Blog Post #17: The End of Disparate Impact As We Know It

By Theresa Lau

January 21, 2015 started as a usual day for most people living in the District of Columbia. But for most civil rights advocates, that particular day was full of uncertainty about the future of civil rights law. The Nine Justices of the Supreme Court gathered to hear the oral arguments on an issue that has sat on the back burner for the last four years. The case,Texas Department of Housing and Community Affairs v. The Inclusive Communities Project, challenged the constitutionality of disparate impact in the fair housing context.[1]

Congress passed the 1968 Fair Housing Act (FHA) to undo generations of discrimination and to replace ghettos by integrating and prohibiting individuals from making dwellings unavailable because of race.[2] Since the passage of the FHA, many circuit courts interpreted the FHA to prohibit unjustified practices with discriminatory motive and effects.[3]However, by the end of this Supreme Court term, disparate impact may become a tool of the past.

In Texas Department of Housing and Community Affairs v. The Inclusive Communities Project, the appellee, a non-profit housing assistance group, alleged that the Texas state housing entity’s allocation of Low Income Housing Tax Credits violated the FHA.[4] The state government agencies distribute low income housing tax credits to landlords who agree to provide low-income housing to families to help promote affordable housing and inclusive neighborhoods.[5] The ICP argues that the Texas Department of Housing and Community Affair’s distribution of these tax credits has a disparate impact on African American residents because it disproportionately granted housing credits in minority communities while denying credits in affluent white neighborhoods.[6] During the oral argument, the appellant argued that Congress did not intend the FHA to cover discriminatory effects-based on the language and plain meaning of the statute.[7]

Despite appellate court rulings that the FHA indeed does permit the disparate impact rule, many civil rights coalitions fear that the Court will be persuaded by Justice Scalia’s clear disapproval for the disparate impact rule, which he vocalized in another landmark civil rights case,Ricci v. Stefano.[8]

The elimination of the disparate impact theory for housing discrimination cases would lead to a significant drop in discrimination claims, not because the U.S. achieved racial parity, but because the affected parties would no longer have legal recourse. The reality is that the face of discrimination has changed significantly over the last quarter century. Overt racism and exclusion have been replaced by more subtle actions. Discriminatory intent is difficult to prove in the fair housing context, because the actors oftentimes are government entities that operate based on their opinion of what is best for their locale. Housing decisions that focus on “improving housing conditions,” for example, are attractive in theory, but do not actually work in practice. Most housing decisions raise dwelling standards, raise rental costs, and ultimately, adversely impact members of the protected class, which creates white-only neighborhoods.[9] These decisions are absent the racial animus necessary for a disparate intent FHA claim. Thus, if the Supreme Court decides to end disparate impact theory, an overwhelming number of minority families will likely be pushed out of integrated communities and again be forced into de facto ghettos and segregated neighborhoods. An adverse decision in Texas Department of Housing and Community Affairs v. The Inclusive Communities Project would likely render the FHA ineffective in addressing the evils that Congress intended to eradicate with the law.[10]

In recent years, the courts have slowly dismantled the protections fought for during the civil rights movement. The need for reform and change is clear during a time where racial tensions are at an all-time high. The anti-discrimination laws need to evolve to address pressing civil rights concerns such as police brutality, voting rights, and institutionalized racism. The Court should not render these protections null, because racism still exists; it’s simply painted a different color.

 

[1] Texas Dep’t of Hous. & Cmty. Affairs v. Inclusive Communities Project, Inc., 135 S. Ct. 46,46 (2014).

[2] See Trafficante v. Metro. Life Ins. Co., 409 U.S. 205, 211 (1972).

[3] See 2922 Sherman Ave. Tenants’ Ass’n v. D.C., 444 F.3d 673, 679 (D.C. Cir. 2006) (noting that “every one of the eleven circuits to have considered the issue has held that the FHA . . . prohibits not only intentional housing discrimination, but also housing actions having a disparate impact.”); see, e.g., Graoch Assocs. # 33, L.P. v. Louisville/Jefferson Cnty. Metro Human Relations Comm’n, 508 F.3d 371-73 (6th Cir. 2007); Kyles v. J.K. Guardian Sec. Servs., Inc., 222 F.3d 289, 295 (7th Cir. 2000) (“Courts have recognized that Title VIII is the functional equivalent of Title VII and so the provisions of these two statutes are given like construction and application.”); See 2922 Sherman Ave. Tenants’ Ass’n v. D.C., 444 F.3d 673, 679 (D.C. Cir. 2006) (noting that “every one of the eleven circuits to have considered the issue has held that the FHA . . . prohibits not only intentional housing discrimination, but also housing actions having a disparate impact.”).

[4] Texas Dep’t of Hous. & Cmty. Affairs v. Inclusive Communities Project, Inc., 135 S. Ct. 46, 46 (2014).

[5] Id.

[6] Id.

[7] Oral Argument of Texas Dept. of Housing and Community Affairs v. Inclusive Communities Project, Inc., The Oyez Project at IIT Chicago-Kent College of Law, http://www.oyez.org/cases/2010-2019/2014/2014_13_1371 (last visited February 14, 2015).

[8] Ricci v. DeStefano, 557 U.S. 594-96 (2009) (Scalia, J. dissenting).

[9] Stacy E. Seicshnaydre, Is Disparate Impact Having Any Impact? An Appellate Analysis of Forty Years of Disparate Impact Claims Under the Fair Housing Act, 65 Am. U.L. Rev. 357, 364-65 (2013).

[10] See Trafficante v. Metro. Life Ins. Co., 409 U.S. 205, 211 (1972) (stating that Congress intended the Fair Housing Act to undo generations of discrimination and replace ghettos by integrating and prohibiting individuals from making dwelling unavailable because of race). See generally, United Nation, The Universal Declaration of Human Rights (listing housing as an essential right).