U.S. Department of Justice Civil Rights Division
	Disability Rights Section—NYA 950 Pennsylvania Avenue, NW Washington, DC 20530   August 15, 2014

By Electronic & First Class Mail

Mayor Connie Moran
City of Ocean Springs
1018 Porter Avenue
Ocean Springs, MS 39564

Mr. Robert W. Wilkinson
Dogan & Wilkinson, PLLC
914 Washington Avenue
Ocean Springs, MS 39564

Re: The United States' Findings Based on its Investigation of the City of Ocean Springs, Mississippi, Pursuant to the Americans with Disabilities Act, DJ No. 204-41-157

Dear Mayor Moran:

The United States Department of Justice ("Department”) makes the following findings and conclusions based on its investigation of the City of Ocean Springs, Mississippi ("City”), for alleged violations of Title II of the Americans with Disabilities Act of 1990 ("ADA”), as amended, 42 U.S.C. §§ 12131-12134,and its implementing regulation, 28 C.F.R. Part 35.

Title II of the ADA prohibits disability discrimination in all activities of local government entities, including zoning decisions. See 42 U.S.C. § 12132; 28 C.F.R. § 35.130. The City is a public entity under the ADA and subject to the ADA’s nondiscrimination mandate. See 42 U.S.C. § 12131; 28 C.F.R. § 35.104. This nondiscrimination mandate requires the City to provide equal services, programs, and activities to entities that serve individuals with disabilities and to ensure that the City’s zoning decisions do not discriminate against individuals with disabilities and entities associated with them. See 28 C.F.R. § 35.130(b), (g). The Department is authorized to investigate allegations of discrimination and to file a civil action if the Attorney General finds a violation of the ADA. 42 U.S.C. § 12133; 28 C.F.R. Part 35, Subpart F.

The Department finds that the City discriminated against Psycamore, LLC ("Psycamore”), an outpatient psychiatric treatment facility, because of the known actual and perceived mental impairments of the patients treated there, and with whom Psycamore has a known association, in violation of the ADA. Psycamore sought to operate in a zone allowing facilities for the examination and treatment of human patients and should have been allowed to operate without obtaining a use permit. But the City denied Psycamore’s certificate of occupancy application, required it to seek a use permit, subjected it to public hearings, and denied its use permit application—even though Psycamore’s proposed use was allowed under the City’s zoning ordinance. The Mississippi Supreme Court found that the City’s decision was arbitrary and capricious. City of Ocean Springs, Miss. v. Psycamore, LLC, No. 2013-CA-00118-SCT, at 11 (Miss. Oct. 31, 2013).

The Department finds that the City based its decision on discriminatory beliefs, myths, and stereotypes about the types of patients with disabilities treated by Psycamore and their mental disabilities. The City violated the ADA when it denied Psycamore a certificate of occupancy, made it submit to a use permit process, and then denied it a use permit—all on these illegal and discriminatory bases. A court enforceable agreement will be necessary: (i) to educate the City and its officials on the requirements of the ADA; (ii) to compensate Psycamore and other aggrieved persons for injuries suffered as a result of the City’s violations of the ADA; and (iii) to reform the City’s zoning practices with respect to persons with disabilities and psychiatric treatment facilities, in order to prevent future violations of the ADA. This letter is notice of our findings of fact and conclusions of law, and of the remediation that the City must take to bring its policies, practices, and procedures into compliance with the ADA, and to remedy past violations. See 28 C.F.R. Part 35, Subpart F.

I. STATUTORY AND REGULATORY BACKGROUND

Congress enacted the ADA "to provide a clear and comprehensive national mandate for the elimination of discrimination against individuals with disabilities." 42 U.S.C. § 12101(b)(1). In so doing, Congress found that "physical or mental disabilities in no way diminish a person’s right to fully participate in all aspects of society, yet many people with physical or mental disabilities have been precluded from doing so because of discrimination." Id.§ 12101(a)(1). Congress further found that "discrimination against individuals with disabilities persists in such critical areas as . . . access to public services." Id.§ 12101(a)(3).

For these and other reasons, Congress enacted Title II of the ADA, which prohibits discrimination against individuals with disabilities by public entities:

[N]o qualified individual with a disability shall, by reason of such disability, be excluded from participation in or be denied the benefits of the services, programs, or activities of a public entity, or be subjected to discrimination by any such entity.

Id. § 12132; 28 C.F.R. § 35.130. This broad non-discrimination mandate protects individuals with disabilities from discrimination in all programs, services, or activities of the City.

Pursuant to a Congressional directive, 42 U.S.C. § 12134(a), the Department issued regulations for Title II of the ADA, reflecting the ADA’s nondiscrimination mandate. See 28 C.F.R § 35.130(a). The ADA and its regulatory provisions prevent the City from, among other things: (1) denying an individual with a disability the opportunity to participate in or benefit from any aid, benefit, or service; (2) affording an individual with a disability an opportunity to participate in or benefit from an aid, benefit, or service that is not equal to that afforded others; (3) providing different or separate aids, benefits, or services to individuals with disabilities (unless necessary to provide such individuals with aids, benefits, or services that are as effective as those provided to others); or (4) limiting individuals with disabilities in the enjoyment of any right, privilege, advantage, or opportunity enjoyed by others. Id. § 35.130(b)(1).

The City is further prohibited from utilizing criteria or methods of administration that have the effect of discriminating against individuals with disabilities, or applying eligibility criteria that screen out or tend to screen out individuals with disabilities or any class of individuals with disabilities from fully and equally enjoying any service, program, or activity, unless such criteria can be shown to be necessary for the provision of the service, program, or activity being offered. Id. § 35.130(b)(3), (b)(8). Title II also requires that a public entity make reasonable modifications to its policies, practices, or procedures when necessary to avoid discrimination on the basis of disability, unless the public entity can demonstrate that doing so would fundamentally alter the nature of the service, program, or activity. Id. § 35.130(b)(7).

Additionally, Title II of the ADA protects the rights of individuals and entities associated with persons with disabilities and prohibits excluding or otherwise denying equal services, programs, or activities to an individual or entity because of the known (actual or perceived) disability of an individual with whom the individual or entity has a known relationship or association. Id. § 35.130(g). Title II further provides relief to any person alleging discrimination on the basis of disability, or any person aggrieved by the discrimination of a person on the basis of his or her disability. See 42 U.S.C. § 12133; see also 29 U.S.C. § 794a (the remedies, procedures, and rights of which are incorporated into Title II by reference); 42 U.S.C. §§ 2000d-2, 2000e-5 (incorporated into 29 U.S.C. § 794a by reference).

These provisions prevent the City from applying its zoning to discriminate against individuals with disabilities and entities associated with them.

II. FINDINGS AND CONCLUSIONS

1. Ocean Springs Zoning

The City’s zoning and land use activities are carried out by its Planning Department, Planning Commission, Mayor, and Board of Aldermen. Its Comprehensive Zoning Ordinance ("Zoning Ordinance”) governs the zoning process and divides the City into thirteen zoning districts, listing the permissible uses of property within the corresponding geographic areas. ¹ Any occupant seeking to change the use of an existing structure must obtain either a certificate of occupancy or a use permit. ²

When the proposed use is listed in the applicable district ordinance, the City’s Planning Department must issue a certificate of occupancy. ³ If not, then a use permit must be obtained after public notice and hearing and approval of the Board of Aldermen and Mayor. ⁴ A use permit should be granted if the proposed use is "similar to or not in conflict with those uses specifically permitted."⁵

2. Psycamore

Psycamore is a private, mental health service provider for high-functioning adults and adolescents with serious mental disorders and psychosocial impairments. Psycamore is licensed as an "acute partial hospitalization” program: a program that provides medical supervision, nursing services, structured therapeutic activities and intensive psychotherapy (individual, family, and/or group) to individuals who are experiencing a period of such acute distress that their ability to cope with normal life circumstances is severely impaired. Psycamore is designed particularly for individuals not in an inpatient setting or for those needing further services after being discharged from a hospital.

Psycamore has offices in Flowood, Southaven, and Biloxi, Mississippi. At these facilities, it offers comprehensive treatment of major psychiatric disorders through intensive outpatient therapy programs with day and evening schedules. To be eligible for services, patients must have a psychiatric illness severe enough to interfere with daily function, but not to require hospitalization. In 2011, when it applied for a certificate of occupancy and use permit from the City, approximately eighty percent of Psycamore’s clients had depression as a primary diagnosis; others had anxiety, panic disorder, post-traumatic stress disorder, obsessive-compulsive disorder, and adjustment disorders. These mental impairments interfere with brain function, a major bodily function, and with patients’ ability to perform various tasks of daily living.

3. 1101 Iberville Drive

In August 2011, Psycamore attempted to open an outpatient psychiatric treatment facility in an existing building at 1101 Iberville Drive in Ocean Springs ("Property”). Due to the actions of the City, Psycamore terminated its lease at the end of January 2012, just five months later. For nearly two years thereafter, from February 2012 through September 2013, the property was for sale or lease.

