I get this question about exemptions to the Fair Housing Act (FHA) regularly, so I thought I would provide a refresher on the “Mrs. Murphy” exception to the FHA. At the outset, please know that apartment community owners, management companies, and leasing office staff members I represent are almost always covered by the FHA as well as companion state, city, or county anti housing discrimination laws. In my world, the FHA and its implementing regulations are part of the guidebook concerning how we do business. The FHA does, however, contain a few exceptions — one of the exemptions is referred to as the “Mrs. Murphy” exception.

The “Mrs. Murphy” exemption provides that if a dwelling has four or fewer rental units and the owner lives in one of those units, that home is exempt from the FHA. “Mrs. Murphy” is the hypothetical elderly widow who has converted a portion of her home into a rental apartment to supplement her limited income.

To be sure, the exemption does not apply to rental advertising. That means Mrs. Murphy cannot run a discriminatory advertisement indicating, for example, that a certain religious group is not welcome to rent her apartment or room. Also, this exemption does not apply when a real estate agent is representing the property owner as the law presumes agents are professionally trained and aware that housing discrimination is against the law.

Also, HUD takes the position that the Civil Rights Act of 1866 (yes, 1866) makes it illegal to discriminate based on race — and as such, there is no exemption from the law when dealing with race.

Should the “Mrs. Murphy’s” of the world discriminate? Of course not. But, the FHA does not apply in this limited circumstance and it can be a defense to a housing discrimination action.

Just A Thought.

 

While I always try to avoid political commentary here at the Fair Housing Defense Blog (as the reader comments can be, shall we say, colorful), I wanted to note a couple of housing related points with the Trump Administration in place now for just under six months. First, Dr. Ben Carson was confirmed by the U.S. Senate as Secretary of the Department of Housing & Urban Development (HUD) back in the Spring. While Dr. Carson admittedly did not have experience in federal housing policy, the fact that he is literally a brain surgeon (in other words, he is an exceptionally smart man) has to be a good thing.  Secretary Carson undertook a listening tour as he visited various HUD supported affordable housing communities to learn more about HUD’s mission (at one building, Secretary Carson did get stuck in an elevator, which was slightly amusing). Those of us who follow housing policy remain alert for any substantive changes that the administration proposes – whether concerning criminal background screens, disparate impact, affirmatively promoting fair housing, occupancy standards, or anything else. The answer on the policy side, at least to date, has been not much has been changed. Similarly, while it is too early to see if there are any fair housing enforcement priority changes, it feels as if the number of cases settled by HUD (at least with respect to the number of HUD press releases) is a little down. As soon as more detailed numbers get released, I will report back.

Next, while the Administration proposed a budget for HUD in fiscal 2018 which contained significant dollar reductions, those possible changes come with two important caveats: (1) Congress has the final say on HUD’s budget as the Administration’s proposal is only a recommendation; and (2) the Administration’s budget seeks $65.3 million to support HUD’s fair housing mission, the same funding level provided in the prior three years. Indeed, for those of us involved in fair housing – this is the number that remains important. At the end of the day, I suspect HUD’s budget for the next fiscal year will ultimately get included in what is known as a Continuing Resolution and that the funding levels will be close to those in place for the current year. And even if HUD’s fair housing budget gets cut, management would still need to ensure we comply with applicable state, city, and county fair housing laws. I would also expect local fair housing advocacy groups to file additional complaints/lawsuits related to information compiled by fair housing testers.

What does it all mean? Professional apartment management must continue to follow the important fair housing laws as we do each and every day.

Just A Thought.

The U.S. Department of Housing and Urban Development (HUD) recently announced that it settled another fair housing case, this one for $20,000, to resolve allegations of discrimination based on national origin and familial status. Two related complaints were filed against the community manager of a California property asserting that he made discriminatory statements about Hispanic residents and that the manager prohibited certain children from playing outside.

