Full opinion text
OPINION LATCHUM, Chief Judge. The controversy in this case arises over the decision of the defendant Wilmington Medical Center to relocate the major tertiary care components of its existing inner-city hospital system to an outlying suburban location. The plaintiffs, five organizations and six individuals representing minority and handicapped persons residing primarily in the City of Wilmington, brought this suit in September, 1976, charging that the proposed relocation discriminates against them in violation of their rights under Title VI of the Civil Rights Act of 1964, 42 U.S.C. § 2000d (“Title VI”) and Section 504 of the Rehabilitation Act of 1973, 29 U.S.C. § 794 (“Section 504”). Essentially, they contend the plan to relocate hospital services to the suburban location will cause disparities in the availability and quality of medical care for the urban community — a result that will impact disproportionately upon the poor, the elderly, ethnic and racial minorities, and the handicapped. Their complaint seeks, inter alia, a judgment (1) that declares the proposed relocation to be in violation of the above statutes and (2) that enjoins commencement of its construction phase pending the outcome of a civil rights “compliance review” of the proposal by the federal defendant. Subject matter jurisdiction is principally based upon 28 U.S.C. § 1331 (federal questions), 28 U.S.C. § 1343 (civil rights), and 28 U.S.C. § 1361 (mandamus against federal officials). In addition to the Wilmington Medical Center (“WMC”), the named defendants are the Secretary of the United States Department of Health, Education and Welfare (the “Secretary” or “HEW”), the Director of the Delaware Bureau of Comprehensive Health Planning (“BCHP”), and the Chairman of the Health Planning Council, Inc. of New Castle County (“HPC”). The case is presently before the Court on cross-motions for partial summary judgment filed by the plaintiffs and the Secretary and upon a motion for summary judgment filed by the defendant WMC. In essence, these motions call for judicial review of an informal determination by the Secretary that WMC’s proposed hospital relocation, after substantial modification in accordance with various “assurances” given by WMC, will not contravene the policies intended to be effectuated by Title VI and Section 504. Moreover, assuming the matter is resolved in favor of the Secretary, the merits of the plaintiffs’ claim against WMC will be necessarily settled in like manner and final judgment accordingly entered thereon. Because there are no issues of fact material to the resolution of this matter in dispute and because the matter is now ripe for judicial review, summary judgment is appropriate. Rule 56, F.R.Civ.P. I. BACKGROUND A description of the factual background of this hardfought and complicated law suit is essential to a full understanding of the issues and of the contending parties’ claims. A. WMC and the Evolution of Plan Omega Defendant WMC, a privately owned, nonprofit general hospital organized and incorporated under the laws of the State of Delaware, was formed in 1965 as a result of “the first full corporate merger between three voluntary, nonsectarian, acute care general hospitals in the United States. These long-established institutions are now divisions of [WMC] and include the Delaware Hospital, the Wilmington Memorial Hospital and its rehabilitation facility, the Eugene duPont Memorial Hospital, and the Wilmington General Hospital.” As a multi-unit hospital system, WMC is in the enviable position of being the principal health care resource for the State of Delaware and especially for the city of Wilmington and the surrounding metropolitan area. Of the eight general hospitals in the state, four are controlled by WMC; its three major divisions, moreover, operate about 1,100 beds or nearly 75 percent of the available acute care beds in the city and New Castle County. Besides its uniqueness as a statewide hospital system, WMC is one of a handful of urban medical centers that has developed in the context of a manpower production center, surrounded by the vast chemical complexes and related industries and research facilities established in the Wilmington area. Finally, the geographic compactness of the State and the proximity of a major university and nearby medical schools have also contributed to WMC’s unique position. Nevertheless, a variety of factors — not the least of which are the “growth pains” present in any new organization — have combined to alter WMC’s unique situation. For example, during the past ten years New Castle County, similar to other metropolitan areas, has witnessed a population exodus from the city to the suburbs. Wilmington’s population approaches 80,000, but 15,000 more persons left than entered the city between the 1960 and 1970 censuses, while the suburban areas to the south and west of the city increased by 10,000 during the same time period. And the trend in the population shift evidently continues unabated. In pointing out a further problem encountered by the managers of WMC, a commentator has observed: “Many multiple-unit [hospital] systems have developed in a unit of service configuration like a doughnut with the acute care tertiary care center occupying the hole of the doughnut and satellite or branch facilities located on the periphery. WMC hospitals are all within the hole of the doughnut . . . .” For more than a decade WMC engaged in an extensive planning process intended to develop the most feasible method to improve the efficiency and quality of its delivered health care and to respond to the growing need for a hospital facility in the southwestern region of New Castle County. In October, 1975, WMC’s Board of Directors unanimously adopted a proposal, commonly known as Plan Omega, that envisioned a major realignment of the health resources presently available at its three major inner-city divisions. Under this plan numerous nonemergency inpatient and outpatient services offered by the three Wilmington divisions will be transferred to a major 800-bed tertiary care facility to be constructed on a 200-acre site located about eight miles southwest of the city in Stanton, Delaware (the “Southwest” or “Stanton” Division). Although the General and Memorial Divisions will be closed, a restored and modernized Delaware Division will remain as WMC’s only sophisticated health care resource in the city. The Delaware Division will continue to offer sophisticated ambulatory and emergency services in addition to regular hospital services, although the plan calls for it to be reduced in size from 542 to 250 beds. The estimated total cost of the project, about 88 million dollars, will be financed primarily with funds generated through charitable contributions and the marketing of tax exempt revenue bonds. In 1975, nearly 35 percent of WMC’s operating revenues (20 million dollars) were derived from federal funds through medicare, medicaid and other federal health assistance reimbursement programs. Moreover, because a hospital’s patient fee structure includes a capital component designed to recapture a portion of every dollar spent on capital improvements, continued reimbursement under these federal programs will assure that a respectable part of Plan Omega’s construction costs will be furnished by federal sources. According to the plaintiffs’ calculations, for example, construction costs related to Plan Omega, which