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PROTECTING THE AMERICAN DREAM (PART I): 

A LOOK AT THE FAIR HOUSING ACT 

HEARING 

BEFORE THE

SUBCOMMITTEE ON THE CONSTITUTION, 

CIVIL RIGHTS, AND CIVIL LIBERTIES 

OF THE

COMMITTEE ON THE JUDICIARY 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED ELEVENTH CONGRESS 

SECOND SESSION 

MARCH 11, 2010 

Serial No. 111–80 

Printed for the use of the Committee on the Judiciary 

( 

Available via the World Wide Web: http://judiciary.house.gov 

(II) 

COMMITTEE ON THE JUDICIARY 

JOHN CONYERS, JR., Michigan, Chairman 

HOWARD L. BERMAN, California 

RICK BOUCHER, Virginia 

JERROLD NADLER, New York 

ROBERT C. ‘‘BOBBY’’ SCOTT, Virginia 

MELVIN L. WATT, North Carolina 

ZOE LOFGREN, California 

SHEILA JACKSON LEE, Texas 

MAXINE WATERS, California 

WILLIAM D. DELAHUNT, Massachusetts 

STEVE COHEN, Tennessee 

HENRY C. ‘‘HANK’’ JOHNSON, JR., 

Georgia 

PEDRO PIERLUISI, Puerto Rico 

MIKE QUIGLEY, Illinois 

JUDY CHU, California 

LUIS V. GUTIERREZ, Illinois 

TAMMY BALDWIN, Wisconsin 

CHARLES A. GONZALEZ, Texas 

ANTHONY D. WEINER, New York 

ADAM B. SCHIFF, California 

LINDA T. SA ́ NCHEZ, California 

DEBBIE WASSERMAN SCHULTZ, Florida 

DANIEL MAFFEI, New York 

[Vacant] 

LAMAR SMITH, Texas 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

HOWARD COBLE, North Carolina 

ELTON GALLEGLY, California 

BOB GOODLATTE, Virginia 

DANIEL E. LUNGREN, California 

DARRELL E. ISSA, California 

J. RANDY FORBES, Virginia 

STEVE KING, Iowa 

TRENT FRANKS, Arizona 

LOUIE GOHMERT, Texas 

JIM JORDAN, Ohio 

TED POE, Texas 

JASON CHAFFETZ, Utah 

TOM ROONEY, Florida 

GREGG HARPER, Mississippi 

PERRY APELBAUM, Majority Staff Director and Chief Counsel 

SEAN MCLAUGHLIN, Minority Chief of Staff and General Counsel 

SUBCOMMITTEE ON THE CONSTITUTION, CIVIL RIGHTS, AND CIVIL LIBERTIES

JERROLD NADLER, New York, Chairman 

MELVIN L. WATT, North Carolina 

ROBERT C. ‘‘BOBBY’’ SCOTT, Virginia 

WILLIAM D. DELAHUNT, Massachusetts 

HENRY C. ‘‘HANK’’ JOHNSON, JR., 

Georgia 

TAMMY BALDWIN, Wisconsin 

JOHN CONYERS, JR., Michigan 

STEVE COHEN, Tennessee 

SHEILA JACKSON LEE, Texas 

JUDY CHU, California 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

TOM ROONEY, Florida 

STEVE KING, Iowa 

TRENT FRANKS, Arizona 

LOUIE GOHMERT, Texas 

JIM JORDAN, Ohio 

DAVID LACHMANN, Chief of Staff 

PAUL B. TAYLOR, Minority Counsel 

(III) 

C O N T E N T S 

MARCH 11, 2010 

Page 

OPENING STATEMENTS 

The Honorable Jerrold Nadler, a Representative in Congress from the State 

of New York, and Chairman, Subcommittee on the Constitution, Civil 

Rights, and Civil Liberties .................................................................................. 1 

WITNESSES 

Ms. Shanna L. Smith, President and CEO, National Fair Housing Alliance 

Oral Testimony ..................................................................................................... 3 

Prepared Statement ............................................................................................. 6 

Ms. Barbara Arnwine, Executive Director, Lawyers’ Committee for Civil 

Rights Under Law 

Oral Testimony ..................................................................................................... 19 

Prepared Statement ............................................................................................. 22 

Mr. Kenneth Marcus, Lillie and Nathan Ackerman Visiting Professor, Baruch 

College School of Public Affairs, City University of New York 

Oral Testimony ..................................................................................................... 35 

Prepared Statement ............................................................................................. 37 

Mr. John P. Relman, Founder and Director, Relman and Dane 

Oral Testimony ..................................................................................................... 74 

Prepared Statement ............................................................................................. 79 

Ms. Rea Carey, Executive Director, National Gay and Lesbian Task Force 

Action Fund 

Oral Testimony ..................................................................................................... 88 

Prepared Statement ............................................................................................. 91 

Ms. Okianer Christian Dark, Associate Dean for Academic Affairs and Professor of Law, Howard University School of Law 

Oral Testimony ..................................................................................................... 99 

Prepared Statement ............................................................................................. 103 

APPENDIX 

Material Submitted for the Hearing Record .......................................................... 123 

OFFICIAL HEARING RECORD 

MATERIAL SUBMITTED FOR THE HEARING RECORD BUT NOT REPRINTED

December 2008 report entitled ‘‘The Future of Fair Housing: Report of the National 

Commission on Fair Housing and Equal Opportunity.’’ 

http://www.nationalfairhousing.org/portals/33/reports/futureloflfairlhousing.pdf 

January 2007 report by Michigan’s Fair Housing Centers entitled ‘‘Sexual Orientation and Housing Discrimination in Michigan.’’ 

http://www.fhcmichigan.org/images/Arcuslweb1.pdf 

May 1, 2009 report by the National Fair Housing Alliance entitled ‘‘Fair Housing 

Enforcement: Time for a Change.’’ 

http://www.nationalfairhousing.org/LinkClick.aspx?fileticket=dsT4nlHikhQ%3D&tabid= 

3917&mid=5321 

(1) 

PROTECTING THE 

AMERICAN DREAM (PART I): 

A LOOK AT THE FAIR HOUSING ACT 

THURSDAY, MARCH 11, 2010 

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON THE CONSTITUTION,

CIVIL RIGHTS, AND CIVIL LIBERTIES, 

COMMITTEE ON THE JUDICIARY, 

Washington, DC. 

