NMHC and NAA continue to be strongly committed to the Fair Housing Act by providing equal housing opportunity for all without regard to race, religion, sex, national origin, disability or familial status. However, more clarity is needed on the applicability of disparate impact liability, which occurs when a business practice or policy has a disproportionately adverse effect on a protected class - regardless of whether the discrimination was intentional. And last summer’s landmark disparate impact ruling by the Supreme Court has helped to raise important questions from apartment owners and operators about seemingly neutral and common business policies - like occupancy limitations, criminal background screening and housing voucher policies - triggering discrimination claims. We continue to explore legislative, regulatory and legal remedies to help apartment firms avoid disparate impact claims.
NMHC and NAA Provide New Guidance on HUD’s Criminal Screening Policy
The new NMHC and NAA new white paper entitled, Criminal Conviction Screening Policies: Best Practices to Avoid Disparate Impact Liability, provides a detailed analysis of HUD’s recent fair housing guidance on criminal screening. HUD’s new policy seeks to extend protections for individuals with criminal histories by ending blanket exclusions of prospective residents based on criminal history in favor of a more individualized approach that is more narrowly tailored to achieve property safety and security goals.
While those with criminal histories are not a protected class under the Fair Housing Act, the HUD guidance relies on disparate impact theory. As a result, the white paper addresses a number of legal and operational concerns raised by the guidance. It explains the background behind the legal theories involved and raises potential conflicts between the guidance and legal precedent, most notably the Inclusive Communities Supreme Court case. The paper further discusses the authority of agency guidance and the role it plays in legal determinations. Finally, it analyzes each of HUD’s recommendations and policy interpretations and indicates best practices to avoid liability under the Fair Housing Act.
In addition, the paper specifically identifies elements that contribute to successful compliance operations. These include developing written policies and uniform procedures for criminal history screening. Policies should be well-justified and document the legitimate business needs for a firm’s criminal screening efforts. And importantly, staff must be appropriately trained in fair housing compliance and how to execute criminal screening policies.
Without question, President Obama has made no secret of his goals to reduce barriers to housing, employment and more for formerly incarcerated individuals. As part of this initiative, he established a Federal Interagency Reentry Council just last week and, in the area of multifamily housing specifically, he has continued to push to extend protections for individuals with criminal histories.
NMHC and NAA will continue to seek additional clarification about the reach of disparate impact liability and HUD’s enforcement efforts. We also remain focused on educating congressional leaders and Administration officials about the challenges that the multifamily industry faces as we strive to provide residents with safe and secure apartment communities.