The case started when two Hispanic couples filed a complaint alleging that the owner and manager of their apartment complex discriminated against them in violation of the Fair Housing Act because of their national origin and because they had children. Additionally, a local California fair housing group filed a supplemental complaint claiming that the manager of the property repeatedly made comments indicating that he did not like having Hispanic residents because they did not speak English as well as accusing the Hispanic residents of bringing pests (including bed bugs and rats) to the property. The supplemental complaint also asserted that the community enforced overly restrictive rules that singled out kids and further that management terminated the lease of one of the Hispanic families after their two year old daughter was heard crying loudly when the manager walked by the family’s door.

In addition to the $20,000 settlement, the Respondents also will undergo fair housing and related sensitivity training.  While I remain mindful that there are always at least two sides to every story, allegations like this (to the extent they took place) provide all of us in the apartment management business a guide concerning a practice we absolutely must train our leasing office staff to avoid at all costs.  Or you will really need to speak with a lawyer like me.

Just A Thought.

Earlier this month, the U.S. Department of Housing and Urban Development (HUD) approved a settlement agreement concerning assistance animals and fees charged to residents. To resolve pending Fair Housing Act (FHA) disability discrimination complaints, the property owners and managers agreed to pay $20,500 to the Nevada housing advocacy group which filed the cases.

The allegations concerned claims that residents who required assistance animals were required to pay a pet deposit fee at three different properties in Nevada.  As has been noted in this space (and elsewhere) many times, as a part of a valid reasonable accommodation request for a service or emotional support animal – management must waive any charges or fees typically assessed against pets. Again, assistance animals are not pets and the charges paid by residents with pets should not be collected.

While I know there are always two (if not more) sides to every story, the takeaway for management is simple: professional apartment leasing offices must not charge pet rent or pet fees for service/companion animals. Or you will really need to speak with a lawyer like me.  While we can absolutely seek a medical verification for most companion animal requests, once that required is legitimately verified, we need to adjust our rent ledger accounting and welcome the resident (and animal) to our community.

Just A Thought.

 

A friend reached out to me to ask questions about HUD’s Smoke Free public housing initiative and for some general thoughts on smoking in apartment homes. So, here goes.

There is no “right” to smoke in a rental home. Smokers are not a protected class under the federal Fair Housing Act (FHA) or its state law counterparts. While some have tried to argue smoking is addictive and, as such, should qualify as a disability, to my knowledge no court has so ruled (and the tobacco companies have strongly objected to any such label). Accordingly, I am aware of no requirement for a reasonable accommodation or reasonable modification because of smoking under the FHA. Indeed, I believe the state of the law would be that smokers would benefit from quitting in that stopping smoking has been found to decrease depression, anxiety, and/or stress. Similarly, the federal government has not concluded that smoking is a legitimate or proven treatment for any recognized medical condition.

Apartment communities can prohibit smoking in individual units as a part of the lease or by means of a separate lease addendum. If your property decides to go smoke free, I recommend using a lease addendum at the time of each renewal in addition to using the addendum for new applicants. Yes, it will take a number of months to capture all of your residents, but if smoking is not addressed in your current lease, simply banning it in individual units during a lease term will be more difficult to defend before a judge.

With respect to affordable (government assisted) housing, the Department of Housing & Urban Development (HUD) issued a Smoke Free Public Housing Rule on November 5, 2016 (and which became effective as of February 3, 2017). Under this initiative, all public housing authorities must comply with the rules and implement smoke free policies within 18 months of the date of the rule (or not later than August 3, 2018). HUD’s rule is not mandating that people stop smoking. It does, however, make clear that public housing authorities must go smoke free by August 2018 such that smoking will not be permitted in apartment homes after that date. Make no mistake, there will be pushback and housing authorities are already working on policies to implement this initiative. Should someone lose their home for one violation? What if a guest lights up? What about someone who is disabled with a mobility impairment and has trouble leaving his or her home? What if someone just cannot or will not quit? What if someone has a medical marijuana permit? And I know there will be more questions than answers as affordable housing owners go through the implementation process.