will not be fully depreciated for perhaps thirty years, will be recovered at the rate of three million dollars annually through hospital charges paid to WMC by the government under medicare. B. Section 1122 of the Social Security Act An integral step along the path leading to Plan Omega’s realization was taken in early March, 1976, when WMC submitted the plan to defendant BCHP for review under section 1122 of the Social Security Act, 42 U.S.C. § 1320a-1 (“section 1122”). That section was enacted by Congress to assure'. that funds provided under ■ medicare, medicaid and programs for maternal and child health services (collectively, “medicare”) are not used to support unnec- : essary capital expenditures by or on behalf of health care facilities reimbursed under ■ such-programs. Since medicare programs pay a hospital’s “reasonable costs,” including depreciation on- buildings and equipment, debt service and-'other capital-related costs reasonably apportioned to a hospital’s fee structure, WMC sought section 1122 certification to assure that it would not be denied such compensation on the ground that its capital expenditure program (Plan Omega) was “unreasonable.” Under section 1122, Congress authorized the Secretary to negotiate with the governors of the various states agreements by which a designated state planning agency would be appointed to review the need for a hospital’s proposed capital expenditure and to determine whether the proposal is consistent with various state health care standards and criteria. As a participating state, Delaware, or rather its designated planning agency, defendant BCHP, contracted with an area-wide planning group, defendant HPC, to conduct studies and submit comments on section 1122 applications. The areawide planning group is responsible for evaluating a proposed capital expenditure and determining, for example, whether the project can be adequately staffed and operated, whether it is economically feasible, whether it will result in an unreasonable increase in the fee structure of the hospital, and whether the health care needs of the community necessitate such a project. If the hospital and the designated state planning agency adhere to-the procedures set forth in section 1122 and the Secretary’s regulations, and if the capital expenditure proposal is found to be consistent with the state health care standards and criteria, then the Secretary will not disallow that portion of the medicare bills submitted by the hospital that represents a return of capital costs by depreciation or otherwise. In this case, defendant HPC adopted a resolution on June 3, 1976 commenting favorably on Plan Omega and defendant BCHP’s approval was registered on June 15, 1976. Having received complete approval at the state level, Plan Omega was submitted to the Secretary who is required under the statute to assure that the proper procedure was followed. On August 6, 1976, the Secretary granted section 1122 approval to Plan Omega. WMC was then assured that that portion of its patient fee structure allocable to a return of depreciation, debt service and other capital costs directly related to Plan Omega would be eligible for reimbursement by way of medicare payments. It is noteworthy, however, that if WMC had abjured the section 1122 process, or been denied approval, it nonetheless could proceed to implement Plan Omega, albeit with the risk that the Secretary might later withhold medicare payments allocable to its capital-related costs. C. The Complaint Under Title VI and Section 504 Shortly after Plan Omega was approved by the Secretary, but before WMC had issued its construction bonds, the plaintiffs commenced this action, alleging that the effectuation of Plan Omega will result in a segregated, dual hospital system, in violation of their rights under Title VI and Section 504. Specifically, the plaintiffs asserted that WMC’s remaining urban facility, the Delaware Division, will become a “ghetto” hospital serving primarily the poor, the elderly, the handicapped, blacks, and Puerto Ricans, while the proposed Stanton Division will attract the more affluent, white population of suburban New Castle County. They also maintained that the relocation of certain acute care services exclusively at the Stanton hospital will make them virtually inaccessible to many handicapped and minority residents of Wilmington and northern New Castle County and will exacerbate the segregatory effect of a dual hospital system. WMC was therefore charged with violating Title VI and Section 504 because it chose a relocation site under Plan Omega that will have an adverse and disproportionate impact upon minority and handicapped persons residing primarily in the city. The other defendants, the Secretary, BCHP, and HPC, were accused of violating their duties under these statutes because they officially sanctioned under section 1122 a federally assisted hospital relocation project that will have the effect of excluding from participation, denying benefits to, and discriminating against persons on the ground of race, color, national origin or handicap. D. The Agency Investigation of Plan Omega Initially, the Secretary and the BCHP moved to dismiss the complaint in this case, arguing that because the plaintiffs had not filed an administrative complaint alleging a Title VI violation, as required by the Secretary’s implementing regulations, the plaintiffs had failed to exhaust their administrative remedies. This argument was rejected, however, and the Court directed the Secretary to address the allegations of the complaint at hand as if it had been filed administratively and to determine whether Plan Omega, if implemented, will violate Title VI or Section 504. The decision to instruct the Secretary to develop the factual record on plaintiffs’ complaint and to exercise his discretion in reviewing Plan Omega, reflected the Court’s view that such a process would “carry out the Congressional expectation that Title VI be administered by the appropriate agency and that judicial review of the agency’s decision follow traditional paths.” Balanced against the desire to invoke the review procedure provided in the Secretary’s regulations, however, was the obvious need for an expeditious resolution of the question whether Plan Omega would have a discriminatory impact. The Secretary was therefore requested to submit to the Court a report specifically delineating the agency’s plan for processing the plaintiffs’ complaint, its investigative methodology, and an estimate of the time period required to carry out the plan. On February 18, 1977, the Secretary submitted a report stating that the investigation of Plan Omega, conducted under the auspices of HEW’s Office for Civil Rights (“OCR”), had begun on January 19 and would be completed on May 4, 1977; the report also identified the personnel assigned to carry out the investigation. Although HEW frankly admitted its inexperience in conducting Title VI and Section 504 reviews of proposed hospital relocations, the investigation undertaken by OCR was an extensive one which focused on “an assessment of the extent to which adequate provision is made for an equal delivery of services to both minority and majority beneficiaries or participants in the programs to be offered by the facilities under Plan Omega, including the accessibility of such services to minorities and handicapped persons, and the extent to which Plan Omega does or does not lead to