HUD to Seek Public Comment on Disparate Impact Regulation

In a move long sought by the American Bankers Association, the Department of Housing and Urban Development signaled today that it will seek public comment on whether its rule implementing the Fair Housing Act discriminatory effects standard is consistent with the Supreme Court decision in Texas Department of Housing and Community Affairs v. Inclusive Communities Project.

The Supreme Court ruled in 2015 that “disparate impact” analysis to demonstrate discrimination claims is recognized under the Fair Housing Act, but included key limitations that placed the burden of proof in disparate impact cases with the plaintiffs.

“HUD remains committed to making sure housing-related policies and practices treat people fairly,” said HUD Secretary Ben Carson today. “We will always challenge any practice that discriminates against people the law protects.”

ABA and the state bankers associations have long called on the regulatory agencies to include the Supreme Court’s reasoning in formal guidance and exam procedures, and have previously committed to collaborating with HUD to develop a rule consistent with the legal precedent set by the Inclusive Communities decision.