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Friday, August 30, 2024
Howard County Equity Listening Session on September 10th
Wednesday, August 28, 2024
31st Baltimore Civil Rights Breakfast on October 7th
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Tuesday, August 27, 2024
On August 5, 2024, the Maryland Department of Housing & Community Development (DHCD) issued a Fair Housing Memorandum that applies to the full spectrum of housing activities, including, but not limited to, outreach and marketing, qualification and selection of residents, and occupancy.
The Department has modified their requirements for Affirmative Fair Housing Marketing Plans and Tenant Selection Plans to comply with the HUD Guidance. Owners and/or managers of properties that have received LIHTC awards, program funds, or other subsidies from the Department are now required to submit a copy of their tenant selection plan or policy by January 1, 2025, to evidence compliance with the policies.
The Memorandum includes revised and updated policies regarding:
- Credit History Screening
- Eviction History Screening
- Criminal Record Screening
- Admission Criteria
DHCD will review the tenant selection plan or policy to ensure it complies with DHCD requirements and will reject any plan that isn’t in conformance.
Tuesday, August 20, 2024
New Jersey proposes new disparate impact discrimination rule
New Jersey Attorney General Matthew J. Platkin and the New Jersey Division on Civil Rights have announced a proposed rule describing and clarifying the prohibitions against disparate impact discrimination under the New Jersey Law Against Discrimination (LAD). The proposed rule clarifies the legal standard for disparate impact discrimination and the burdens of proof in claims in the housing, financial lending, employment, places of public accommodation, and contracting. The proposed rule largely codifies existing state and federal case law and provides examples of policies and practices that may result in a disparate impact on members of a protected class under the LAD.
New Jersey’s proposed LAD prohibits conduct that expressly treats people differently based on their membership in a protected class and policies or practices that have a negative impact on members of a protected class. Under the LAD, even policies or practices that are neutral on their face and that do not single out a protected class for different treatment may violate the LAD if they have a disparate impact on protected class members.
Proposed rule
The proposed rule is intended to clarify that the LAD prohibits practices or policies that result in a disproportionately negative effect on members of a protected class, even if such practices or policies are not intended to discriminate, unless it is shown that such are necessary to achieve a substantial, legitimate, nondiscriminatory interest and there is no less discriminatory, equally effective alternative that would achieve the same interest. The proposed new rule provides the standard for determining whether a practice or policy is unlawfully discriminatory, and the burden-shifting framework applied to the standard for disparate impact claims arising in specific contexts. The proposed rule covers how liability for disparate impact may apply to many examples of policies and practices.
Subchapter 4 regards housing and housing financial assistance. A proposed burden-shifting framework putting the burden of showing that there is not a less discriminatory, equally effective alternative means of achieving the housing provider’s or lender’s substantial, legitimate, nondiscriminatory interest on the respondent at the final stage of the burden-shifting test. If the complainant can show the practice or policy results in a disparate impact on members of a protected class, the respondent must show that the challenged practice or policy is necessary to achieve a substantial, legitimate, nondiscriminatory interest and that there is not a less discriminatory, equally effective alternative means of achieving that.The respondent may, but is not required to, identify what policy or practice options it considered and how and why it decided to select the policy or practice.
Here are some examples of policies and practices that may have an unlawful disparate impact:
- Minimum income requirements.
- Financial standards, or income standards that have a disparate impact on people seeking to pay rent with forms of government low-income rental assistance; Excluding applicants based on criminal or credit history.
- Automatically refusing all rental housing applicants who have no credit score or a score below a minimum threshold.
- Requiring
a renter or buyer to violate or forgo a sincerely held religious
practice or observance.