the establishment of dual facilities.” Recognizing the complicated nature of the task it had been directed to perform, OCR’s staff began by collecting and analyzing the information amassed by the parties, including information generated pursuant to a significant amount of discovery taken in connection with this law suit. For example, OCR had access to information produced by virtue of the plaintiffs’ request that WMC collect data recording patient visits classified (1) by race, age, national origin, or handicap, (2) by zip code zone of origin, (3) by medical service, (4) by mode of payment, (5) by mode of transportation and (6) by time of admission. Information produced from this process enabled OCR to predict what the distribution of patients by race will be at the two locations envisioned under Plan Omega and to determine how priorities of patient use of transportation according to race or handicap will be affected by the relocation of certain services exclusively to Stanton. Moreover, OCR conducted its own study of Plan Omega’s potential impact on Wilmington’s community of minority and handicapped persons; for example, it analyzed demographic data in order to determine those areas where the minority population is concentrated and their proximity to the present and proposed location of hospital sources; it conducted on-site inspections of WMC’s three existing facilities and interviewed supporting staff and personnel concerning delivery of health care now and as proposed under Plan Omega; and, it studied the transportation matrix of New Castle County as well as the area’s existing and proposed public and private transit services in order to ascertain their influence upon the potential accessibility for urban residents of hospital resources moved to a suburban location. Finally, OCR reviewed as part of the record in this case thousands of pages of public hearing transcripts, minutes of HPC subcommittee meetings, and miscellaneous reports and studies generated during the process of local and state agency review of Plan Omega. After an unprecedented investigation which spanned more than six months and produced a massive record exceeding six thousand pages, OCR issued its July 5, 1977, “Letter of Findings” informing WMC that Plan Omega as then constituted would violate Title VI and Section 504. In effect, the Letter of Findings represented HEW’s conclusion that the investigative review had established a prima facie Title VI and Section 504 case against WMC. OCR’s report also pointed out that WMC had not satisfactorily rebutted the prima facie case by coming forward with evidence showing that the discriminatory effect was justified on the basis of a bona fide interest of WMC or that no alternative course of action could be taken that would enable that interest to be served with less discriminatory effect. However, the Letter of Findings did identify numerous “factors which tend to . mitigate the disproportionate impact" and enumerated 12 areas in which Plan Omega would have to be modified in order to achieve compliance with the statutes and the Secretary’s regulations. The Secretary, heeding the Congressional admonishment to first attempt informal, voluntary efforts to secure compliance with the statutes in question, engaged in extensive negotiations with representatives of WMC in order to delimit the areas in which Plan Omega would have to be modified. After more than three months of discussions, an agreement was finally executed on November 1, 1977. That agreement constitutes a binding and specifically enforceable contract (herein referred to as the “contract of assurances”) the terms of which obligate WMC to modify and supplement those particular features of Plan Omega which HEW believes will otherwise have a discriminatory effect. It also embodies the Secretary’s determination that Plan Omega, as modified, comports with Title VI and Section 504 and that there are no grounds for denying federal financial assistance to WMC so far as Plan Omega is concerned. The plaintiffs, however, do not share the Secretary’s confidence in the adequacy of the assurances given by WMC; they contend that the contract of assurances was based upon inadequate and erroneous findings and that the Secretary’s determination was not based on a consideration of the relevant factors. In any event, the Secretary’s determination completes the administrative remedy process and this case is now in a posture that is suitable for judicial review. II. SCOPE OF JUDICIAL REVIEW The first question the Court must consider is what standard Congress intended to govern judicial review of final agency action taken pursuant to Title VI and Section 504. In an order dated November 4, 1977, the Court expressed its view that the scope of judicial review in this case would be governed by the familiar “arbitrary and capricious” standard defined in the Administrative Procedure Act, 5 U.S.C. § 706(2)(A). The plaintiffs have moved to modify that order, asserting that Title VI and Section 504, together with the unusual circumstances of this case, establish their right to a plenary judicial trial de novo. The defendants, of course, oppose the motion, arguing that the plaintiffs’ statutory rights will be adequately protected by this Court’s “searching inquiry” into the administrative record. See Camp v. Pitts, 411 U.S. 138, 93 S.Ct. 1241, 36 L.Ed.2d 106 (1973); Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971). A. The Statutory Framework 1. Title VI. The Court must begin with the language and overall scheme of the legislation. In 1964 Congress proclaimed in section 601 of Title VI that no person shall be subjected to discrimination “on the ground of race, color, or national origin . . . under any program or activity receiving Federal financial assistance.” The broad language of this section reflects the clear Congressional policy against racial discrimination by the recipients of federal largesse and is predicated on the power of the federal government, when granting financial assistance under a host of federally sponsored programs, to specify the conditions and the terms upon which that assistance is granted. Then, to effectuate its mandate, Congress provided in section 602 a clear, unequivocal directive to the various governmental departments and agencies responsible for dispersing federal funds: “Each Federal department and agency which is empowered to extend Federal financial assistance to any program or activity, by way of grant, loan, or contract ... is authorized and directed to effectuate the provisions of section 2000d [section 601 of Title VI] with respect to such program or activity by issuing rules, regulations, or orders of general applicability which shall be consistent with achievement of the objectives of the statute authorizing the financial assistance in connection with which the action is taken. . . . Compliance with any requirement adopted pursuant to this section may be effected (1) by the termination of or refusal to grant or to continue assistance under such program or activity to any recipient as to whom there has been an express finding on the record, after opportunity for hearing, of a failure to comply with such requirement . or (2) by any other means authorized by law: Provided, however, That no such action shall be taken until the department or agency concerned has advised the appropriate person or persons of the failure to comply with the requirement and has determined