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Schwemm Paper Cited by Department of Housing and Urban Development

A paper written by Robert G. Schwemm, Ashland-Spears Distinguished Research Professor at the University of Kentucky College of Law, has led to the adoption of final regulations by the Department of Housing and Urban Development (HUD) endorsing use of the “discriminatory effect” standard under the federal Fair Housing Act.

Every anti-discrimination law prohibits intentional discrimination some also ban practices that unjustifiably harm minorities, even if such practices have not been adopted with a discriminatory intent. In Fair Housing Act cases, examples of practices that might be held illegal under a discriminatory effect theory include:

  • a city’s zoning ordinance that allows only families to live in certain areas (which might foreclose “group homes” for disabled persons)
  • a bank’s policy of not providing mortgages unless would-be borrowers have a certain minimum down-payment or credit score (which might disqualify more minorities than whites)
  • a home insurer’s practice of not issuing policies on homes with less than a certain value (such homes are disproportionately owned by minorities)
  • a landlord’s policy of not accepting tenants who aren’t U.S. citizens or can’t speak English (which would disproportionately disqualify people of certain national origins) or whose ability to pay depends on a source of income like alimony or Social Security (which could negatively impact women or disabled people).

Under the new HUD regulations, such practices could violate the Fair Housing Act, at least if potential defendants could not prove that the challenged practice is needed for a legitimate, nondiscriminatory purpose. Often they can’t, Schwemm noted, because such policies and practices have been adopted with little or no thought or maintained for years after their original rationale is no longer relevant.

Schwemm’s paper, which was co-authored by Sara Pratt (now a senior civil rights official at HUD), was presented to the Obama Administration by civil rights organizations in 2010. The paper was also published on Social Science Research Network, from which it has been downloaded more than 480 times (download here). The paper called for HUD to confirm that a discriminatory effect standard existed under the Fair Housing Act, an issue that the Supreme Court has never ruled on.

HUD’s publication of the new regulations, which appeared in the Federal Register on Feb. 15 and will become effective on March 18, is likely to be deferred to by the courts and thus will control future Fair Housing Act litigation. The HUD regulations, though focused primarily on harmful outcomes, can also help root out intentional discrimination, which is often difficult to prove. The regulations also affirm that the Fair Housing Act bans practices that create or perpetuate racially segregated housing patterns.

HUD had issued a proposed regulation in 2011, which produced scores of comments from fair housing and legal aid organizations, state and local law enforcement and housing officials, public housing agencies, trade associations, insurance companies, mortgage lenders, credit unions, banking trade associations, and real estate agents. One commentator was the NAACP Legal Defense and Educational Fund, Inc., the nation's leading civil rights litigation organization, whose Washington office Director Leslie Proll, said: “Issuance of the HUD regulation has long been a top priority for LDF. The federal government’s official imprimatur will reinforce the courts’ and federal agencies’ longstanding and consistent interpretation of the Fair Housing Act. This regulation will promote stronger fair housing enforcement across communities and in all aspects of the housing market. This is a very good day for fair housing.”

Professor Schwemm regularly augments his research with advice to government agencies and litigators involved in housing discrimination cases. His treatise, "Housing Discrimination: Law and Litigation," is considered the premier work in the field, and he has represented plaintiffs in three fair housing cases in the U.S. Supreme Court. Schwemm, who has taught at UK since 1975, served as interim dean of the College of Law in 1998-99.