatisfactory treatment of a major alternative in terms of project direction. 24. The Landauer report found the fundamental problems with the Cedar-Riverside project center about the cost of the land, and that the project will not be able to go forward unless land costs are written down. This point was made by CREDF in its written comments and oral comments and the public hearing. There is no discussion whatsoever of land write-downs in the EIS, though there are vague discussions of other possible courses of action such as Urban Renewal Plan changes or substitution of developer entities. 25. Land write-downs would have two types of significant environmental effects. The EIS discussion of land economic factors (paragraph 2.2.2.3(f)), suggests that land costs necessitate high-rise construction. Kirschner’s testimony establishes: first, that land write-downs dispose of the question of the economic feasibility of low-rise construction; second, if write-downs were accomplished by use of local tax revenues, it would have a significant effect on the cost/benefit balance of the project as it affects city services and tax revenues. The EIS contains no discussion of land write-downs as they would affect alternatives and cost/benefit analyses. 26. The Landauer report suggested changes in phasing and delays in staging of the project. Many witnesses testified as to the problems that would, thus, be created, yet, there is no discussion of these effects in the EIS. 27. Kirschner testified that the information contained in the Landauer report, which he assessed to be generally accurate, required discussion of a number of alternative approaches to dealing with the situation. He testified that there was no discussion of any of these, and without financial information, there was no way for a decision maker to judge how to perceive or to know the balance between desirable design changes resulting in environmentally beneficial effects versus their economic cost. The Stein deposition and the EIS at F-30 affirmed that the HUD EIS team made no attempt to evaluate the environmental implications of financial infeasibility of the project as planned or of resort to major land cost write-downs. 28. Rehabilitation. The possibility of rehabilitation of the properties owned by the developer Cedar-Riverside Associates and the few other property owners in the area was recognized by and adequately treated in the EIS. There is insufficient evidence to conclude that rehabilitation was a feasible alternative which should have been considered further in the alternatives section of the final EIS. HUD does not own the property in question. Cedar-Riverside Associates, the owner of a majority of the properties, has already made a decision not to try to rehabilitate its properties. It proposes to replace these old structures with new construction. B. The discussion of alternative development possibilities and their effect on the environment is contradictory, conclusory, and misleading. 1. Mr. Hartman characterized the alternative section as “wholly inadequate” because it is incomplete without explanation of the reasoning underlying statements made, and fails to weigh and compare the environmental costs and benefits of various alternatives. Mr. Kirschner testified that the section was incomplete, confusing and lacking explication of the underlying reasoning process for the statements made, and that an explanation of the reasoning process is “critical” in reviewing alternatives. He also found an absence of real analysis of alternatives’ costs and benefits. Both witnesses are professional planners with experience in the planning of housing and redevelopment projects and the evaluation of alternative proposals for housing development. Prof. Cooper testified that the absence of balancing of cost and benefits of particular alternatives made a reasoned choice by the subsequent reviewer impossible. She noted a method for comparison of social and psychological effects of housing design that would be appropriate, citing the figure from the Leibman article attached as an appendix to the CREDF comments on the draft EIS. 2. Table IV — 1, the only attempt quantitatively to compare differing effects of alternatives, is incomplete and lacking in discussion of the underlying basis for the values shown. 3. Hartman testified that Table IV-1 is the only attempt to quantify differences among alternatives and that it was inadequate, confused in its presentation and that no indication of the basis for the numbers was provided. Alternatives in the table do not correspond to those discussed in the text. Rehabilitation appears in the table, but not in the text. The third part of the table, Stages III-X includes only the Title VII proposal and not the four alternatives which were part of the other two table sections. It appears that one third of the table was inadvertently omitted. 