PHOENIX – Attorney General Kris Mayes today joined a coalition of 18 attorneys general in filing an amicus brief urging a federal court to reject a challenge to the Department of Housing and Urban Development’s (HUD) Discriminatory Effects Rule. The homeowners insurance industry is challenging the rule, which under the Fair Housing Act, says insurers and other parties are liable for housing practices that may appear neutral but in reality are discriminatory and have a “disparate impact” on certain populations.
“Now more than ever, it’s vital that we push back on any discriminatory housing practices. Whether it’s lenders, insurers or price-fixing schemes – there is no excuse or place for these unfair practices in Arizona, or across our nation,” said Attorney General Mayes.
Courts have long recognized the Fair Housing Act prohibits housing practices that, while not overtly discriminatory, have a disparate impact on individuals based on race, national origin or other protected characteristics. However, a trade association representing property and casualty insurance companies sued to have HUD’s Discriminatory Effects Rule declared invalid as it applies to homeowner’s insurers. The insurers argued that HUD should have granted a blanket exemption to the rule and its failure to do so makes the rule invalid for multiple reasons, including because many states require insurers to rely only on market-based factors in making underwriting decisions.
Attorney General Mayes and the coalition filed their brief in the U.S. Court of Appeals for the District of Columbia Circuit, arguing that disparate-impact liability is a critical tool to fight housing discrimination, which is a major and ongoing cause of widespread residential segregation. Attorney General Mayes and the attorneys general explain the law in many states already imposes disparate-impact liability on entities in the housing industry, so the insurers are wrong to invoke state law as a basis for their requested exemption.
Arizona’s fair housing laws are substantially similar to the federal laws that underpin HUD’s Discriminatory Effects Rule. Studies of housing in Arizona reveal that, even now, Arizonans are disparately impacted by a legacy of discriminatory housing practices, like restrictive covenants and lending practices. The Attorney General’s Civil Rights Division combats housing discrimination where it is found. HUD’s Discriminatory Effects Rule is an essential tool in the Attorney General’s attempts to end unfair housing practices.
Joining Mayes, Raoul and Schwalb in filing the brief are the attorneys general of California, Colorado, Delaware, the District of Columbia, Illinois, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island and Washington.