Iberville Drive features several businesses, as well as the Marble Springs Historic Park and homes. Since 1984, the Property has been zoned C-3 highway commercial. The Property is located near a law firm, a psychologist’s office, and a realtor’s office. There are also several bars, a tattoo parlor, a fast food restaurant, and a gas station not far from the Property. The neighborhood to the east, beyond the Property and the park, is zoned R-1 residential. The closest residential home is diagonally across the street, and the next closest home is across the public parking lot for the park. Prior uses of the Property include an attorney’s office and an insurance company. The Property is currently being used as law offices.

4. Certificate of Occupancy

Psycamore leased the Property on August 1, 2011. On August 29, it posted a sign and ran advertisements about its proposed psychiatric treatment facility. The next day, it submitted an application for a certificate of occupancy for use as a "Psychiatric Partial Hospitalization” program. The application noted that it would operate Monday through Friday, with no session later than eight p.m.

In response, "Friends of Iberville Drive” ("FID”) formed to prevent Psycamore from opening at the Property. A concern expressed by some was public safety due to the mental disabilities of Psycamore’s patients. A flier was circulated publicly and to City officials that depicted Psycamore as the psychiatric ward in the film, One Flew Over the Cuckoo’s Nest.

5. Special Call Meeting and Board of Aldermen Motion

The City repeatedly acted inconsistently with its zoning rules and usual practices. In September 2011, the Board of Aldermen held a meeting to hear public comments on Psycamore’s certificate of occupancy application. Many comments focused on an alleged threat to property values and public safety posed by Psycamore’s patients due to their actual or perceived mental impairments. Because of the concerns raised in the comments, by motion the Board of Aldermen instructed the Planning Department to research whether Psycamore’s proposed use was allowed, and instructed the Planning Department not to make a decision as to whether Psycamore’s proposed use was allowed by right, but only to make a recommendation to the Planning Commission and Board of Aldermen. The Board thus required Psycamore to go through the use permit application process, without the Planning Department first determining whether a certificate of occupancy should be issued by right for a legally conforming use. The Board passed the motion over objection by the Planning Department. Accordingly, the Planning Department researched Psycamore’s use, and issued a report ("Report”) and recommendation to the Planning Commission and Board of Aldermen.

6. Planning Department Report

The Planning Department’s Report ("Report”) recommended that "the Planning Commission find Psycamore to be a legal use within the C-3 Highway Commercial zoning district,” because it is a "medical or paramedical clinic” as defined by the Zoning Ordinance. Consequently, a use permit was not needed, and a certificate of occupancy should have been issued. In the alternative, the Report found that "Psycamore’s requested use [was] similar to and not in conflict with” a medical or paramedical clinic—a use "specifically allowed in C-3 Highway Commercial." As a result, the City should have issued Psycamore a use permit. The Report also found that there was "no research to suggest that a psychiatric office or clinic of the proposed size and nature would have detrimental impacts on property values or public safety."

7. Additional Public Hearings and Use Permit Application Under Protest

Although Psycamore’s proposed use—a medical or paramedical clinic—was permitted by right in the C-3 highway-commercial district, the City required Psycamore to apply for a use permit, and go through the public notice and hearing process, which it did under protest. The Planning Department’s Report was presented to the Planning Commission and Board of Aldermen at public hearings. At these hearings, the Planning Commission and Board of Aldermen also heard from proponents and opponents of Psycamore’s use permit application. Opponents argued that Psycamore was not a permitted use and conflicted with other uses permitted in the zoning district because of the types of patients treated by Psycamore, who they alleged posed a threat to safety and would cause property values to decrease. FID submitted a brief to the City discussing the perceived dangers of people with mental health disorders, including generalizations, myths, and stereotypes about people with mental illness.

The City relied on the FID brief and comments and, on November 29, 2011, voted to deny Psycamore’s application for a use permit, citing traffic, the residential and historic nature of the area, and the substandard infrastructure on the street. The City expressly adopted the arguments in the FID brief—including specifically citing those sections of the brief that focused on the threat of violence, crime, and substance abuse posed by Psycamore’s patients due to mental illness—but simultaneously stating that it was "not adopting any arguments regarding violent crime” therein.

8. The City Violated the ADA by Denying Psycamore’s Applications Based on Disability

The Department finds that the City’s denials of Psycamore’s certificate of occupancy and use permit applications—based on impermissible assumptions and unfounded stereotypes about Psycamore’s patients because of their disabilities—violate the ADA. Psycamore is therefore an aggrieved person under the ADA, as are those individuals and entities harmed by the City’s discriminatory actions. See 42 U.S.C. § 12133; see also 29 U.S.C. § 794a (the remedies, procedures, and rights of which are incorporated into Title II by reference); 42 U.S.C. §§ 2000d-2, 2000e-5 (incorporated to 29 U.S.C. § 794a by reference).