4. Mr. Kirschner’s testimony stressed the necessity of a quantitative or semi-quantitative matrix comparison of the differential effects of alternatives on a range of environmental variables. He also pointed out the table and text do not correspond; rehabilitation is mentioned in the table, but not discussed in the text, and the option of moving the site of Stage II is discussed in the text, but not compared to other alternatives in this table. 5. The comparisons appearing in the table do not present raw numbers and there is no description of the way the fractions used for comparison purposes were derived. There is no explanation as to why the relative impact of a 60-80 du/acre mature project and a 30-35 du/acre mature project should decline from .4 to .2 for electrical use but decline 50% more from .5 to .2 for steam use. Nor is any reason given that the relationship (for the above two alternatives) for water use should be .2 and .5 in the mature new community but .3 and .6 in Stage II. 6. With respect to traffic levels shown in the table, they are representative only of straight line population differences for each alternative and do not purport to predict traffic which will occur in the Cedar-Riverside area. Mr. Downs, defendant’s expert witness, was unable to determine from the table whether it represented total traffic or only traffic generated by the housing project, and was, thus, unable to determine if traffic would vary in a straight line fashion with housing density, since at lower densities more individuals working or attending school in the area might be forced to commute by automobile. The HUD EIS team calculated these inter-relationships on a linear, straight line basis and thus, the reasons for the above inconsistencies are not ascertainable. 7. Mr. Hartman noted that no rationale was given for the choice of the six environmental variables used in the table. It was his opinion that the six (water, sewage, solid waste, electricity, steam, traffic) represent an inadequate range of probable environmental effects. For example, domestic water consumption, sewage and solid waste will be the same for the given population regardless of where situated. Locating all the population in Cedar-Riverside raises only the question of the adequacy of the existing sewer and water lines to handle these high populations, and no materially different environmental effects on a system basis will result. With respect to traffic, only a straight line assumption regarding traffic generated by the project is made. No evaluation is given of carbon monoxide levels and the overall level of traffic in the project area. The table, assuming a straight line relationship as to electricity and steam use gives no indication of possibly better energy conservation performance of differing alternative designs. 8. The inadequacy of analyzing these environmental effects is illustrated by noting some of those omitted, such as: the relationship between design and social-psychological satisfaction with housing, open space adequacy, appropriateness of the unit size and income level in meeting regional housing demands and air pollution. 9. The characterization of alternatives solely in terms of gross densities is not descriptive enough to allow their comparison as to important environmental effects. 10. Mr. Hartman, Prof. Cooper and numerous defense witnesses testified that paragraphs 4.1.1 to 4.1.4 and paragraph 4.3, which involve altering the character of development in various stages, presented alternatives incapable of thorough evaluation because the alternatives are described only in terms of densities (or in paragraph 4.3 in terms of “changes in design”) without further details. Absent a description of the design elements most closely related to environmental effect, no evaluations can be made. 11. Other witnesses supported these conclusions. Mr. Engelen, Ms. McFall and Mr. Broun testified that gross density figures gave an incomplete description of important characteristics of housing. Mr. Jorvig testified that one could not predict differences in amounts of open space between developments of different densities without knowing more detail about building heights and the size of units. Mr. Rapson, the Project Architect, stated that simple density figures were not nearly enough to understand environmental effects. Prof. Cooper testified that gross density figures would not allow conclusions as to effects on the social environment, nor comparison among alternatives as to these effects. 12. Prof. Cooper has studied and compared the actual functioning of a number of different types of housing developments. She testified that consideration of alternative designs is “absolutely essential” in evaluating social-psychological effects of housing, the relationship of housing to open space and the suitability of housing for different populations. It appears impossi-' ble to compare such effects of a 30-35 du/acre project to those of a 60-80 du/acre project without information on design details. Design can vary within a given density; at 60 du/acre, high-density, low-rise is possible or several high-rise towers; at 35 du/acre, a single tower or low-rises can be built. Such comparison could be by a table or matrix with discussion and balancing such as the illustrative figure shown in the Liebman article attached as an appendix to the CREDF comments. 