The M v.

Opinion

USCA1 Opinion

                  United States Court of Appeals

                      For the First Circuit

                       ____________________



No. 98-2224



                    THE M/V CAPE ANN, ET AL.,



                     Plaintiffs, Appellants,



                                v.



                    UNITED STATES OF AMERICA,

                 GENERAL SERVICES ADMINISTRATION,



                      Defendants, Appellees.



                       ____________________



           APPEAL FROM THE UNITED STATES DISTRICT COURT



                FOR THE DISTRICT OF MASSACHUSETTS



           [Hon. William G. Young, U.S. District Judge]



                       ____________________



                              Before



                     Torruella, Chief Judge,



                  Bownes, Senior Circuit Judge,



                    and Lipez, Circuit Judge.



                      _____________________



    Timothy R. McHugh, with whom Hoch & McHugh, was on brief, for

appellant A.C. Cruise Line, Inc.

    Alan D. Circeo on brief pro se.

    Barbara Healy Smith, Assistant United States Attorney, with

whom Donald K. Stern, United States Attorney, and Julie S.

Schrager, Assistant United States Attorney, were on brief, for

appellees.


____________________



                        December 17, 1999

                       ____________________         TORRUELLA, Chief Judge.  This case comes to us on appeal

from the United States District Court for the District of

Massachusetts and calls into question the level of government

assistance required by the Uniform Relocation Assistance and Real

Property Acquisition Policies Act ("Uniform Relocation Act" or

"URA"), 42 U.S.C.  4622 (1994).  Congress passed this Act in 1970

to standardize federal legislation regarding relocation assistance

and to provide "fair and equitable" treatment to parties displaced

by federal programs.  See Pou Pacheco v. Soler Aquino, 833 F.2d

392, 395 (1st Cir. 1987).  The plaintiff-appellant A.C. Cruise

Line, Inc. ("Cruise Line") sought review of an award provided by

the General Services Administration ("GSA"), alleging that the

relocation assistance it received was far short of fair and

equitable treatment.  The district court did not agree and granted

summary judgment in favor of the GSA.  Because we find that the

GSA's decision was a reasonable application of the regulations, we

affirm.

                          I.  BACKGROUND

         Drawing all inferences in favor of the appellant, we

summarize the facts as follows.  The Cruise Line conducted its

passenger vessel business at the Fan Pier on the Boston Harbor

waterfront from 1976 until 1992, when it was evicted in order for

the United States to construct the new federal courthouse. 

Although ultimately unsuccessful, the GSA in coordination with

Anthony Athanas, one of the principals of the Fan Pier Land

Company, assisted the Cruise Line in its search for a new location,

specifically by engaging the services of a harbor consultant and by

contacting the World Trade Center.  In November 1992, the Cruise

Line made a temporary move to Commercial Wharf, even though it

would not be permitted to operate its business from that location. 

Then, in June 1993, the Cruise Line moved permanently to Pier 8,

290 Northern Avenue, Boston.

         On February 15, 1993, the Cruise Line filed a claim with

the GSA requesting relocation benefits in the amount of $80,017.05

and relocation assistance as provided for in the Uniform Relocation

Act.  In May 1994, the GSA referred the claim to its Office of the

Inspector General for an internal audit and review, which was

completed on August 2, 1994.  The audit found that $23,903 of the

total proposed amount were actual expenses "allocable to the

permanent relocation" of the appellant -- $3900 for moving expenses

and $20,003 for reestablishment expenses.  Of the $3900 in moving

expenses, $2000 in search related expenses were subject to a $1000

regulatory cap reducing the total moving expenses to $2900.  See

Uniform Relocation Assistance and Real Property Acquisition for

Federal and Federally Assisted Programs, 49 C.F.R.  24.303(a)(13)

(1999).  Likewise, the reestablishment expenses were reduced to

reflect the $10,000 cap.  See 49 C.F.R.  24.304 (1999).  The final

award was $12,900.  Subsequent to the audit, a GSA contracting

officer increased the award by $452.03, and the Cruise Line

received benefits of $13,352.03. 

                     II.  STANDARD OF REVIEW

         We review a district court's grant of summary judgment de

novo and review the facts in a light most favorable to the

nonmoving party.  See EEOC v. Green, 76 F.3d 19, 23-24 (1st Cir.

1996); Udo v. Tomes, 54 F.3d 9, 12 (1st Cir. 1995).  A party

challenging GSA's award of benefits under the Uniform Relocation

Act bears the burden of establishing that the Agency acted

arbitrarily or capriciously or otherwise abused its discretion. 

