Court Tosses Homeless Shelter’s Claims

ATLANTA (CN) - A federal judge dismissed a lawsuit in which a homeless shelter that owes more than $147,000 in water and sewer charges accused Atlanta of conspiring to drive it out of business and of violating its constitutional rights.

Founded in 1981, the Metropolitan Atlanta Task Force for the Homeless provides food, water, shelter and pro bono services to homeless individuals in Atlanta. The nonprofit, which relies on grants and donations from public and private entities, operates a homeless shelter in a 95,000-square-feet facility at the corner of Peachtree and Pine streets, between Atlanta's downtown and midtown business districts.

Since 2008, the city, which supplies water and sewer services to the Task Force's shelter, has cut the water to the shelter on several occasions after the Task Force failed to pay its bills. The Fulton County Superior Court ordered the city to resume water and sewer services in December 2008, giving the Task Force 14 additional days to pay its debt.

The court issued a similar order in June 2009, after the city interrupted service to the shelter due to delinquent payments. The court gave the Task Force seven days to pay its bills, but noted that it was "'extremely troubled' by the plaintiff's history of delinquent payment and nonpayment," and would grant no additional injunctions.

While its account remained delinquent, the Task Force sued the city, attributing its inability to pay for services to Atlanta's "conspiracy to drive the Task Force out of business." The organization claimed Atlanta had prevented it from receiving federal and state funding by refusing to issue certain certificates of compliance.

According to the Task Force's complaint, the city had discriminated against it because its shelter serves single men, who, the city claimed, may endanger women and children. The Task Force claimed that, when it sought to improve its shelter in 1998, Atlanta agreed to help secure funding for a shelter that caters exclusively to women, children and intact families.

The Task Force also alleged the city had defamed it in the press and had hurt its ability to receive donations from private entities.

In addition to the constitutional and tort claims asserted in its complaint, the Task Force sought to compel the city to issue certificates of compliance and to continue providing water and sewer services to its shelter, despite its unresolved debt.

The city asked the court to dismiss the Task Force's claims and countered by asking for the balance due for the services rendered.

On Sept. 21, U.S. District Judge Thomas Thrash ruled that the city was entitled to sovereign immunity as to the state law tort claims, because the Task Force could not prove that Atlanta had harmed its reputation and business relations out of pecuniary interest. "At most, the Task Force can only show that the City of Atlanta and its officers intentionally interfered with the Task Force's business relationships because they did not approve of the Task Force's operation of the homeless shelter and its impact on the city," Thrash wrote.

Thrash also dismissed the Task Force's due process and equal protection claims against the city.

According to the ruling, the Task Force had failed to prove that Atlanta had deprived it of its downtown building and of the ability to pursue its profession.

The Task Force had also argued that the city had prevented it from getting state grants by refusing to issue certificates showing that the Task Force's programs were consistent with the city's housing plan.

Thrash found that the Task Force had no constitutional protection that made it eligible for state grants and was "a mere applicant for a benefit, dependent on the approval of both the City of Atlanta and the DCA [Department of Community Affairs]."

As for the equal protection claim, the Task Force had failed to prove that Atlanta had treated it differently from other similarly situated homeless shelters, the order states.

The court upheld Atlanta's breach of contract claim and ordered the Task Force to pay its outstanding debt. According to the ruling, as of May 13, the Task Force still owed more than $147,000 on an inactive account and over $47,000 on its active account.

Thrash refused to order the city to resume water and sewer services to the Task Force's shelter, noting that the Fulton County Superior Court had already ruled on the issue.The Task Force lost the Peachtree-Pine shelter to foreclosure in 2010, but continued to run the facility while carrying on lawsuits against various parties.

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