This framework aligns with how New Jersey courts and the New Jersey Division of Civil Rights have applied disparate impact liability. Placing the burden on the respondent to prove no less discriminatory alternatives exist is appropriate “in light of the particularly stark information asymmetry between housing providers and victims of housing discrimination, as housing providers are far more likely to have access to information about the challenged practice or policy, their interests, what potential alternative practices or policies are available, and whether an alternative could serve their interests while having less discriminatory effects.” Increased use of tenant screening reports and online platforms in housing sale and rental markets have made it especially difficult for complainants to access information about specific housing providers’ policies and practices, and that there is a significant imbalance in access to legal representation in housing cases, as landlords have legal representation in 90% of housing cases involving eviction, while less than 10% of renters have legal representation in such cases.
The proposed rule also would apply to the practices and policies of real estate brokers, agents, salespersons, property management, and lending institutions. For lending institutions, this includes making available or unavailable the provision of housing financial assistance, establishing financial assistance terms or conditions, and the creation and application of criteria requirements, procedures, or standards for the review and approval of real estate transactions, with the exception of evaluations of an applicant’s consumer credit history where required for a federal loan product or formula or practices or policies that enforce federal guidelines.
Credit Unions Exploit Federal Tax Exemption to Buy Tax-Paying Community Banks - Not Subject to Community Reinvestment Act requirements
Nonprofit credit unions are buying record numbers of for-profit banks. Until recently, a nonprofit couldn't own a for-profit, but tax changes in recent years have changed the dituation.
As the Independent Community Bankers of America (ICBA) recently wrote: "Credit unions are increasingly exploit their federal tax exemption to acquire tax-paying community banks, the need for policymakers to re-examine their tax status is urgent. Action is needed now to preserve community banks and the communities that depend on them, ensuring the continued vitality of the relationship-based banking sector that has supported Main Street America for generations.
Credit unions pay no tax to operate the same business that was taxable the day before once they acquire a bank. As public scrutiny of these inappropriate deals and the number of credit union purchases of taxpaying community banks have raced past record highs, policymakers must protect local communities by ending the credit union tax exemption,” Rainey said. As more than 20% of bank deals this year have been credit unions leveraging their tax exemption to purchase banks, the media is taking note:
Axios: Why credit unions are buying banks.
American Banker: Credit unions extend bank-buying spree.
Credit Union Today: Citing exec pay, sports deals, 'lavish' HQs, bank group tells Congress there are new reasons to revoke CU tax exemption.
Op-ed: Confessions of a credit union executive turned community banker.
Op-ed: Stop letting credit unions buy community banks."
As Axios recently concluded: Credit unions have many advantages over banks. They pay less in taxes and don't need to deliver profits to shareholders.They also have less of a regulatory burden — they aren't subject to Community Reinvestment Act requirements, for instance, and their National Credit Union Share Insurance Fund is in healthier shape than the FDIC's Deposit Insurance Fund.
Axios: Why credit unions are buying banks.
American Banker: Credit unions extend bank-buying spree.
Credit Union Today: Citing exec pay, sports deals, 'lavish' HQs, bank group tells Congress there are new reasons to revoke CU tax exemption.
Op-ed: Confessions of a credit union executive turned community banker.
Op-ed: Stop letting credit unions buy community banks."
Agencies Finalize Interagency Guidance on Reconsiderations of Value for Residential Real Estate Valuations
On August 20th, five federal regulatory agencies issued final guidance addressing reconsiderations of value (ROVs) for residential real estate transactions. The guidance advises on policies and procedures that financial institutions may implement to allow consumers to provide financial institutions with information that may not have been considered during an appraisal or if deficiencies are identified in the original appraisal.
According to VivalLaw, the guidance will allow lenders and borrowers to request and provide additional information to supplement appraisals in assessing real estate value
The agencies are:
DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
12 CFR Part 34
[Docket ID OCC-2023-0007]
FEDERAL RESERVE SYSTEM
12 CFR Part 225
[Docket No. OP-1809]
FEDERAL DEPOSIT INSURANCE CORPORATION
12 CFR Part 323
RIN 3064-ZA36
NATIONAL CREDIT UNION ADMINISTRATION
12 CFR Part 722
[Docket ID NCUA-2023-0061]
CONSUMER FINANCIAL PROTECTION BUREAU
12 CFR Chapter X
[Docket No. CFPB-2023-0033]
ROVs are requests from a financial institution to an appraiser or other preparer of a valuation report to reassess the value of residential real estate. Deficiencies identified in valuations, either through an institution’s valuation review processes or through consumer-provided information, may be a basis for financial institutions to question the credibility of the appraisal or valuation report.