The Subcommittee met, pursuant to notice, at 1:58 p.m., in room 

2141, Rayburn House Office Building, the Honorable Jerrold Nadler (Chairman of the Subcommittee) presiding. 

Present: Representatives Nadler, Cohen, and Chu. 

Staff present: (Minority) David Lachmann, Subcommittee Chief 

of Staff; Kanya Bennett, Counsel; and (Minority) Paul Taylor, 

Counsel. 

Mr. NADLER. This hearing of the Subcommittee on the Constitution, Civil Rights, and Civil Liberties will come to order now that 

a convening quorum is present. 

I will recognize myself for an opening statement first. 

Today, the Subcommittee on the Constitution, Civil Rights, and 

Civil Liberties begins a review of housing discrimination, the Fair 

Housing Act, and the effectiveness of our government’s enforcement 

of the law. 

Housing discrimination remains a persistent problem in our 

country. While we would like to think that housing discrimination 

is an artifact of the past, we know it is not. Jim Crow laws and 

restrictive covenants may no longer be with us, but the discriminatory attitudes and practices they represented remain with us. 

Outright discrimination, steering, a refusal to build accessible 

housing as required by law, and discriminatory lending practices 

continue to plague renters and prospective homeowners. Additionally, there are still people who are subjected to legally sanctioned 

discrimination in many jurisdictions. Discrimination on the basis of 

sexual orientation and gender identity are perfectly legal in many 

areas, and people are regularly denied a place to live simply because of that status. 

Today, earlier today, I have introduced along with Chairman 

Conyers legislation amending the Fair Housing Act to correct that 

omission. Many communities around the Nation have already done 

so, and the time is long since passed when the Nation should follow 

suit. 

2 

As the Subcommittee continues its work, we will be looking at 

other ways to amend our fair housing laws and to devise other 

strategies to ensure that we can most effectively eliminate housing 

discrimination once and for all. We are fortunate today to have a 

distinguished panel of witnesses who will provide an excellent update on where we stand and recommend further actions to fulfill 

the promise of the Fair Housing Act. 

Fair housing has always been a value that has defied partisanship. I look forward to work with my colleagues on both sides of 

the aisle to further the American values of equality and fairness. 

In the interest of proceeding—well, I don’t have to do that. Without objection, all Members will have 5 legislative days to submit 

opening statements for inclusion in the record. Without objection, 

the Chair will be authorized to declare a recess of the hearing if 

necessary. 

Yes, I should mention that one reason a number of the Members 

of the Committee or the Subcommittee are not here today is that 

the Congressional Black Caucus is having a meeting at the White 

House right now, and that has deprived us of some of our interested Members for the moment. 

We will now turn to our witnesses. As we ask questions of our 

witnesses, the Chair will recognize—well, I will dispense with that. 

[Laughter.] 

I was going to say we will recognize Members in the order of seniority, et cetera. I will now introduce the witnesses. 

Shanna Smith is president and CEO of the National Fair Housing Alliance. Ms. Smith began her career in 1975 as executive director of the Toledo Fair Housing Center, where she pioneered investigations and litigation in fair housing practices. Ms. Smith also 

serves on the executive committee of the Leadership Conference on 

Civil Rights, where she co-chairs its fair housing task force, is a 

member of the board of the Center for Responsible Lending, and 

was appointed in January 2008 to the Federal Reserve’s Community Advisory Council. 

Barbara Arnwine has been the executive director of the Lawyers’ 

Committee for Civil Rights Under Law since 1989. While there, she 

has played an instrumental role in advocating for the passage of 

civil rights legislation, including the Civil Rights Act of 1991. 

She has spent her career advocating on behalf of civil rights in 

the areas of housing, fair lending, community development, employment, voting, education and environmental justice. Ms. 

Arnwine is a graduate of Scripps College and earned her law degree from Duke University. 

Kenneth Marcus holds the Lillie and Nathan Ackerman chair in 

equality and justice in America at the Baruch School of Public Affairs City University of New York, where he teaches public administration, education law, and civil rights. 

Before joining the faculty at Baruch, Mr. Marcus served as a 

staff director of the United States Commission on Civil Rights and 

as the general deputy assistant secretary of housing and urban development for fair housing and equal opportunity. Mr. Marcus is a 

graduate of Williams College magna cum laude and the University 

of California, Berkeley, School of Law. 

3 

John Relman is the founder and director of the firm Relman and 

Dane. Mr. Relman has practiced extensively in the areas of fair 

housing and fair lending law. Before going into private practice, 

Mr. Relman served as project director of the Fair Housing Project 

at the Washington Lawyers’ Committee for Civil Rights and Urban 

Affairs. 

Prior to joining the committee, he clerked for the Honorable Sam 

Ervin III of the U.S. Court of Appeals for the Fourth Circuit and 

the Honorable Joyce Hens Green of the U.S. district court for the 

District of Columbia. Mr. Relman is a graduate of Harvard University and received his law degree from the University of Michigan. 

Rea Carey is the executive director of the National Gay and Lesbian Task Force Action Fund based in Washington, D.C., which advocates on behalf of the gay, lesbian, bisexual and transgender 

community. She has over 20 years of experience in nonprofit management and in public policy issues affecting the LGBT community. 

Ms. Carey earned her master’s degree in public administration 

from Harvard University’s Kennedy School of Government. 

Okianer Christian Dark is associate dean of academic affairs and 

professor of law at Howard University. Prior to joining Howard’s 

faculty in the fall of 2001, Ms. Dark served as an assistant United 

States attorney in the civil division of the U.S. attorney’s office in 

Portland, Oregon. There, Ms. Dark was responsible for the civil 

rights litigation in the district of Oregon, which included the Fair 

Housing and Americans with Disabilities Act. 

She has also offered her personal story as a victim of housing 

discrimination in a videotape titled ‘‘Who Can Ever Get Used to 

This?’’, which has been used nationally for training purposes by 

fair housing organizations, law school property and fair housing 

courses, and by the United States Department of Justice. Ms. Dark 

received her B.A. magna cum laude from Upsala College and her 

law degree from Rutgers University. 

I am pleased to welcome all of you. Your written statements in 

their entirety will be made part of the record. 

I would ask each of you to summarize your testimony in 5 minutes or less. To help you stay within that time, there is a timing 

light at the table. When 1 minute remains, the light will switched 

from green to yellow and then red when the 5 minutes are up. 

Before we start, let me apologize for beginning the hearing a little late. Most of that was due, as you know, to the fact that we 

were voting on the floor. 

Before we begin, it is customary for the Committee to swear in 

its witnesses. 

