Friday, September 10, 2010

Hazleton Ordinance Outlawed, As Homeland Security Worries About Internal Threats

This morning, driving to work, I listened to NPR. The station featured among its lead stories the following two:

1. Homeland security officials, on the verge of marking the ninth anniversary of 9/11, continue to worry about homegrown terrorist attacks... as well they (we all) should.

2. The U.S. Court of Appeals for the Third Circuit, sitting in Philadelphia, affirmed the unconstitutionality of the illegal-alien ordinance enacted several years ago by the central PA city of Hazleton (the town where I was born, by the way). In the face of federal inertia and ineptitude regarding illegal aliens in this country, Hazleton took the lead in attempting to deal with the issue on the local level... the level where the rubber meets the road. I have been following this story in my "Employment Law Answer Book" since the ordinance's enactment. I have also followed the more successful efforts in a few other jurisdictions, which learned from Hazleton's apparent mistakes.


Yesterday, the Third Circuit issued its opinion in Lozano v. City of Hazleton, available at 2010 WL 3504538. Here are the first few pages of the decision, providing the essential background information:

I. INTRODUCTION
*1 “Since the late 19th century, the United States has restricted immigration into this country.... But despite the existence of these legal restrictions, a substantial number of persons have succeeded in unlawfully entering the United States, and now live within [the] various States.” Plyler v. Doe, 457 U.S. 202, 205 (1982). The dispute we are now called upon to address is one of an increasing number of cases that have arisen from actions that state and local governments have taken because of illegal immigration.

The City of Hazleton, Pennsylvania (“Hazleton” or the “City”) is appealing a permanent injunction that the district court entered prohibiting Hazleton's enforcement of two local ordinances that attempt to regulate employment of, and provision of rental housing to, certain aliens. Several individuals and organizations sued to enjoin enforcement of the ordinances arguing that they violate the United States Constitution, as well as federal and state statutes. The district court agreed and enjoined Hazleton from enforcing the ordinances in their entirety.

We now hold that the district court erred in reaching the merits of the challenge to the private cause of action provision because no plaintiff has standing to challenge that provision. Accordingly, that portion of the district court's order will be vacated. However, although our reasoning differs somewhat from the analysis used by the district court, we conclude that it correctly enjoined the rest of the challenged ordinances. We will therefore affirm the district court's order in all other respects.

II. FACTUAL AND PROCEDURAL BACKGROUND
A. Hazleton and its Ordinances
The City of Hazleton is located in Luzerne County in northeastern Pennsylvania. Lozano v. City of Hazleton, 496 F.Supp.2d 477, 484 (M.D.Pa.2007). Under Pennsylvania law, Hazleton is classified as a City of the Third Class and operates under an “Optional Plan B” form of government. Id. Its executive is a mayor, and its legislature is a city council. Id.

Hazleton's population was only 23,000 in 2000. Id. Between 2000 and the time of trial, however, its population increased to between 30,000 and 33,000. Id. Much of this growth was due to an influx of Latino families who migrated from New York and New Jersey to Pennsylvania in the early 2000s. Id. These newcomers included United States citizens and lawful permanent residents, as well as persons lacking lawful immigration status, who are often referred to as “undocumented immigrants” or “illegal aliens.” FN1 Id.

FN1. Hazleton refers to persons who are not lawfully present within the United States as “illegal aliens.” Plaintiffs refer to them as “undocumented immigrants.” We recognize that there are significant criticisms of each term. See, e.g., Beth Lyon, When More “Security” Equals Less Workplace Safety: Reconsidering U.S. Laws that Disadvantage Unauthorized Workers, 6 U. Pa. J. Lab. & Empl. L. 571, 576 (2004) ( “Scholarly and popular concerns about the phrase ‘illegal alien’ abound, pointing out that the phrase is racially loaded, ambiguous, imprecise, and pejorative.”); Martinez v. Regents of the Univ. of Cal., 83 Cal.Rptr.3d 518, 522 n.2 (Cal.Ct.App.2008) (“[T]he term ‘illegal alien’ [is] less ambiguous [than the term ‘undocumented immigrant.’]”), rev. granted, 198 P.3d 1 (Cal.2008).

Federal immigration law defines an “alien” as “any person not a citizen or national of the United States.” 8 U.S.C. § 1101(a)(3). “Immigrant” is defined as “every alien except an alien who is within [certain specified] classes of nonimmigrant aliens,” and generally refers only to lawful permanent residents. 8 U.S.C. § 1101(a)(15). Congress has preferred the term “alien” to describe those persons who lack lawful immigration status, see, e.g., 8 U .S.C. §§ 1182, 1227, 1228. We will use the word “alien” rather than “immigrant” because “alien” is more precise, and precision is important to discussions in this area. When discussing issues of employment, we will use the official term: “unauthorized alien.” 8 U.S.C. § 1324a. However, when discussing issues of immigration status, we will use either: “aliens not lawfully present” or “aliens lacking lawful immigration status,” rather than “illegal aliens.”

