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Tex. Dep't of Hous. & Cmty. Affairs v. Inclusive Cmtys. Project, Inc.

Supreme Court of the United States

January 21, 2015, Argued; June 25, 2015, Decided

No. 13-1371

Case Summary

Overview

HOLDINGS: [1]-Where a nonprofit corporation asserted a disparate-impact claim against the Texas Department of Housing and Community Affairs under the Fair Housing Act (FHA), 42 U.S.C.S. § 3601 et seq., based on the Department's allocation of tax credits in predominantly black inner-city areas and predominantly white suburban neighborhoods, the Supreme Court determined that disparate-impact claims were cognizable under the FHA because of the FHA's results-oriented language, the Supreme Court’s interpretation of similar language in Title VII of the Civil Rights Act of 1964 and the Age Discrimination in Employment Act of 1967, Congress’s ratification of disparate-impact claims in 1988 against the backdrop of the unanimous view of nine Courts of Appeals, and the FHA's statutory purpose.

Outcome

Judgment affirmed and case remanded. 5-4 decision; 2 dissents.

LexisNexis® Headnotes

 

 

Business & Corporate Compliance > ... > Public Health & Welfare Law > Housing & Public Buildings > Fair Housing

Civil Rights Law > ... > Contractual Relations & Housing > Fair Housing Rights > Prohibited Conduct

Labor & Employment Law > Discrimination > Disparate Impact > Scope & Definitions

HN1  Housing & Public Buildings, Fair Housing

In contrast to a disparate-treatment case, where a plaintiff must establish that the defendant had a discriminatory intent or motive, a plaintiff bringing a disparate-impact claim challenges practices that have a disproportionately adverse effect on minorities and are otherwise unjustified by a legitimate rationale.

 

Business & Corporate Compliance > ... > Public Health & Welfare Law > Housing & Public Buildings > Fair Housing

Tax Law > Federal Income Tax Computation > Credits > General Overview

HN2  Housing & Public Buildings, Fair Housing

The Federal Government provides low-income housing tax credits that are distributed to developers through designated state agencies. 26 U.S.C.S. § 42. Congress has directed States to develop plans identifying selection criteria for distributing the credits. 26 U.S.C.S. § 42(m)(1). Those plans must include certain criteria, such as public housing waiting lists, § 42(m)(1)(C), as well as certain preferences, including that low-income housing units contribute to a concerted community revitalization plan and be built in census tracts populated predominantly by low-income residents. 26 U.S.C.S. § 42(m)(1)(B)(ii)(III), (d)(5)(B)(ii)(I). Federal law thus favors the distribution of these tax credits for the development of housing units in low-income areas.

 

Business & Corporate Compliance > ... > Public Health & Welfare Law > Housing & Public Buildings > Fair Housing

Tax Law > Federal Income Tax Computation > Credits > General Overview

HN3  Housing & Public Buildings, Fair Housing

In the context of low-income housing tax credits, under Texas law, a developer’s application for the tax credits is scored under a point system that gives priority to statutory criteria, such as the financial feasibility of the development project and the income level of tenants. Tex. Gov't Code Ann. § 2306.6710(a)-(b) (2008). The Texas Attorney General has interpreted state law to permit the consideration of additional criteria, such as whether the housing units will be built in a neighborhood with good schools. Those criteria cannot be awarded more points than statutorily mandated criteria.

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135 S. Ct. 2507 ; 192 L. Ed. 2d 514 ; 2015 U.S. LEXIS 4249 ; 83 U.S.L.W. 4555; 25 Fla. L. Weekly Fed. S 441

TEXAS DEPARTMENT OF HOUSING AND COMMUNITY AFFAIRS, et al., Petitioners v. THE INCLUSIVE COMMUNITIES PROJECT, INC., et al.

Notice: The LEXIS pagination of this document is subject to change pending release of the final published version.

Subsequent History: As Corrected July 2, 2015.

On remand at, Remanded by Inclusive Cmtys. Project, Inc. v. Tex. Dep't of Hous. & Cmty. Affairs, 795 F.3d 509, 2015 U.S. App. LEXIS 13779 (5th Cir. Tex., 2015)

Prior History:  [1] ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

Inclusive Cmtys. Project, Inc. v. Tex. Dep't of Hous. & Cmty. Affairs, 747 F.3d 275, 2014 U.S. App. LEXIS 5424 (5th Cir. Tex., 2014)

Disposition: 747 F. 3d 275, affirmed and remanded.