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WBK Industry News - Federal Regulatory Developments

HUD Issues Advance Notice of Proposed Rulemaking Regarding the Fair Housing Act’s Disparate Impact Rule

HUD has announced that it is reviewing the final rule implementing the Fair Housing Act’s disparate impact standard to determine whether its 2013 Disparate Impact Regulation is consistent with the 2015 U.S. Supreme Court ruling in Texas Department of Housing and Community Affairs vs. Inclusive Communities Project, Inc.

As HUD is in the process of considering changes, it is seeking public comment on whether the Disparate Impact Rule should be revised for law or policy reasons.  Specifically, HUD is requesting comments related to, among other things, the following:

  1. Does the Disparate Impact Rule’s burden of proof standard for each of the three steps of its burden-shifting framework clearly assign burdens of production and burdens of persuasion, and are such burdens appropriately assigned?
  2. Does the Disparate Impact Rule’s definition of “discriminatory effect” in 24 CFR 100.500(a) in conjunction with the burden of proof for stating a prima facie case in 24 CFR 100.500(c) strike the proper balance in encouraging legal action for legitimate disparate impact cases while avoiding unmeritorious claims?
  3. Should the Disparate Impact Rule provide defenses or safe harbors to claims of disparate impact liability (such as, for example, when another federal statute substantially limits a defendant’s discretion or another federal statute requires adherence to state statutes)?
  4. Are there revisions to the Disparate Impact Rule that could add to the clarity, reduce uncertainty, decrease regulatory burden, or otherwise assist the regulated entities and other members of the public in determining what is lawful?

All comments are due to HUD on August 20, 2018.

More information regarding the Notice of Proposed Rulemaking can be found here.