What a busy week! Prosperity Indiana worked with our colleagues on three bills this week dealing with consumer lending, landlord tenant issues and land contracts. Here is where things stand on those bills:
SB395 Uniform Consumer Credit Code (Sen. Eric Bassler) –
This bill was heard in Senate Insurance and Financial Institutions Committee on Wednesday and Mindi Goodpaster testified in opposition on behalf of Prosperity Indiana. The bill would create a flat 36% rate on any loan regardless of size (think auto loans and second mortgages) and does not address a 36% cap on payday loans, which is what we have been advocating for. The committee is holding the bill and considering three possible amendments introduced by Senator Walker for vote next week. One of the amendments would create an annual cap of four payday loans per year and a maximum of eight in a lifetime. We will wait to see how the bill will be amended before refining our position.
SB391 Property Matters (Sen. Mike Bohacek) –
SB 391 was supposed to be heard in Senate Judiciary on Wednesday, but at the last minute was held and the committee is considering amendments for hearing and discussion next week. The bill contains several concerning provisions that look to limit tenants’ rights and processes for complaints about habitability. Prosperity Indiana is working with Senator Bohacek to make changes to the bill that address those provisions.
HB1191 Land Contracts and Landlord-tenant Matters (Rep. Ed Clere) –
HB1191 is scheduled for a hearing on Monday, Jan 27 at 10:00 a.m. in House Judiciary Committee. The bill is a streamlined version of HB1495, which passed out of the House in 2019 but died in the Senate. In an effort to address some of the concerns that killed the bill last year, the main provisions of HB1191 include disclosures by landlords to tenants on liens, habitability issues, etc. and recording requirements so that tenants will be able to make better informed decisions about the property they want to buy and give them further legal recourse in case issues arise with the property. HB1191 will be amended to take out the landlord-tenant provisions to streamline the bill to improve its likelihood for passage. Jessica Love will be testifying on behalf of Prosperity Indiana in support of the bill.
With the end of the first half of session nearing, committees will be wrapping up their hearings next week. This means that those bills that have been heard will be voted on in their chamber of origin and moving on to the second chamber for consideration. Those bills that did not receive a hearing will be considered dead. While not all of Prosperity Indiana’s priorities received hearings thus far, we are encouraged that HB1191 is moving forward and are hopeful about its passage this session. We will continue to keep you informed and will let you know how you can take action to make this happen.
Click here to read our Priority Legislation Report 1-24-2020.pdf
Another Statehouse Day is on the books and the 2020 short session of the Indiana General Assembly speeding along! This week, members walked the halls and advocated for critical policy priorities that impact their communities and clients. Legislators engaged in great conversations about the bills most important to our efforts and why it is critical state legislators take action to increase renter protections and reduce evictions, implement consumer protections to combat predatory lending, and increase access to and the supply of affordable housing. Key handouts that outline each of our top priorities can be found below.
We encourage you to contact your legislators today and speak up in support of these bills. You can find their contact information by entering your zip code on our advocacy action page.
To follow these and other top bills we are supporting, monitoring, or concerned about this session, click here for our bill tracker. This link will automatically be updated as the final bills are added this week.
We thank our members who traveled near and far to make their voices heard. Having policymakers hear from constituents about how these proposals impact work you do is exceptionally powerful.
RELEASE DATE: December 18, 2019
Contact: Kathleen Lara, email@example.com, 317-222-1221, 403
SENATORS YOUNG AND VAN HOLLEN INTRODUCE LEGISLATION TO EXPAND CRITICAL, TARGETED HOUSING ASSISTANCE TO LOW-INCOME FAMILIES
INDIANAPOLIS – New legislation introduced today by Senators Todd Young (R-IN) and Chris Van Hollen (D-MD), the Family Stability and Opportunity Vouchers Act, aims to provide 500,000 additional housing vouchers to low-income families with young children that would enable them to access safe, stable housing in areas of opportunity. If enacted, this measure would dramatically reduce family and youth homelessness and improve life outcomes for those assisted.