[Witnesses sworn.] 

Mr. NADLER. Thank you. Let the record reflect that the witnesses 

answered in the affirmative. You may be seated. 

Our first witness will be Ms. Smith, who is recognized for 5 minutes. 

TESTIMONY OF SHANNA L. SMITH, PRESIDENT AND CEO, 

NATIONAL FAIR HOUSING ALLIANCE 

Ms. SMITH. Thank you. Good afternoon, and thank you, Chairman Nadler, for the opportunity to talk about the American dream 

and fair housing. 

4 

As you know, the Fair Housing Act was passed in 1968 and 

amended in 1988 with very strong bipartisan support. Congress’s 

intent was to create neighborhoods where people would have equal 

access to the American dream and an opportunity to live where 

they wanted to by choice and free of discrimination. 

For myriad reasons, we as a Nation have truly failed to come 

close to achieving the goals of the Fair Housing Act. 

So the 1968 law clearly articulated two goals of the Fair Housing 

Act. And in 1972, the U.S. Supreme Court, in Trafficante v. Metropolitan Life Insurance Company and Parkmerced Apartments in 

San Francisco talked about those two goals. 

One is obvious. It is the elimination of housing discrimination. 

But the second goal is to promote residential integration. 

Our failure as a Nation to effectively address both individual and 

systemic housing, lending and insurance discrimination means discrimination is still pervasive and residential segregation remains 

the norm. It is important to point this out, because when you look 

at the companion law, Title VII, the Equal Opportunity Employment Act, we see many corporations who have succeeded in having 

a diverse workforce. But each night, that workforce goes home to 

segregated communities, segregated neighborhoods. 

The Fair Housing Act is one of the strongest civil rights laws 

that has ever been passed. One of the main reasons we do not have 

more integrated communities today is because the law has not been 

effectively enforced. We need to use the strength of the existing law 

to promote integration and fight housing discrimination. 

So how prevalent is discrimination? Last year, HUD, the U.S. 

Department of Justice, the private fair housing groups, and the 

State and local agencies only reported about 30,000 complaints of 

discrimination. We have looked at research to show that we could 

estimate that more than 4 million instances of housing discrimination happened annually. 

Who is being harmed by this? Well, we have the seven protected 

classes, but in addition, we need to talk about how people with disabilities and families with children right now are reporting the 

highest rates of discrimination. 

We recently settled a lawsuit with the fifth largest builder in the 

United States, the AG Spanos company. And I have to say that Michael Spanos and the company was very good to work with. He was 

concerned that the discrimination happened. 

But the fact is, from 1991 through 2007 and 2008, they built 

apartment complexes, 123 apartment complexes, that were not accessible to people with disabilities. And in that settlement, you 

know, he has got to renovate and retrofit 12,300 apartments at a 

cost of nearly $8 million to $10 million. And had they been built 

correctly, people with disabilities would have had access to those 

units and this latter cost wouldn’t have come to play. 

Families with children are experiencing rampant rates of discrimination. When you consider that 2 million children are homeless now because of the foreclosure crisis and families with children 

are looking for housing every day, they look on the Internet and 

they see ads that say, ‘‘No kids,’’ ‘‘no teenagers,’’ ‘‘three-bedroom 

apartment, one child,’’ ‘‘three-bedroom single-family home for rent, 

four people only.’’ 

5 

And the law says you can—in a three bedroom with a family— 

you can have a husband and wife and four kids, and yet they are 

restricting occupancy. 

Then we have the whole issue of underreported complaints of 

housing discrimination. Sexual harassment in housing continues to 

increase. I personally think with the advent of Viagra that we have 

seen much more sexual harassment of particularly low-income 

women in housing. 

And a recent case in New York City in the—— 

Mr. NADLER. Excuse me. Let me just explore that for a second. 

Sexual harassment in housing. What is the connection with the 

housing? 

Ms. SMITH. The landlords will require or—— 

Mr. NADLER. Oh, sexual harassment by landlords. 

Ms. SMITH. Yes, I am sorry. 

Mr. NADLER. Okay. 

Ms. SMITH. Sexual harassment by the landlords. The New York 

City case on the Upper West Side that just happened this month— 

I am sorry, in February—women were being evicted because they 

refused to have sex with the landlord and the superintendent. The 

superintendent was a convicted child sex offender, and the women 

had no idea that they had any protection under the fair housing 

law, that landlords cannot sexually harass a tenant. 

Other underreported issues deal with national origin. Latinos 

and Asian-Americans are not filing cases although our investigations when we do testing show high rates of discrimination that 

they experience. 

Oh, it said stop. 

Also, the other thing I wanted to talk about very quickly is disparate impact. All 11 circuits have heard fair housing cases, and 

they have all said that the Fair Housing Act covers both intentional discrimination and discrimination by housing policies and 

practices that have a disparate impact. 

And while the Supreme Court hasn’t made a decision, all 11 circuits have. And in my testimony, I have several examples. 

And finally, quick recommendations. The National Fair Housing 

Alliance since 1990 has supported adding additional protected 

classes: source of income, source of—I would say source of legal income, marital status, sexual orientation, and gender identity or expression. 

We worked with former Secretaries Jack Kemp and Henry 

Cisneros and had a commission on fair housing. And the top recommendation was to create an independent fair housing agency for 

enforcement of the law. 

And finally, on the discriminatory advertising I talked about, the 

Communications Decency Act protects these Internet providers and 

servicers and allows them to run ads or have people post ads that 

say no kids, no Blacks, Christians only. So what we would like to 

see is an amendment to the Communications Decency Act so that 

it does—it no longer trumps the Fair Housing Act. 

Thank you. 

[The prepared statement of Ms. Smith follows:] 

6 

PREPARED STATEMENT OF SHANNA L. SMITH


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Mr. NADLER. Thank you. 

Ms. Arnwine is recognized for 5 minutes. 

TESTIMONY OF BARBARA ARNWINE, EXECUTIVE DIRECTOR, 

LAWYERS’ COMMITTEE FOR CIVIL RIGHTS UNDER LAW 

Ms. ARNWINE. Good afternoon, Chairman Nadler. 


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My name is Barbara Arnwine, and I am the executive director 

of the Lawyers’ Committee for Civil Rights Under the Law. Thank 

you for this opportunity to testify at this important hearing on the 

Fair Housing Act. 

