Justice Department Secures Settlement in Discrimination Lawsuit for Blocking Affordable Housing Development

The Justice Department announced today that the Town of Franklinton (Franklinton), Louisiana, has agreed to pay $230,000 in damages and civil penalties to settle allegations that it violated the Fair Housing Act when it blocked a proposed affordable housing development for low-income tenants in a predominantly white part of Franklinton.

Under the agreement, Franklinton will also facilitate the development of new affordable housing to replace the units that it previously blocked, amend its zoning ordinance to increase the amount of land available for the development of multi-family housing and create a land donation program to support the development of affordable housing.   

“Developing affordable housing in high opportunity neighborhoods can have a transformative impact on the livelihoods of low-income residents of all races,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Fair Housing Act prohibits cities and towns from blocking low-income housing development because they believe that Black people will make up a large share of the future residents. Officials must ensure that affordable housing opportunities are made available and that all families have access to them regardless of race. The Justice Department will continue to hold jurisdictions accountable when they abuse their zoning power to deny equal access to housing opportunity.”

“Access to affordable housing free from discrimination is a right bestowed upon all Americans,” said U.S. Attorney Duane A. Evans for the Eastern District of Louisiana. “Denying affordable housing development for low-income individuals delays full achievement of the American Dream. The successful resolution of this Fair Housing Act matter provides low-income residents with the resources needed to achieve generational success.”

The complaint, filed on June 27, alleges that Franklinton discriminated because of race and color when it refused to approve zoning for a 40-unit development called Quail Run that would have been financed through the federal Low Income Housing Tax Credit (LIHTC), a tax incentive that subsidizes the construction and rehabilitation of rental housing affordable to low-income tenants. Franklinton is highly segregated, and although approximately 48% of its population is Black, that population is concentrated in the town’s north side. Quail Run would have been built on the south side, in a neighborhood that is over 80% white. Over 80% of Black households in Franklinton qualify as low-income and Black residents would have been significantly more likely than white residents to qualify to live in Quail Run. The construction of Quail Run would have disproportionately provided much needed housing opportunities to Black families in the part of Franklinton where the residents are predominantly white. 

As alleged in the complaint, Franklinton’s Zoning Commission unanimously recommended that Franklinton grant zoning approval for the development of Quail Run. However, the Mayor refused to consider the Zoning Commission’s recommendation and the town later denied Quail Run’s zoning application without the City Council ever holding a vote on the matter. As a result of Franklinton’s action, the developers had to return the tax credits and were not able to develop housing and the land remained vacant. The developers filed a complaint with the Department of Housing and Urban Development (HUD), which later referred the matter to the Justice Department.

“Low-income residents should have equal access to affordable housing in well resourced, low poverty neighborhoods,” said Principal Deputy Assistant Secretary Diane Shelley of HUD’s Office for Fair Housing and Equal Opportunity. “Jurisdictions that deny the development of affordable housing in neighborhoods for fear that future residents will be a certain race perpetuate segregation and violate the Fair Housing Act, which remains as important today as it was in 1968. HUD is proud to work with the Justice Department to root out illegal discrimination and uphold civil rights law.”

Under the settlement, which was approved on Friday June 28 by the U.S. District Court for the Eastern District of Louisiana, Franklinton will, among other things:

• pay $205,000 in damages to Quail Run’s developers and $25,000 in a civil penalty to the United States;
• approve and support the development of at least 40 units of affordable housing to replace the number of units that would have been included in the Quail Run development;
• rezone at least 20 acres of available land to make it available for the development of affordable housing;
• create a land donation program to support the development of affordable housing;
• revise its zoning procedures to increase transparency and ensure that uniform non-discriminatory standards are applied in Franklinton’s residential land use decisions;
• provide training on fair housing and zoning procedures to its officials and employees who are involved in land use and zoning; and
• hold a public listening session on the town’s need for housing and host an educational program for Franklinton’s residents to learn about their fair housing rights.

Individuals who believe they have been victims of housing discrimination practices can file a complaint at fairhousingflorida.com or call 561-533-8717.

FHC files Federal Lawsuit alleging Florida SB264 Housing Law violates Federal Fair Housing Act

Today the Fair Housing Center of the Greater Palm Beaches, Housing Opportunities Project for Excellence (H.O.P.E., Inc.), National Fair Housing Alliance (NFHA) and the Asian Real Estate Association of America (AREAA) filed a fair housing discrimination suit in federal court in Miami challenging Florida’s SB 264, a state law that greatly restricts people from China, Russia, Iran, North Korea, Cuba, Venezuela, and Syria from purchasing real property in the state.

