Texas Dept. of Housing and Comm. Affairs v. Inclusive Communities Project, Inc.

Disparate-impact claims, showing discriminatory effect without evidence of discriminatory intent, are cognizable under the Fair Housing Act.

The Inclusive Communities Project, Inc. (ICP) is a non-profit group that assists low income families in finding affordable housing. The ICP brought a lawsuit, claiming that the Texas Dept. of Housing and Comm. Affairs (Dept.) allocated tax credits in a manner that caused racially segregated housing patterns. The district court ruled in favor of the ICP because the Dept. failed to show that there were no less discriminatory alternatives for allocating the tax credits. The Fifth Circuit held that disparate impact claims are cognizable under the Fair Housing Act (FHA) but reversed and remanded, finding that the district court did not need to require the Dept. to find less discriminatory alternatives. The Court affirmed, holding that that disparate impact liability is cognizable under the FHA. The Court relied on the statutory interpretation of Title VII of the Civil Rights Act of 1964 and the Age Discrimination in Employment Act of 1967, as well as Griggs v. Duke Power Co. and Smith v. City of Jackson in making its determination.