13. Some of the design features most important to such a characterization of alternatives are number of stories, number of units per floor, placement of entrances in relation to common space, number of units per entrance, availability and location of private or semi-private open space. Prof. Cooper stated that preliminary site plans with details as to the form of entry, kind of open space and treatment of common space and facilities would be necessary. 14. Witnesses Cooper, Rapson, Engelen and Kirschner all testified that the development of such alternative preliminary site plans is practical, economically feasible and a normal part of the planning process. Such preliminary site plans and a description of building design elements are necessary to evaluate alternatives and allow a reviewer to know what the alternative will be and its effects. Mr. Rapson indicated such site plans for alternatives and models or schematic drawings of housing design were necessary to give government officials an idea of alternatives and what was planned. Here such details and plans are necessary for each major prototype and several combination prototypes. There are no such prototypes presented to the decision maker for the consideration of alternative environmental impacts in this EIS. 15. The unsupported assumption made throughout the EIS that the findings of The Cost of Sprawl generalize automatically to the Cedar-Riverside New Town carries through to the alternative section. Resulting statements as to the effect of alternatives on energy use and air pollution are conclusory and misleading. 16. Assertions that development of Cedar-Riverside at a lower density would increase overall traffic, air pollution and energy consumption pervades the discussion of alternatives. Although unsupported and unexplained in the text of the alternative section, these assertions presumably result from assumptions that the finding of the report, The Costs of Sprawl, apply to the Cedar-Riverside case. 17. It is questionable whether The Costs of Sprawl findings apply to all; testimony indicated that the conclusions therein are not related to a project density in a simple linear way. Mr. Downs testified that considerable calculation would have to be done to apply the results found in The Costs of Sprawl to a specific project in a concrete way. 18. There is no explanation of the underlying basis for assertions about relative energy consumption among alternatives. Relative energy consumption is a variable of important environmental consequence and the alternative section of the EIS is inadequate on this ground. Mr. Stein’s deposition shows that no attempt was made critically to evaluate energy use by various alternatives, nor to extrapolate The Costs of Sprawl to possible alternatives. 19. The Comprehensive Open Space Plan, Appendix D, conflicts with the proposal for the Stage II-B site which is partially the subject of this EIS. Section 4.1.S exemplifies the “inadequate” nature of the alternative section by failing to compare and evaluate these conflicting proposals for the II-B site. 20. The Comprehensive Open Space Plan (COSP) indicates that the river bluff neighborhood park will be located below the crib wall in an area which conflicts with the proposed location for the Stage II-B housing. In the alternative section, paragraph 4.1.3, there is no discussion of the removal of the Stage II-B housing because of an alternative open space use. The EIS states: “The impacts might be even worse if, for example, development were relocated from the Stage II-B site.” The open space plan calls for adding two to three acres in the river bluff area and appears to conflict with the construction of four hundred and fifty units on the 3.6 acres in the II-B site. This should have been the subject of careful evaluation in the alternative section. 21. Discussion of alternatives is generally conclusory and lacking in the rigor necessary for realistic comparison of alternatives as part of a sound decision making process. 22. Testimony with respect to specific paragraphs of the alternative section of the EIS indicated the absence of a thorough explanation of conclusions and a rigorous comparison of environmental effects. In paragraph 4.1.1 benefits and costs cited for the lower density alternatives appear to be arbitrarily selected and stated as fact without explanation of the underlying reasoning. There is no attempt to weigh the factors, no calculus as to the costs and benefits and therefore no basis for reaching a conclusion as to the desirability of the alternative. 23. Paragraph 1.2 is incomplete. Characterizing the environmental effects of a change in density to 60-80 du/acre rather than the 30-35 du/acre discussed in paragraph 4.1.1 as “similar but to a lesser extent”, is too vague to be meaningful. The alternative sites and the costs and benefits discussed for them in paragraph 4.1.3 all seem arbitrarily selected; there is no specification of the reasons for the selection; there is no discussion of relative costs and benefits. 24. Paragraph 4.1.4 is without meaningful discussion. Paragraph 4.1.5 contains a discussion which is not relevant to a comparison of alternatives. C. The range of environmental variables considered in examining alternatives is not broad enough to allow a full analysis of each alternative or a meaningful comparative evaluation of the environmental effects of each. 1. The EIS Alternative Section fails to consider a number of significant environmental effects which vary with different alternatives. Absent such a discussion and comparison, no decision maker can evaluate the desirability of the project as proposed or the various alternatives. 2. The social and psychological effects of physical design and ownership. Numerous witnesses testified as to the importance of such considerations as: population groups that would be attracted to the housing, levels of satisfaction likely to result, development of proprietary concern, existence of barriers to feelings of community and creation of excessive friction among residents. There was general agreement that these were important environmental considerations. Some specifically mentioned the importance of these factors in comparing alternatives. Prof. David Cooperman wrote to the HUD consultant on social concerns that social impacts of alternatives should be evaluated and that he assumed someone on the EIS team was doing so. Prof. Clare Cooper felt it “absolutely necessary” that alternatives be compared and evaluated in this way. Mr. Hartman testified that an adequate Alternative Section would have to discuss these effects. Mr. Kirschner found the Alternative Section inadequate because effects of ownership, with implications for the social and physical environment, were ignored. 3. Meeting community housing needs. Table II — 5 in the EIS compares the Cedar-Riverside development proposal to the Metropolitan areas housing needs by rental costs and unit size. The text declares that the development “proximates” regional housing needs. This is not the case as to larger units and as to low income units. Mr. Jorvig’s testimony established that a project providing 10% units with three or more bedrooms would not “proximate” the regional demand of 32% for such units. The Cedar-Riverside project proposes only 9% of such larger units. 4. The Landauer report stated that the developer’s proposal was not meeting the demands for subsidized housing and was placing too much emphasis on market rate housing. While the table itself might alert a decision maker to a problem in this area in spite of the inaccuracy in the text, the weighing of the environmental effects of the performance of different alternatives in this regard is also required. 5. The extent to which alternative development proposals meet the city and region’s most pressing housing needs should be an important factor in comparing alternatives in the EIS. The testimony indicated that the two most pressing needs were for larger units and for low income units. The testimony pointed out the inadequacy of the Alternative Section as to this issue and showed its particular importance in view of the undersupply of low income and larger units in the New Town proposal. 6. The deposition of Mr. Stein showed that the HUD EIS team gave no consideration to this question in evaluating alternatives. 7. Demographic effects on the city and the extent to which alternatives achieve the goal of a balanced, mixed community. These issues do not enter into the EIS evaluation of alternatives. Further, there is no description of or data on the population that the various alternatives are designed to serve and thus the EIS provides the decision maker with no projections as to important characteristics of the social environment. The testimony established that differing housing designs would attract different population mixes, thus an evaluation of the consistency of such a resident mix with the urban renewal plan and project agreement goals is necessary; that different populations also will have different effects on certain other environmentally related factors such as transportation and associated carbon monoxide was also made clear in the evidence. 8. Public Costs and Benefits. Witnesses Kirschner and Hartman testified that the effect of a large scale redevelopment project on public agency budgets was a significant environmental concern not addressed in a rigorous way in the EIS generally and not addressed at all in the Alternative Section; that these effects are directly related to the availability and uses of resources, and the level and distribution of services of public agencies. Prof. Cooper-man in his letter to Sharon Fitzsimons, the HUD social consultant, also suggested that a far more rigorous and uniform treatment of the effect of alternatives on public service budgets was necessary. 