On April 11, 1968, a week after the assassination of Dr. Martin Luther King Jr., President Lyndon Johnson signed into law the Fair Housing Act, a landmark housing discrimination law intended to ensure equal access to housing opportunities for all individuals.
Section 804(a) of the FHA makes it illegal “to refuse to sell or rent after the making of a bona fide offer, or to refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny, a dwelling to any person because of race, color, religion, sex, familial status, or national origin.”
Although this section applies primarily to private persons — homeowners, landlords or real estate agents, among others — the specific language in the law, “otherwise make unavailable or deny,” raises issues for government regulation of the housing market. Because of this, the FHA has implications for local zoning decisions, especially when such decisions affect or diminish the availability of multifamily and affordable housing.
Discriminatory intent vs. disparate impact
A critical question in interpreting federal antidiscrimination laws is whether a violation requires intentional discrimination or only a disparate impact on certain people.
For those laws that require a showing of intentional discrimination, the plaintiff must produce evidence that the defendant intended to discriminate in a decision it made. If only disparate impact is required, however, then the plaintiff may produce statistical evidence demonstrating the challenged act’s effect on protected classes, even if the defendant had no discriminatory intent.
In the 2015 case Texas Dept. of Housing and Community Affairs v. Inclusive Communities Project, Inc., the U.S. Supreme Court held that the FHA requires only disparate impact to establish a violation. The government doesn’t need to have intended to exclude minorities from housing opportunities, or to have been motivated by racial animus, for a violation to have occurred.
Instead, the court found that “unlawful practices [under the FHA] include zoning laws and other housing restrictions that function unfairly to exclude minorities from certain neighborhoods without any sufficient justification.”
Examples of unintentional violations
In the Texas Department of Housing case, the plaintiff alleged that the department reinforced segregated housing patterns by awarding proportionately more low-income tax credits for housing in urban areas populated largely by minorities, rather than in suburbs with mostly white residents. The Supreme Court ruled that if the statistical evidence supported this argument, the department’s conduct would likely be unlawful under the FHA.
Likewise, if a local zoning board consistently denies applications for multifamily apartment buildings in predominantly white neighborhoods while approving similar developments in predominantly minority neighborhoods, it might be a violation of the FHA. Even if the zoning decisions are not explicitly based on race, the disparate impact on different racial groups could still constitute discrimination under the FHA.
Practical consequences
Following the Supreme Court’s decision, lawsuits have been filed across the nation — including at least one in South Carolina — alleging that local planning denials of multifamily or affordable housing were illegal under the FHA.
It is relatively straightforward for a plaintiff to produce the necessary statistical support for an FHA claim. For example, if the plaintiff can show that the surrounding neighborhood is predominately white, but a proposed project that was rejected would have been inhabited predominantly by minority residents, that evidence standing alone could well support an FHA claim.
Whenever a municipality makes planning decisions that affect multifamily or affordable housing, it should consult with its attorney and carefully consider the application of the FHA. Particularly when the municipality denies an application for multifamily or affordable housing, it must organize a factual record to show the legitimate, nondiscriminatory reasons that the project was denied.