Due to the discriminatory actions of the City, Psycamore was prevented from opening a clinic at the Property and was delayed in opening its third clinic (now located in Biloxi) by five to six months. The City ignored its own definition, past practices, and relevant evidence when it required Psycamore to go through the use permit hearing process and again when it denied Psycamore’s application for a use permit. As a result, the City created a precedent for singling out certain medical facilities that treat patients with mental disabilities and applying a heightened requirement for them to locate in Ocean Springs. The City’s actions also perpetuated the stigma surrounding mental health disorders.

Due to its professional association with persons with disabilities, Psycamore is a covered entity protected by the ADA, as are other persons or entities associated with Psycamore and its patients. See 42 U.S.C. § 12133; 28 C.F.R. § 35.130(g); see also 28 C.F.R. , pt. 35, App. A. The City discriminated against Psycamore because of its association with individuals with disabilities and, in the process, prevented the Property from being rented for a use permitted in the C-3 highway-commercial zoning district based on discriminatory reasons. The City provided unequal services to, and made a decision that had the effect of discriminating against, Psycamore (and those associated with Psycamore) because it serves individuals with known disabilities. The City thus violated the ADA when it denied Psycamore’s certificate of occupancy and use permit applications.

III. REMEDIATION

To remedy the City’s violations, it must, at minimum:

1. Adopt a non-discrimination policy stating that the City will not engage in any act or practice, directly or through contracting, licensing, or other arrangements, that has the purpose or effect of unlawfully discriminating against any person with a disability, or any person or entity associated with a person with a disability, in violation of Title II of the ADA—or otherwise discriminate on the basis of disability in violation of the ADA.
2. Train all City staff, volunteers, administrators, and officials involved in zoning—including the Planning Department, Planning Commission, Board of Aldermen, and Mayor—on the requirements of the ADA and the rights of individuals with disabilities, including the affirmative obligation of public entities to provide equal services, programs, and activities to entities that serve individuals with disabilities and to ensure that the City’s zoning decisions do not discriminate against individuals with disabilities and entities associated with them.
3. Grant Psycamore a certificate of occupancy (and use permit if necessary) to operate a partial hospitalization program, or other psychiatric treatment facility, in any C-3 or C-4 zoned district in the City, including the Property located at 1101 Iberville Drive, should Psycamore choose to open in these districts in the City.
4. For any land use request involving persons with disabilities or an entity associated with them that the City denies or grants with conditions in the next five years, make written findings specifying the basis for the denial or the conditions imposed.
5. Hire a full-time ADA Coordinator to carry out the City’s responsibility for compliance with Title II of the ADA and its implementing regulation.
6. Take other affirmative action to prevent discrimination based on disability by the City.
7. Pay compensatory damages, including damages for out-of-pocket expenses and lost profits, to Psycamore and other aggrieved persons in an appropriate amount for injuries suffered as the result of the City’s failure to comply with the requirements of Title II of the ADA, 42 U.S.C. §§ 12131-12134, and its implementing regulation, 28 C.F.R. Part 35.

IV. CONCLUSION

Please carefully consider these findings and conclusions by the Department. We are open to a dialogue to address the City’s discrimination and to reach an agreed resolution. In the event that the United States is unable to reach a resolution, it may take appropriate action, including initiating a civil action. See 42 U.S.C. § 12133; 28 C.F.R. Part 35, Subpart F. The Department prefers to resolve this matter cooperatively through an agreed court-enforceable resolution to bring the City into compliance with the ADA, remedy harm, and prevent future violations. To this end, if the City is interested in an agreed resolution it must contact the United States Department of Justice within 14 days of the date of these findings and conclusions to notify the United States that it is willing to discuss resolution.

Please note that this letter is a public document, and we will share a copy of this letter with Psycamore, as required by 28 C.F.R. Part 35, Subpart F. At any time, Psycamore may file a private suit pursuant to Section 203 of the ADA, 42 U.S.C. § 12133, regardless of the contents of this letter and the Department’s findings in this matter. Please be advised that the City shall not discriminate or retaliate against any persons or entity because of their participation in this matter. See 42 U.S.C. § 12203.

If you have any questions regarding this letter, please contact me at (202) 307-0663.

Sincerely,





Rebecca B. Bond
Chief
Disability Rights Section

cc: John B. Edwards, Esq.
Amy L. St Pe', Esq.
Sudhakar Madakasira, M.D./Psycamore, LLC
William Guice, Esq.
Roger Applewhite/Marble Springs House, LLC
Kristopher W. Carter, Esq.

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August 22, 2014