9. There is no comparison of alternatives in this regard and there is inadequate information in the remainder of the EIS to allow a decision maker to make his own projections and comparisons. In the several places in the EIS that deal with matters requiring public expenditures due to the New Town community, none provide cost estimates with the exception of those dealing with police and fire protection costs. The testimony showed that the EIS conclusion that the project will have “minimal” effects on city services is conclusory and probably inaccurate. Kirschner predicted that the project will have a significant effect on the level of city services required and that it was possible that the net effect of the project on city revenues would be negative. Particularly would this be true if city tax increment revenue was necessary for land write-downs. He testified that there was no way, accurately, to predict this from the EIS. 10. Mr. Stein’s deposition shows that there was no attempt by the HUD EIS team to compare alternatives as to these costs and benefits. There was, further, no attempt to evaluate the effect of necessary land write-downs on city revenues although this would have a major impact on the net project effect on city costs versus revenues. 11. Cost of Resources and Materials. The testimony supported the conclusion that high-rises are more costly structures to build than low-rise apartment buildings, on a per unit cost basis, even considering the distribution of a fixed land cost over more units with high-rise. Data in the report The Costs of Sprawl supports this conclusion. Mr. Downs, defendant’s witness whose consulting firm prepared the report, agreed that high-rises were significantly more costly to construct than low-rises. Investment in housing represents the irreversible and irretrievable commitment of scarce resources. The cost of those resources relates directly to the cost residents must ultimately pay for shelter. It is, therefore, a significant environmental effect. There is no attempt to compare alternatives on this basis. 12. Open Space. There is no evaluation in the Alternative Section with respect to the Stage II — river bluff area of the relative desirability of the Stage II area for open space uses or of alternative housing configurations in the Stage II area and their relationship to river front aesthetics and open space access. 13. Generally, with respect to both Stage II and the project at maturity, there is no comparison of open space needs of different populations that would be housed in different alternative types of housing, the different open space needs that would result from housing alternatives which have significant adjacent private or semi-private open space (as contrasted to the proposed high-rise development without such open space), or the adequacy of specific acreages and locations of open space possible in the proposal vis-a-vis differing alternatives. 14. Open space is a critical environmental concern. Failure to indicate the effects of various alternatives to the project on open space is a most significant and material inadequacy of the impact statement Alternative Section. Any decision made without such information would be arbitrary and capricious. 15. With respect to open space in the Alternative Section, the conclusion in paragraph 4.1.1(b)(4) is not substantiated by any discussion of the underlying basis for that assertion. Testimony showed that the reduction in psychological and social tensions alluded to would only occur if the open space were increased by creation of private or semi-private open space which was usable to residents rather than undifferentiated open space. The conclusion at paragraph 4.1.3 that the relocation of Stage II would “possibly increase the amount of open space in Cedar-Riverside” constitutes a most cursory treatment of the value of such relocation particularly in light of the conflict between the II-B housing site and the neighborhood park space identified in the COSP. D. The discussion of alternatives in the EIS fails to compare and evaluate the costs and benefits of reasonable alternatives as required by NEPA and HUD regulations, and therefore, fails to provide a basis for decision making. 1. Mr. Hartman testified that an adequate comparison and evaluation of alternatives requires: (1) a method for measuring the effect of each alternative on each environmental variable, (2) a comparison of the relative effects of each alternative on each variable, (3) a method of weighing the importance of different environmental effects and (4) the balancing of costs and benefits of each alternative. He testified that in the absence of such a cost/benefit calculus there is no basis for the drawing of conclusions. Prof. Cooperman discusses a method for such a comparison as to existing services in Exhibit 19. Section by section and in total the EIS discussion of alternatives fails to weigh factors, compare costs and benefits and compare differential effects of alternatives on environmental variables. 2. Mr. Kirschner testified that such quantified or semi-quantified case by case balancing is necessary for making judgments; that Table IV-1 is a wholly inadequate attempt at such a weighing and balancing; that the attempts which are made to quantify effects are all on a gross basis rather than on a per unit basis, thus allowing no meaningful comparisons. 