UJ-Eighty Corporation v. City of Bloomington Board of Zoning Appeals

Indiana University (IU) holds outsized political influence in the City of Bloomington, Indiana. It is the City’s largest employer with nearly 10,000 employees. Its annual budget totals nearly $1.7 billion. And at 1,933 acres, its campus occupies over 12 percent of the City’s entire land area, making it the largest landowner, too. IU is also a fierce competitor in the market for student housing—fully one third of IU’s roughly 33,000 undergraduates live in IU-owned, -operated, or -affiliated housing. IU tells its students: “On-campus housing is where you belong.” At all times relevant to this case, Bloomington’s zoning ordinance effectively restricted the residential use of certain properties near IU to “fraternity/sorority house[s].” Key here, the ordinance provided that such properties could be occupied only by students “sanctioned or recognized” by IU “as being members of a fraternity or sorority through whatever procedures Indiana University uses to render such a sanction or recognition.” In effect, IU got to determine which of its students, if any, a neighboring property was allowed to house. Petitioner owns a fraternity house across the street from IU’s campus. After IU derecognized the fraternity whose members lived in petitioner’s house, the City cited petitioner for violating the zoning ordinance when two of the students failed to move out of the house and into IU’s own student housing. The question presented is whether the Due Process Clause prohibits the government from vesting an economically self-interested entity with regulatory power over its rivals, as the D.C. Circuit has held, or whether it does not, as the Delaware Supreme Court and now the Indiana Supreme Court have held.