The Corner

Obama Administration Issues ‘Disparate Impact’ Housing Regulations

The Obama administration yesterday (Friday, natch) issued regulations formally adopting a “disparate impact” approach to enforcing the Fair Housing Act. This means that you can be found liable for illegally discriminating in a housing-related matter by following some policy that has a disproportionate effect, even though the policy is nondiscriminatory by its terms, in its application, and in its intent. So, for example, if a bank’s lending policy for home loans results in, say, a higher percentage of Asians being accepted than Latinos, then it can be held liable (banks have been actively opposing the regulations, unsuprisingly).

The disparate-impact approach is bad law and bad policy, especially in the housing area, as discussed in this brief. Here’s hoping the Supreme Court grants review in a pending case out of Mt. Holly, N.J. — which raises this issue and in which a petition for review has been filed – and puts an end to this nonsense.