Fair Housing Information

What Affordable Housing Professionals Should Know

Most compliance professionals are familiar with fair housing laws. They ensure equitable treatment of tenants and fair application processes at affordable housing developments. Moreover, failure to comply with fair housing laws can result in penalties, fines, litigation, and other negative financial impact.

Compliance professionals should be especially knowledgeable of fair housing laws because of federal funding and the sensitivity of the information that LIHTC tenants are required to provide. Actions, requests, statements, and questions by compliance professionals may be construed as discriminatory if not approached with fair housing laws in mind. For this reason, it is helpful to review fair housing laws. Exhibit A shows a summary of major fair housing legislation.

Exhibit A: History of Fair Housing Legislation

  • 1788 U.S. Constitution: Slaves considered three-fifths of a person
  • 1856 Dred Scott decision: Blacks have privileges only as granted by whites
  • 1865 13th Amendment: Abolition of slavery
  • 1866 Civil Rights Act of 1866: Racial discrimination made illegal
  • 1868 14th Amendment: All citizens guaranteed due process
  • 1917 Buchanan v. Warley: Segregation prohibited in purchase of homes
  • 1962 Executive Order 11063: Racial discrimination prohibited in federally funded programs
  • 1964 Civil Rights Act of 1964 (Title VI): Discrimination prohibited in all federally funded programs
  • 1968 Civil Rights Act of 1968 (Title VIII): Provided for fair housing opportunities throughout the United States
  • 1974 Housing and Community Development Act: Sex added to protected classes
  • 1988 Fair Housing Amendments Act of 1988: Handicapped and familial status added to protected classes; enforcement provisions strengthened
  • 1995 Housing for Older Persons Act of 1995 (HOPA): Requirements for 55 and older housing relaxed. No longer required significant facilities and services designed for the elderly.

Fair Housing Act

Fair housing has been established in a number of laws over the history of the civil rights and affordable housing movements in the United States.

The Civil Rights Act of 1968 devoted an entire section (Title VIII) to fair housing. Known as the Fair Housing Act, its purpose was to “provide, within constitutional limitations, for fair housing throughout the United States.” Title VIII prohibits housing discrimination, both in rental and sales practices, based on race, color, religion, and/or national origin. In 1974, a provision in the Housing and Community Development Act added sex as a protected class. In 1988 the Fair Housing Act was amended again to add protections for handicapped (disabled) persons and families with children.

The Fair Housing Act attempts to deal with all aspects of housing. It makes several types of activities illegal, including refusal to rent, discriminatory conditions for rental, discriminatory language in advertising, and denial of the availability of units. Most, if not all, SHFAs require owners to certify that they are in compliance with the Fair Housing Act before they are able to receive their allocation of housing credits.

Types of Discrimination

According to fair housing laws, there are two types of discrimination — different treatment and different impact.

  • Different treatment means treating people differently because of their minority status.
  • Different impact means that an action or policy that involves no variation in treatment still results in a different impact on some minorities.

Training management staff at an LIHTC property to follow policies and procedures is relatively simple when compared to the more difficult task of sensitizing staff to discrimination by different treatment or different impact. Therefore, making staff aware of prohibited activities that they can avoid in their daily duties may be a more effective way to help them understand fair housing laws. Exhibit B is a list of additional prohibited activities from the Fair Housing Act.

Exhibit B: Examples of Discriminatory Activities

  • Refusal to rent to a protected class
  • Refusal to negotiate rental with a protected class and permitting negotiations with others
  • Advertising indicating discriminatory preference or limitation through language or the use of locations, logos, or human models
  • Selective use of media (e.g., advertising only in newspapers whose readership is predominantly white)
  • Refusal to show available units
  • Refusal to supply rental information, such as rental rates
  • False representation of non-availability
  • Imposition of different rental charges, security deposits, or rental terms or conditions
  • Discriminatory information requested on rental applications (e.g., asking about number of children or about the presence of handicap)
  • Discriminatory qualification criteria, applications, or procedures
  • Delay tactics to frustrate a person from pursuing rental
  • Steering (channeling minorities to certain parts of a community, building, or floor)
  • Restrictions or different provisions in lease contracts
  • Provision of different levels of services or facilities
  • Sexual harassment
  • Eviction on the basis of a protected class
  • Discriminatory notices or statement
  • Blockbusting (inducing lessee to not renew by suggesting an ethnic/racial character to the property/neighborhood) or panic selling (seeking to induce residents to move out motivated by race)

Enforcement

As the enforcement provisions stand today, through amendments to the act and through case law, a housing discrimination complaint can be filed against any person engaged in or about to be engaged in discrimination. This includes not only the person whose actions were discriminatory but also his or her supervisors and employers, including the owner of the property. The statute of limitations for a complaint filed with HUD is one year from the date of the alleged discrimination.