Hazleton's mayor, as well as other local officials, subsequently concluded that aliens lacking lawful status were to blame for certain social problems in the City, see J.A. 1672-85, and that the federal government could not be relied upon to prevent such aliens from moving into the City, or to remove them, see Lozano, 496 F.Supp.2d at 522 n.44. Accordingly, City officials decided to take independent action to regulate the local effects of unlawful immigration. See J.A. 1385, 1486-87. Beginning on July 13, 2006, Hazleton's City Council began enacting a series of ordinances designed to address these concerns. Lozano, 496 F.Supp.2d at 484.

*2 This litigation concerns two of those ordinances: the Illegal Immigration Relief Act Ordinance (“IIRAO”), which consists of Ordinance 2006-18, as amended by Ordinance 2006-40 and Ordinance 2007-6; and the Rental Registration Ordinance (“RO”), which consists of Ordinance 2006-13.FN2 These ordinances attempt to regulate the employment of unauthorized aliens, and the provision of rental housing to aliens lacking lawful immigration status, within Hazleton.

FN2. On July 13, 2006, Hazleton enacted Ordinance 2006-10, the first version of the IIRAO. On August 15, 2006, the City enacted Ordinance 2006-13, the RO. On September 21, 2006, Hazleton enacted Ordinance 2006-18, a revised version of the IIRAO, which replaced Ordinance 2006-10 in its entirety. On December 28, 2006, Hazleton enacted Ordinance 2006-40, which amended the IIRAO by adding an “implementation and process” section. Finally, during trial, the City enacted Ordinance 2007-6, which again amended the IIRAO to provide that complaints based, in full or in part, on national origin, ethnicity, or race, would be considered invalid. The full-text of these ordinances is attached as an Appendix.


1. The Illegal Immigration Relief Act Ordinance
The IIRAO begins with a statement of findings and a declaration of purpose, which asserts:

[t]hat unlawful employment, the harboring of illegal aliens in dwelling units in the City of Hazleton, and crime committed by illegal aliens harm the health, safety and welfare of authorized U.S. workers and legal residents in the City of Hazleton. Illegal immigration leads to higher crime rates, subjects our hospitals to fiscal hardship and legal residents to substandard quality of care, contributed to other burdens on public services, increasing their cost and diminishing their availability to legal residents, and diminishes our overall quality of life.

IIRAO § 2C.FN3 In response to these concerns, the IIRAO:

FN3. It is important to note that the parties hotly contest whether aliens in Hazleton actually caused any of these purported problems and whether Hazleton officials had any valid reason to think they did. The district court did not make any factual findings about the cause of any social or fiscal problems Hazleton may be facing, and our discussion should not be interpreted as supporting either side of that debate.


seeks to secure to those lawfully present in the United States and this City, whether or not they are citizens of the United States, the right to live in peace free from the threat [of] crime, to enjoy the public services provided by this city without being burdened by the cost of providing goods, support and services to aliens unlawfully present in the United States, and to be free of the debilitating effects on their economic and social well being imposed by the influx of illegal aliens to the fullest extent that these goals can be achieved consistent with the Constitution and Laws of the United States and the Commonwealth of Pennsylvania.
IIRAO § 2F.
Section 4 of the IIRAO asserts that it is unlawful “for any business entity” to “recruit, hire for employment, or continue to employ” or “permit, dispatch, or instruct any person” who is an “unlawful worker” to perform work within Hazleton.FN4 IIRAO § 4A. Under the IIRAO, an “unlawful worker” is defined as: “a person who does not have the legal right or authorization to work due to an impediment in any provision of federal, state or local law, including but not limited to a minor disqualified by nonage, or an unauthorized alien as defined by [ 8 U.S.C. § 1324a(h)(3) ].” IIRAO § 3E. Section 4A requires “[e]very business entity that applies for a business permit” to “sign an affidavit ... affirming that they do not knowingly utilize the services or hire any person who is an unlawful worker.” IIRAO § 4A.

FN4. The IIRAO defines “business entity” broadly to mean “any person or group of persons performing or engaging in any activity, enterprise, profession, or occupation for gain, benefit, advantage, or livelihood, whether for profit or not for profit.” IIRAO § 3A. The term encompasses (but is not limited to) “self-employed individuals, partnerships, corporations, contractors, and subcontractors.” IIRAO § 3A(1). It includes “any business entity that possesses a business permit, any business entity that is exempt by law from obtaining such a business permit, and any business entity that is operating unlawfully without such a business permit.” IIRAO § 3A(2).


