• Wesley Aleshire

A New Ruling on Disparate Impact

There is a New Ruling on Disparate Impact that "was" scheduled to go into effect on October 26th. I've shared thoughts from those in support and those in opposition to this new ruling. What are your thoughts?

HUD has released a new final ruling meant to address the way Disparate Impact cases are assessed under the Fair Housing Act. This new ruling does not go quite as far as the rule proposed by HUD back in August 2019, but it does include some of the changes wanted by those who have been advocating for it. This final ruling is meant to modify the 2013 HUD regulations that address allegations of Disparate Impact.

Not everyone is in support of this new ruling, so, I’ll share both sides of the dispute. I’ve taught Fair Housing for over 12-years now I believe it’s important to look at the needs of both sides whenever determining which direction to go with Fair Housing-related legislation. If any guideline put in place gives an unfair advantage to either the housing provider or the renter, it’s still unfair.

Read both sides and please share your perspective in the comments.

Those in favor of HUDs New Ruling believe that this change adds a needed layer for the burden of proof to the plaintiff. Here are a few of the specifics that those in favor are in support of.

1) For starters, the burden of proof is modified so that the plaintiff must:

· Prove that the policy or practice in question had is arbitrary and unnecessary.

· Prove that it is the direct cause of disparate impact to protected classes.

· Show that it is considered significant.

· Prove that the alleged conduct is directly correlated with the asserted injury.

2) Then, the defendant would be able to challenge allegations with evidence that may support the valid interest of the policy or practice in question.

3) Once a defendant disproves the plaintiff’s evidence the burden shifts back to the plaintiff. At this point the plaintiff must do one of two things:

· Show that a less discriminatory option exists that “would also” serve the defendants identified interest without causing an undue burden on the defendant.

· Prove that the defendants’ evidence is not valid.

Those who oppose HUDs New Ruling believe that this new ruling makes it too difficult for the plaintiff to prove discrimination. Here are a few of the specifics that those in opposition to the new ruling are opposing.

If discriminatory intent cannot be shown, it would allow housing providers to freely engage in activities that deprive disadvantaged people, domestic violence survivors, and other protected classes from housing opportunities.

The 1st step in the 2013 “three-step burden-shifting standard” already provided a formidable obstacle for most plaintiffs.

The new rule increases the standards that are needed from the plaintiff to move through the legal process before the plaintiff can obtain additionally needed information from the defendant. This information is needed earlier on in court proceedings to present a strong challenge.

Having to prove that the policy or practice is arbitrary, artificial, and unnecessary would imply that unreasonable profit is valid because “a valid interest or legitimate objective” such as a practical business need includes profit. Those in opposition of the new ruling believe that excessive profit would outweigh consideration of a less discriminatory policy or practice, even if it would still result in a reasonable profit.

It is important to note that there was a federal lawsuit meant to overturn this ruling alleging that it may violate the Administrative Procedure Act. This has led to a federal judge issuing a preliminary injunction which means the HUD will be unable to implement the new rule until the legal challenge is resolved.

There you have it, both sides of the story, so, what are your thoughts?
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