The legislation prioritizes these new vouchers for low-income pregnant women and families with children under age 6 experiencing persistent housing instability, or living in an area of concentrated poverty. This targeted assistance would be catalytic at a time when the affordable housing crisis throughout the state is acute. In Indiana, a two-bedroom apartment is not affordable for the average renter in 82 of 92 counties; and there is currently a 134,485-unit deficit of housing that is affordable and available to the 27 percent of Indiana renters who are extremely low-income (earning $21,050 or less per year for a family of four).
Limited resources for housing assistance, coupled with high housing cost burden, leads thousands of Hoosier families to face evictions, housing instability, and homelessness —a cycle that has severe negative consequences for health outcomes, educational attainment and economic mobility.
“The Family Stability and Opportunity Vouchers Act will expand assistance targeted to families urgently in need and prove that poverty is a cycle that can be broken,” said Jessica Love, Executive Director of Prosperity Indiana. “Our network enthusiastically supports this bill and applauds Senators Young and Van Hollen for their leadership in working to ensure unstably housed families and children in our state and across the country have more equitable opportunities to thrive in all facets of life.”
"The American Dream should extend to every American child, regardless of the circumstances of their birth. Evidence clearly shows what happens when we empower families with young children to relocate to areas offering good jobs, quality schools, and safe neighborhoods: earnings grow, job vacancies are filled, poverty declines, and children more fully realize their God-given potential,” said Senator Young. “This bill draws on recent groundbreaking research to invest in housing mobility vouchers and customized relocation support services to improve life outcomes and strengthen Hoosier families, all while substantially reducing taxpayer expenditures on healthcare, public safety, and social services.”
This legislation is championed as a key policy solution by the Opportunity Starts at Home campaign, a national effort to engage multi-sector partners in pushing for stronger federal affordable housing policy. Prosperity Indiana was endorsed this year as the Indiana state partner to lead this effort. To find out more, click here: https://www.prosperityindiana.org/OSAH.
For a link to Senator Young's press release, click here: https://www.young.senate.gov/newsroom/press-releases/young-and-van-hollen-introduce-bipartisan-bill-to-increase-mobility-keep-families-together-and-move-children-to-areas-of-opportunity
About Indiana Association for Community Economic Development D/B/A Prosperity Indiana
Prosperity Indiana is a statewide membership organization for the individuals and organizations strengthening Hoosier communities. Prosperity Indiana believes in a society where all persons can live and work in an environment that provides equitable access to economic and social opportunity.
On Monday, December 16, congressional negotiators revealed the details of two "minibus" spending bills - one for domestic programs and the other, for the defense budget. These packages will fund the federal government through the end of the fiscal year, September 30, 2020 (domestic and defense. Today, the House passed both measures, sending them to the Senate and then, upon passage, to the President of the December 20 funding deadline.
Our updated budget chart is included below, outlining many major programs of interest for Prosperity Indiana members, but here are key highlights:
HUD: The funding package is a victory for housing advocates in that most HUD programs are funded at or above the Senate proposed levels. The final figures are not as ambitious as the House proposal, but important increases were achieved for TBRA, PBRA (enough to renew all contracts for 12 months), the Public Housing Capital fund, Homeless Assistance Grants, Housing Counseling (which was at risk of cuts in the Senate budget proposal), and Section 202 Housing for the Elderly, among others.
The final bill does not include provisions from the House bill that would have prevented HUD from implementing the harmful proposed mixed-status rule that would separate families in HUD-assisted housing or it's proposed weakening of the Equal Access Rule that provide protections against discrimination in shelters based on sexual orientation and gender identity.
USDA: Most USDA's rural housing programs receive similar funding to last year, with small increases for Section 514 farm labor housing loans and Section 523 self-help housing grants and larger increases for the MPR rental preservation program and for Section 542 vouchers.
