Agenda - Planning Commission - 10/15/2015

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August 10, 2015 1 Volume 9 1 Issue 15 Zoning Bulletin not cognizable under the FHA (i.e., not within the jurisdiction of the FHA; not able to be brought under the FHA). While the Department's appeal was pending, the Secretary of Housing and Urban Development ("HUD") issued a regulation interpreting the FHA to encompass disparate -impact liability. HUD's regulation also established a. burden -shifting framework for adjudicating such claims. Under that framework, a plaintiff bringing a disparate impact claim, such as ICP here, would first need to prove that a challenged practice (e.g., here, the Department's allocation of tax credits) caused or predictably will cause a discriminatory effect. (24 CFR § 100.500(c)(1).) If a statisti- cal discrepancy is caused by factors other than the defendant's policy, a, plaintiff cannot establish a prima facie case, and there is no liability. Af- ter a plaintiff does establish a prima facie showing of disparate impact, the burden shifts to the defendant to "prov[e] that the challenged practice is necessary to achieve one or more substantial, legitimate, nondiscrimi- natory interests." (24 CFR § 100.500(c)(2).) Once a defendant has satis- fied its burden at step two, a plaintiffmay "prevail, upon proving that the substantial, legitimate, nondiscriminatory interests supporting the chal- lenged practice could be served by another practice that has a less discriminatory effect." § 100.500(c)(3). The United States Court of Appeals for the Fifth Circuit held that disparate -impact claims are cognizable under the FHA. On the merits, however, the Court of Appeals reversed the District Court's judgment and remanded the matter. Relying on HUD's regulation, the Court of Ap- peals held that it was improper for the District Court to have placed the burden on the Department to prove there were no less discriminatory alternatives for allocating low-income housing tax credits. The Department filed a petition for a writ of certiorari on the question of whether disparate -impact claims are cognizable under the FHA. The Supreme Court of the United States granted certiorari (and heard the case). DECISION:. Judgment of United States Court of Appeals for the Fifth Circuit affirmed, and matter remanded. The Supreme Court of the United States held that disparate -impact claims are cognizable under the FHA. In other words, the court held that, under the FHA, housing decisions with a disparate impact are prohibited. Importantly, the court noted that "[s]uits targeting unlawful zoning laws and other housing restrictions that unfairly exclude minorities from certain neighborhoods without sufficient justification are at the heartland of disparate -impact liability." In so holding, the court looked at the history and enactment of the FHA and its amendments. It also looked to two other antidiscrimination statutes for guidance—§ 703(a)(2) of Title VII of the Civil Rights Act of 1964 ("Title VII") and § 4(a)(2) of the Age Discrimination in Employ- ment Act of 1967 ("ADEA"). The Supreme Court had found under prior 4 © 2015 Thomson Reuters