Forty-two years after passage of the Fair Housing Act as amended in 1988, we are still so far from fulfilling its promise. Its requirement that communities receiving Federal housing assistance 

and the Federal Government proactively further fair housing, residential integration, and equal opportunity needs better governmental enforcement and continued due diligence by civil rights organizations like the Lawyers Committee, NFHA, and all the ones 

that are represented here. 

This need was reiterated during hearings held as part of the National Commission on Fair Housing and Equal Opportunity. The 

commission’s recommendations were released in a major report in 

December 2008 entitled the ‘‘Future of Fair Housing,’’ and we urge 

this Congress to affirmatively act upon them as soon as possible. 

I will address some of these today, and I am sure my esteemed 

panel member Dean Okianer Dark, who was a member of this commission, will also provide more details. 

As a multifaceted civil rights organization, the Lawyers’ Committee works across many disciplines to address civil rights issues 

and their impact upon minority communities. Our environmental 

justice, community development, and education projects are all especially interconnected with the work of the Fair Housing Project 

in a coordinated effort to combat discriminatory practices and resegregation. 

To this end, we are recommending diversity and education and 

integration requirements, and the reauthorization of the elementary and secondary education act programs to redress the Federal 

Government’s role in perpetuating segregated communities in the 

education context and the housing context. 

Presently, the Lawyers’ Committee’s top fair housing priority is 

fighting the foreclosure crisis. As stated in the ‘‘Future of Fair 

Housing’’ report, ‘‘The impact of this crisis is causing one of the 

greatest losses of wealth in the American minority community in 

its history.’’ Millions of distressed homeowners have become vulnerable targets to unscrupulous and sometimes criminal third-party 

scammers posing as loan modification specialists. 

The Lawyers’ Committee has responded by creating a coordinated national campaign entitled the loan modification scam prevention network to support existing efforts at the national, State 

and local levels. We are working with Fannie Mae, Freddie Mac, 

NFHA, and NeighborWorks of America. The Lawyers’ Committee is 

leading an effort to increase reporting and prosecution of alleged 

scammers to support ongoing enforcement efforts. 

Our Web site, www.preventloanscams.org, provides additional information about our campaign. 

For a legislative fix, we are supporting the formation of the Consumer Financial Protection Agency, which the House has already 

passed, and is now awaiting passage in the Senate. We believe this 

new agency will help quell discriminatory, deceptive and fraudulent loans which have led to this current foreclosure crisis. 

21 

As part of our litigation efforts after Hurricane Katrina, the Lawyers’ Committee created the Disaster Survivor Legal Assistance 

Initiative and emerged as one of the leading civil rights organizations in providing legal assistance to victims of the storm. This 

brought a number of cases to light. 

First, alleged violations by Internet providers of the Fair Housing 

Act arose as a major issue. And as Shanna has already said, before 

the courts have thus far shielded Internet providers under the 

Communications Decency Act, we ask that Congress adopt a simple 

amendment to the CDA which makes clear that nothing in the 

CDA limits the application of the Fair Housing Act or any similar 

State law. 

Second, for several years, the Lawyers’ Committee’s fair housing 

program has given priority to fighting discriminatory zoning decisions in municipalities. This has been a major barrier in our postKatrina housing recovery efforts in Mississippi and New Orleans. 

A case we are involved in with John Relman and others in St. Bernard’s Parish illustrates how HUD’s enforcement of Section 808 of 

the Fair Housing Act can be extremely effective in fighting discriminatory and exclusionary zoning. 

Despite HUD’s actions, we still believe it is necessary for HUD, 

one, to release a guidance as soon as possible so that recipients of 

Federal housing know their duties, and it is critical for Congress 

to amend the Fair Housing Act so that a discriminatory housing 

practice involves a violation of the affirmatively furthering provision under Section 3608. 

Third, the Lawyers’ Committee has focused much of its amicus 

litigation on source of income discrimination. And while we are encouraged by the court’s decisions thus far, we urge congressional 

action here, as well. 

Discrimination based on source of income is currently not covered 

under the Fair Housing Act. Hence, to better ensure compliance 

and clarify the act’s original intent, we recommend an amendment 

to the Fair Housing Act that would add source of income as a protected class. 

And lastly, all courts of appeal have recognized that violations of 

the Fair Housing Act may be proved on a disparate impact standard. However, the standard is now under attack by the financial 

industry in a series of fair lending cases, and it is very important 

that the standard be vigorously defended by the Department of 

Justice and by the adoption by HUD of a regulation consistent with 

the holdings in all of these courts of appeals. 

The Lawyers’ Committee applauds this Subcommittee’s actions to 

take a close look at the Fair Housing Act. It is increasingly clear 

that fair housing is the lynchpin to protecting the American dream. 

We look forward to the further hearings addressing these issues 

and determining what actions are most important and will be most 

successful. 

Thank you so much. 

[The prepared statement of Ms. Arnwine follows:] 

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PREPARED STATEMENT OF BARBARA ARNWINE


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Mr. NADLER. Thank you. 

Mr. Marcus is recognized for 5 minutes. 

TESTIMONY OF KENNETH MARCUS, LILLIE AND NATHAN ACKERMAN VISITING PROFESSOR, BARUCH COLLEGE SCHOOL 

OF PUBLIC AFFAIRS, CITY UNIVERSITY OF NEW YORK 

Mr. MARCUS. Thank you, Mr. Chairman. It is always an honor 

to—— 

Mr. NADLER. Speak directly into the mic, please. 

Mr. MARCUS. Better? 

I commend the Subcommittee for entertaining the topic today. As 

Ms. Arnwine pointed out, we have not yet fulfilled the mission behind the Fair Housing Act. We continue to see serious, significant 

discrimination of many kinds throughout this country in housing 

and in lending, particularly glad that Ms. Smith pointed out a case 

of sexual harassment, which we do see in apartments around the 

country, and I think that that example is particularly useful because it is one example that shows that as bad as discrimination 

is in other areas—employment, education, labor, so on and so 

forth—when it happens in your home, when it happens in your 

home, there is a kind of a violation that goes beyond what one sees 

elsewhere. 

And we do see today forms of discrimination like sexual harassment, like outright racism in housing that really need to be addressed. My successor at the Office of Fair Housing and Equal Opportunity, John Trasvina, tells a story of a gentleman just last 

year, of a case in which a landlord saw his tenant speaking to an 

African-American couple and said, ‘‘If you all want to have AfricanAmericans to visit, we are going to have to ask you to move. We 

are not having those people at our property. We own the property. 