Complaints are filed with HUD, a state fair housing authority, city or regional fair housing authorities, and/or a claimant attorney representative. Most cases are conciliated through HUD, with both parties meeting and determining a mutually satisfactory settlement. The Fair Housing Amendments Act of 1988 added the Administrative Law Judge (ALJ) as an alternate means of adjudicating fair housing complaints. The ALJ is a quicker and easier method of handling complaints. In addition, either the complainant or the respondent can elect to have the case tried in federal district court.

Testers

Fair housing organizations, as well as the federal government, can legally send testers to a property. Testers are people who are professionally trained to portray prospective tenants. Their job is to act as prospects and note how they are treated. A properly trained tester is indistinguishable from a true prospect. Therefore, even if a member of a real estate management staff suspects someone is a tester, he or she should treat that person the same as any other prospect.

The courts have ruled that a tester or an organization may file a fair housing complaint. If staff treats everyone the same (which is the objective of the fair housing laws), they will not need to be concerned about whether the prospect is really a tester.

Accessibility Requirements

Owners are required to make existing units accessible for the disabled. For all covered multifamily dwellings first occupied after March 13, 1991, the Fair Housing Amendments Act of 1988 requires that the design and construction provide the following:

  • Accessible routes to building entrances
  • Accessible public and common-use areas
  • Sufficiently wide doors
  • An accessible route into and through the dwelling unit
  • Accessible light switches, outlets, and thermostats
  • Reinforcement of bathroom walls
  • Usable kitchen and bathrooms

In covered multifamily housing without an elevator that consists of 4 or more units built for first occupancy after March 13, 1991, all ground floor units must comply with these seven design and construction requirements. Through enforcement precedent and guidelines published by HUD and other agencies, these requirements impact design specifications for parking lots and garages, elevators, and many other aspects of a building.

Reasonable Accommodation and Modification

The Americans with Disabilities Act (ADA) states that housing providers are required to make reasonable accommodations in rules, policies, practices, or services and to allow reasonable modifications of existing premises.

Reasonable accommodations are changes to policies and procedures that may be required to allow a disabled person to use and enjoy the property. For example, if your current maintenance policy requires the resident to file a written request, you can change your policy to allow residents to make verbal maintenance requests.

Reasonable modifications are physical changes to a property that allow a disabled person full use of the premises. Modifications may be made to the interior of a unit or to any common area not open to the public (for example, laundry rooms, clubhouses, or storage areas). A lift on the outside of the building to allow a person with a wheelchair to have access to a second-floor apartment may be an example of a reasonable modification. Requests for modifications by tenants do not need to be made only at the beginning of the tenancy; they may be made at any time. The owner may not require an additional security deposit.

Examples of Common Accommodations

  • Allowing a personal care attendant to live with the resident
  • Allowing an assistive animal in the apartment
  • Installing anti-slip tape on floor and/or stairs
  • Using nontoxic fertilizers for landscaping
  • Removing ballasts from florescent tubing
  • Posting “No Smoking” signs in common areas such as the office or hallways
  • Allowing removal of carpet

Examples of Common Modifications

  • Installing grab bars in the bathroom
  • Lowering or removing kitchen cabinets
  • Installing a visual doorbell or fire alarm
  • Removing a bathtub to install a roll-in shower
  • Adding additional accessible reserved parking spaces

Protected Classes

In the years after the Fair Housing Act, other classes of people were included in protection from discrimination. Currently, federal fair housing laws make it unlawful to discriminate against people who fall into one or more of the seven protected classes:

  • Race
  • Color
  • Religion
  • Sex
  • National origin
  • Familial status
  • Handicap

State and Local Laws

States and some municipalities have separate laws dealing with fair housing.  These laws may provide broader coverage than the federal laws, so it is imperative that compliance professionals familiarize themselves with the legislation applicable to their properties.

Each member of real estate management staff must know the laws at the federal, state, and municipal levels. Depending on the state and city, the following classes could be protected:

Class

  • Sexual Orientation (e.g.,: same-sex couples)
  • Gender Identity (e.g., transgender individuals)
  • Marital Status (e.g., single mother)
  • Ancestry (e.g., culture/origin)
  • Age (e.g., young adult renters)
  • Source of Income (e.g., contractors)
  • Section 8 Voucher (e.g., rental assistance)
  • Political Ideology (e.g., anarchist/socialist)
  • Unfavorable Discharge from Military Service 
  • Students

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