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What Constitutes Housing Discrimination?

The U.S. Supreme Court was set to consider whether a policy that appears neutral on its face but in implementation disproportionately affects protected classes of people (a legal test known as “disparate impact”) violates federal housing law. However, before oral argument occurred the petitioner dismissed its appeal.

Background

AARP’s friend of the court brief in Magner v. Gallagher argued that disparate impact should be included under the federal Fair Housing Act (FHA) because it is necessary to affect the law’s intent. As the brief notes, Congress explicitly intended the FHA to address discrimination in zoning and land use policies that “have the effect of limiting the ability of such individuals to live in the residence of their choice in the community” even if the offending laws were not intended to discriminate.

The FHA’s prohibition against discrimination based on disability is especially important to the goal of aging in place. AARP’s brief cited cases (including those brought by AARP attorneys) in which older residents in rental housing, age restricted, assisted living and continuing care retirement communities challenged exclusionary rules that appeared nondiscriminatory but had a discriminatory effect.

In addition to submitting AARP’s brief in Magner, AARP Foundation Litigation attorneys represent residents challenging a 2003 Mount Holly, N.J., redevelopment plan that calls for the acquisition by eminent domain and subsequent demolition of hundreds of homes in “the Gardens,” a cohesive, racially integrated, ethnically diverse community built in the 1950s. Only 20 percent of Gardens residents are white (compared with 66 percent for all of Mount Holly), 90 percent have annual incomes of less than $40,000, one in seven is age 65 or older. The redevelopment plan hits the older homeowners (especially those on fixed incomes who have paid off their mortgages) particularly hard because they will never find a replacement house for the value of their current paid-off house. Despite challenges to the plan, the Township began acquiring and vacating properties, causing neighborhood deterioration and dropping property values of the holdout homeowners.

Under the disparate impact analysis, the residents established that there was an adverse disparate impact on African American and Hispanic residents. Following the logic argued in Magner, the Township would now be required to show that there was a legitimate justification for the redevelopment plan. If it could, the next step would be to determine if there are any less discriminatory alternative methods to accomplishing that purpose. This was precisely what the U.S. Court of Appeals for the Third Circuit’s ruled in the Mount Holly case, but then stayed that decision pending a ruling on Magner.

After the appeal to the Supreme Court was withdrawn, taking Magner off the table, the Mount Holly case will now proceed in the District Court.


What’s at Stake

The Fair Housing Act is a critical tool that removes impediments to the ability of people to age in place in their homes and communities by allowing them to challenge all types of discrimination in the housing market. If the ability of those affected by discrimination to bring cases under a disparate impact theory were limited or ended, older people would no longer be able to challenge neutral policies that had clearly discriminatory affects based on disability, race or other protected classes. It would be harder to challenge many potentially illegal practices that limit their options for long term residential care and lives of dignity and independence as they age.

Disparate impact tests enable a wider range of workable long term care solutions in assisted living facilities, and other types of residences where people choose to live together or to have their services delivered. Discrimination against older residents and homeowners who are minorities and people with disabilities that impede their ability to age in their homes and communities are often dressed up in what appear to be neutral policies. The rights of these people are threatened unless disparate impact challenges under the FHA remain cognizable.

Status of the Case

Magner v. Gallagher was before the U.S. Supreme Court until it was withdrawn by petitioners.

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