Disparate Impact Won't Save Us From Exclusionary Zoning

The Fair Housing Act (FHA) imposes liability upon landlords and governments whose policies have a discriminatory effect against racial minorities. However, the courts have interpreted this doctrine narrowly.

5 minute read

March 30, 2020, 7:00 AM PDT

By Michael Lewyn @mlewyn


Suburban Home

TBaker770 / Shutterstock

Under the "disparate impact" doctrine of the Fair Housing Act (FHA), a landlord or government agency may, under certain circumstances, be liable for housing discrimination when its practices have a discriminatory (or, in legalese, "disparate") impact* upon protected classes listed in the FHA (including racial minorities). Zoning regulations often adversely impact lower-income households, who in turn are disproportionately likely to belong to racial minority groups. For example, if a city requires that all housing consume at least one acre of land, this means that only those who can afford to purchase one acre of land can live in the city. Does this mean that cities are always liable for this sort of exclusionary zoning? A recent case out of the New York suburbs suggests that the answer is "rarely."

The case of MHANY v. Nassau County arises out of the following facts: Garden City (a wealthy Long Island suburb) decided to rezone land that had been used in the "public use” zone—that is, for government buildings. A planning firm hired by the city proposed to zone the land for multi-family housing; because of pressure from Garden City residents, the city instead rezoned most of the land for single-family housing. As a result, the city rejected a nonprofit agency’s proposal to build hundreds of units of multi-family housing, including some "affordable" (i.e., subsidized lower-income) housing. The nonprofit (hereinafter "plaintiff") filed suit under the FHA in a federal trial court.

As to the disparate impact claim, the court first described the three-part test governing disparate impact claims under Supreme Court precedent. First, the plaintiff must show a prima facie case of disparate impact—that is, that the policy of a city or landlord had a negative impact upon a protected class such as a racial minority group. Second, if a prima facie case is shown, the burden shifts to the defendant to show that its policy was supported by a legitimate, nondiscriminatory interest. Third, if the defendant meets the burden in step two, the burden shifts to the plaintiff to show that the defendant’s interest could be served by another practice that 1) has less discriminatory effect than the defendant’s policy and 2) is also effective in meeting the defendant’s legitimate, nondiscriminatory interests.

In MHANY, a higher court (the U.S. Court of Appeals) had already resolved the first two steps: it was clear that Garden City's rezoning disproportionately harmed local African-Americans and Hispanics, and that the city's decision had been supported by the legitimate interests of preventing increased traffic and preventing school overcrowding. The appeals court then sent the case back to the trial court to decide whether plaintiffs met the third element of the three-part test—that is, whether rezoning the land for multi-family use had less discriminatory effect than the city's rezoning, and whether rezoning the land for multi-family use met the city’s goals of reducing school crowding and limiting traffic.

The trial court found for the plaintiff. In particular, the court found that multi-family zoning was less harmful to minorities than single-family zoning, because "one could not build any measurable number of affordable housing units under that [single-family] zoning…while it would have been financially feasible to build 45 to 78 affordable housing units under the R-M controls." Because affordable housing residents were disproportionately African-American and Hispanic, the plaintiff’s alternative had less discriminatory impact than single-family zoning. 

The court’s emphasis on "affordable housing" suggests that cities might be liable for exclusionary zoning if its policy excludes such housing. But what if plaintiffs propose market-rate multi-family housing, or market-rate small-lot single-family housing, instead of (even more expensive) market-rate single-family housing on large lots? The MHANY case suggests that plaintiffs would not prevail unless they can show that more minorities would have lived in the multi-family housing.

The court also found that multi-family zoning met the city’s goals, but again on narrow factual grounds. As to school crowding, the court found that multi-family housing would have met the city’s goals, because Garden City schools were not particularly overcrowded and would not have been overcrowded even with hundreds of new children. Obviously, this ruling would not be relevant to cities with more crowded schools.

Finally, the court found that multi-family zoning met the city's goal of minimizing traffic, because even if such zoning led to more traffic than single-family zoning, it "would have reduced traffic in relation to the conditions under the [prior public use] zone." The court explained, based on expert testimony, that multi-family housing generates far less traffic than office buildings (the primary use under prior zoning). It logically follows that if the city had always zoned the property for single-family housing, plaintiffs would not have been able to show that their proposal reduced traffic, and the city would have prevailed based on its interest in reducing traffic. 

Thus, the MHANY case suggests that a city can avoid disparate impact liability for exclusionary zoning as long as land was always zoned for the use that creates the least possible neighborhood traffic. So if cities can persuade courts that single-family house zoning is the least traffic-creating use, and the land at issue has been zoned for that use for many years, cities are likely to prevail in the majority of disparate impact cases involving exclusionary zoning.

*I note that the U.S. Department of Housing and Urban Development has proposed regulations that make it more difficult to raise disparate impact claims. Even if President Trump is re-elected, it is unclear to what extent courts will defer to these proposed rules. If President Trump is not re-elected, his successor is likely to reinstate existing law or even make it stricter.


Michael Lewyn

Michael Lewyn is an associate professor at Touro University, Jacob D. Fuchsberg Law Center, in Long Island. His scholarship can be found at http://works.bepress.com/lewyn.

View form second story inside Southdale Mall in Edina, Minnesota with escalators and model cars parked on downstairs floor.

The Mall Is Dead — Long Live the Mall

The American shopping mall may be closer to its original vision than ever.

March 21, 2024 - Governing

View of Austin, Texas skyline with river in foreground during morning golden hour.

The Paradox of American Housing

How the tension between housing as an asset and as an essential good keeps the supply inadequate and costs high.

March 26, 2024 - The Atlantic

Houston, Texas skyline.

Report: Las Vegas, Houston Top List of Least Affordable Cities

The report assesses the availability of affordable rental units for low-income households.

March 22, 2024 - Urban Edge

Single-Family Housing Construction

Understanding Affordable Housing Lingo

20 key terms in the affordable housing discussion.

28 minutes ago - Multi-Housing News

Close-up of hand holding charging cable moving toward charging port on electric car.

Undoing Biden's EV Rule

The partisan divide over how government should reduce greenhouse gas emissions was on full display after the Biden administration finalized its emissions standards rule for light and medium duty vehicles on March 20.

1 hour ago - Office of U.S. Senator Dan Sullivan

Aerial view of high-rise buildings on waterfront in Boston, Massachusetts

Boston Moves Zoning Reform Forward

The ‘Squares + Streets’ plan creates form-based zoning templates for neighborhoods that promote mixed use and denser housing near transit.

2 hours ago - The National Law Review

News from HUD User

HUD's Office of Policy Development and Research

Call for Speakers

Mpact Transit + Community

New Updates on PD&R Edge

HUD's Office of Policy Development and Research

Write for Planetizen

Urban Design for Planners 1: Software Tools

This six-course series explores essential urban design concepts using open source software and equips planners with the tools they need to participate fully in the urban design process.

Planning for Universal Design

Learn the tools for implementing Universal Design in planning regulations.