See Administrative Procedure Act, 5 U.S.C.  706(2)(A) (1996); NLRB

v. Beverly Enters.-Mass., Inc., 174 F.3d 13, 23 (1st Cir. 1999);

see also Pou Pacheco, 833 F.2d at 398 (applying standard to GSA

decision).  In applying the arbitrary and capricious standard, the

task of the reviewing court is to determine whether the agency

considered the pertinent evidence and relative factors and

sufficiently articulated an explanation for its action.  See

Beverly Enters., 174 F.3d at 23 & n.2.  So long as the agency's

determination is "within the bounds of reasoned decisionmaking," we

may not set it aside, regardless of whether we may have reached an

opposite decision.  See Baltimore Gas & Elec. Co. v. Natural

Resources Defense Council, Inc., 462 U.S. 87, 105-06 (1983).                         III.  DISCUSSION

         The main thrust of appellant's claim is that the GSA

failed to provide adequate relocation assistance, causing the

appellant to incur unusual relocation expenses.  The appellant

primarily challenges the GSA award of relocation benefits on two

grounds: (1) the GSA failed to provide the relocation assistance

required by law, thereby necessitating appellant's interim move to

Commercial Wharf; and (2) the GSA arbitrarily and capriciously

reclassified relocation expenses so that they would fall within the

regulatory caps for search and reestablishment expenses.  49 C.F.R.

 24.303(a)(13), 24.304; see also 42 U.S.C.  4622.

                       A.  THE INTERIM MOVE

         The Uniform Relocation Act provides for payment to

"displaced persons" of "actual reasonable expenses" incurred in

moving a business, searching for a new location, and reestablishing

the business at the new location.  See 42 U.S.C.  4622.  The Act

also requires that the displacing agency take measures to:

                  (2) provide current and continuing information

         on the availability, sales prices, and rental

         charges . . . suitable locations for business;

                              . . .

                  (4) assist a person displaced from a business

         or farm operation in obtaining and becoming

         established in a suitable replacement

         location;

                              . . .

                  (6) provide other advisory services to

         displaced person in order to minimize

         hardships to such persons in adjusting to

         relocation.



42 U.S.C.  4625(c).

         The appellant insists that its interim move was

necessitated by the GSA's failure to provide "current and

continuing" assistance within the meaning of the statutory scheme. 

The appellants rely on our opinion in Pou Pacheco for the

proposition that they are entitled to relief where the government's

failure to provide adequate assistance compels the displaced party

to move more than once.  The GSA in turn responds that it satisfied

its obligation of providing assistance under the Act, and that the

unusually harsh circumstances surrounding Pou Pacheco are not

present here.

         It is undisputed that the GSA and Anthony Athanas

provided some assistance to the Cruise Line before its move.  That

assistance took the form of hiring a harbor consultant, Martha

Reardon, and pursuing a lead on potential berth space at the World

Trade Center.  The Cruise Line challenges the adequacy of this

assistance, claiming, among other things, that before compiling a

list of alternative sites, the GSA never consulted the Cruise Line

with respect to its business needs, and that after providing the

list in December 1991, the GSA did nothing further to keep the list

current and actually aid the Cruise Line when it was forced to

vacate the Fan Pier in November 1992.  The Cruise Line also notes

that the World Trade Center was not actually available in November

1992, and would have cost the Cruise Line three times the price of

its dock space at Fan Pier.  The GSA charges that the Cruise Line

failed to avail itself of government assistance when it was offered

by either responding to correspondence or attending meetings,

focusing instead on legal efforts to resist the move.

         While we are unable to find an affirmative definition of

"current and continuing" assistance in either the statute, the

interpreting regulations, or the case law, at least two circuits

have concluded that a displacing agency need not obtain or tender

a replacement location to adequately meet its burden under the

Uniform Relocation Act.  See Pietroniro v. Borough of Oceanport,

764 F.2d 976, 980 (3d Cir. 1985); American Dry Cleaners & Laundry,

Inc. v. United States Dep't of Transp., 722 F.2d 70, 72-73 (4th

Cir. 1983); cf. Katsev v. Coleman, 530 F.2d 176, 180-81 n.7 (8th

Cir. 1976) (holding that URA does not guarantee identical

substitute housing for displaced person).  In other words, the

Third and Fourth Circuits have held that the URA does not require

that the agency be successful in its relocation assistance.  See

American Dry Cleaners, 722 F.2d at 73 (relying on the legislative

history).  Nevertheless, no court has yet determined the minimum

amount of assistance required by the Act.