that compliance cannot be secured by voluntary means. " Pursuant to the mandate of section 602, various departments and agencies, including HEW, promulgated extensive regulations for implementing the broad proscription of section 601, all of which are basically identical. Indeed, the regulations and the unequivocal language of section 602 underscore the Congressional objective: to eliminate discrimination by whatever means possible, including the suspension of federal assistance to recalcitrant recipients. But the suspension of federal aid was a sword which Congress cautioned the agencies to wield judiciously; it was envisioned as a weapon of last resort, designed to provide government agencies with “leverage” in their efforts to secure compliance with the statute. Congress thus mandated that federal agencies attempt at the outset to secure compliance by informal, voluntary means. The enforcement regulations promulgated by HEW in this regard provide an apt illustration. Applicants for federal funds under a program to which Title VI applies are required to furnish to HEW, as a condition to the extension of the assistance, a formal, written “assurance” that the applicant will operate in compliance with Title VI. 45 C.F.R. § 80.4(a)(1). Even then, however, the regulations require HEW to conduct “periodic compliance reviews” to ascertain whether recipients have kept faith with the “assurances.” Id. at § 80.7(a). Further, a prompt investigation is begun whenever HEW has reason to believe, because of a complaint or other information, that a recipient is out of compliance with the statute or the regulations. Id. at § 80.7(b), (c). If an investigation indicates a recipient’s practices fully comport with Title VI, the regulations merely require HEW to so inform the recipient and the complainant, if any, in writing. Id. at § 80.7(d)(2). On the other hand, if the investigation indicates a failure or threatened failure to comply, the recipient is advised of this finding, and informal methods are undertaken, if possible, to secure voluntary compliance. Id. at § 80.7(d)(1). If the informal efforts to achieve compliance are unsuccessful, however, section 602 directs HEW, as well as other government agencies, to effect compliance (1) by cutting off federal assistance upon an express finding on the record, and after the opportunity for a hearing, of a failure to comply, or (2) by any other means authorized by law. Clearly, when Congress enacted Title VI and proclaimed an end to the use of federal funds in discriminatory programs, it also stated with precision the administrative measures available to enforce its mandate. From this elaborately and carefully constructed enforcement mechanism, it is. manifest that the scheme of Title VI is essentially administrative. But even with the safeguards built into the regulatory framework, Congress nonetheless believed it was necessary to provide for judicial review of departmental action as a “final barrier” against the possibility of federal officials improperly construing their statutory obligations or taking action inconsistent with those obligations. See Adams v. Richardson, 156 U.S.App.D.C. 267, 480 F.2d 1159, 1163-64 (1973) (en banc); Taylor v. Cohen, 405 F.2d 277, 279 (C.A. 4, 1968) (en banc). Section 603 of Title VI in part reads: “. . .In the case of [agency] action terminating or refusing to grant or to continue financial assistance upon a finding of failure to comply with any requirement imposed pursuant to section 2000d-l [section 602 of Title VI] any person aggrieved (including any State or political subdivision thereof and any agency of either) may obtain judicial review of such action in accordance with section 1009 of Title 5 [§ 10 of the Administrative Procedure Act, 5 U.S.C. §§ 701-06] and such action shall not be deemed committed to unreviewable agency discretion within the meaning of that section.” While the above language contemplates judicial review of action “terminating or refusing to grant” financial assistance, still it plainly indicates such review is pursuant to the judicial review chapter of the Administrative Procedure Act, 5 U.S.C. §§ 701-06, which does not restrict standing to seek judicial review to applicants or grantees of federal funding who believe themselves aggrieved by agency action. Moreover, at least three courts have held that aggrieved persons may seek judicial review to challenge the failure or refusal of federal officials to terminate funding to programs that purportedly engaged in discrimination. It also seems clear that the language of section 603 contemplates not an independent cause of action in federal court but an intermediate level of judicial review to determine the propriety of an agency action or proceeding. In Adams v. Richardson, for example, certain black students, citizens and taxpayers brought suit against the Secretary of HEW and others, alleging that HEW had been derelict in its duty to enforce Title VI and had failed or refused to terminate funding to various segregated public educational institutions. The district court agreed that HEW had consciously abdicated its statutory responsibilities and ordered it to institute compliance and enforcement proceedings against the recalcitrant schools. On appeal, the Circuit Court, after modifying the higher education aspect of the lower court’s injunctive order, affirmed in all other respects the relief granted. Moreover, it specifically noted and approved the nature of the judicial proceeding instituted by the plaintiffs: “. . . the purpose of the District Court ... is not to resolve particular questions of compliance or noncompliance [with Title VI], It is, rather, to assure that the agency properly construes its statutory obligations, and that the policies it adopts and implements are consistent with those duties . . . .” The nature of the judicial review sanctioned in Adams, therefore, evinces an appreciation of the distinct function of the reviewing court vis-a-vis the administrative role envisioned by Congress when it enacted Title VI. To read section 603 as authorizing private persons to institute a de novo proceeding in a federal court, in the first instance, for the purpose of determining whether a particular recipient is or is not complying with Title VI, would not only distort the plain meaning of the statute, but would also “propel the court[s] into the domain which Congress has set aside exclusively for the administrative agency.” Securities & Exchange Comm’n v. Chenery Corp., 332 U.S. 194, 196, 67 S.Ct. 1575, 1577, 91 L.Ed. 1995 (1947); see Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 166-69, 83 S.Ct. 239, 9 L.Ed.2d 207 (1962). The legislative history, moreover, confirms that Congress intended to accord aggrieved persons a right to post-administrative remedy judicial review under the APA, as contradistinct from an independent and de novo proceeding in the federal courts. While the majority reports of the Senate and House Judiciary Committees are bereft of much explanation regarding the judicial review provided by section 603, the minority views of two members of the House Judiciary Committee appear to indicate the general understanding of that question at the time the House bill (H.R. 7152) was favorably reported on. Representatives Poff and Cramer issued a separate minority statement which expressed their concern regarding the consequences of vesting administrative agencies with the power