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III. The Fundamental Alteration Defense, Whose Concrete Meaning Is

Not Ripe For Review, Confirms The Reasonableness Of The General

Integration Requirement

This Court should reject the suggestion of petitioners (and the limited number of States that have joined them as amici) that the presumptive integration mandate should be rejected because it is too intrusive and perhaps counterproductive. At the outset, such a suggestion does not undermine the threshold conclusion of discrimination: discriminatory deprivation of important benefits does not become nondiscriminatory simply because equal treatment would cost the public entity more money. Nor is it an answer to a charge of discrimination in the provision of a service that the service need not be provided at all or might be withdrawn if it had to be provided equally (an argument that could be made of most government services). See Pet. Br. 24. In addition, and in any event, the in terrorem argument ignores the important limits incorporated into the construction of the ADA at issue here–limits that confirm the reasonableness of the construction.

One important limit, already noted, is set by the threshold requirement that the plaintiff under Title II be a "qualified individual with a disability." § 12132. That term is defined to require the individual to meet "the essential eligibility requirements for the receipt of services or the participation in programs or activities provided by a public entity." § 12131(2). The ADA thus does not provide for a general right of any individual with a disability, though not qualified for any existing government programs under their essential eligibility requirements, to [page 26] demand that the eligibility criteria be modified so as to create programs suitable for a broader class of individuals.

Closely related, the court below, following the Attorney General’s position, has provided for a "fundamental alteration" defense to an otherwise-valid claim of discrimination. That defense comports with the ADA. In Title II, the definition of "qualified individual with a disability" speaks of "reasonable modifications" and "essential eligibility requirements." § 12131(2). Title I condemns employers’ refusals to make "reasonable accommodations" and allows a defense of "undue hardship" (§ 12112(b)(5)(A)), a standard that is defined to mean "significant difficulty or expense, when considered in light of" a number of factors, focused on but not limited to cost considerations (§ 12111(10)). Title III similarly condemns the failure of providers of public accommodations "to make reasonable modifications" unless the defendant "can demonstrate that making such modifications would fundamentally alter the nature of" the provided services. § 12182(b)(2)(A). And the predecessor of the ADA, namely, Section 504 of the Rehabilitation Act, incorporated a similar limitation. See Southeastern Community College v. Davis, 442 U.S. 397, 410, 412-13 (1979) ("fundamental alteration"); Alexander v. Choate, 469 U.S. 287, 300 (1985). (Emphases added through this paragraph.) While no question is presented here whether this defense is mandated by the ADA, the defense is unquestionably consistent with the ADA.

The availability of such a defense to the presumptive integration mandate under Title II, along with the "qualified individual" precondition, is one among several reasons why petitioners’ federalism-based arguments against that mandate lack merit. See Pet. Br. 32-35. Quite simply, with this defense, the burdens on public entities are substantially [page 27] moderated and can hardly be deemed outside what Congress contemplated. Congress clearly understood that "the integration of people with disabilities will sometimes involve substantial short-term burdens, both financial and administrative"–justified by the prospect that "the long-range effects of integration will benefit society as a whole." H.R. Rep. 485, Part III, at 50. Moreover, unlike in Pennhurst State School & Hospital v. Halderman, 451 U.S. 1 (1981), Congress in the ADA did not merely authorize a "contract" with States under the Spending Power and did not set forth mere aspirational objectives; instead, it clearly imposed an enforceable non-voluntary obligation on the States and other public entities. Cf. Cedar Rapids, slip op 6 (Thomas, J., dissenting) ("special rules of construction" apply to Spending Power programs placing "conditions on the receipt of federal funds"). This Court has indicated that, when Congress has thus laid down a broad federal rule that unquestionably displaces state power in an area and granted a federal agency broad authority to implement the command, the proper question is simply whether the exercise of the implementing authority is within the grant, without a special additional federalism hurdle that must be overcome to support its exercise. City of New York v. FCC, 486 U.S. 57 (1988); see AT&T Corp. v. Iowa Utilities Bd., 119 S. Ct. at 730 n.6.

A "fundamental alteration" defense, in short, supports the basic rule at issue here. No more need or should be decided about the nature of the defense in this case. The exact nature of the defense has hardly been explored in the lower courts and is not presented at this stage of the present case. Moreover, the nature of the balance contemplated by Congress–between short-term costs and long-term savings, in a statute indisputably ambitious in its [page 28] intended effect–is not a matter properly examined in the abstract.

Thus, there are significant factual issues relevant to any elaboration of the standards governing the defense. On one hand, as has been found on remand in the present case,7 the cost of care or treatment in community settings for particular individuals may often be less than or comparable to costs in institutional settings, either absolutely or for a particular State looking at its own sources of funding (including Medicaid funds).8 On the other hand, difficult choices may arise if the transfer of individuals leaves high "fixed" costs of needed institutions to be borne in serving a smaller number of individuals, raising their per-person cost "artificially" and creating additional pressure to reduce the availability of institutional settings for those who need them. But discrimination against one [page 29] individual is hard to justify on the ground that it benefits another individual, and it is, in any event, far from clear what the real-world tradeoffs will be. Not only must more be known about the number of individuals involved in changes that would not otherwise already be taking place, but account must be taken of the possibilities of consolidating facilities, sharing staffs, instituting mixed uses of facilities, and adopting other measures that might materially reduce the costs of change

Such prospects may make any specter of harmful tradeoffs more hypothetical than real. The nature of the "fundamental alteration" defense should be explored in concrete settings that will inform the proper answer. Meanwhile, the existence of the defense confirms the reasonableness of the presumptive integration mandate applied in this case.

7 The district court found, in its January 29, 1999, Order: "There is no dispute that the cost of serving plaintiffs in the community is significantly less than serving them in an institution." Order at 6. The district court added, however, that the State may not actually realize the savings from relocating respondents, "because of fixed overhead costs associated with providing institutional care," and that (on restricted evidence) it was "unable to determine whether the State has realized any appreciable cost savings by placing [respondents] in the community." Id. at 6.
8 See Sledge, et al., "Day Hospital/Crisis Respite Care Versus Inpatient Care, Part II: Service Utilization and Costs," 153 Am. J. Psychiatry 1074 (1996); Mechanic, "The Challenge of Chronic Mental Illness: A Retrospective and Prospective View," 37 Hospital and Community Psychiatry 891 (1986) (history of nursing home transfers); Wasylenki, "The Cost of Schizophrenia," 39 Canadian J. Psychiatry 565 (1994); Williams & Dickson, "Economics of Schizophrenia," 40