Again, this rule is only mandatory for affordable communities. But affordable community property managers will likely want to reach out to a lawyer like me to get started on this process.

Just A Thought.

 

Occupancy standards are an issue which come up from time to time. On the one hand, a family certainly should have the right to decide the size of the apartment home they need and/or can afford.  On the other hand, management has a legitimate health and safety right to put a reasonable limit in place.  We do not want, and the law will not support, eight people living in a one bedroom unit.  The issue, of course, is where those two points intersect in 2017.

Going back as far as 1992, the U.S. Department of Housing & Urban Development issued guidance (known as the Keating Memorandum) which provided that a limit of two people per bedroom was presumptively reasonable. Since that time, however, there has been a shift away from a rigid “two people per bedroom” standard. Some states and localities have passed laws concluding that three people per bedroom is now reasonable, particularly when affordable housing is in limited supply and if rents are perceived to be high. Other localities (and the prevailing view) is that occupancy standards should be judged on a sliding scale based on the size of the apartment home. To illustrate, does the home have a den? Are the rooms large? If so, then three heartbeats per bedroom could well be reasonable. If the apartment is tiny, then perhaps two people per bedroom is appropriate.

To be sure, from a leasing office perspective, the old standard was easier to apply. As management’s lawyer, I always prefer when my employees have less discretion.

Also, here is a related issue that regularly comes up: a married couple rents a one bedroom unit. The woman gets pregnant. All good. But now there are going to be three people in the apartment. And what if it is a small home? In addition to occupancy standards, management needs to be cognizant of the protection for “familial status” in the Fair Housing Act (FHA). Management will not look good attempting to evict a family with an infant out of a one bedroom unit. The best advice is to talk with a lawyer like to ensure your property has policies in place to address these situations.

Just A Thought.

A couple of interesting emotional support animal medical verification questions have hit my desk over the past month. First, recall that case law on the issue of permissible credentials of a medical or health care professional is a bit unclear. Individuals who are licensed by a public regulatory authority (such as a state) to provide medical care, therapy or counseling to persons with disabilities certainly qualify. This includes, of course, medical doctors, physician assistants, psychiatrists, psychologists, and many social workers. Guidance from the Department of Justice (DOJ) and the Department of Housing & Urban Development (HUD) notes that a peer support group or even a non-medical service agency may also provide verifications in appropriate circumstances. As has been written in this space, however, many professional apartment management companies are pushing back against medical verifications that appear to have been simply purchased over the internet without any legitimate medical evaluation or analysis. Those are easier.

But what happens when, for example, a licensed chiropractor from California purports to verify an emotional support animal with a diagnosis of depression for an applicant who lives in Florida? Or when one counselor writes the exact same letter for 12 residents at the same property? Sorry to say there is no cookie cutter response. We do an individualized evaluation of the letters to make a determine (as best we can) if the medical verifications are legitimate within the bounds of what the law permits management to ask. Many times the letters have other defects which permits us to seek further clarification to determine if the verifications are legitimate.

The bottom line is that unless and until DOJ/HUD or the courts give us more guidance, management will continue to review, evaluate, and respond as best we can. That being written, it seems to me to make sense to require that someone have a credential for an area related to that for which he/she purports to give the certification.  And that an individual professionally trained in a health care field actually evaluate the resident to confirm a legitimate disability and need for an emotional support animal.

Just A Thought.

As all of us in the property ownership/management business know, communities get bought and sold from time to time. Indeed, a property can be sold many years (even decades) after it was first designed and constructed. Effective in properties designed and/or constructed from 1991 on, the Fair Housing Act (FHA) requires that all multifamily construction meet a specified level of accessibility for individuals with disabilities. As a part of the law, the FHA has seven “safe harbors” that design and construction firms must follow.  Notably, while the Americans With Disability Act (ADA) and the FHA share some elements, simply following the ADA may not be enough to ensure your project is in compliance with the FHA.