The guidance offers examples of ROV policies and procedures that a financial institution may implement to help institutions identify, address, and mitigate discrimination risk; describes the risks of deficient residential real estate valuations; and explains how financial institutions may incorporate ROV processes into risk management functions. The agencies finalized the guidance largely as proposed, with the addition of clarifying edits based on public comments received on the proposed guidance published in July 2023.
The guidance ultimately recommends that financial institutions should develop ROV policies that identify, address, and mitigate deficient values. The guidance recommends policies that:
Consider ROVs as a possible resolution for consumer complaints or inquiries related to residential property valuations.
Consider whether any information or other process requirements related to a consumer’s request for a financial institution to initiate an ROV create unreasonable barriers or discourage consumers from requesting the institution initiate an ROV.
Establish a process that provides for the identification, management, analysis, escalation, and resolution of valuation-related complaints or inquiries across all relevant lines of business.
Establish a process to inform consumers how to raise concerns about the valuation early enough in the underwriting process for any errors or issues to be resolved before a final credit decision is made.
Identify stakeholders and clearly outline each business unit’s roles and responsibilities for processing an ROV request.
Establish risk-based ROV systems that route the request to the appropriate business unit.
Establish standardized processes to increase the consistency of consideration of requests for ROVs.
Ensure relevant lending and valuation-related staff, inclusive of third parties (e.g., appraisal management companies, fee-appraisers, mortgage brokers, and mortgage servicers) are trained to identify deficiencies (including practices that may result in discrimination) through the valuation review process.
The FFIEC in its previous principles has stressed: "Valuation discrimination or bias can cause consumer harm, lead to violations of law, and have a detrimental impact on communities. In addition, valuation discrimination or bias could result in deficient and unreliable collateral valuations that undermine an institution’s credit decisions and negatively impact its safety and soundness."
August 28th Webinar on Grants Pass Decision & People with Disabilities
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Wednesday, August 14, 2024
HUD Approves Settlement with California Housing Providers Resolving Claim of Disability Discrimination
The U.S. Department of Housing and Urban Development (HUD) has entered into a Conciliation Agreement between Burbank Housing Management Corporation, Burbank Housing Development Corporation, BHDC Parkwood Apartments, LLC, Oak Ridge Apartments Associates LP, and James Perez, requiring the respondents to pay $41,500 in compensation to the complainant. The Agreement resolves allegations that the respondents violated Section 504 of the Rehabilitation Act of 1973 and the Fair Housing Act by discriminating against tenants with disabilities. Read the Agreement here.
The Fair Housing Act prohibits discrimination because of disability, including refusing to allow reasonable accommodations that would otherwise permit tenants with disabilities an equal opportunity to use and enjoy their housing. Section 504 of the Rehabilitation Act of 1973 (Section 504) prohibits the exclusion or discrimination of qualified individuals based on disability in any program receiving federal financial assistance, including from HUD.
The Agreement began with a complaint alleging that the Sonoma County, California, based housing providers interfered with the rights of tenants with disabilities to obtain reasonable accommodations, and that the respondents, who are receive HUD and US Department of Agriculture (USDA) funding, were in noncompliance with Section 504. The Respondents denied the allegations in the Complaint and agreed to settle the matter. The Conciliation Agreement does not constitute an admission of guilt by the Respondents and no determination has been issued by HUD about this.
Under the terms of the Agreement, the housing providers will pay $41,500 to the complainant. They will also ensure their reasonable accommodation policies are in compliance with the Fair Housing Act and Section 504 and that they process reasonable accommodation requests in a timely manner. Both HUD and USDA will monitor the Agreement.
