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Texas Department of Housing and Community Affairs
The case involves an appeal from Texas officials accused of violating the Fair Housing Act. Photograph: Eric Gay/AP
The case involves an appeal from Texas officials accused of violating the Fair Housing Act. Photograph: Eric Gay/AP

US supreme court upholds key provision banning racial bias in housing

This article is more than 8 years old

Ruling is a victory for fair housing advocates, after Texas officials were accused of using tax credits to keep low-income housing out of white neighborhoods

The US supreme court on Thursday upheld a key anti-discrimination provision in one of the most cherished civil rights landmarks, the 1968 Fair Housing Act.

Signed into law a week after the death of Martin Luther King, the act forbids housing-related discrimination. Under a doctrine called “disparate impact”, it had long been interpreted as banning not only overt unfairness but also policies that were unintentionally biased, such as zoning strategies that inadvertently promoted segregation, as well as more subtle tactics that make it harder for minorities to live where they want to.

Civil rights activists argued that ending disparate impact would mean that those bringing discrimination claims would face the tough task of proving decision-makers’ mindsets, rather than the objective real-world consequences of their actions. They contend that the act is a valuable means to remedy unfair behaviour that remains widespread.

Given that in 2013 the court eliminated another protective measure from the civil rights movement era – part of the voting rights act – the decision was not widely predicted.

“Today was a sweeping victory, a solid victory … the court recognised the long history of housing discrimination,” Lisa Rice, executive vice-president of the National Fair Housing Alliance, told the Guardian.

“The people who are opposed to the Fair Housing Act have been trying really hard and for a long time to undo it and weaken it so when you’re met with a lot of opposition it can get deflating.”

Using Twitter, leading 2016 Democratic presidential candidate Hillary Clinton welcomed the court’s decision:

Everyone deserves to live free from discrimination. Glad the Supreme Court did the right thing to #KeepHousingFair. -H

— Hillary Clinton (@HillaryClinton) June 25, 2015

Craig Flournoy, chair of the ICP, told the Guardian he was “absolutely overjoyed and glad to see that the supreme court agrees with our case … ‘Disparate impact’ is the single most important tool available in the law to fight segregation in housing.”

He said that he hoped the ruling will give fresh momentum to those battling discrimination. “All that’s really left is for housing advocates and government officials to use that weapon rather than doing nothing,” he said. “A law without action is a useless tool … [The decision] really is a start not an ending.”

The financial crisis shone a spotlight on the lending practices of some institutions. In 2011 the US Department of Justice reached a $335m settlement with Countrywide Financial, which the government alleged charged more than 200,000 black and Hispanic borrowers higher fees than whites or placed them into subprime loans between 2004 and 2008.

But some banks, housing agencies and developers were keen to see the court rule against disparate impact on the basis that it limits their flexibility and unfairly exposes them to possible legal action regardless of their intentions.

“Recognition of disparate-impact claims is consistent with the FHA’s central purpose,” justice Anthony Kennedy wrote in the majority opinion, though the majority cautioned that their ruling was limited in scope and should not be interpreted as giving the green light for courts to impose racial targets or quotas.

“Courts should avoid interpreting disparate-impact liability to be so expansive as to inject racial considerations into every housing decision,” Kennedy wrote in the 5-4 decision.

“Much progress remains to be made in our Nation’s continuing struggle against racial isolation … we must remain wary of policies that reduce homeowners to nothing more than their race. But since the passage of the Fair Housing Act in 1968 and against the backdrop of disparate-impact liability in nearly every jurisdiction, many cities have become more diverse.

“The FHA must play an important part in avoiding the Kerner Commission’s
grim prophecy that ‘[the] nation is moving towards two societies, one black, one white – separate and unequal’ … the court acknowledges the Fair Housing Act’s continuing role in moving the nation toward a more integrated society.”

The case stemmed from a lawsuit filed by a Dallas-based nonprofit called the Inclusive Communities Project (ICP) in 2008. It sued the Texas department of housing and community affairs on the basis that it was disproportionately approving tax credits for affordable housing in minority neighbourhoods rather than white neighbourhoods, effecting a form of segregation.

The genesis of the McKinney pool party incident earlier this month that sparked the latest debate about violent encounters with police and African Americans was an alleged insult that prompted a fight: “Go back to your Section 8 home.”

That referred to a federal programme that provides housing subsidies. In McKinney, affordable housing developments are concentrated in the eastern part of the Dallas suburb, while middle-class subdivisions such as Craig Ranch, the location of the pool, are in the west.

The ICP previously brought a lawsuit against McKinney, settled out of court, in which it accused the city’s housing policies of perpetuating racial segregation.

In a dissent, justice Clarence Thomas wrote that the issue was complex and “racial imbalances do not always disfavour minorities”, and made a reference to the majority of NBA basketball players being black.

“We should not automatically presume that any institution with a neutral practice that happens to produce a racial disparity is guilty of discrimination until proved innocent,” he wrote.

In another long dissent which echoed Thomas’s by noting the large number of black players in the 2015 NFL draft, justice Samuel Alito said that the decision was inconsistent with the language of the act and the intentions of Congress and could have a negative impact, because “when disparate impact is on the table, even a city’s good-faith attempt to remedy deplorable housing conditions can be branded ‘discriminatory’”.

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