What Else Was Included? The minibus packages also contained significant funding and/or funding boosts for physically expanding national border fencing, military spending, the National Institutes of Health, the 2020 Census, election security grants and gun violence research.
WE COMMEND PROSPERITY INDIANA MEMBERS FOR YOUR ADVOCACY IN WORKING TO ACHIEVE CRITICAL FUNDING INCREASES!
WHAT ABOUT THE TAX PACKAGE? HOW DID AFFORDABLE HOUSING CREDIT IMPROVEMENT ACT PROVISIONS FARE?
As the FY20 appropriations bills move forward this week, a year-end tax bill is also moving through Congress this week. Unfortunately, despite the work of our network and local and national partners, no provisions from the Affordable Housing Credit Improvement Act were adopted. Early on yesterday, the 4 percent floor for LIHTC was included, but late night negotiations saw it cut that from the final package. Continued advocacy is needed on this front as we head into 2020.
Last week, the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) issued a Notice of Proposed Rulemaking (NPR) proposing substantial revisions to the examination process in ways that do not all appear to align with the intent of the Act. CRA was established to address a legacy of redlining and divestment in low- and moderate-income (LMI) communities. However, the proposed changes raise concerns about how it will affect CRA’s charge to affirmatively meet the community needs for credit and services in LMI communities.
There are some key core issues at of critical concern, based on an initial review of the NPR. We ask that our members who are concerned about these regulations continue to check our website for further details be prepared to comment not only with regulators, but with members of Congress as well!
Where it Counts
How it Counts
There remain significant concerns in how the one ratio test may result in
Following the NPR release several civil rights/fair housing/consumer groups listed below issued a letter linked here: https://nationalfairhousing.org/2019/12/13/diverse-coalition-issues-joint-statement-on-proposed-changes-to-community-reinvestment-act/. Americans for Financial Reform Education Fund, Center for Responsible Lending, NAACP, NAACP Legal Defense and Educational Fund, Inc., National Association of Real Estate Brokers, National Coalition for Asian Pacific Americans Community Development, National Community Reinvestment Coalition, National Fair Housing Alliance, The Leadership Conference on Civil and Human Rights, and UnidosUS.
There was a sea of red at the Statehouse yesterday on Org Day as tens of thousands of teachers rallied as lawmakers returned for the ceremonial start of the 2020 legislative session. Legislators spent much of the day meeting with educators urging action on compensation, testing reforms and repealing certain professional development mandates.
As attention was focused on the #RedforEd movement, there was additional big news from House leadership as Speaker Brian Bosma announced he will retire after this session to move to a “national legislative campaign role.” Republicans in the House will confirm his replacement in the next two weeks. (Photo Source: Robert Scheer/IndyStar).
Prosperity Indiana's policy staff shared our 2020 State Priorities (see below) with numerous legislators throughout the day as well and specific legislation we are working with lawmakers to craft to address the critical
concerns of our members!
These efforts are focused on ensuring Hoosiers can remain in or gain access to safe, stable, and affordable housing and expanding consumer protections to more low-income households build and retain assets.
The best way you can prepare right now to help us advance these priorities is to register for our Statehouse Day on Tuesday, January 14, 2020, from 1-4 p.m. EST. At this event, we connect members with their legislators to share why these priorities are so critical to our network and our communities. If you have questions regarding these priorities or how to get more engaged in advocacy, contact our policy director, Kathleen Lara, at firstname.lastname@example.org.
We will keep you updated and engaged throughout session, but please be aware all hearings and session meetings are publicly available to stream live at www.in.gov/iga.
On Tuesday, Nov. 19, the House passed a month-long extension of the current short-term funding bill by a vote of 231-192. This measure represents the second continuing resolution of the 2020 fiscal year. This will would allow lawmakers to continue funding the government for 30 days while negotiating differences between the House and Senate FY20 spending bills. Lawmakers seem close to agreement on final spending levels, but key differences remain, particularly around funding for the Administration’s proposed border wall.