People who believe they have experienced discrimination may file a complaint by contacting HUD's Office of Fair Housing and Equal Opportunity at (800) 669-9777 (voice) or (800) 877-8339 (Relay) or at hud.gov/fairhousing.
HUD Charges Colorado Appraiser, Appraisal Management Company, and Lender with Race Discrimination
The U.S. Department of Housing and Urban Development (HUD) has charged multiple entities with housing discrimination for issuing a biased appraisal and then denying a refinance loan application in Denver, Colorado. HUD’s Charge against the appraiser, Maksym Mykhailyna; appraisal company, Maverick Appraisal Group; appraisal management company, Solidifi U.S. Inc.; and lender, Rocket Mortgage, LLC, alleges that the appraiser issued a discriminatory appraisal that undervalued a Black homeowner’s property on the basis of her race. The Charge further alleges that when the homeowner complained to Rocket Mortgage, Rocket Mortgage would only approve her refinance loan application based on the appraised value that she alleged was discriminatory. Read the Charge.
HUD’s Charge of Discrimination alleges that Maksym Mykhailyna and his appraisal company, Maverick Appraisal Group, issued an insupportably low appraisal of a duplex owned by a Black woman in a predominantly white area of Denver. Other recent appraisals of the same property had steadily increased in value, yet this appraisal resulted in a dramatic drop, despite the Denver market experiencing substantial growth in home values at that time. To reach that low number, the appraisal was rife with inaccuracies and unsupportable methodological choices (such as relying on comparable properties in neighborhoods with greater Black populations and excluding potential comparable properties in neighborhoods with greater white populations) that not only artificially lowered the appraised value but deviated from Mr. Mykhailyna’s own methodology and findings about the relevant neighborhood in appraising similar, nearby properties with White owners. Both Solidifi and Rocket Mortgage reviewed the appraisal report but failed to correct it despite several red flags. When the homeowner complained to Rocket Mortgage, she was told she could only proceed with her loan application based on the appraisal that she alleged was discriminatory; ultimately, her application was denied.
A US Administrative Law Judge will hear HUD’s Charge unless any party to the Charge elects to have the case heard in federal district court. If an administrative law judge finds, after a hearing, that discrimination has occurred, the judge may award damages to the homeowner for her losses as a result of the discrimination, injunctive relief, other equitable relief to deter further discrimination, payment of attorney fees, and civil penalties to vindicate the public interest. If a federal court hears the case, the judge may also award punitive damages to the homeowner.
Anyone who believes they are the victims of housing discrimination should contact HUD at (800) 669-9777 (voice) or (800) 927-9275 (TTY). Additional information is available at https://www.hud.gov/fairhousing.
HUD’s National Fair Housing Training Academy website contains a flowchart of the appraisal process as well as trainings related to combating and investigating appraisal bias.
HUD Charges Wisconsin Housing Provider with Discriminating Against a Tenant with Disabilities
The U.S. Department of Housing and Urban Development (HUD) on July 19, 2024 charged Tammy and Ramiro Estrada, the owner of a duplex in Appleton, Wisconsin, with violating the Fair Housing Act by refusing to grant a tenant with a disability a reasonable accommodation to allow the tenant to live with her assistance animals.
The Fair Housing Act prohibits discrimination because of disability, including the denial of reasonable accommodations. Individuals with disabilities have the right to reasonable accommodations when necessary for equal access to their home, including the use of assistance animals. Also, individuals are protected from coercion, intimidation, threats, or interference when they assert their fair housing rights or file a complaint with HUD.
HUD’s Charge alleges that the owners denied the tenant’s request by applying unlawful breed restrictions, fines, and fees to the request. They also interfered with the Complainant’s attempt to obtain a service dog and threatened them with eviction, eventually non-renewing their lease and citing the reasonable accommodation requests in the non-renewal notice. The tenants had to rent more expensive housing elsewhere.