That has never happened. And we are not going to let it start happening with this.’’ 

So one sees that sort of blatant outright discrimination. And that 

is something that we need to address and address firmly and for 

which we need a very strong civil rights apparatus to address. 

However, I think the reason that we have heard already from 

two witnesses a discussion of disparate impact is that nowadays 

most people who harbor prejudice of this sort will not admit it 

quite so openly. They will conceal it. They will deny it. In some 

cases, they are even unconscious of it. 

For that reason, we have disparate impact as a means of discerning discrimination where intent cannot be proven. But disparate impact has been controversial, because while it can be useful as a legitimate law enforcement tool, it can also be misused. 

And when it is misused, there are real dangers—both legally and 

in terms of equity—and I want to say a few words—and I want to 

say a few words about that. 

You have heard from two witnesses correctly that the courts of 

appeals have found that disparate impact is a viable claim under 

the Fair Housing Act. And I think that that argument would prevail in any court in the country, with the possible exception of the 

Supreme Court. 

We do not know what the Supreme Court would say if disparate 

impact is challenged, as it has been challenged before when the 

36 

issue has been averted. And there are a lot of arguments that can 

go either way on this issue. 

We know, for instance, that when President Reagan signed the 

amendment to the Fair Housing Act, he said that the bill ‘‘does not 

represent any congressional or executive branch endorsement of 

the notion expressed in some judicial opinions that Title VIII violations may be established by a showing of disparate impact,’’ et 

cetera. In fact, he said more explicitly Title VIII speaks only to intentional discrimination. 

So I would say that the question remains unsettled in the sense 

that we still don’t know what the Supreme Court would do and 

that, if Congress has a view on this, it can resolve it—it can resolve 

it with legislation. 

More importantly, perhaps, if it does address that, there is the 

question as to whether certain forms of disparate impact are inconsistent with equal protection, an issue that was raised both in the 

Kennedy opinion and in the Scalia opinion in the recent New 

Haven firefighters case, Ricci v. DeStefano. 

In that case, the question was raised as to whether disparate impact may violate equal protection to the extent that, for instance, 

it presses either employers or other entities to use race-conscious 

remedies for permits other than to combat discrimination. 

Now, I see I need to sum up, so what I am going to say is, the 

reason that I am raising this is that there remains a real question 

as to whether in a subsequent case the Supreme Court would either narrow in an unpredictable way or entirely strike down the 

use of disparate impact under Title VIII. 

If Congress wants to avoid that, it needs to address disparate impact in this legislation in a way that will preserve it from judicial 

challenge. 

Mr. NADLER. Let me just ask you a question at this point. 

Mr. MARCUS. Yes, sir. 

Mr. NADLER. Do you believe a challenge in front of the Supreme 

Court on disparate impact would be statutory or constitutional in 

nature? 

Mr. MARCUS. Well, I think it could go either way. I think that 

Justice Scalia is predicting that the constitutional challenge is upcoming, and I think it will happen. 

As for the statutory challenge, since there is no circuit split, I 

don’t see it imminently, but we know that the Supreme Court got 

two cases in which it could have been resolved. 

So I think both challenges may come up, but the constitutional 

challenge may be more imminent. 

Mr. NADLER. Thank you. 

Mr. MARCUS. Thank you. 

[The prepared statement of Mr. Marcus follows:] 

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PREPARED STATEMENT OF KENNETH MARCUS


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Mr. NADLER. I now recognize Mr. Relman for 5 minutes. 

TESTIMONY OF JOHN P. RELMAN, FOUNDER AND DIRECTOR, 

RELMAN AND DANE 

Mr. RELMAN. Thank you, Chairman Nadler. And thanks—— 


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Mr. NADLER. Microphone, please. 

Mr. RELMAN. Yes, good. 

Thank you, Chairman Nadler, and thank you very much both for 

convening these hearings and for the opportunity to testify. 

My testimony today will address two topics: discrimination housing practices directed toward the disability community and the role 

of private firms in recent large fair housing enforcement actions. 

The Fair Housing Act has prohibited disability discrimination for 

22 years, yet hundreds of thousands of people with disabilities remain stranded in institutional or inaccessible settings because of 

architectural and attitudinal barriers. 

Just as the Fair Housing Act was a powerful force for racial integration in America, it was also intended to promote the integration 

of people with disabilities. For people with disabilities, integration 

means being part of the American mainstream and not being treated unfavorably because of a housing provider’s biases or stereotypes about disability. 

Vigorous enforcement of the Fair Housing Act and timely enforcement of the Fair Housing Act is particularly important when 

it comes to refusals to accommodate inaccessible design and construction. It can be the difference between a person with a disability being allowed to or being able to live in an integrated setting or being relegated to an institutional setting. 

Twenty-two years after the amendment, the governmental enforcement of the Fair Housing Act’s disability provisions still does 

not begin to approach the level of a national commitment. The 

Obama administration inherited a bureaucratic environment from 

past Administrations that has left a backlog of complaints languishing on the desks of investigators, some of whom don’t fully 

understand the basic elements of the disability discrimination 

claim, and that has left people languishing unnecessarily in institutional settings. 

Under the leadership of Assistant Attorney General Tom Perez 

and HUD Secretary Shaun Donovan, the Obama administration is 

taking what I believe are important steps to improve enforcement 

of the Fair Housing Act’s disability protections. But because discrimination against people with disability remains rampant, more 

fair housing complaints allege disability discrimination than any 

other protected class. 

And for this reason, the Administration needs private civil rights 

firms as enforcement partners. I would direct the Committee’s attention to both the statistics in Shanna Smith’s testimony showing 

the number of disability complaints filed and also her reference to 

the Spanos case. That was a case that we litigated on behalf of the 

National Fair Housing Alliance. 

And although we only have 14 lawyers in our national civil 

rights practice, yet we were able to prosecute successfully this very 

complicated and cutting-edge case, I think an example of ways that 

private firms can assist with the need to fill the gap where the 

Federal Government has not been able to fill in. 

Beyond problems with design and construction, people with disabilities also face a rash of other problems that includes differential 

treatment, facially neutral rules that have a harsher disparate impact on them, refusal to provide reasonable accommodations in 

76 

rules and policies, or to permit reasonable modifications of units 

that give access to common areas and increase accessibility. 

And we have also seen problems in retirement homes, where 

housing providers impose rules and policies that discriminate on 

the basis of disability. 