         Although we took a broad approach to applying the

statutory requirements of the URA in Pou Pacheco, our opinion is by

no means inconsistent with the view of the Third and Fourth

Circuits.  Pou Pacheco came to us on appeal from a jury trial and

court order to compensate the displaced business under the Uniform

Relocation Act.  The Pou Pachecos were forced to relocate their

coffee torrefaction -- a facility for grinding, processing,

warehousing, and selling coffee.  Testimony at trial established

that torrefaction equipment slips into disrepair if not regularly

used.  Although some equipment was maintained after the first move,

the torrefaction was never fully operational.  After the

Commonwealth refused to pay for storage beyond twelve months, Pou

was forced to move his equipment a second time, but unfortunately

was unable to obtain the necessary permits to run his business from

the second location.  See Pou Pacheco, 833 F.2d at 395.

         The district court awarded the Pou Pachecos reimbursement

for dismantling expenses, moving expenses, storage rental expenses,

search costs, reinstallation of machinery and equipment, and value

of new equipment and machinery related to both moves.  We found

that the jury and the court "were free to fashion the special

relief they did," due to the "delicate nature" of the displaced

business and the fact that the business remained inoperable.  Id.

at 400-01.  We reasoned that the challenged award was sustainable

against the "background of strong congressional support for the

fair and equitable treatment of displaced persons and businesses,

as well as Congress' expressed willingness to depart from

traditional notions of valuation and eminent domain."  Id. at 396.

         We were very clear that our decision was limited to the

unique facts then before us.  We made no finding that the

government failed to meet its burden under the URA, and set no

standard by which to measure the adequacy of the government's

assistance.  On that issue, we come to the facts of this case with

a clean slate, and agree with our colleagues on the Third and

Fourth Circuits that the government need not provide a suitable

alternate location, but rather must advise displaced businesses of

the availability of such sites.  See American Dry Cleaners, 722

F.2d at 73.

         We need not set a threshold level of assistance at this

time because it is clear to us in this instance that the GSA

satisfied its requirements under the Act.  In Pietroniro, the Third

Circuit found that reference to five alternative locations and

several local realtors satisfied the URA, despite the fact that

none of the locations were economically feasible.  See 764 F.2d at

981; see also American Dry Cleaners, 722 F.2d at 71 (finding

referrals to many possible relocation sites, none of which were

acceptable to the displaced business, sufficient assistance under

the URA).  As in Pietroniro, the Cruise Line has not pointed to a

suitable location to which it was not referred by the GSA.  See

Pietroniro, 764 F.2d at 982-83.  To the contrary, the Cruise Line

admits that the GSA's referrals "may fairly represent then-existing

available facilities."  The record suggests that the Cruise Line

was advised of available locations and that assistance was

available, but chose not to avail itself of such services.  See

Boston v. United States Dep't of Interior, 424 F. Supp. 259, 267

(E.D. Mo. 1976) (granting summary judgment against plaintiff, who

claimed denial of advisory services, when evidence indicated that

the plaintiff had been advised of services but chose not to seek

them).  We empathize with the frustrated sentiments of one

Massachusetts District Court judge who noted:

                  Although the hardships faced by the tenant are

         severe, to a large extent they were aggravated

         by the tenant itself.  The tenant had nine

         months to find a suitable site for relocation. 

         During that time, it refused to accept the

         prospect of increased rents and face the

         reality of relocation, apparently determined

         to remain in possession of the premises. . . .

         In light of this continued resistance, the

         tenant will not now be heard to complain of

         undue hardship.

United States v. Acre of Land, 577 F. Supp. 236, 238 (D. Mass.

1983).

         The current case comes to us in a very different posture

than Pou Pacheco.  We review the GSA award under a deferential

standard and find no evidence that the GSA's decision to exclude

the interim move is arbitrary and capricious or an abuse of

discretion.  We must therefore affirm the decision of the district

court on this ground.

                    B.  REIMBURSABLE EXPENSES

         The Cruise Line requests that it be reimbursed for the

following actual expenses that were classified as reestablishment

expenses by the GSA:



Landing Fees at World Trade Center

$1,825.50


Forwarding of Calls

$1,500.36


Attorney Search Time

$11,353.50


Marine Sanitary System

$3,512.72


Electric and Telephone Hook Up

$2,416.40


Install-Sanitary System

$1,019.44


Backflow Preventer

$310.00


Deck Plates

$1,211.00


Floating Piers

$3,800.00.


These expenses were not reimbursed because they were related to the

interim move or exceeded a regulatory cap.

         The Cruise Line primarily contests the reclassification

of expenses.  There are two regulatory caps involved: (1) search

costs are capped at $1,000 and limited to those that are reasonable

and necessary, see 49 C.F.R.  24.303(a)(13); and (2)

reestablishment expenses are capped at $10,000, see 49 C.F.R.