A US Administrative Law Judge will hear HUD’s Charge unless any party to the Charge elects to have the case heard in federal district court. If an administrative law judge finds, after a hearing, that discrimination has occurred, the judge may award damages to the family for their losses because of the discrimination, injunctive relief and other equitable relief to deter further discrimination, payment of attorney fees, and civil penalties to vindicate the public interest. If the federal court hears the case, the judge may also award punitive damages to the family.
People who believe they are the victims of housing discrimination should contact HUD at (800) 669-9777 (voice) 800-927-9275 (TTY). Additional information is available at www.hud.gov/fairhousing. Housing providers and others can learn more about their responsibility
to provide reasonable accommodations and reasonable modifications to
individuals with disabilities here.
US Department of Justice Files Civil Rights Lawsuit Against Illinois Landlord for Sexually Harassing Tenants
The US Department of Justice (DOJ) filed a lawsuit on July 18, 2024 against Michael J. DeWitte, of Washington, Illinois, for sexually harassing female tenants and housing applicants in violation of the Fair Housing Act. The lawsuit, filed in the U.S. District Court for the Central District of Illinois, alleges that, since at least 2002, DeWitte harassed female tenants and applicants with unwelcome sexual harassment including sexual contact and comments about their physical appearances; offers to strip for female tenants; removing his pants while giving a tour to a female housing applicant; exposing his genitals to female tenants; asking female tenants on dates; requesting sex in exchange for reduced rent or other housing benefits; and evicting female tenants when they did not give in to his sexual advances. The lawsuit seeks monetary damages to compensate those harmed by the alleged harassment, civil penalties to vindicate the public interest, and a court order barring future discrimination.
Anyone who believes that they may have been victims of sexual harassment or other types of housing discrimination at rental properties owned or managed by Michael DeWitte, or who have other information that may be relevant to this case, may contact the Justice Department by calling the U.S. Attorney’s Office for the Central District of Illinois at 309-671-7019 or 833-591-0291, and emailing USAILC.Civil.Rights@usdoj.gov or FairHousing.USAILC@usdoj.gov.
The Justice Department’s Sexual Harassment in Housing Initiative is run by the Civil Rights Division, in coordination with U.S. Attorneys’ Offices. The initiative address es and raises awareness about sexual harassment by landlords, property managers, maintenance workers, loan officers, and others who have control over housing. Since beginning the initiative in 2017, the department has filed 44 lawsuits alleging sexual harassment in housing and recovered over $17 million for victims of such harassment. The Civil Rights Division is committed to protecting people from sexual misconduct.
Police investigate antisemitic graffiti found at Bethesda school
Montgomery County police are investigating antisemitic graffiti discovered at Bethesda Elementary School on August 11th. The school’s marquee sign was defaced with a statement: “Israel rapes men, women and children,” in red spray paint. The nearby crosswalk and sidewalk also were painted with similar statements and “Free Gaza,” as was a nearby building in the 4900 block of Del Ray Avenue. Authorities were investigating the incident as a bias-related crime.
Several families with young children saw the graffiti while going to the market located there on Sundays, said Guila Franklin Siegel, associate director of the Jewish Community Relations Council of Greater Washington. Siegel said the farmers market is owned by a Jewish person and located in a neighborhood with several synagogues nearby. A few families with young children, and the Bethesda Urban Partnership helped to clean up the vandalism.
Thomas Taylor, superintendent of Montgomery County Public Schools, called the incident horrifying, adding that he was grateful for the volunteers who cleaned up the vandalism. He said that the school district is partnering with organizations to train staff on how to address hate and bias in the classroom, which he said “will ultimately have a ripple effect in the community and spread to our community.”
Monday, August 5, 2024
Anne Arundel County Launches New Housing Resources Portal
Anne Arundel County Executive Steuart Pittman, the Office of Equity and Human Rights (OEHR), and Arundel Community Development Services, Inc. (ACDS) recently launched a new online housing portal that serves as a one-stop hub for users to get access to needed housing-related resources and information.