3. Mr. Broun testified that a cost/benefit weighing of environmental advantages and disadvantages of a proposal in order to make a quantitative or semi-quantitative assessment of net effect is necessary for decision making. 4. The deposition of Mr. Stein shows that the HUD EIS team made no attempt quantitatively to evaluate the effect of alternatives on environmental variables such as auto use or air quality, to do a cost/benefit assessment of any alternative or to rank environmental effects in any order of importance. Without such weighing and balancing, informed decision making is impossible and the Alternative Section is inadequate on this basis. E. Responses to comments which relate to alternatives are incomplete, cursory and inaccurate. Reasonable alternatives suggested in comments which would have environmental effects significantly different from those of the project as proposed are not considered in the EIS. 1. Written comments of the Environmental Protection Agency suggested: “Because of adverse impacts on air quality, the final EIS should evaluate alternative designs that would reduce the number of trips.” It also suggested: “The alternative of placing the parking facilities on the periphery of the development should be investigated”. 2. Responses appear in the EIS at C-13 through C-16. There are comparative lengthy responses to all points raised by the EPA except these two suggestions. There is no discussion of the possibility of alternative designs or peripheral parking in the EIS response. The Alternative Section does not discuss any alternative in terms of quantitative difference in trip generation and air pollution levels. The Stein deposition shows that no such studies were conducted by the HUD EIS team. 3. Testimony of Roy Mann, landscape architect, specifically urged the alternative treatment of the river bluff and bluff crest as open space. This suggestion was based largely on concern for preservation of the character of the river gorge and his belief that open space is inherently the best use for the bluff and bluff crest. The response is that there will be open space in the bluff area. This was not an adequate response and raises doubts to the comprehension of his comments by the drafters of the EIS. 4. Mr. Kirschner testified at the public hearings as to the social and economic advantages of cooperative ownership as an alternative for Cedar-Riverside. The response was that Kirschner overstated the case for the advantages of co-ops and cited a HUD supported study to this effect. Kirschner testified at trial that this was an inadequate and misleading characterization of the study. It found in fact, significant advantages to cooperatives in the areas of tenant stability and maintenance cost. A HUD memorandum based on the study supported this contention. No discussion of cooperative ownership appears in the EIS text. 5. John Cann, representing CREDF, testified at the hearings as to the necessity of an alternative course of action by HUD to resolve the development’s financial crisis. This alternative proposal involved writing down the cost of the land by about 50%. The response was that the proposal was not within the purview of the EIS. 6. Comments on the draft EIS contained many proposals as to alternative density, design and ownership forms and the positive environmental effects of these changes. These suggestions received no reasoned, objective response. Responses to the comments ignored the alternative proposal altogether in several cases. Other responses referred simply to the developer’s purported efforts. No alternative suggestion was responded to adequately and none were reflected in the content of the EIS Alternative Section. III. THE EIS IS INADEQUATE AND DOES NOT COMPLY WITH NEPA BECAUSE IT IS NOT A FULL, FAIR AND ACCURATE DISCLOSURE OF ADVERSE AND ENVIRONMENTAL EFFECTS OF THE PROJECT. A. The discussion of air quality in the EIS presents a misleading and inaccurate projection of potential health endangering levels of carbon monoxide and other pollutants in an area with admittedly “marginal” air quality. 1. Mr. Madole, a staff member of the Minnesota Pollution Control Agency, Division of Noise and Air Quality, with responsibility for issuing indirect source permits, testified that he would not issue an indirect source permit for the proposed Stage II of the Cedar-Riverside development. This was based on his estimation that the projections in the EIS for future carbon monoxide pollution in the Cedar-Riverside area were extremely conservative. 2. The discussion of local air quality in Section 2.2.3.2.4 of the EIS appears misleading. The section states, in part, that while the Cedar-Riverside area is one in which relatively high concentrations of carbon monoxide could be expected, that in future years, projected auto emission controls should reduce the problem. Mr. Madole testified that auto emission controls would not reduce the problem of carbon monoxide pollution caused by