As well, there appears to be a widespread use of advertisements 

for active adults and those capable of living independently without 

assistance. These are discriminatory advertisements. Policies such 

as these and practices discourage people with disabilities from applying and living in communities with people who do not have disabilities. 

In many of these situations, the Fair Housing Act already provides sufficient substantive protections. And the principal question 

is really one of enforcement. There are, however, a number of areas 

in which we believe—I believe the Fair Housing Act or the HUD 

regulations that govern enforcement can be clarified and strengthened. 

I would like to mention three. The first concerns the statute of 

limitations when it comes to design and construction barriers. The 

court of appeals for the Ninth Circuit has recently adopted a very 

cramped view of the Fair Housing Act’s statute of limitations that 

bars litigation of design and construction violations that are identified more than 2 years after the date of the final occupancy permits. 

What this does is it effectively gives designers and developers a 

free bite at the apple. It lets them off the hook for blatant violations that are going to be in place for many years to come, and it 

prevents access as long as they can avoid detection in the first 2 

years of operation. 

The second issue that we think can be clarified is to provide a 

private right of conduct that allows individuals and private parties 

to challenge discriminatory municipal ordinances that prevent people in recovery from drug and alcohol addiction, for example, from 

being able to live in single-family-zoned areas in neighborhoods 

and allowing their full integration into these communities. And 

that is—that is a provision that should be allowed under Section—— 

Mr. NADLER. I am sorry. Could you—you are saying there should 

be a private right of action for what exactly? 

Mr. RELMAN. For enforcing Section 3608(e)(5) of the Fair Housing Act. This is a provision that allows and requires the duty to 

affirmatively further fair housing under the Fair Housing Act. And 

there needs to be a private right of action now to enforce that. That 

would allow us to address these problems with discriminatory zoning. 

And finally, financial conditions is often affected by disability because the latter may limit one’s ability to work. As a consequence, 

many people with disabilities depend on rental subsidies such as 

the housing choice voucher program to live in decent, safe, affordable and accessible housing. 

But the Fair Housing Act does not explicitly prohibit a landlord 

from simply refusing to accept vouchers. So I believe Congress can 

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crimination similar to the one in the low-income housing tax credit 

program administered by the Department of Treasury. 

And finally, the joint statements that HUD and DOJ have issued 

have been enormously helpful to advocates and to lawyers like myself. These are joint statements on group homes that have clarified 

the law, reasonable accommodation and reasonable modification. 

And they have been used by thousands of advocates. 

We are puzzled why HUD and DOJ have not taken a similar approach in other areas, such as with the statute of limitations, continuing violations, et cetera, to clarify what the law should say. 

Finally, I would just like to sum up by saying a few words about 

the role of private firms in fair housing enforcement, because this 

is very important. Over the last 2 years, our firm has been involved 

in five major enforcement actions, a $10.8 million jury verdict on 

behalf of an African-American community in Zanesville, Ohio, a 

summary judgment ruling in a fair housing case in Westchester 

County that led to a $52 million settlement requiring Westchester 

to satisfy its duty to affirmatively further fair housing by building 

affordable housing in areas of the county that are less than 3 percent African-American, as alluded to by Barbara Arnwine, three 

findings of contempt against St. Bernard Parish in Louisiana for 

denying an affordable housing provider the right to build multifamily housing, and two lawsuits brought on behalf of the city of 

Baltimore and the city of Memphis against Wells Fargo for targeting African-American neighborhoods for unfair and predatory 

loans, as well as the Spanos case referred to by Shanna Smith. 

The questions may fairly be posed, why has so much recent important fair housing litigation been the product of private enforcement efforts like our firm? And how, if at all, is this development 

related to current or past enforcement efforts by the Federal Government? 

I would like to suggest that what I believe has happened is that 

historically the housing and civil enforcement section has done an 

excellent job in enforcing the law, both in Republican and Democratic administrations. All of this, though, changed with the last 

Republican administration. Enforcement efforts eroded significantly 

not due to the commitment of lawyers, career attorneys who managed to stay, but due to the departure of many other experienced 

career attorneys who found the environment no longer hospitable 

to the principles they had committed to. 

The result was both a lack of resources needed to identify and 

litigate new cases and absence of leadership needed to conceive and 

develop new litigation strategies, both of those things. 

So from 2001 to 2008, the responsibility for litigating these cases 

and for enforcing the law fell increasingly to firms like ours that 

have the expertise and resources needed to take on these difficult 

and complex cutting-edge cases. 

Now, in one sense, this is nothing different than what Justice 

Douglas envisioned and Congress envisioned when they first 

passed the Fair Housing Act. They said that complaints by private 

persons are the primary method of obtaining compliance with the 

act. This is what Justice Douglas said in the famous Trafficante 

case, and it is what Congress intended. 

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The reality in the years that followed that decision, though, has 

proved both prescient and understated, prescient because private 

parties and firms played an important role in enforcing the act, but 

understated because the role of the Department of Justice proved 

far more important than either Justice Douglas or Congress might 

have imagined. 

The last thing I want to say about this is I think that the good 

news is that the Obama administration has renewed the Federal 

Government’s commitment to fair housing enforcement in significant and vital ways. Assistant Attorney General Tom Perez and 

Secretary Donovan have committed their departments to agendas 

that incorporate many of the ideas that are at the heart of the 

cases that I mentioned above. 

The Westchester case was settled with the assistance of this Department of Justice. The St. Bernard Parish cases have become a 

central focus of Secretary Donovan’s current efforts. And Assistant 

Attorney General Perez has opened 45 new lending discrimination 

investigations, and announced that predatory lending targeted at 

minority communities is going to be a priority enforcement area. 

I think, though, that going forward we need to do three things. 

The first—and this is my final comment—Congress has got to provide the Department of Justice and HUD with the funding needed 

to fully staff its enforcement work. Second, Congress has got to 

adequately fund the fair housing initiatives program to ensure that 

fair housing organizations have sufficient resources to investigate 

and test to determine whether housing providers are violating the 

law. 

And third and last, the civil rights division has got to redouble 

its efforts to coordinate Federal, State, municipal and private efforts to enforce the law, working closely with all of these important 

stakeholders, to make sure that we fulfill the purpose and the 

promise that Congress envisioned when it first passed the Fair 

Housing Act. 

Thank you very much. 

[The prepared statement of Mr. Relman follows:] 

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PREPARED STATEMENT OF JOHN P. RELMAN


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Mr. NADLER. Thank you. 

And I recognize Ms. Carey for 5 minutes. 