It includes detailed and helpful information and links regarding:
Financial Assistance.
Health & Safety Conditions.
Educational & Legal Resources.
Homeowners & Homebuyers.
Renters.
Temporary & Permanent Housing.
Emergency Assistance.
Go to the Anne Arundel Housing Portal.
The new portal serves as a hub for resources offered by government, local partners, and private community-based organizations, providing a very broad range of housing-related resources. Prospective homebuyers, veterans, real estate agents, renters, older adults, and organizations that support individuals with housing-related needs can all find helpful resources.
The State of Maryland, Baltimore City, and the other counties in our metro also have similar online housing-related resource portals:
Baltimore City has a great Housing Resource Guide that has a wealth of information and links to various housing and housing-related resources in the City. Go to the City's online Housing Resource Guide.
Baltimore County has a Supportive Housing Programs portal that has information and links to available housing-related resources. Go to the Baltimore County housing portal.
Harford County Department of Housing and Community Development has an online portal with helpful housing and related information and links. Go to the Harford County housing portal.
Carroll County has an online Resources portal with links and information about various resources available in the area. Go to the Carroll County Resources portal.
The State of Maryland also has a housing portal that contains very helpful information and links to needed resources. Go to the Maryland Housing Resources Portal.
*****
Read the June 6, 2024 Anne Arundel County release.
Friday, August 2, 2024
KeyBank Criticized by Advocates for Not Improving Performance in Cleveland's Low-Moderate Neighborhoods
Cleveland-based KeyBank - which mortgage lends in Baltimore - has criticized for years that it has systematically failed minority residents in its own hometown. In November, 2023, the National Community Reinvestment Coalition released a critical report on the bank for "betraying" Black applicants in search of home loans. In 2022, the report found, just 2.6% of KeyBank's Cleveland lending went to Black borrowers, down from 3% the year prior.
While KeyBank denied the report's findings and cited recent improvements, Cleveland City Councilman Richard Starr, whose Ward 5 has had decades of disinvestment, criticized the bank. Starr describes his ward as “a low moderate neighborhood” that is diverse. The median household income is around $13,000. He agreed with the report's stance that KeyBank did not meet the criteria of what was supposed to be a promise to promote and work towards social and racial equity for Black and low-income homebuyers.
In 2016, KeyBank made a $16.5 billion dollar community benefits agreement, with a goal to invest $5 billion in lending to Black and low-income neighborhoods, but reports show it failed to do this. Starr also said "...they have shown that they have redlined in the neighborhoods that majority African Americans live in, and that is no way to call yourself a key player in the community.”
KeyBank denies Starr’s claims, saying that it has acted to increase Black and minority lending in Cleveland. “Nationally, our percentage of applications from Black borrowers has grown from 2.6% in FY20 to 7.6% YTD 2024,” according to KeyBank, adding that Black borrowers in Cleveland grew from 5.7% to 27% since 2020, and that the bank has hired a Community Lending team to create support for underserved communities in Cleveland and launched the Neighbors First Credit program in 2023, providing more than $200,000 in credits to homebuyers, and has helped 41 clients in the Cleveland metro.
Starr says the Black community has not seen the results of any of KeyBank’s investments: “Despite being headquartered in Cleveland, KeyBank has not made significant investments in our major underserved neighborhoods, leaving many areas in economic stagnation.” Starr says KeyBank’s performance under the Community Reinvestment Act (CRA) has been “unsatisfactory,” and they have not met the credit needs of low- and moderate-income neighborhoods.
He calls on KeyBank to improve their efforts and create real investments for Cleveland’s underserved communities. He asks how the bank has supported financial literacy, provide transparency in how much it has reinvested in Cleveland's poor neighborhoods recently, better support affordable housing projects, improve supplier diversity, and make more firm commitments.
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