Agenda - Planning Commission - 10/15/2015

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Zoning Bulletin August 10, 2015 1 Volume 9 1 Issue 15 State agency contends disparate -impact claims are not cognizable under the Fair Housing Act Citation: Texas Dept. of Housing and Community Affairs v. Inclusive. Communities Project, Inc., 135 S. Ct. 2507 (2015) The United States Supreme Court has jurisdiction over all federal courts and over state court cases involving issues of federal law, plus original jurisdiction over a small range of cases. NATIONAL (06/25/15)—This case addresses the issue of whether disparate -impact claims are cognizable under the federal Fair Housing Act. In other words, the case addresses the issue of whether, under a proper interpretation of the Fair Housing Act, housing decisions (includ- ing zoning actions) with a disparate impact are prohibited. The Background/Facts: The Federal Government provides low- income housing tax credits that are distributed to developers by desig- nated state agencies. In Texas, the Department of Housing and Com- munity Affairs (the "Depaitinent") distributes the credits. The Inclusive Communities Project, Inc. (the "ICP"), a Texas-based nonprofit corpora- tion that assists low-income families in obtaining affordable housing, sued the Department and its officers in federal district court. The ICP brought a disparate -impact claim under §§ 804(a) and 805(a) of the federal Fair Housing Act (the "FHA"). Under § 804(a) of the FHA, it unlawful to "refuse to sell or rent . . . or otherwise make unavailable or deny, a dwelling to a person because of race" or other protected characteristic. Under § 805(a), it is unlawful "to discriminate against any person in" making certain real-estate transac- tions "because of race" or other protected characteristic. The ICP alleged that the Department and its officers had, in violation of those sections of the FHA, caused "continued segregated housing pat- terns by allocating too many tax credits to housing in predominantly black inner-city areas and too few in predominantly white suburban neighborhoods." The ICP argued that the Department had to modify its selection criteria in order to encourage the construction of low-income housing in suburban communities. Relying on statistical evidence, the District Court concluded that the ICP had established a prima facie (i.e., on its face) showing of disparate impact. In so concluding, the District Court assumed that the Depart- ment's proffered nondiscriminatory interests in distributing the tax credits were valid, but found that the Department failed to meet its burden to show that there were no less discriminatory alternatives for allocating the tax credits. The District Court thus ruled for ICP. The District Court ordered that the Department add new selection criteria for the tax credits. The Department appealed. It argued that disparate -impact claims are © 2015 Thomson Reuters 3