TESTIMONY OF REA CAREY, EXECUTIVE DIRECTOR, 

NATIONAL GAY AND LESBIAN TASK FORCE ACTION FUND 

Ms. CAREY. Good afternoon, Chairman Nadler, Members of the 

Committee. 

Mr. NADLER. Before you continue, let me mention that we have 

been joined by the gentlewoman from California, Ms. Chu. 


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Ms. CAREY. On behalf of the National Gay and Lesbian Task 

Force Action Fund, the oldest national organization advocating for 

the rights of lesbian, gay, bisexual and transgender people, herein 

after LGBT people, I thank you for the opportunity to testify on 

housing discrimination as it relates to sexual orientation and gender identity. We are particularly grateful to be included in this 

hearing. 

For us, the pursuit of the American dream, including homeownership, is a risky proposition. When our sexual orientation or 

gender identity is known, either because we offer it willingly or a 

landlord, realtor or lender is made aware by other means, there is 

the potential for outright hostility, property damage, and even 

physical violence. 

Studies show that when callers describe themselves as gay or lesbian, apartments are more likely to be described as unavailable. In 

a 2007 Michigan study, same-sex couples were shown less desirable 

properties, were quoted higher rent prices, or encountered outright 

refusal to sell or rent properties. 

In 2009, we, together with the National Center for Transgender 

Equality, completed a groundbreaking survey of over 6,000 

transgender people nationwide. The study showed transgender and 

gender-non-conforming people were living at twice the rates of extreme poverty and double the rate of unemployment than the general population, despite high levels of education. Disturbingly, 11 

percent of transgender people reported having been evicted, and 19 

percent reported becoming homeless due to bias. 

While the general population has a homeownership of approximately 68 percent at the time of our survey, our survey showed 

only a 32 percent rate of homeownership among transgender people. 

Similarly, LGBT seniors fall within a higher risk category for 

housing challenges. We recently released Outing Age 2010 describing the multiple economic and policy barriers LGBT people face as 

we age. 

LGBT seniors are more likely to be economically fragile due to 

the impacts of discrimination over their lifespan. As they need to 

move into smaller residences and assisted-living facilities, seniors 

are especially vulnerable. Importantly, amending the FHA will 

make it more likely they can find safer housing. 

Several court cases mirror the research finding housing discrimination. For instance, a 2002 case in New York found housing regulations negatively affected lesbian and gay tenants. And in 2003, 

Lambda Legal said it had settled a case on the basis of anti-gay 

housing discrimination in Palm Beach County. 

We have received stories from LGBT people who have experienced discrimination. One couple was forced to tell potential landlords that they were roommates because they were harassed and 

rejected when they had applied as a couple. 

In Baltimore, a transgender man upon meeting a potential landlord was asked if he was a boy or a girl, was confronted with a 

$100-per-month increase in the quoted rent, and was told checks 

were not accepted. When his friend inquired about the same apartment, she was told checks were accepted and the rent was not 

raised. 

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This doesn’t have to be the reality for LGBT people, but it is. 

Thankfully, several jurisdictions have adopted laws to protect 

LGBT people from housing discrimination. Twenty States and the 

District of Columbia prohibit discrimination on the basis of sexual 

orientation, and 13 States and D.C. include gender identity. 

For example, in 2007, Iowa amended its Civil Rights Act of 1965 

to include both sexual orientation and gender identity. In New 

York City, one of the most comprehensive civil rights laws in the 

Nation includes housing protections based on numerous characteristics, including sexual orientation and gender identity. 

Despite the protections afforded to some LGBT people by State 

and local law, Federal protection is necessary. Amending the FHA 

would provide base line protections for LGBT people living outside 

currently protected jurisdictions. Further, State and local protections often do not offer robust enforcement and recourse to victims. 

LGBT people suffer pervasive discrimination in so many areas of 

their lives. No one should be evicted, be kept from living in certain 

areas, or pay more rent simply because of who they are. Nor should 

anyone have to lie about who they are in order to have safe housing. 

For all these reasons, the Fair Housing Act should be amended 

to ban discrimination on the basis of sexual orientation and gender 

identity, and we thank you, Chairman Nadler, for your leadership 

on this issue. 

[The prepared statement of Ms. Carey follows:] 

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PREPARED STATEMENT OF REA CAREY


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Mr. NADLER. Thank you. 

And I will now recognize Ms. Dark for 5 minutes. 

TESTIMONY OF OKIANER CHRISTIAN DARK, ASSOCIATE DEAN 

FOR ACADEMIC AFFAIRS AND PROFESSOR OF LAW, HOWARD 

UNIVERSITY SCHOOL OF LAW 

Ms. DARK. Thank you, Chairman. 


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Good afternoon and thank you, Chairman Nadler, and Members 

of the Committee. I am honored to participate in this particular 

hearing about the Fair Housing Act. 

As you noted in my introduction, I come to the housing work in 

an unusual way. I was a victim of housing discrimination in Richmond, Virginia, when as a young law professor at the University 

of Richmond School of Law I attempted to rent an apartment and 

was unable to do so based on my race. 

I subsequently brought a lawsuit to challenge the discriminatory 

conduct, which was successfully resolved. However, this particular 

experience changed me in important ways, and so I began a life to 

make contributions wherever I could to support the fair housing 

movement. 

Recently, or more recently, I have had the opportunity to serve 

on the National Commission on Fair Housing and Opportunity, 

which was established by leading civil rights and fair housing organizations in the country. This commission was formed by the Leadership Conference on Civil Rights Education Fund, the National 

Fair Housing Alliance, the NAACP Legal Defense and Educational 

Fund, and the Lawyers’ Committee for Civil Rights Under the Law. 

The primary purpose of the commission was to investigate the 

state of fair housing on the 40th anniversary of the Fair Housing 

Act. It was a seven-member bipartisan commission, superbly led by 

former U.S. Housing and Urban Development Secretary, the Honorable Henry Cisneros and the Honorable Jack Kemp. 

In addition, as my written testimony points out, we had representatives who were distinguished in many ways, and we held as 

a group five hearings across the country—Chicago, Houston, Los 

Angeles, Boston and Atlanta—and we heard testimony from many 

stakeholders, various different interest groups. But here is the bottom line: The hearings exposed the fact that despite strong legislation passed, ongoing discriminatory practices in the Nation’s housing and lending markets continued—residential segregation that 

results in significant disparities beyond minority and non-minority 

households in access to good jobs, quality education, homeownership attainment, and asset accumulation. 