The law almost completely prohibits Chinese citizens and people domiciled in China from buying property in the state. People domiciled in one of the other six countries are prohibited from buying real property within ten miles of critical infrastructure facilities or military institutions—a restriction that covers 98.5% of all residential land in the state.

“Xenophobia has no place in our country—and let there be no mistake, that’s precisely what SB 264 is,” said Noah Baron, Assistant Director of Litigation at Advancing Justice – AAJC. “This legislation echoes last century’s ‘alien land laws,’ which also restricted the property rights of Asian Americans on the basis of stereotypes and prejudice. The United States must not continue down this dangerous road; we know where it leads because we have traveled it before: during World War II when unfounded suspicions of Japanese Americans led to the forced imprisonment of over 120,000 Japanese Americans by the U.S. government and going as far back as the 1882 Chinese Exclusion Act.” 

“The people of Florida deserve better than a government that says ‘you are not welcome’ to large groups of people just because they were born in a particular country,” said Vince Larkins, President and CEO of Fair Housing Center for the Greater Palm Beaches. “We cannot sit idly by while housing discrimination is now the official policy of the State of Florida.”

The lawsuit filed by Relman Colfax, Asian Americans Advancing Justice – AAJC, and Courtney Cunningham asserts that SB 264 violates the federal Fair Housing Act, which prohibits acts that are motivated by a person’s national origin or have a disproportionate harmful effect on people from specific countries. As described in the complaint, SB 264 is based on stereotyped and xenophobic generalizations, and is transparently motivated by discrimination against people from the seven targeted countries.

“SB 264 is reminiscent of early twentieth century land laws that attempted to prevent Asian and other immigrants deemed undesirable from settling in the United States. This law is one of the most discriminatory housing prohibitions this country has seen since the Fair Housing Act was passed in 1968. Legislation such as this prevents people from purchasing homes and becoming, or continuing to be, valued members of the community. SB 264 cannot be permitted to stand,” said Keenya Robertson, President and CEO of Housing Opportunities Project for Excellence, Inc.

“This is a momentous day for AREAA and our 19,000 members as it is the first time we have filed suit to protect the rights of the AANHPI community,” said Jamie Tian, President of AREAA. “SB 264 must be defeated. Florida legislators and Governor DeSantis have wrongly targeted Chinese, and other select groups of immigrants. They have opened the door for greater discrimination while creating increased barriers of homeownership entry for prospective AANHPI homebuyers and sellers. My parents came to the U.S. from China as PhD candidates and they eventually bought a home in Irvine, California. I shudder to think about what my parents would have gone through today if they had settled in Florida. It’s infuriating to realize we now live in a reality where government leaders are putting homeownership out of reach for AANHPI people in Florida.”

The law was promoted by Governor DeSantis who described it as part of an effort to prevent people from certain countries from “worming” their way into American society. The bill’s sponsor described it as targeting foreign agents, but its broad sweep captures people lawfully in the United States and vetted by immigration officials such as people on student visas, domestic employment and seasonal worker visas, and visas for victims of criminal activity and human trafficking. People from the targeted countries who already own property in the state are required to register with the Florida Department of Commerce. The penalties for violating the law include felonies punishable by as much as five years imprisonment and can be applied to buyers, sellers, and real estate professionals.

“The federal Fair Housing Act was signed into law to eliminate the race-based barriers to housing that have plagued our nation since its inception. SB 264 is contrary to the spirit of our nation’s fair housing laws and tramples on the rights of people of Asian descent and other immigrants. It sends the dangerous message that discrimination in housing based on national origin is acceptable in the state of Florida,” said Lisa Rice, President and CEO of the National Fair Housing Alliance. “We look forward to vindicating the fair housing rights of Asians and other immigrants in Florida and making it possible for them to secure stable housing.”

The sponsors’ defense of the bill is to cite national security concerns, but people from the targeted countries make up a tiny percentage of all residential property buyers in the state and the legislative record identified no link between the purchase of residential property and security threats. With no basis, SB 264 explicitly targets individuals from the seven targeted countries for disfavored treatment while imposing no similar restrictions on nationals of any other country. The legislation impedes the pursuit of the American dream for families from China and the other countries who aspire to build a life in this country free from discrimination.

“It is our expectation that the court will find this explicitly discriminatory law as a violation of the Fair Housing Act and strike it down,” said Reed Colfax, a partner with Relman Colfax. 

To view the full complaint click here.

HUD Commemorates National Fair Housing Month

WASHINGTON – Today, Adrianne Todman, Acting Secretary of the U.S. Department of Housing and Urban Development (HUD), released the following statement in commemoration of Fair Housing Month and the signing of the Fair Housing Act of 1968, which prohibits discrimination on the basis of race, color, national origin, religion, sex (including sexual orientation and gender identity), disability, and familial status.

