REFinBlog

June 25, 2015

SCOTUS Upholds Disparate Impact

Texas Department of Housing and Community Affairs

The United States Supreme Court held today that disparate-impact claims are cognizable under the Fair Housing Act in Texas Department of Housing and Community Affairs et al. v. The Inclusive Communities Project Inc., (No 13-1371). The conventional wisdom had been that the Court was going to hold that the Fair Housing Act “does not create disparate-impact liability”  (in the words of Justice Alito’s dissent at page 2).

I found it striking the extent to which Justice Kennedy’s opinion, which was joined by Justices Ginsburg, Breyer, Sotomayor and Kagan, relied on the history of residential segregation in the United States. For those of us steeped in the history of housing in America, this history is pretty much standard, but it takes on a lot of meaning when it is restated in a Supreme Court opinion. The opinion reads,

De jure residential segregation by race was declared unconstitutional almost a century ago, but its vestiges remain today, intertwined with the country’s economic and social life. Some segregated housing patterns can be traced to conditions that arose in the mid-20th century. Rapid urbanization, concomitant with the rise of suburban developments accessible by car, led many white families to leave the inner cities. This often left minority families concentrated in the center of the Nation’s cities. During this time, various practices were followed, sometimes with governmental support, to encourage and maintain the separation of the races: Racially restrictive covenants prevented the conveyance of property to minorities; steering by real-estate agents led potential buyers to consider homes in racially homogenous areas; and discriminatory lending practices, often referred to as redlining, precluded minority families from purchasing homes in affluent areas. By the 1960’s, these policies, practices, and prejudices had created many predominantly black inner cities surrounded by mostly white suburbs.

The mid-1960’s was a period of considerable social unrest; and, in response, President Lyndon Johnson established the National Advisory Commission on Civil Disorders, commonly known as the Kerner Commission. After extensive factfinding the Commission identified residential segregation and unequal housing and economic conditions in the inner cities as significant, underlying causes of the social unrest. The Commission found that “[n]early two-thirds of all nonwhite families living in the central cities today live in neighborhoods marked by substandard housing and general urban blight.” The Commission further found that both open and covert racial discrimination prevented black families from obtaining better housing and moving to integrated communities. The Commission concluded that “[o]ur Nation is moving toward two societies, one black, one white— separate and unequal.” To reverse “[t]his deepening racial division,” it recommended enactment of “a comprehensive and enforceable open-occupancy law making it an offense to discriminate in the sale or rental of any housing . . . on the basis of race, creed, color, or national origin.”

In April 1968, Dr. Martin Luther King, Jr., was assassinated in Memphis, Tennessee, and the Nation faced a new urgency to resolve the social unrest in the inner cities. Congress responded by adopting the Kerner Commission’s recommendation and passing the Fair Housing Act. (5-6, citations omitted)

This straightforward acknowledgment of the history of racial discrimination in America may be the most powerful part of this opinion.