Key Provision of Fair Housing Act Upheld by Supreme Court

Key Provision of Fair Housing Act Upheld by Supreme Court
By NARC Intern: Nico Stauffer-Mason

On June 25, the Supreme Court issued a landmark decision regarding housing discrimination and the administration of affordable housing programs. In Texas Department of Housing and Community Affairs v. The Inclusive Communities Project, the Court affirmed that the Fair Housing Act of 1968 covers “disparate impact,” the unintentional discriminatory effects of policies that are not purposefully discriminatory. The Act was passed during the Civil Rights era to prohibit discrimination by landlords, realtors, state agencies, and other groups in housing policies. Although the language of the law does not explicitly address impact claims, the majority opinion of the Court held that the law’s purpose and context clearly indicate that unintentionally discriminatory policies are covered, in addition to intentionally discriminatory ones.

The lawsuit was brought by the Inclusive Communities Project (ICP), a Dallas-based group that advocates for fair, accessible affordable housing in the region. ICP contended that the Texas Department of Housing and Community Affairs’ formula for determining where to build new subsidized housing units concentrated development in poor, predominantly African-American neighborhoods. The lawsuit also contended that this policy excluded people seeking affordable housing from neighborhoods with better schools and municipal services. As the state’s formula did not specifically include factors like racial diversity and income levels, the discriminatory result was unintentional. ICP thus argued that disparate impact liability applied, and that the policy needed to be corrected nonetheless. The Supreme Court ruled in the plaintiffs’ favor, asserting that the skewed housing formula, while not intentionally discriminatory, can be challenged under the law through an impact claim.

Many groups praised the decision to apply the Fair Housing Act to disparate impact claims as well as claims of intentional discrimination. The White House Office of the Press Secretary released a statement lauding the Court for its interpretation of the Act, saying that the decision “preserves a longstanding and important method for challenging and eliminating” discrimination in housing. The Secretary of Housing and Urban Development likewise voiced support for the decision, saying that disparate impact claims are a “critical tool” for eliminating barriers to housing access.

The Supreme Court’s application of disparate impact liability to the Fair Housing Act, while significant, is not groundbreaking. According to a report from the National Fair Housing Alliance, all eleven Federal Courts of Appeals have ruled in previous cases that disparate impact is cognizable under the Act. Congress also rejected a 1988 amendment to the law that would have explicitly barred the application of the Fair Housing Act to impact claims. Thus, both federal courts and Congress understood the Act to address unintentionally discriminatory policies in addition to intentional discrimination. In its ruling, the Supreme Court relied heavily on these previous interpretations. Justice Kennedy, the author of the majority opinion, cited the rejection of the proposed 1988 amendment by Congress as proof that the law was intended to imply disparate impact liability.

Because the Court upheld a previous interpretation of the Fair Housing Act as opposed to advancing an entirely new understanding, the policies set forth by the Act will not change significantly. As the Fair Housing Act has been held to apply to disparate impact claims in all eleven Federal Circuits, the restrictions on unintentional discrimination inherent in the Court’s ruling are not new to any jurisdiction. However, now that this interpretation has become the law of the land, the application of disparate impact liability to housing policies and the enforcement of this aspect of the Act will be more uniform.

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