 24.304.  The Cruise Line alleges that the GSA arbitrarily

reclassified expenses that were valid uncapped moving expenses so

that they would fall within a regulatory cap.  We find, however,

that the GSA considered the pertinent evidence and factors and

articulated an explanation for its action which falls well "within

the bounds of reasoned decision making."   Baltimore Gas, 462 U.S.

at 105-06.

         The GSA, relying on the audit, excluded the attorney's

search fees because they exceeded the $1000 cap which had already

been met, and because the attorney's rate of $135/hr was

unreasonable.  The regulations entitle the Cruise Line "to

reimbursement for actual expenses, not to exceed $1,000, as the

Agency determines to be reasonable, which are incurred in searching

for a replacement location."  49 C.F.R.  24.303(13).  The

provision applies to fees paid to a real estate agent or broker to

locate a site, and they could arguably apply to similar fees paid

to an attorney.  Nevertheless, the provision also permits the GSA

to determine whether the fees are reasonable.  The appellant has

presented no evidence to suggest that the GSA's determination on

this matter was arbitrary and capricious or an abuse of discretion. 

As the GSA's decision was consistent with the regulations, we defer

to the GSA's judgment.

         In support of its claim that the GSA arbitrarily

reclassified relocation expenses as reestablishment expenses, the

Cruise Line relies on the audit itself, which concludes that

"$23,903 of the total proposed amount were actual paid or incurred

expenses, and were allocable to the permanent relocation of the

claimant."  We note, however, that the appellant has pulled the

first sentence of a paragraph out of context.  The remainder of the

paragraph indicates that "relocation expenses" is a catch-all

phrase that includes both moving expenses and reestablishment

expenses, which are subject to different monetary limits.  The

audit clearly explains that it reclassified $25,184.37 of the

expenses as reestablishment expense to be consistent with the

regulations.  The appellant suggests capriciousness in the audit's

decision to reclassify the expenses "for the purpose of maintaining

the integrity of the regulatory limitations."  However, we read

this statement as honoring Congress's intent to limit certain

reestablishment expenses which include alterations to the

replacement real property such as those listed by the Cruise Line.

         The distinction between moving expenses and

reestablishment expenses originates with Congress.  See 42 U.S.C.

 4622.  The regulations have interpreted moving expenses to

include, among other things:

                  Disconnecting, dismantling, removing,

         reassembling, and reinstalling relocated

         machinery, equipment, and other personal

         property including substitute personal

         property described at  24.303(a)(12).  This

         includes connection to utilities available

         nearby.  It also includes modification to the

         personal property necessary to adapt it to the

         replacement structure, the replacement site,

         or the utilities at the replacement site, and

         modification necessary to adapt the utilities

         at the replacement site to the personal

         property.



49 C.F.R.  24.303(a)(3) (emphasis added).  In contrast,

reestablishment expenses include:

                  (1) Repairs or improvements to the replacement

         real property as required by Federal, State or

         local law, code or ordinance.

                  (2) Modifications to the replacement property

         to accommodate the business operation or make

         replacement structures suitable for conducting

         the business.

                              . . .

                  (4) Provision of utilities from right-of-way

         to improvement on the replacement site.



49 C.F.R.  24.304 (a) (emphasis added).  The obvious distinction

between moving and reestablishment expenses is whether

modifications are made to personal property or to the replacement

real property.  The GSA's position that the specified expenses are

in fact reestablishment expenses is supported by the record.  The

audit concluded that: (1) the marine sanitary system is an

allowable expense under  24.304(a)(2); (2) the electric and

telephone hook up are reestablishment expenses allowable under

 23.304 (a)(4); (3) the installation of the sanitary system is

covered by  23.304(a)(2); (4) the backflow preventer is covered by

 23.304(a)(2); (5) installation of deck plates is allowable under

 23.304(a)(2); and (6) installation of floating piers is allowable

under  23.304(a)(2).  We find nothing unreasonable in the GSA's

application of the regulations.

         Instead, the Cruise Line hangs its hat on the argument

that under Pou Pacheco the regulatory caps are guidelines only, and

can be exceeded if there is evidence of unusual expense. 

Unfortunately, the appellant overlooks the distinction in posture

between Pou Pacheco and the current case and its effect on the

standard of review and deference that we afford to the agency's

award.  In this case, we may only remand to the district judge if

we find that the GSA acted in an arbitrary and capricious manner,

not if we believe that the regulations could have reasonably been

interpreted differently.  In Pou Pacheco, we considered whether a

jury and court award was sustainable -- a related, but

substantially different question, involving a different standard of

review.

         Regardless of the hardship to the Cruise Line that

resulted from its forced relocation from Fan Pier, short of

evidence that the GSA's decision in this case was arbitrary and

capricious, we have no choice but to sustain the district court's

decision that the GSA's award was based on a reasonable 

interpretation of the regulations.

         Affirmed.