Section 4 also provides for public monitoring, prosecution, and sanctions. Any City resident may submit a complaint to Hazleton's Code Enforcement Office alleging that a local business entity is violating the section's prohibition on utilizing the services of an unlawful worker. IIRAO § 4B(1). Upon receipt of such complaint, the Code Enforcement Office requests identity information about the alleged unlawful worker from the employing business, and that business must provide the information within three business days, or Hazleton will suspend its business license. IIRAO § 4B(3). If the worker is alleged to be an unauthorized alien, the Code Enforcement Office submits any identity information received from the business to the federal government, pursuant to 8 U.S.C. § 1373, for verification of “the immigration status of such person(s).” FN5 Id.

FN5. 8 U.S.C. § 1373(c) states: “The Immigration and Naturalization Service shall respond to an inquiry by a Federal, State, or local government agency, seeking to verify or ascertain the citizenship or immigration status of any individual within the jurisdiction of the agency for any purpose authorized by law, by providing the requested verification or status information.”


*3 If the Code Enforcement Office confirms that the worker lacks authorization to work in the United States, the business must terminate that person within three business days or the City will suspend its business license.FN6 IIRAO § 4B(4). Safe harbor from this sanction is provided to businesses that verify the work authorization of its workers through use of the “Basic Pilot Program” (which has since been named “E-Verify”). IIRAO § 4B(5). E-Verify is a federal program for verifying work authorization which Congress has authorized for use on a trial basis.

FN6. This three business day period is tolled if the business entity acquires further information about the worker and requests a secondary verification from the federal government of the worker's authorization, or if the business entity tries to terminate the worker and that worker challenges the termination in Pennsylvania state court. IIRAO § 7C.


A business whose license is suspended under the IIRAO regains its license one business day after it submits an affidavit affirming that it has terminated the unlawful worker. IIRAO § 4B(6). If a business is found to have employed two or more unauthorized aliens at one time, it must also confirm its enrollment in E-Verify in order to recover its license.FN7 IIRAO § 4B(6)(b). If a business entity violates the IIRAO a second time, Hazleton suspends its license for a minimum of twenty days and reports the violation, whether or not eventually corrected, to the federal government. IIRAO § 4B(7).

FN7. City agencies and business that contract with the City for amounts greater than $10,000 are also required to enroll in E-Verify. IIRAO § 4C-D.


The IIRAO further creates a private cause of action against businesses that employ unlawful workers. Section 4E of the IIRAO makes it “an unfair business practice” for a business entity to discharge “an employee who is not an unlawful worker,” if, on the date of the discharge, “the business entity was not participating in [E-Verify] and the business entity was employing an unlawful worker.” IIRAO § 4E(1). An employee discharged under these conditions may sue the business entity under the IIRAO for treble actual damages, as well as reasonable attorney's fees and costs.FN8 IIRAO § 4E(2).

FN8. Even an employee who is properly terminated for cause (or without cause in the case of an employee at will) has a cause of action under this provision. The ordinance uses “lost” wages as a measure of “damages.” IIRAO § 4E(2).


The IIRAO also addresses the “harboring” of persons lacking lawful immigration status. Section 5 makes it “unlawful for any person or business entity that owns a dwelling unit in the City to harbor an illegal alien in the dwelling unit, knowing or in reckless disregard of the fact that an alien has come to, entered, or remains in the United States in violation of law.” FN9 IIRAO § 5A. “Harboring” is broadly defined. The ordinance states: “to let, lease, or rent a dwelling unit to an illegal alien ... shall be deemed to constitute harboring.” IIRAO § 5A(1). Additionally, Section 7 of the IIRAO makes legal immigration status a condition precedent to entering into a valid lease. IIRAO § 7B. All leases entered into by persons lacking lawful status are deemed breached. Id.

FN9. The IIRAO defines an “illegal alien” as “an alien who is not lawfully present in the United States, according to the terms of United States Code Title 8, section 1101 et seq.” IIRAO § 3D.


The mechanisms for enforcing the housing provisions of the IIRAO are similar to those set forth above for enforcing the employment provisions. Thus, any City resident may file a complaint with Hazleton's Code Enforcement Office alleging that a property owner is illegally “harboring” a tenant who is an “illegal alien.” IIRAO § 5B(1). Once such a complaint is received, the Code Enforcement Office may request identifying information about the named tenant from the property owner, and the property owner must provide that information within three days. IIRAO § 5A(3). The City then verifies the legality of the tenant's immigration status with the federal government, pursuant to 8 U.S.C. § 1373(c). IIRAO § 5B(3).

*4 If the federal government confirms that the tenant lacks lawful immigration status, the IIRAO gives the property owner five business days to evict that tenant. IIRAO § 5B(4). If the owner fails to do so, the City suspends the owner's rental license and bars the owner from collecting any rent for the applicable dwelling unit.FN10 IIRAO § 5B(4)-(5). These sanctions end one business day after the owner submits an affidavit affirming that s/he has corrected the violation. IIRAO § 5B(6). Any subsequent violation subjects the owner to a fine of $250.00 per day per “adult illegal alien” harbored in a dwelling unit, as well as suspension of her/his rental license. IIRAO §§ 5A(2), 5B(8).

