Nearly lost in the uproar over end-of-term rulings on Obamacare and same-sex marriage, the Supreme Court’s surprise decision in a “disparate impact” housing case may soon be seen as being every bit as consequential as the term’s major newsmakers. The Court’s 5–4 ruling in Texas Department of Housing and Community Affairs v. Inclusive Communities Project has green-lighted one of the Obama administration’s most transformative and controversial initiatives, and probably injected a major new issue into the 2016 presidential campaign.
The Fair Housing Act of 1968 prohibits intentional discrimination on the basis of race, color, religion, sex, familial status, or national origin. The question before the Court in the Texas case was whether housing policies that are not clearly discriminatory, but neutral on their face, can nonetheless be outlawed because they have “disparate impacts” on various groups. A bank, for example, can condition its home loans on a certain credit rating, with no discriminatory intent. But a disparate-impact suit could target this policy for its disproportionate effect on minority home-buyers.
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