This measure has now moved to the Senate as members of Congress look to wrap up the week’s business before both the current federal funding deadline this Friday, November 21 and the Thanksgiving recess next week. This measure would continue FY 19 enacted funding levels for housing and community development programs.
The bill, however, has hit a procedural snag as the underlying bill used as a means to pass the short term funding bill is a funding bill Senate Republicans would like to avoid so as to keep it open to negotiations later in the year. In short, the House is likely to see the bill returned so that they use a different underlying bill to send back to the Senate. That becomes procedurally quite close to the Friday deadline for both the House to vote again and the Senate to vote for final passage.
What happened in the Senate spending bill?
We have outlined on this blog the House and Senate bill proposals for FY 20 spending. In our August newsletter, we urged members to call and urge our Senators to fund community development programs as the highest possible level under the agreed upon spending caps and to restore funding that was cut from HUD’s housing counseling budget. The final bill passed on October 31, by a vote of 84-9, without a change to the counseling program funding level, so we urge continued advocacy and calls to your House Representative and both Senators as negotiations continue.
Some amendment language was passed, however, that Prosperity Indiana believes strengthened the underlying bill, including a provision to allow the USDA to extend rental assistance agreements for projects financed by existing Section 514 or 515 loans for up to 20 years to help assisted residents remain stably housed for longer periods
Stay tuned to our social media and this blog for timely budget updates!
On November 11, the Fair Housing Center of Central Indiana (FHCCI) announced a record settlement in a lawsuit against a local business owner accused of targeting Latino communities with predatory land contracts for homeownership of properties that were frequently not in a habitable condition and inflated in their sales price. While the owner of the company in question, Casas Baratas Aqui (translated: “Cheap Homes Here”)
The FHCCI press release noted that several individual plaintiffs brought action in federal court in April 2018 alleging that the company violated the Fair Housing Act, Equal Credit Opportunity Act, Civil Rights Acts of 1866 and 1871, Truth in Lending Act, as well as several Indiana state statutes. Specifically, the company was accused of targeting Hispanic/Latino homeseekers, in particular, with a housing product that offered uninhabitable homes at high interest rates and home prices far above their property values. (Photo Source: IndyStar Article linked below, Sarah Stier, IndyStar)
As IndyStar reported, Amy Nelson, the Executive Director of FHCCI, stated that, “This is a ground-breaking resolution that will have a national impact on rent-to-own and land contracts by providing an example of requirements to ensure fairness in these transactions.”
The IndyStar article outlines one specific case where a plaintiff “entered a one-year lease with a monthly rental rate of $1,000. She was given the option to buy the home for $77,900.” The owner of the company, however, bought the house for only $32,000. The borrower also had a down payment of $8,500 and also required the borrower to “pay $69,400 with a 10 percent interest rate, in monthly installments of $746 for a 30-year term.” In addition to the high costs of this house, the plaintiff found that “the plumbing was completely clogged, the sink didn't function, the floor was rotted and the ceiling had started to collapse,” according to the case complaint. Further, the plaintiff was intimidated after, according to the complaint, “being told to be careful [about complaining] since they are 'illegal.'
These plaintiffs will see financial relief as a result of this settlement thanks to the FHCCI’s work. The owners said they would change their business practices based on this and the September 2019 ruling from the Indiana Supreme Court. (Photo Source: Indystar Article Screenshot, article authored by Crystal Hall)
Earlier this fall, the Court ruled in a case that similarly addressed predatory homeownership contracts. Prosperity Indiana joined the state, the city of Indianapolis, Neighborhood Christian Legal Clinic, the Notre Dame Clinical Law Center and National Consumer Law Center, and the Fair Housing Center of Central Indiana as amicus filers in the Rainbow Realty case where, similar to this instance, borrowers were required to pay for all repairs and maintenance as a homeowner would, but if they fell behind in their monthly payments, they would be treated like renters, facing eviction, not foreclosure, and losing all of their equity.
