In January 1972, Metro-Act of Rochester, Inc., and eight individual plaintiffs filed suit in the United States District Court for the Western District of New York against the Town of Penfield and members of its Zoning, Planning, and Town Boards. The individual plaintiffs included Rochester residents who owned property and paid taxes there, as well as low and moderate income persons, some of whom were members of racial or ethnic minority groups, who sought to live in Penfield. Organizational plaintiffs included Metro-Act of Rochester, Inc., a nonprofit corporation focused on housing issues for low and moderate income persons.
Penfield's zoning ordinance, adopted in 1962, allocated 98 percent of the town's vacant land to single-family detached housing and imposed requirements relating to lot size, setback, floor area, and habitable space that increased the cost of such housing beyond the means of persons of low and moderate income. Only 0.3 percent of land available for residential construction was allocated to multifamily structures, and even on that limited space low density and other requirements made low and moderate income housing economically infeasible. No land was zoned for apartments or mobile homes.
The plaintiffs alleged that the ordinance and its enforcement, including delays on proposals, denials of variances and permits, refusals to allow tax abatements, and failures to provide support services, had the purpose and effect of excluding low and moderate income persons and members of minority groups from residing in Penfield. Low and moderate income plaintiffs claimed they had attempted to locate suitable housing in Penfield but could not due to the restrictions, resulting in higher commuting costs, substandard living conditions, and fewer municipal services. Rochester taxpayer plaintiffs alleged that Penfield's practices forced Rochester to provide more low and moderate income housing than it otherwise would, requiring tax abatements that increased their own tax burdens.
The record referenced two specific development efforts: Penfield Better Homes Corp. applied in late 1969 for rezoning to build subsidized cooperative townhouses for moderate income persons but was denied a variance, and O'Brien Homes, Inc. proposed a project in late 1971 that was also denied or remained under consideration. Affidavits from individual plaintiffs detailed their income levels, family sizes, maximum affordable housing payments, and unsuccessful searches for housing in Penfield through newspaper ads and other means.
On May 2, 1972, Rochester Home Builders Association moved to intervene as a plaintiff, alleging that its member firms had been prevented from building low and moderate income housing in Penfield and had lost profits. On June 7, 1972, the original plaintiffs moved to add Housing Council in the Monroe County Area, Inc., as a plaintiff; an accompanying affidavit stated that one of its members, Penfield Better Homes Corp., had been actively attempting to develop moderate income housing in Penfield but had been unable to secure approvals. The District Court dismissed the complaint for lack of standing, denied the motions to add parties, and the Court of Appeals for the Second Circuit affirmed. The Supreme Court granted certiorari.