FN10. This five business day period is tolled if the property owner acquires further information about the tenant and requests a secondary verification from the federal government of the tenant's immigration status, or if the property owner tries to evict the tenant and that tenant challenges the eviction in Pennsylvania state court. IIRAO § 7D.


2. The Rental Registration Ordinance
The RO operates in conjunction with the anti-harboring provisions of the IIRAO. Section 7 of the RO requires that any prospective occupant of rental housing over the age of eighteen apply for and receive an occupancy permit. RO §§ 1m, 7b. To receive that permit, the prospective occupant must pay a ten-dollar fee and must submit certain documents, including “[p]roper identification showing proof of legal citizenship and/or residency” to Hazleton's Code Enforcement Office. RO § 7b. Hazleton landlords are required to inform all prospective occupants of this requirement, and they are prohibited from allowing anyone over the age of eighteen to rent or occupy a rental unit, unless that person has a permit. Id.

Section 10 of the RO provides that a landlord found guilty of renting to someone without a permit must pay an initial fine of $1000 per unauthorized occupant, and an additional fine of $100 per day per unauthorized occupant until the violation is corrected. RO § 10b. An authorized occupant of rental housing who is found guilty of permitting someone without a rental permit to live in her/his apartment must pay the same fine. Id.

B. The Plaintiffs
The following six plaintiffs claim that they have standing to bring this suit: Pedro Lozano, John Doe 1, John Doe 3, John Doe 7, Jane Doe 5, and the Hazleton Hispanic Business Association (“Plaintiffs”).FN11 business entities, landlords, and tenants, as well as an organization whose members include Hazleton business entities and landlords. We briefly describe these Plaintiffs, and the basic facts underlying each Plaintiff's claim to standing.

FN11. Eleven plaintiffs filed the operative complaint. The district court dismissed three of them for lack of standing, and that portion of the district court's decision is not being appealed. Of the eight plaintiffs the district court found to have standing, only six press their cases on appeal.


Pedro Lozano is a lawful permanent resident who immigrated to the United States from Colombia in January 2002. Lozano, 496 F.Supp.2d at 485-86. He owns a duplex in Hazleton and rents out half of it to help pay his mortgage. Id. at 488. He hires contractors to perform repairs on his property as needed. Id. at 489.

John Doe 1 was born in Mexico, and had lived in Hazleton for six years at the time of trial. Id. at 486. He is unsure of his immigration status, but believes that he could be removed from the United States. Id. He is similarly unsure of his work authorization. Id. John Doe 1's landlord evicted him because of the risk of being fined pursuant to the aforementioned provisions of the IIRAO and the RO. Id. at 497.

*5 John Doe 3 had lived in Hazleton for four years at the time of trial. Id. at 486. He understands his immigration status to be “illegal,” and he rents an apartment within Hazleton. Id. at 497.

John Doe 7 and Jane Doe 5 were born in Columbia and had lived in Hazleton for more than five years at the time of trial. Id. at 486. They rent a house in Hazleton, but fear eviction and being forced to leave Hazleton if the ordinances are enforced. Id. at 497.

The Hazleton Hispanic Business Association (“HHBA”) is an organization of business owners from the Hazleton area that exists to “promote the interest of [its] business members and to project the image of the Hispanic business community.” Id. at 492 (internal quotation marks omitted). HHBA's president, Rudolfo Espinal, owns three rental properties in Hazleton and hires contractors to perform repairs on those properties as needed. Id. at 492-93.

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So, while homeland security officials fret about the possibility --- high in this writer's opinion --- of new terrorist actions inside America, the American government appears to be powerless --- from our Congress at the highest level to the town council of little 'ol Hazleton, PA, at the lowest--- to do a thing about the millions of aliens living illegally inside our borders.

Now let's be fair and frank: from Oklahoma City in 1995 to Columbine and VTU in this decade, terrorism has been perpetrated by American citizens --- even our high school and college kids, God help us--- against their fellow American citizens. This is a threat at least equal to any posed by illegal aliens.

But this concomitant threat in no way absolves our leaders from dealing with the influx of illegals from outside our borders. We need to address both challenges.

The Hazleton ordinance, whether constitutionally sound or not, was an honest effort by democratically elected officials to fill the vacuum left by other democratically elected officials in Washington to deal effectively with the challenge of an unknown (but estimated to be between 10 and 20 million) number of illegals inside our country.

Now, the Third Circuit confirms that, while our elected officials in Washington won't or can't act, our elected local officials are not allowed to act.

Isn't that just perfect?

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