The Supreme Court’s ruling found that the contract in this case was a rental agreement and not a purchase agreement, as they had been told. Justice Geoffrey Slaughter wrote for the panel in stating, “attempted waiver of their obligations as landlords is void."
FOR IMMEDIATE RELEASE:
November 12, 2019
Hoosier Veteran, Faith, Community Groups Applaud Federal Bill to Protect Consumers from Predatory Lending
INDIANAPOLIS – A coalition of more than 100 Indiana-based veterans groups, faith-based organizations, non-profits, and civil rights organizations applauds the introduction of the Veterans & Consumer Fair Lending Act, a bipartisan bill sponsored by Senators Jeff Merkley (D-OR), Sherrod Brown (D-OH), Jack Reed (D-RI) and Chris Van Hollen (D-MD), as well as Representatives Jesus “Chuy” Garcia (D-IL) and Glen Grothman (R-WI). The coalition urges members of Indiana’s federal delegation to add their names as coauthors of the legislation.
If passed, the lending regulations outlined in the Military Lending Act (MLA), including a 36 percent interest rate cap on small-dollar, short-term loans (commonly known as payday loans), would be applied to all citizens. Right now, the protections only cover active-duty military members, leaving veterans and civilians vulnerable to lenders charging triple-digit interest rates. In Indiana, payday lenders charging up to 391 percent APR have drained over $300 million in finance charges over the past five years. Nearly 90 percent of Hoosiers want to see these loans capped at 36 percent APR.
“Extending the Military Lending Act is a clear message that our military (active and reserve), veterans, and their families are valued for their service to our nation,” said Brigadier General James Bauerle, Vice Chairman of the Military / Veterans Coalition of Indiana. “We cannot take for granted this group of great Americans as they have sacrificed so much and done so much so we can enjoy the freedom granted in our Constitution.”
Advocates from across Indiana have been recommending that state lawmakers enact a 36 percent rate cap for several years. To date, 16 states and Washington, D.C., have adopted similar legislation (a rate cap at 36 percent or lower) with promising results. At the state level, Senator Greg Walker (R-Columbus) Senator John Ruckelshaus (R-Indianapolis), Senator James Tomes (R-Evansville), Senator Vaneta Becker (R-Evansville), Senator Dennis Kruse (R-Auburn), Senator Jean Breaux (D-Indianapolis), Senator Mark Stoops (D-Bloomington), Senator J.D. Ford (D- Indianapolis), Senator Mike Bohacek (R-Michigan City), and Senator Lonnie Randolph (D-East Chicago) coauthored SB 104 in the 2019 session, which would have capped interest rates on small-dollar, short-term loans statewide at 36 percent APR. The bill failed to pass the Senate 22-27.
“Human service agencies across this state regularly see the damage and distress payday lending causes,” said Emily Bryant, President of the Indiana Coalition for Human Services. “Our members enthusiastically applaud the introduction of federal legislation to extend the Military Lending Act protections to all consumers.”
For more information, please see:
Financial Drain: http://www.incap.org/documents/Financial_Drain_Report2019.pdf
Bellwether Polling: http://incap.org/documents/INPaydayLendingMemo1.22.18.pdf
United States Department of Defense report: https://archive.defense.gov/pubs/pdfs/Report_to_Congress_final.pdf
WE NEED YOUR VOICE!
One of the most powerful tools in fighting housing discrimination is the Disparate Impact Rule, a bedrock legal principle under the Fair Housing Act. While disparate impact has been upheld by the U.S. Supreme Court as a legitimate means to target discrimination that often flies under the radar, the Administration has proposed revising this rule in a way that would preclude most from bringing future legal challenges.
Although the federal Fair Housing Act was passed in 1968, housing discrimination enforcement remains woefully incomplete. Nationally, it is estimated that 4 million incidents of housing discrimination occur each year. Without a strong Disparate Impact Rule, the ability to challenge these harmful practices becomes far more difficult. To now add additional and cumbersome barriers for individuals and organizations fighting discrimination is counterintuitive and counterproductive. You have until Friday, October 18 to urge the Administration to reverse this proposal.