to suspend financial aid under programs authorized and founded by the legislature, subject only to the right of a posteriori judicial review. As the minority statement put it: “It will be seen that the judicial review authorized by this legislation (as distinguished from an original judicial proceeding) is keyed to the Administrative Procedure Act. . . . [I]n all respects, this proceeding is a review rather than a trial. The limited review procedure authorized in the Administrative Procedure Act was justified when [Title VI] was written on the grounds that administrative agencies were supposed to have more expertise in their particular fields than the courts themselves. That is why the courts were allowed to reverse administrative findings only when they were not supported by substantial evidence, were clearly erroneous, or were contrary to law. Outside the Department of Justice itself, no administrative agency can claim to have any special expertise in the field of racial discrimination. Accordingly, the theoretical justification for the limited procedure established in the Administrative Procedure Act does not exist, and because it does not exist, tying the judicial remedy of [T]itle VI to the Administrative Procedure Act is not justified because it does not fully protect the rights of those charged with racial discrimination in the administration of Federal aid programs. The foregoing consideration has to do with the judicial remedy which would be made available to those charged with acts of discrimination. It should also be remembered that this judicial procedure is available to those who bring charges of discrimination and who are aggrieved by negative ruling of the administrative agency. . . . ” The views expressed in the minority statement were not contradicted by the majority report nor by any other member of the House Judiciary Committee; indeed, the Chairman of that Committee, Representative Celler, reinforced the view that section 603 only authorizes a right to post-administrative remedy judicial review. During the lengthy floor debates on the bill he observed that “the [administrative] record is made and goes to the court. If the court feels that there is insufficient evidence [it] may remand the case back to the agency for additional evidence. The agency may have an additional hearing and obtain more evidence. Then the case would go back to the district court ... to determine the ease and make a decision, affirming or rejecting the decision of the agency. All we do in [section 603] is what we have done in all agencies. . . .We provide sufficiently for relief to a party aggrieved. . . . [W]e provide in the Administrative Procedure Act for a review to the party aggrieved, to the court on the basis of the record that has been made.” Although there was scant consideration of the question in the Senate, the remarks of its members during the debates conform to the views of those in the House. Senator Byrd, for instance, noted that the statute clearly “provides for judicial review of agency actions upon the demand of aggrieved persons,” although such review is tied to the review provisions of the APA and, therefore, “is to be distinguished from an original judicial proceeding. . . . The proceeding is a review rather than a trial.” The remarks of other members of the Senate parallel those of Senator Byrd and dispel any notion that section 603 was intended to accord persons an independent cause of action free of the review requirements of the APA. To the contrary, the right of review based on the APA was perceived by Congress as “a barrier against any arbitrary or capricious act . on the part of any administrator in carrying out” his Title VI responsibilities. 2. Section 504. The language of Section 504 of the Rehabilitation Act of 1973 is almost identical to that of section 601 of Title VI and expresses “a policy of nondiscrimination against otherwise qualified handicapped individuals with respect to participation in or access to any program which is in receipt of Federal financial assistance.” Unlike its Title VI prototype, Section 504 contains no additional provisions requiring administrative rulemaking or enforcement procedures, although it seems unlikely that Congress intended its prohibitory command to be self-executing. While the legislative history accompanying the statute is largely unilluminating the history of subsequent clarifying amendments makes it clear that Congress contemplated the swift promulgation of comprehensive regulations effectuating the rights guaranteed by Section 504. Lloyd v. Regional Transportation Authority, 548 F.2d 1277, 1281-82 (C.A. 7, 1977); Cherry v. Mathews, 419 F.Supp. 922, 924 (D.D.C.1976). On April 28, 1976, Executive Order 11914, 41 Fed.Reg. 17871 (April 29, 1976) was issued. This Order, the functional equivalent of section 602 of Title VI, authorizes HEW and other federal agencies responsible for disbursing federal monies “to adopt rules, regulations and orders to ensure that recipients of federal aid are in compliance with Section 504. If compliance cannot be secured voluntarily, it may be compelled by suspension or termination of federal assistance after a hearing or by ‘other appropriate means authorized by law.’ HEW is given the responsibility of establishing standards for who are ‘handicapped individuals’ and for determining what are ‘discriminatory practices’ as well as coordinating the implementation of Section 504 by all federal agencies.” Lloyd v. Regional Transp. Auth., supra, 548 F.2d at 1281. On May 4, 1977, HEW issued final regulations implementing Section 504. Specifically, in connection with the instant litigation, it is noteworthy that § 84.4 of the regulations provides: “(b) Discriminatory actions prohibited. (5) In determining the site or location of a facility, an applicant for assistance or a recipient may not make selections (i) that have the effect of excluding handicapped persons from, denying them the benefits of, or otherwise subjecting them to discrimination under any program or activity that receives or benefits from Federal financial assistance or (ii) that have the purpose or effect of defeating or substantially impairing the accomplishment of the objectives of the program or activity with respect to handicapped persons.” This regulation parallels HEW’s site selection regulation implementing Title VI. See 45 C.F.R. § 80.3(b)(3). The parallels do not end there, however. The Section 504 regulations reiterate the “voluntary compliance” philosophy of Title VI and its regulatory framework by requiring applicants to furnish “assurances” to HEW as a condition to the extension of aid and by encouraging voluntary, remedial compliance measures necessary to overcome the effects of discrimination against the handicapped. Moreover, until the adoption of consolidated procedural regulations governing all of the civil rights statutes for which HEW has enforcement duties, the “procedural provisions applicable to Title VI of the Civil Rights Act of 1964,” found in 45 C.F.R. §§ 80.6-.10 and Part 81, are expressly incorporated by reference into the Section 504 regulations. Nor is the close resemblance between the Title VI and the Section 504 administrative remedial machinery an accidental or an unintended result. The legislative history indicates that Congress envisioned parallel enforcement mechanisms: “Section 504 was patterned after, and is almost identical to, the antidiscrimination