“For more than half a century, the federal government has sought to end discrimination in housing through enforcement of the Fair Housing Act. Under the Biden-Harris Administration, the Department of Housing and Urban Development takes its responsibilities under that law and other civil rights laws very seriously and works diligently to ensure people have full access to housing that meets their needs,” said HUD Acting Secretary Adrianne Todman. “Everyone in this country deserves to live free from discrimination, bias, and danger. This Fair Housing Month, we are recommitting ourselves to the important work of protecting individuals and families across America from harm.”

This year’s Fair Housing Month theme, Fair Housing: The ‘Act’ in Action, underscores the Biden-Harris Administration’s commitment to combating discrimination in housing, protecting fair housing rights for all who call America home, and redressing our nation’s past discriminatory policies and practices.

“This April, we reflect on the hard-fought battle for fair housing and recommit efforts to eliminate discrimination and disparities in housing across our country” said Demetria L. McCain, Principal Deputy Secretary for Fair Housing and Equal Opportunity. “This month and every month, HUD is taking meaningful action to advance housing justice and protect the rights of all people to live free from discrimination in the homes of their choice, regardless of their race, color, religion, national origin, sex (including sexual orientation or gender identity), disability, or familial status.”

Each April, HUD recognizes Fair Housing Month alongside communities, fair housing advocates, and fair housing organizations to underscore the significance of the Fair Housing Act, raise public awareness of fair housing rights and responsibilities, highlight fair housing enforcement efforts, and emphasize the importance of creating diverse and inclusive communities.

HUD will commemorate Fair Housing Month with an Opening Ceremony on April 11, 2024, at 2:00 P.M. (EDT), that will showcase HUD’s efforts to advance and protect fair housing rights to ensure that all people have the right to obtain the housing of their choice, free from discrimination. Register to attend the Fair Housing Month Opening Ceremony here. There is no cost to register. For a complete listing of HUD Fair Housing Month events and activities, visit: https://www.hud.gov/FHM. Follow the Office of Fair Housing and Equal Opportunity on Facebook for additional news and updates.

Mortgage Giant loanDepot.com Commits to Industry-Leading Best Practices for “Reconsideration of Value” in Settlement of Appraisal Discrimination

A landmark settlement has been reached with loanDepot.com, LLC, one of the ten largest residential mortgage lenders in the country, resolving a federal appraisal discrimination lawsuit brought against the lender.

Relman Colfax filed the case on behalf of homeowners Drs. Nathan Connolly and Shani Mott, a Black couple living in the mostly white historic neighborhood of Homeland in Baltimore, Maryland. The couple applied to loanDepot to refinance their mortgage and loanDepot had the home appraised by Shane Lanham of 20/20 Valuations, LLC. Drs. Connolly and Mott alleged that the appraisal was discriminatory on the basis of race, and that loanDepot discriminated and retaliated against them by failing to overturn the appraisal and/or have a new one conducted. The discrimination claims against Defendants Lanham and 20/20 Valuations remain pending.

Recognizing that fair and accurate appraisals are critically important to protecting the fair housing and fair lending rights of people of color, loanDepot commits in the settlement to maintain or implement a comprehensive set of industry-leading policies and practices for the “reconsideration of value” (ROV) process in mortgage lending. loanDepot will make clear to applicants that they can ask loanDepot to reconsider an appraisal if they believe it is flawed. loanDepot will explain how to make an ROV request, maintain a clear and thorough internal process for timely addressing them, escalate any that allege discrimination, and explain any denials in writing. Second appraisals will be ordered if loanDepot identifies any indicia of discrimination. Applicants will not be charged to utilize the ROV process.

loanDepot will require its employees to attend training on appraisal discrimination and appraisers to certify that they have not been found to have discriminated. The company will not utilize appraisers who cannot meet this certification requirement or if bias is identified. It will also conduct statistical analyses of appraisals and ROVs to identify any possible discrimination, maintain records, and report its findings. The settlement also provides for a payment to Drs. Connolly and Mott. The Settlement Agreement, which sets forth the required ROV best practices in greater detail, is available here.

Dr. Connolly stated that he is “pleased that loanDepot has agreed to these important best practices for ROVs and hopes that other lenders will follow loanDepot’s lead and commit to comparable policies and procedures.” While loanDepot denies the allegations in the litigation, it engaged constructively throughout the settlement process, demonstrating a commitment to combat bias in lending. 

The Relman Colfax litigation team includes John Relman, Reed Colfax, Jennifer Klar, Glenn Schlactus, Soohyun Choi, Gabriel Diaz, and David DePriest, with paralegal assistance from Don Scales, Max Niles, and Jazmin Trenco.