Click here to access a pre-drafted letter you can easily add to/edit and submit directly.
Below you can review the full letter we submitted, but even comments that are just a few sentences expressing your concern about this proposed revision of the HUD Disparate Impact rule can have enormous impact. You can learn more about the proposed rule here: https://www.defendcivilrights.org
Docket No. HUD-2019-0067
October 16, 2019
Office of General Counsel, Rules Docket Clerk
Department of Housing and Urban Development
451 7th Street SW, Room 10276
Washington, DC 20410
To Whom It May Concern:
Prosperity Indiana appreciates the opportunity comment on the Department of Housing and Urban Development’s (HUD) Notice of Reconsideration of the Implementation of the Fair Housing Act's Disparate Impact Standard, Docket No. FR-6111-P-02. The Disparate Impact Rule has served as a critical tool in helping enforce anti-discrimination laws.
Our organization represents a network of more than 170 community development organizations dedicated to helping low-income Hoosiers achieve and maintain housing and economic security in each of our state’s 92 counties. Our members strive to ensure all Hoosiers can access safe, stable and affordable housing, and our work is focused on building a society where all persons can live and work in an environment that provides equitable access to economic and social opportunity. Central to that effort is ensuring we confront and eradicate instances of economic and residential discrimination and segregation.
For more than 50 years, the Fair Housing Act has made substantial strides in reducing the discriminatory practices related to renting or buying a home, getting a mortgage, or seeking housing assistance despite our government’s previous history of condoning or perpetuating those practices. As time moves on, the portion of that act that prohibits facially neutral policies that limit housing opportunities based on race, color, national origin, religion, sex, as well as the presence of families with children or people with disabilities, becomes ever more critical. Much of the discrimination that citizens face today manifests in these ways. That is why the Disparate Impact Rule is so critical. Since 2013, the uniform Disparate Impact Rule has been effective in establishing a rigorous, but fair process by requiring plaintiffs to establish a strong case, without undermining their reasonable ability to confront these practices. This Rule has empowered victims to remedy discriminatory practices that unfortunately persist far too frequently throughout our state of Indiana and across the country.
In the past five years alone, the Fair Housing Center of Central Indiana documented 947 fair housing allegations, opened 209 targeted fair housing investigations and assisted numerous persons with disabilities in obtaining reasonable accommodations after initial denials from housing providers, working alongside landlords and tenants to achieve equitable outcomes for all. In addition, the Center has initiated 12 federal court actions and 17 HUD/ Fair Housing Assistance Program complaints to intervene where there have been violations of fair housing law. In two of those lawsuits, more than 3,000 victims of housing discrimination are identified. The Disparate Impact Rule is essential to rooting out these discriminatory practices to fulfill the promise of the Fair Housing Act.
Contrary to HUD’s claims that the proposed revisions to this Rule are merely an effort to update the standard “to better reflect the Supreme Court's 2015 ruling in Texas Department of Housing and Community Affairs v. Inclusive Communities Project, Inc., and to provide clarification regarding the application of the standard to State laws governing the business of insurance,” we find this to be a brazen attempt to undermine the core tenants of the Act and disadvantage parties who have been injured by discriminatory practices to prevent them from successfully bringing forward a claim of disparate impact.
In fact, the majority opinion in the Inclusive Communities case quotes HUD’s rule extensively without any suggestion that its opinion was in tension with that rule. Instead, Justice Kennedy wrote, “In addition, it is of crucial importance that the existence of disparate-impact liability is supported by amendments to the FHA that Congress enacted in 1988. By that time, all nine Courts of Appeals to have addressed the question had concluded the Fair Housing Act encompassed disparate-impact claims.” The Court implicitly endorsed the 2013 Rule by not questioning or challenging it, and no lower court actions since the Inclusive Communities Project suggest that the three-step burden shifting standard is inadequate.
