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
RIN 2529-AA98
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.
Sincerely,
Jessica Love
Executive Director
