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HUD Final rule on Discriminatory Effects in Housing

HUD announced it is issuing the final rule to formalize a standard on discriminatory effects in housing. The rule, “Implementation of the Fair Housing Act’s Discriminatory Effects Standard,” was sent to the Federal Register for publication. It will take effect 30 days after the date of publication.

According to HUD, the final rule:

· Formalizes HUD’s  long-held recognition of discriminatory effects liability under the Fair Housing Act;

· Formalizes a burden-shifting test for determining whether a given practice has an unjustified discriminatory effect, leading to liability under the Act;

1. The charging party or plaintiff first bears the burden of proving its prima facie case that a practice results in, or would predictably result in, a discriminatory effect on the basis of a protected characteristic;

2. If the charging party or plaintiff proves a prima facie case, the burden of proof shifts to the respondent or defendant to prove that the challenged practice is necessary to achieve one or more of its substantial, legitimate, nondiscriminatory interests;

3. If the respondent or defendant satisfies this burden, then the charging party or plaintiff may still establish liability by proving that the substantial, legitimate, nondiscriminatory interest could be served by a practice that has a less discriminatory effect.

· Adds to and revises illustrations of discriminatory housing practices found in HUD’s Fair Housing Act regulations.

Interested members can view the final rule here.

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