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Fair housing future?  Colorado court hints at direction of fair housing laws in Trump era

Aside from a few negative comments made last year during the presidential campaign, there has been very little indication of where Secretary Ben Carson and the Trump administration will take federal fair housing policy in the future. A recent decision by the US District Court in Denver, Colorado, however, indicates that, regardless of what the Trump administration does, courts and state legislatures may step in to pick up the slack in fair housing enforcement.

In Smith v. Avanti (Civil Action No. 16-cv-00091-RM-MJW), Judge Raymond Moore addressed fair housing claims asserted by a couple, one of whom is a transgender woman, seeking to rent a townhouse. The couple had two minor children. After meeting with the couple and touring the property, the owner notified them that she would not rent the townhouse to the couple, citing the couple’s “unique relationship” and possible noise caused by their children. In response, the Smiths filed a complaint, alleging that the owner violated provisions of the Fair Housing Act (FHAct) that prohibit discrimination on the basis of familial status and sex, and under Colorado’s fair housing law, which also prohibits discrimination on the basis of sex, sexual orientation and familial status.

In his decision, issued on April 5, 2017, Judge Moore concluded that under Tenth Circuit precedent, the FHAct’s prohibition on the basis of sex could not be read to prohibit discrimination on the basis of sexual orientation. As a result, discrimination based solely on a person’s status as a transgender person does not constitute discrimination on the basis of sex under the FHAct. Nevertheless, drawing from employment law cases, Moore reasoned that to the extent that the owner discriminated against the Smiths on the basis of sexual stereotypingthat is, that the plaintiff does not conform to stereotypical norms associated with biological men or womenis protected under the FHAct’s sex discrimination prohibitions. Moore also decided that the Smiths were discriminated against on the basis of their family status. Turning to the state law claims, Judge Moore concluded that the owner had discriminated against the Smiths under Colorado law, which prohibits discrimination on the basis of sex (including sexual stereotyping), sexual orientation (including transgender status) and familial status.

While the Smith decision represents the opinion of only a single federal district court judge and may be appealed to the Tenth Circuit, it is significant in several respects:

·         First, in pre-Trump era statements, HUD had taken the position that discrimination on the basis of sexual orientation was, in fact, covered by the FHAct. For example, in issuing its “Equal Access” regulation last September, HUD stated that “[d]iscrimination because of gender identity is covered within the [FHAct’s] prohibition of sex discrimination.” 81 Fed. Reg. at 64770. Significantly, the Smith decision does not discuss those HUD statements. Instead, following Tenth Circuit precedents, it clearly declined to read the sex discrimination provisions of the FHAct to broadly protect persons on the basis of sexual orientation or gender identity.

·         Nevertheless, the Smith decision does extend FHAct sex discrimination protection on the basis of sexual stereotyping. Depending on the facts of individual cases and how broadly the concept of sexual stereotyping is applied, those protections may cover much of the same territory as sexual orientation/gender identity protections would cover.

·         Many states and local governments, such as Colorado, have adopted express prohibitions against discrimination on the basis of sexual orientation, gender identity and other protected classes not expressly included in the FHAct. So, even if the Trump administration attempts to constrict the scope of FHAct protections, state and local governmentsand courts interpreting those lawsmay seek to reinforce existing protections and extend protections to additional protected classes. Indeed, cases like Smith may encourage state and local governments to extend protections to additional classes of persons, if they perceive that the Trump administration is seeking to restrict those protections at the federal level.

It’s unwise to look at a single decision as establishing a trend or precedent. But Smith provides a reminder that even if HUD alters its fair housing policies or reduces fair housing budgets or staff, the underlying law will still allow individuals to file claims in federal and state courts. Those courtsnot HUD will ultimately decide the extent of protections under the FHAct and state and local laws. Indeed, efforts at the federal level to restrict fair housing enforcement may encourage state legislatures and city councils to extend protections beyond those that the FHAct recognizes.

 The Bottom Line: Budget and staff cuts at HUD headquarters may make headlines, but they do not necessarily translate into less fair housing scrutiny. During the Trump era, the future of fair housing may turn more on decisions made in courthouses, state legislatures and city halls than on decisions made at the White House or on Seventh Street, SE, in Washington, D.C.

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