language of section 601 of the Civil Rights Act of 1964, 42 U.S.C. 2000d-l (relating to race, color, or national origin), and section 901 of the Education Amendments of 1972, 42 U.S.C. 1683 (relating to sex). The section therefore constitutes the establishment of a broad government policy that programs receiving Federal financial assistance shall be operated without discrimination on the basis of handicap. . The language of section 504, in followig [sic] the above-cited Acts, further envisions the implementation of a compliance program which is similar to those Acts, including promulgation of regulations providing for investigation and review of recipients of Federal financial assistance, attempts to bring non-complying recipients into voluntary compliance through informal efforts such as negotiation, and the imposition of sanctions against recipients who continue to discriminate against otherwise qualified handicapped persons on the basis of handicap. Such sanctions would include, where appropriate, the termination of Federal financial assistance to the recipient or other means otherwise authorized by law. Implementation of section 504 would also include pre-grant analysis of recipients to ensure that Federal funds are not initially provided to those who discriminate against handicapped individuals. Such analysis would include pre-grant review procedures and a requirement for assurances of compliance with section 504. This approach to implementation of section 504, which closely follows the models of the above-cited anti-discrimination provisions, would ensure administrative due process (right to hearing, right to review), provide for administrative consistency within the Federal government as well as relative ease of implementation, and permit a judicial remedy through a private action.” Further, the above language indicates that Congress, consistent with the provisions of Title VI, intended aggrieved persons under Section 504 to have a judicial remedy in the form of judicial review of administrative action rather than an independent, original cause of action in the district courts. Cf. Cannon v. University of Chicago, 559 F.2d 1063 (C.A. 7, 1976), petition for cert. filed, 46 U.S.L.W. 3438 (Dec. 28, 1977) (Title IX); Lloyd v. Regional Transp. Auth., supra, 548 F.2d at 1277 (Section 504). The plaintiffs, however, strenuously insist that Title VI and Section 504 implicitly authorize a private action to enforce their terms and that in the circumstances of this case such an action entails a plenary judicial trial de novo. In support of their argument, the plaintiffs rely heavily upon a series of cases brought by private plaintiffs under Title VI and Section 504. Lau v. Nichols, 414 U.S. 563, 94 S.Ct. 786, 39 L.Ed.2d 1 (1974); Lloyd v. Regional Transp. Auth., supra; Uzzell v. Friday, 547 F.2d 801 (C.A. 4, 1977); Bossier Parish School Board v. Lemon, 370 F.2d 847 (C.A. 5, 1967); Gurmankin v. Costanzo, 411 F.Supp. 982 (E.D. Pa.1976), aff’d, 556 F.2d 184 (C.A. 3, 1977); Laufman v. Oakley Bldg. & Loan Co., 408 F.Supp. 489 (S.D.Ohio 1976). The Secretary, adhering to the position recently taken by the government before the Supreme Court in Bakke v. Regents of the University of California, 18 Cal.3d 34, 132 Cal.Rptr. 680, 553 P.2d 1152 (1976), cert. granted, 429 U.S. 1090, 97 S.Ct. 1098, 51 L.Ed.2d 535 (Feb. 22, 1977) (No. 76-811), concedes that a private action may be brought against a recipient of federal assistance under Title VI and Section 504, but contends that the plaintiffs in this case elected to enforce their rights through the administrative process and therefore are entitled only to judicial review of administrative action. None of the cases cited by the plaintiffs, however, support the view that Title VI and Section 504 implicitly confer upon private parties an independent cause of action in the form of a trial de novo in the circumstances of this case. First of all, the Court does not read those cases as broadly as the plaintiffs, because most of them were expressly brought under 42 U.S.C. § 1983 to redress violations of rights provided by Title VI rather than directly under the aegis of the statute itself. E. g., Uzzell v. Friday, supra. Therefore, language in those decisions indicating that the private party had stated a claim under Title VI was merely another way of saying that the allegations of statutory violations were sufficient to state a cause of action under § 1983. Even in those cases where § 1983 was not mentioned, it seems likely that the courts were in fact relying upon it to establish a cause of action since the suits were brought against public agencies acting under color of state law. In both Lau and Bossier, for example, a class suit by a large group of minorities was brought against a public school system to enforce their constitutional and statutory rights to an equal educational opportunity. No jurisdictional issue was presented to the Supreme Court in Lau but the plaintiffs’ complaint shows that their constitutional and statutory claims were explicitly premised on 42 U.S.C. § 1983. In Bossier, the Fifth Circuit merely held that the plaintiffs had “standing” under Title VI to enforce a national constitutional right. 370 F.2d at 851. Because there apparently was no authority at that time for bringing a suit directly under the Fourteenth-Amendment to enforce a right to equal protection of the law absent an independent statutory basis, it is likely that that action was brought under the authority of § 1983 as well. Thus, since most of these eases arose under 42 U.S.C. § 1983, the Court declines to attach to them the meaning which the plaintiffs so ardently champion. These cases, as well as any decision relying on them, cannot be read as supporting the proposition that the plaintiffs are entitled to bring an independent cause of action directly under the auspices of Title VI or Section 504 which would warrant a judicial trial de novo. Thus, Lau and similar cases are of no help to the plaintiffs because they are unable to invoke 42 U.S.C. § 1983, having sued a private hospital not acting under color of state law. Second, some of the cases relied upon by the plaintiffs permitted a class suit to proceed as an independent cause of action directly under Section 504 against a public agency only because the administrative remedy established under the statute to protect their rights had proven to be wholly inadequate or nonexistent. For example, in Lloyd v. Regional Transp. Auth., supra, the Seventh Circuit held that the representatives of a large class of handicapped persons could bring a private action directly under Section 504 against a recipient of federal financial assistance to enforce the affirmative rights granted by that legislation. 