Despite that affirmation, HUD is now proposing dramatic changes to this Rule that blatantly favor defendants to the extent that it nearly invalidates the ability of individuals to effectively bring a case forward. Under the current Rule, §100.500, the three-step standard for presenting a prima facie case is simple. First, the plaintiff has the burden of proving a policy or practice caused or predictably will cause discrimination. Second, if that burden is established, the defendant must prove that the challenged practice is necessary to achieve their legitimate, substantial, nondiscriminatory interests. Third, if the defendant is able to prove that, the plaintiff must then prove that those interests could be served by a different policy or practice that has a less discriminatory impact. That standard is already rigorous in requiring plaintiffs to prove a strong case is present before the burden ever shifts to the defendant.
HUD now proposes to place the burden of proving “the challenged practice is necessary to achieve one or more substantial, legitimate, nondiscriminatory interests” on the defendant as well. The revisions under consideration would impose a new five-point test before the defendant has any burden. Plaintiffs would have to do the following:
1) prove that a policy is “arbitrary, artificial, and unnecessary” to achieve a valid interest; 2) demonstrate a “robust causal link” between the practice and the disparate impact;
3) show that the policy negatively affects “members of a protected class” based on race, color, religion, sex, family status, or national origin;
4) indicate that the impact is “significant”; and
5) prove that the “complaining party’s alleged injury” is directly caused by the practice in question
Under the proposed revisions, the plaintiff must overcome nearly insurmountable barriers to establish their case and provide proof before discovery could even take place. That is essential because the discovery process often provides critical evidence illuminating the specifics of how certain policies and practices came to be implemented and their intent. These excessive barriers will require plaintiffs to anticipate what justifications a defendant may use and try to provide responses before the defendant is ever required to respond.
Further, a closer read of the revised language to §100.500 (b)(1) appears to suggest that if a practice is exceedingly profitable, it may be exempt from disparate impact claims – even if a plaintiff can demonstrate discriminatory outcomes. The current Rule in that section requires the defendant to show that the challenged practice is “necessary to achieve one or more substantial, legitimate, nondiscriminatory interests.” The revision would shift the burden to the plaintiff and requires that the plaintiff show the practice is “unnecessary to achieve a valid interest or legitimate objective such as a practical business, profit, policy consideration, or requirement of law.” This addition of “profit” invites arguments from defendants claiming exorbitant profit may be a legitimate basis to continue the practice.
Finally, the proposed revisions provide new, broad defenses that landlords, lenders and other defendants can employ to subvert responsibility. Those include a defense enabling them to agree that a model used by the defendant in question may be discriminatory, but could be the fault of statistics and algorithms informing their practices related to credit scoring, pricing, marketing and underwriting. While these can still be harmful and discriminatory, the companies using these practices may not be held responsible for their consequences.
Under this proposal, we believe there will no protection against a landlord evicting victims of domestic violence, based on common leases that hold all tenants, even victims, responsible for crimes in their homes. We believe landlords could legally turn away applicants who do not hold full-time jobs, affecting people with disabilities or seniors. We believe an apartment building could also restrict occupancy to one person per bedroom. Families with children would be barred from renting or would be forced to rent more expensive multi-bedroom apartments. We also believe it could allow an insurance company to refuse to insure homes under a certain dollar value. In many communities, this would exclude homes in neighborhoods of color from quality insurance and would prevent homeowners in those areas from fully protecting their homes.
After decades of slow, steady progress, this proposal would eliminate the incentive for property owners, lenders and insurers to adopt stronger policies that better serve us all. It would also eliminate the right of victims of discrimination from reasonably accessing justice. On behalf of our network striving to ensure more residents of Indiana can prosper and live in safe, secure housing, we urge HUD to withdraw this proposed reconsideration of the Disparate Impact Rule and appreciate the opportunity to comment.