SMU Law Review Forum

The Uncertain Future of the Fair Housing Act: HUD’s Recent Changes to the Disparate Impact Standard

Leah Powers, Southern Methodist University, Dedman School of LawFollow

Abstract

In 2013, the Department of Housing and Urban Development (HUD) published its Disparate Impact Final Rule in which it sought to formalize its longstanding interpretation of disparate impact liability under the Fair Housing Act (FHA) by setting forth a three-part burden-shifting framework. HUD subsequently revisited its disparate impact standard following the 2015 Supreme Court ruling in Inclusive Communities and published a Proposed Rule on August 19, 2019. On September 24, 2020, HUD published a new Final Rule substantially altering the disparate impact standard laid out by the 2013 Rule.

This Comment will analyze the similarities and differences between the disparate impact standard in the 2013 Rule and the standard set forth in the current, 2020 Rule. Additionally, given that the 2020 Rule was drafted in response to Inclusive Communities, this Comment will examine whether, and to what extent, the 2020 Rule is consistent with the Court’s ruling. Finally, this Comment will address the criticism leveled at the 2020 Rule by fair housing advocates and explore potential consequences of the new standard. Ultimately, this Comment will argue that, although the 2020 Rule finds some textual support in Inclusive Communities for several elements of its new framework, given the broad remedial purpose of the FHA, the core mission of HUD to eradicate housing discrimination, the potential, negative consequences of the new standard, and President Biden’s recent memorandum on housing discrimination, HUD should abandon the 2020 Rule and readopt the 2013 Rule.