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NMHC/NAA have released a new white paper examining recent developments in the Department of Housing and Urban Development’s (HUD) rulemaking process and their issuance of guidance based on disparate impact liability under the Fair Housing Act (FHA). The document is intended to provide an in-depth review of the latest agency actions on disparate impact that are relevant to apartment owners, operators, developers and managers throughout the country.

Disparate impact theory provides legal recourse where a business practice or policy has a disproportionate impact on protected classes such as race and sex even when there is no intent to discriminate. NMHC/NAA has long-cautioned that necessary and routine business practices like criminal history checks, credit screening and other lease procedures could trigger discrimination claims under disparate impact theory.

This document provides greater clarity on recent decisions around disparate impact and the implications for the apartment industry.