548 F.2d at 1286-87. The Court’s holding, however, was explicitly based on the fact that the administrative procedures for enforcing Section 504 were still in their embryonic stages and thus were inadequate to vindicate the plaintiffs’ rights. The Seventh Circuit suggested, moreover, that the existence of a meaningful administrative enforcement mechanism would relegate the plaintiffs to a more limited form of post-agency action judicial review. Id. at 1286 n.29. Obviously, Lloyd and similar cases are inapposite here because the Secretary has carried out his duty to enforce the statutes through appropriate implementing regulations which have not been shown to be inadequate, let alone nonexistent. Thus, neither the cases cited by the parties nor any reported decisions discovered by the Court’s own research provide any real support for the plaintiffs’ argument that Title VI and Section 504 create an implied right to a private de novo judicial remedy in favor of persons who have a grievance based upon discrimination against a private hospital receiving federal funds. The Court recognizes, however, that there are occasions when statutes which are silent as to the existence of a judicial remedy may be interpreted by courts as giving rise to an implied private cause of action. See, e. g., Rosado v. Wyman, 397 U.S. 397, 90 S.Ct. 1207, 25 L.Ed.2d 442 (1970); Allen v. Board of Election, 393 U.S. 544, 89 S.Ct. 817, 22 L.Ed.2d 1 (1969); J. I. Case Co. v. Borak, 377 U.S. 426, 84 S.Ct. 1555, 12 L.Ed.2d 423 (1964). But to construe Title VI and Section 504 as implicitly permitting a private judicial remedy which would warrant a de novo trial in this case would do violence to the evident intent of Congress. For the violation of the affirmative rights granted by Title VI and Section 504, Congress afforded a private administrative remedy. As previously stated, that remedy empowers any interested person who deems himself discriminated against to file a complaint before the agency which is authorized to extend the federal aid. Efforts to secure voluntary compliance, as mandated by Congress, may be followed by formal hearings and, if necessary, the withdrawal of funds in order to end discrimination by the offending party. Finally, there is a right to judicial review of the agency’s decision regarding the complaint. Clearly, Congress vested in the appropriate administrative agencies rather than in the federal courts the initial responsibility to adjudicate Title VI and Section 504 complaints and to enforce the policies intended to be effectuated by those laws. By placing such a premium on agency expertise, the statutes evidence the Congressional intent to exclude parallel judicial remedies. “A frequently stated principle of statutory construction is that when legislation expressly provides a particular remedy or remedies, courts should not expand the coverage of the statute to subsume other remedies. ‘When a statute limits a thing to be done in a particular mode, it includes the negative of any other mode.’ ” National Railroad Passenger Corp. v. National Ass’n of Railroad Passengers, 414 U.S. 453, 458, 94 S.Ct. 690, 693, 38 L.Ed.2d 646 (1974) quoting Botany Worsted Mills v. United States, 278 U.S. 282, 289, 4 S.Ct. 129, 73 L.Ed. 379 (1929). The teaching of these Supreme Court cases is clear: Where Congress has not specifically provided for a certain remedy, courts should not lightly imply one, particularly where other means of enforcement have been provided. See Securities Investor Protection Corp. v. Barbour, 421 U.S. 412, 95 S.Ct. 1733, 44 L.Ed.2d 263 (1975). Nothing in the language of Title VI or Section 504, nor anything the Court has found in their legislative histories, would appear to authorize an independent cause of action in a federal court that would warrant a de novo trial. Moreover, implication of such a private judicial remedy would be inconsistent with the legislative intent and the underlying purposes of the statutory scheme. It seems clear from the face of the statutes and the regulations designed to implement them that by providing private parties an administrative but not a judicial remedy in which to raise grievances based on discrimination, Congress’ purpose was to entrust administrative agencies with the discretion to review and resolve such grievances. Therefore, to hold, as the plaintiffs insist we must, that a trial de novo is required to judicially ascertain whether Plan Omega will violate Title VI and Section 504 seems unsound, for it would largely transfer the power to enforce those statutes from the Secretary, where Congress put it, to the district courts. The Secretary, after investigating the plaintiffs’ charges against Plan Omega, found the charges to have merit and then exercised his discretionary power to formulate an appropriate remedy through voluntary compliance. Judicial review of that action, as opposed to a de novo trial, will minimize the opportunity for a reviewing court to substitute its discretion for that of the agency and reduces the risk that the Court’s mode of review will short-circuit functions properly within the administrative sphere. Consolo v. Federal Maritime Comm’n, 383 U.S. 607, 621, 86 S.Ct. 1018, 16 L.Ed.2d 131 (1966); United States v. Carlo Bianchi & Co., 373 U.S. 709, 715, 83 S.Ct. 1409, 10 L.Ed.2d 652 (1963). Nor is the Court persuaded by the plaintiffs’ argument that implication of a private judicial remedy is consistent with the legislative objectives of Title VI and Section 504 because it would facilitate enforcement of the Congressional policy against discrimination in federally funded programs. Besides the fact that it ignores the question whether implication of such a remedy is consistent with the purposes of the legislative scheme, the “private attorneys general” argument goes too far. Enforcement of every federal statute would be assisted by implying a private cause of action to parallel an already existing administrative mechanism created by Congress. But such a result in itself is not an acceptable rationale for expanding the statutory remedies explicitly provided by the legislature. In short, based on the evident legislative intent and in the face of a carefully constructed scheme of consolidated enforcement regulations implementing Title VI and Section 504, the Court concludes that in the circumstances of this case the plaintiffs are only entitled to judicial review of the agency action in question under the review standards of the Administrative Procedure Act. The Court hastens to add, however, that had the plaintiffs alleged a violation of a fundamental federal constitutional or statutory right for which no remedy had been created by the Congress, or for which the available remedies had proven inadequate for protecting those rights, the result the Court reaches today might well be different. See Bivens v. Six Unknown Named Agents of the Federal Bureau of Narcotics, 403 U.S. 388, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971); Steele v. Louisville & Nashville R. R., 323 U.S. 192, 65 S.Ct. 226, 89 L.Ed. 173 (1944). 3. Review Under the Administrative Procedure Act. In every case involving judicial review of agency action under the APA the reviewing court must set aside action found to be “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law,” 5 U.S.C. § 706(2)(A), or action taken contrary to various constitutional, statutory, or procedural requirements, id. §§ 706(2)(B), (C), (D). In two additional, narrowly defined instances, agency action must be set aside if the court finds that the action was not supported by “substantial evidence,” id. § 706(2)(E), or if, after a trial de novo, the court concludes the action was “unwarranted by the facts,” id. § 706(2)(F). Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402, 413-15, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971). The substantial evidence review of § 706(2)(E) properly applies only to cases where agency action is predicated upon a public adjudicatory hearing (5 U.S.C. §§ 556, 557), or where agency action is taken after a rulemaking hearing required by statute (5 U.S.C. § 553). Citizens to Preserve Overton Park v. Volpe, supra, 401 U.S. at 414, 91 S.Ct. 814; Camp v. Pitts, 411 U.S. 138, 141, 93 S.Ct. 1241, 36 L.Ed.2d 106 (1973). See generally, 2 K. Davis, Administrative Law Treatise § 13.08 (1958). Neither circumstance applies here. First, the Secretary’s determination that a modified Plan Omega will satisfy the civil rights statutes was not based on an adjudicatory hearing; the Secretary’s regulations provide for a trial-type hearing only when he seeks to suspend federal aid to an uncompliant recipient. The present proceedings do not involve a decision to terminate assistance that would have triggered an adjudicatory proceeding because compliance was voluntarily achieved through the informal settlement process encouraged under the statutes. Second, the Secretary’s action plainly does not qualify as an exercise of his rulemaking power. See 5 U.S.C. § 551(4), (5); PBW Stock Exchange, Inc. v. SEC, 485 F.2d 718 (C.A.3,1973), cert. denied, 416 U.S. 969, 94 S.Ct. 1992, 40 L.Ed.2d 558 (1974). See generally 2 K. Davis, Administrative Law Treatise § 5.01 (1958). De novo review of administrative decisions under the APA is proper in only two situations: (1) where the agency action is adjudicatory in nature and the reviewing court finds that the administrative fact finding procedures were inadequate, and (2) “when issues that were not before the agency are raised in a proceeding to enforce nonadjudicatory agency action.” Citizens to Preserve Overton Park v. Volpe, supra, 401 U.S. at 415, 91 S.Ct. at 823. The latter situation is inapplicable because this is not a suit to enforce agency action; nor have the parties raised issues that were not before the Secretary at the time of his disputed decision. Still, the plaintiffs argue that § 706(2)(F) applies and that there must be a trial de novo because the Secretary’s determination was “adjudicatory in nature” and was based on inadequate and erroneous findings of fact. The Court, however, is not reviewing the record of a formal hearing or other proceeding in which an administrator has made findings regarding disputed issues of fact. The “facts” concerning Plan Omega’s impact on minorities and the handicapped are merely inferences as to the future based on demonstrable evidence gathered from a variety of sources. The plaintiffs argue that the evidence relied on by the Secretary in making predictions about the impact of Plan Omega was inadequately adduced and irrationally applied. But whether the Secretary adequately identified the factors he relied on and whether his policy choices rationally follow from the evidence adduced are questions implicated by the arbitrary and capricious test rather than by the de novo review standard. See Bowman Transportation, Inc. v. Arkansas-Best Freight System, Inc., 419 U.S. 281, 284-85, 95 S.Ct. 438, 42 L.Ed.2d 447 (1974); Burlington Truck Lines v. United States, 371 U.S. 156, 168, 83 S.Ct. 239, 9 L.Ed.2d 207 (1962); Permian Basin Area Rate Cases, 390 U.S. 747, 792, 88 S.Ct. 1344, 20 L.Ed.2d 312 (1968). The pertinent inquiry is whether the procedures employed by HEW to adduce the determinable evidence were inadequate as a matter of law. The factual information contained in the record was gathered by solicitation of data and written reports prepared by WMC and the plaintiffs, on-site inspections by members of the OCR investigative team, review of the litigants’ answers to interrogatories, responses to requests for production, and deposition testimony connected with this case, reports of experts retained by HEW and the plaintiffs, demographic data furnished by the United States Bureau of Census, and empirical studies of the transportation matrix in the Greater-Wilmington area. It also appears that the data collection design employed by HEW was suggested by the plaintiffs and that the plaintiffs had access, and indeed contributed to, the investigative review process. The plaintiffs also met with members of HEW’s investigative team on several occasions, an opportunity which enabled them to discuss the review methodology and, at least to some extent, help sharpen the investigation’s focus on the issues. While the investigation surely includes instances of human error, these errors are not the result of HEW’s “fact-finding procedures.” Moreover, even if the Court were to find that the existing agency record does not support the Secretary’s decisions, the proper remedy would be to remand the case for further consideration rather than conduct a plenary trial de novo. See Camp v. Pitts, supra, 411 U.S. at 140-41, 93 S.Ct. 1241. The appropriate standard for review is thus whether the Secretary’s decision concerning Plan Omega was “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A). In making that analysis, the reviewing court “must consider whether the decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment.” Citizens to Preserve Overton Park v. Volpe, supra, 401 U.S. at 416, 91 S.Ct. at 823; Bowman Transportation, Inc. v. Arkansas-Best Freight System, Inc., supra, 419 U.S. at 285-86, 95 S.Ct. 438. This standard of review is a deferential, although not a cursory, one. Ordinarily, courts defer to an agency’s choice of remedies, Diamond Ring Ranch v. Morton, 531 F.2d 1397, 1407 (C.A. 10, 1976), and the agency action is presumed to be valid. Citizens to Preserve Overton Park v. Volpe, supra, 401 U.S. at 415, 91 S.Ct. 814; United States v. Chemical Foundation, 272 U.S. 1, 14-15, 47 S.Ct. 1, 71 L.Ed. 131 (1926). A court must even affirm a decision with which it disagrees so long as the agency considered the relevant factors and a rational basis exists for its decision. Agency action that is arbitrary surely may be set aside, but a court is not empowered to substitute its judgment for that of the agency. Citizens to Preserve Overton Park v. Volpe, supra, 401 U.S. at 416, 91 S.Ct. 814; Bowman Transportation, Inc. v. Arkansas-Best Freight System, Inc., supra, 419 U.S. at 290, 95 S.Ct. 438. Cf. United States v. Allegheny-Ludlum Steel Corp., 406 U.S. 742, 749, 92 S.Ct. 1941, 32 L.Ed.2d 453 (1972). The arbitrary and capricious standard of review, however, is not a ritualistic procedure by which courts summarily endorse agency decisions as correct. To the contrary, a reviewing court must engage in a “substantial inquiry” into the facts, an inquiry that is “searching and careful,” in order to determine whether the agency decision was based on a consideration of relevant factors, Citizens to Preserve Overton Park v. Volpe, supra, 401 U.S. at 415-16, 91 S.Ct. 814, and whether the facts and the decision are rationally connected. Bowman Transportation, Inc. v. Arkansas-Best Freight System, Inc., supra, 419 U.S. at 290, 95 S.Ct. 438; United States v. Allegheny-Ludlum Steel Corp., supra, 406 U.S. at 749, 92 S.Ct. 1941. In complicated cases such as this one, moreover, the court must undertake an intensive review of the evidence relied upon by the agency in reaching its decision. Although this close scrutiny enables the Court to satisfy itself “that the agency has exercised a reasoned discretion, with reasons that do not deviate from or ignore the ascertainable legislative intent,” it is not intended to permit the Court to second-guess the agency’s expert decision-maker in the exercise of his specialized, experienced judgment. Ethyl Corp. v. EPA, 176 U.S.App.D.C. 373, 541 F.2d 1, 34-37 (en banc), cert. denied, 426 U.S. 941, 96 S.Ct. 2660, 49 L.Ed.2d 394 (1976). Therefore, the Court has no aut