So, what happens to a subsequent owner or purchaser of a property built after the effective date of the statute? Are they on the hook for deficiencies in the design and/or construction that took place long before they bought the property? Most likely not.

There is a very strong appellate opinion from the 11th Circuit Court of Appeals as well as guidance from the U.S. Department of Justice and the U.S. Department of Housing & Urban Development noting that a subsequent property owner who had no involvement in the initial design and construction should not have liability arising from the improper design and/or constructions. That is the good news. The less good news is that in the event the property faces a FHA accessibility lawsuit, the new owner will most likely be named as a nominal defendant required to provide access to the property for what can be costly repairs and/or retrofits.  Even if those repairs are funded by someone else.

What should an individual or entity contemplating buying a community built after 1991 do? My recommendation is to do a FHA accessibility review as a part of your due diligence process. And if you are buying from the original owner/developer, check on the status of their insurance for these types of claims. You will be glad you did.

Just A Thought.

While many apartment communities are “pet friendly” and welcome animals, almost every community has restrictions concerning, for example, certain breeds and/or weight limits for pets. In addition to the community policy on animals, many local jurisdictions similarly ban some dog breeds pursuant to a county or city ordinance. The question that comes to my desk is what happens when a resident submits a request for a service or companion animal as a reasonable accommodation pursuant to the federal Fair Housing Act (FHA) that would otherwise run afoul of the county or city ordinance because of the breed of the dog? Courts have answered this question by concluding that enforcing a city or county ordinance banning certain breeds would violate the FHA by permitting a discriminatory housing practice. In short, the federal statute controls.

Now, there is another step for management to take. We can undertake an analysis to determine if the animal at issue poses a “direct threat” to other residents, to the property, and/or to the leasing office staff. A “direct threat” must be particularized to the specific animal and not based on a generalized stereotype. For example, management could not simply conclude that because pit bulls are generally restricted by a county ordinance, all pit bulls are therefore a “direct threat” and are banned from our property, even as a companion animal. In order to make such a conclusion, management needs to have objective evidence that the specific animal in question has behaved in such a manner to be a “direct threat” (and such behavior likely cannot be remedied) before making such a determination.

You might want to reach out to a lawyer like me if this issue comes up at your property so you can review the appropriate analysis in an effort to avoid needing to defend against a discrimination complaint.

Just A Thought.

 

A legitimate question from leasing office professionals I get from time to time is: “We approved an emotional support animal for a resident two years ago. Does that approval continue indefinitely or can we seek a supplemental medical verification from time to time?” My answer is that there are any number of disabilities for which we grant a reasonable accommodation but for which medicine, treatment, surgery, or even the passage of time can have cured or helped cure such that the condition no longer qualifies as a disability. To that end, it appears reasonable for management to seek a supplemental medical verification for a disability that is not obvious. Do I think you should do this every three months? Certainly not. But there is a legitimate argument to seek a supplement every couple of years or perhaps even at lease renewal time. The point is not to improperly pry into any resident’s medical history, but as we are in an era of, shall we say, questionable medical verifications for certain emotional support animals (yes, I am talking about those simply purchased over the internet with a few computer clicks and a credit card without any legitimate medical evaluation or diagnosis), doing our best to comply with applicable law only makes sense. In addressing this specific issue, one federal judge wrote “[n]o provision in the [Fair Housing Act] purports to make a granted accommodation eternal.”

Might you get some pushback? Yes, but hopefully not from your residents with legitimate disabilities. Indeed, I suspect individuals with real disabilities are disheartened by those attempting to game the system as it does a disservice to those who actually need emotional support animals.

That being said, of course, there are certain obvious disabilities for which management most likely would never need a supplemental verification. Such as if a resident is blind or if a resident uses a wheelchair.

This is a challenging area and one for which management should continually attempt to get it right.

Just A Thought.