CUNA followed up its letter last week to the Department of Housing and Urban Development (HUD) with a joint letter reiterating the call for HUD to align the 2013 disparate impact final rule with the standards established by the U.S. Supreme Court.
HUD’s 2013 disparate impact rule codified HUD’s interpretation that the Fair Housing Act (FHA) creates liability for practices with an unjustified discriminatory effect, even if those practices were not motivated by discriminatory intent.
The Supreme Court’s 2015 Inclusive Communities decision held that disparate impact claims are identifiable under the FHA.
“The inconsistencies between the 2013 Final Rule and the Inclusive Communities decision cast needless uncertainty on business decision-making,” the joint letter reads. “It is important that HUD amend its Fair Housing regulations to reflect the subsequent standards articulated by the Supreme Court. Doing so will provide businesses with the clarity needed to ‘sustain a vibrant and dynamic free-enterprise system.’”
Specifically, the organizations note that the HUD’s 2013 final rule is not—as Inclusive Communities requires—appropriately calibrated to prevent disparate impact liability from unfairly penalizing “practical business choices.”
The Supreme Court’s decision holds that claims for disparate impact must establish “robust causality” between an impermissible disparity and a “specific policy” that is “artificial, arbitrary and unnecessary.”