HUD Releases Advance Notice to Amend Disparate Impact Rule

HUD released an advance notice of proposed rulemaking in the Federal Register on June 20, seeking public comment on possible amendments to HUD’s 2013 final rule implementing the Fair Housing Act’s disparate impact standard to ensure the rule is consistent with the U.S. Supreme Court decision in Texas Department of Housing and Community Affairs v. Inclusive Communities (see Memo6/29/15). Comments are due on August 20, 2018.

For many years HUD interpreted the Fair Housing Act to prohibit housing practices that have a discriminatory effect, even if there was no intent to discriminate. Eleven courts of appeals agreed. There were minor variations, however, in how the courts and HUD applied the discriminatory effects concept. Therefore, the February 15, 2013 regulation was issued to establish uniform standards for determining when a housing practice with a discriminatory effect violates the Fair Housing Act (see Memo2/8/13).

The final rule standardized a three-step “burden-shifting” approach that HUD has used and that a majority of appeals courts have applied.

  • First, the party complaining that there is a discriminatory effect has the burden of proving that a practice caused, or predictably will cause, a discriminatory effect.
  • Second, if the complaining party makes a convincing argument, then the burden of proof shifts to the defending party, which must show that the practice has a “legally sufficient justification,” meaning it is necessary to achieve a substantial, legitimate, nondiscriminatory interest that cannot be served by another practice that has a less discriminatory effect.
  • Third, if the defending party is successful, the complaining party can still succeed by demonstrating that the defending party’s substantial, legitimate, nondiscriminatory interest could be served by another practice that has a less discriminatory effect.

Read the advance notice of rulemaking at:

More about disparate impact is on page 7-1 of NLIHC’s 2018 Advocates’ Guide at: