Once upon a time, a group of landlords sued the city of St. Paul, arguing that city housing inspections had overreached and forced them — and thus their low-income, predominantly minority tenants — from livable properties. That’s an illegal taking, they said, and a direct violation of the federal 1968 Fair Housing Act, which protects minorities and other protected classes of individuals from housing discrimination.
The city argued otherwise. Pointing to low-cost apartment rentals with holes in the interior and exterior walls that allowed in the elements, faulty wiring, units without heat, and rat infestations, city officials effectively called these property owners slumlords. The lawsuits went to court, and in some cases were bundled together. The legal process, begun in 2004 and 2005 and expected by some to take months, has taken more than a decade, roping in top officials in the Obama administration. And it’s still not over.
Finally, the Supreme Court has ruled on something…
Leading plaintiffs, Thomas Gallagher and Joseph Collins, have since settled their case with the city of St. Paul, but other legal challenges wrapped up in the suit remain in the federal trial court pipeline, awaiting a decision from the U.S. Supreme Court on similar Fair Housing Act cases. (And, as Bob points out, other cases are out there.)
The Texas case focused on the impact of housing tax credits, which had been distributed by the state to developers building affordable housing. The Inclusive Communities Project alleged that regardless of intent, the impact was discriminatory — a heavy concentration of affordable housing in poor minority neighborhoods. As in Magner v. Gallagher, housing advocates worried that the conservative Supreme Court justices would use the case to gut “disparate impact” as a legal argument entirely, raising the bar for housing discrimination cases and forcing advocates to prove intent. (That, in turn, could have a spillover effect, and undermine federal legal cases against predatory lending and discriminatory financial practices).
The Magner v. Gallagher case has led down all sorts of legal and political rabbit holes. In a 68-page report, Republican lawmakers seized on efforts by U.S. Labor Secretary Thomas Perez — back when he was assistant U.S. Attorney General in the civil rights division — to convince the city of St. Paul not to take Magner v. Gallagher to the Supreme Court. Perez reportedly flew into St. Paul for an in-person heart-to-heart with the mayor. Former U.S. Vice President Walter Mondale, who authored the Fair Housing Act, was no less persuasive. So were dozens of rights groups, from the NAACP to national housing advocates. St. Paul agreed, and withdrew the case with 20 days to go.
Says this Wall Street Journal editorial from March 2013:
“On February 3, 2012, Mr. Perez and his deputy, special counsel for fair lending Eric Halperin, met in St. Paul with Mayor Coleman, Deputy Mayor Paul Williams, City Attorney Grewing and Mr. Lillehaug. Our sources say that Mr. Lillehaug and Ms. Grewing told Congressional investigators that Mr. Perez talked about the importance of disparate impact, mentioned Mr. Mondale’s concern and proposed another deal: Justice would decline to intervene in Newell, the city would withdraw its Supreme Court case, and then the feds would also decline to intervene inEllis. The mayor agreed.”
Whatever the political ramifications or near-ramifications of the legal battles to date, housing advocates appear delighted with the Supreme Court’s 5-4 decision in Texas v. The Inclusive Communities Project, and are letting the world know. The Obama administration appears equally pleased.
A selection from published statements:
THE WHITE HOUSE Office of the Press Secretary FOR IMMEDIATE RELEASE June 25, 2015
Statement by the Press Secretary on the U.S. Supreme Court Ruling in Texas Department of Housing and Community Affairs v. Inclusive Communities Project Inc.
The Court’s decision affirms that the Fair Housing Act enables Americans to challenge not only laws, policies, and practices that are intentionally discriminatory, but also those that have an unjustified discriminatory effect.
Too many Americans are victims of more subtle forms of discrimination, such as predatory lending, exclusionary zoning, and development policies that limit affordable housing. This decision reflects the reality that discrimination often operates not just out in the open, but in more hidden forms. And, it preserves a longstanding and important method for challenging and eliminating those practices and continuing the work to end discrimination in housing.
Civil and Human Rights Coalition Applauds Supreme Court Decisions on Fair Housing and Health Care Decisions Maintain the Integrity of Bedrock Civil Rights Protections
WASHINGTON – Wade Henderson, president and CEO of The Leadership Conference on Civil and Human Rights, issued the following statement following Supreme Court decisions in Texas v. The Inclusive Communities Project, which was a challenge to the use of disparate impact claims under the Fair Housing Act, and in King v. Burwell, which was a challenge to the Affordable Care Act:
“In a time when bedrock civil rights protections are slowly receding in the areas of voting, education, and elsewhere, today’s two Supreme Court decisions preserving the integrity of the Fair Housing Act and the Affordable Care Act are a welcome relief for the most vulnerable Americans.
In the Texas case, the Supreme Court’s decision ensures that millions of Americans will still be protected from housing discrimination and upholds the important principle that, as a nation, we value the diversity of the communities in which we live. When Americans are denied equal opportunity to housing, they are denied access to good jobs, quality education, safe streets, transit, and a clean and healthy environment, all of which are critical to leading healthy and prosperous lives. As the Court acknowledged, ‘much progress remains to be made in our Nation’s continuing struggle against racial isolation.’ At a time of heightened concern across the country over threats to racial justice, as seen in places like Ferguson, Missouri, and Baltimore, Maryland, a fully functioning and effective Fair Housing Act is more important than ever, and we applaud the Court’s recognition that the Fair Housing Act has a ‘continuing role in moving the Nation toward a more integrated society.’
…. Wade Henderson is president and CEO of The Leadership Conference on Civil and Human Rights, a coalition charged by its diverse membership of more than 200 national organizations to promote and protect the rights of all persons in the United States. The Leadership Conference works toward an America as good as its ideals. For more information on The Leadership Conference, visit www.civilrights.org.
ADDENDUM: Jerry Hendrickson, deputy St. Paul City Attorney and a 40-year veteran of the office, said Thursday that the SCOTUS decision is
‘We think it helps,” Hendrickson said. “The city is supportive of the Fair Housing Act. This case specifically talks about our case in a couple of places, and is critical of the 8th Circuit Court decision. The idea that the Fair Housing Act and decent housing were in conflict is troubling to a lot of people.”
Magner v. Gallagher, the multi-landlord suit against St. Paul which no longer includes Gallagher, remains in federal district court in Minneapolis. The judge assigned to the case, Michael Davis, is retiring soon, so expect no rush to trial.
As for how the Scotus decision will impact additional housing cases filed by Raven Financial and other landlords, “It’s too early to tell,” Hendrickson said. “Each case is different. Like Raven, it could. We think this decision is favorable for the city.”