Now, we produced a report based on those hearings that have— 

that set forth nine recommendations. And I am just going to try to 

put it in four categories, take the nine and scrunch it down to four. 

First and foremost, we recommended the creation of an independent fair housing enforcement agency. In order to address the 

longstanding and systematic problems with fair housing enforcement, we recommended this independent agency to replace the existing fair housing enforcement structure at HUD. 

Support for an independent fair housing enforcement agency was 

the most consistent theme of the hearing. And as you have heard 

from the testimony of Ms. Shanna Smith and Mr. John Relman, 

they have identified some of the problems with the housing enforcement at HUD. 

A reformed independent fair housing agency would have three 

components: a career staff with fair housing experience and competence as the key criteria for employment; an advisory commission 

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cates and enforcers; and an adequate staff and resources, adequate 

staff and resources to make fair housing a reality. 

And so that was our number-one recommendation. We had about 

three recommendations that I would say address the silo effect. 

That is, we have to look at housing in the context of other areas. 

It has already been pointed out, housing with health, housing with 

safety, housing with employment, housing with education. All of 

these areas are impacted. 

And so one of our specific recommendations was the revitalization of the President’s Fair Housing Council. The President’s Fair 

Housing Council, which was established by Executive Order 12892, 

would allow for putting all of the relevant agencies together or departments together so that they could develop a plan or whenever 

they were looking at their plans in particular areas to think about, 

how would we address fair housing? How would anything that we 

are doing directly or indirectly affect housing? 

A third point that I will address has to do with supporting the 

Fair Housing Initiatives Program. The Fair Housing Initiatives 

Program supports fair housing enforcement and education, and it 

provides funds primarily to nonprofits or to agencies—to nonprofits 

so that they can address these two points. 

Here is—I will tell the FHIPs are really important. These folks 

are on the front line. I guess that is what I want you to know. They 

are on the front line, and they need the funds in order to adequately address the problem. 

I know this, because when I had suffered discrimination, I didn’t 

know what to do. I didn’t even know where to go. Someone told me, 

‘‘Call HOME,’’ and I said, ‘‘Home?’’ They really meant Housing Opportunities Made Equal. I was like, ‘‘I am already home.’’ But they 

said, ‘‘Call HOME.’’ 

So I called Housing Opportunities Made Equal. The people there 

understood immediately what I was experiencing, a rash of different kinds of emotions, anger, humiliation, frustration, and they 

were extremely helpful in helping me to work through the process. 

Honestly, if I had had to depend on HUD to help me through 

that process, we would still be talking about the lawsuit that 

should have been brought. But with the help of HOME, I was able 

to manage my way through the administrative process of identifying an attorney, get this case off the ground. 

And, by the way, you say, well, you should have been able to do 

that anyway, because, after all, you are an attorney, and a pretty 

experienced one. But it is different when you are the plaintiff. It 

is different when you are the victim. 

You are not thinking like, ‘‘Oh, maybe I need to file the following 

motion.’’ No. That is not what is going on. And so being a lawyer 

wasn’t helpful at that point. It has helped me out of the trauma 

at that moment. 

I will say, finally, because I see my time is just about up, that 

one of the other points that we found in the hearing—all of these 

hearings—is that the link between fair housing and foreclosure, the 

foreclosure crisis, was very clear. 

The current mortgage crisis definitely has its roots in decades of 

discriminatory housing and lending practices. It was well documented throughout our hearing that essentially, as one witness put 

102 

it, the subprime market discovered African-Americans and Latino 

communities and targeted them for unfair and deceptive loan products and lending practices. 

That is why the commission strongly recommended that in order 

to more effectively address this problem, the Federal Government 

must be improved by fostering better coordination between HUD’s 

administration enforcement of the Fair Housing Act, the Department of Justice, the bank regulatory agencies, and the private fair 

housing groups, prioritizing fair housing and fair lending litigation 

to identify and eliminate discriminatory and predatory lending 

practices and policies, and ensuring the legal standard for violation 

of the Fair Housing Act and Equal Credit Opportunity Credit Act 

includes the well-established disparate impact standard. 

So in conclusion, I think Ms. Arnwine pointed it out very well in 

her remarks, so I will just repeat it. Fair housing is the lynchpin 

for furthering the American dream. 

Thank you. 

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Mr. NADLER. Thank you very much. I will now recognize myself 

for 5 minutes to ask some questions. 

Ms. Smith, you said that—I think you said that fair housing organizations cannot take full advantage of their normal testing 

methods when it comes to mortgage lending because it is a felony 

for testers from fair housing organizations to apply for a home loan 

as part of a discriminatory lending test. Can you elaborate on that? 

Why is it felony? And what can we do about it? 

Ms. SMITH. We can do pre-application testing, but to test 

throughout the process, you actually have to complete an application. And when you look at the mortgage loan application, it says 

if you put any untruthful information on there, it is a felony. 

And while we have done some full application testing, it has been 

using people’s true information. If we are going to be able to catch 

these scammers, to continue to test regular banking institutions, 

we need to test through the process, because I have been doing this 

for 35 years. 

Mr. NADLER. Granted that necessity, what do you think our response to this limitation on your ability should be? 

Ms. SMITH. What I would like to see is an amendment to that 

part of the mortgage loan application granting the opportunity to 

do full application testing, but I don’t think we can just say, oh, 

anybody can do it. I think we need to run it through the Justice 

Department and create the identities with the cooperation of the 

housing section of Justice and the lending experts, and then qualified fair housing organizations could apply to Justice and say, ‘‘This 

is our testing methodology. This is a program. We need 15’’—— 

Mr. NADLER. So Justice, in effect, would have to license or recognize specific organizations to do this? 

Ms. SMITH. Yes. And I think that would have good quality control 

so that not just anybody goes out and tries to do this kind of full 

application testing. We do testing with Justice now. 

Mr. NADLER. I understand that. Okay, thank you. 

Let me ask Ms. Carey, the Michigan Fair Housing Center produced a report a couple years ago that examined sexual orientation 

housing discrimination in Michigan. I understand that HUD just 

announced to examine in its nationwide decennial study in housing 

discrimination, discrimination based on sexual orientation and gender identity, but the Michigan study is really the first formal attempt to look at this type of housing discrimination. 

How do you think we get the government housing organizations 

and other interested entities to collect data and develop responses 

to housing discrimination directed at the LGBT community? 

Ms. CAREY [continuing]. Excuse me. Certainly the inclusion of 

lesbian, gay, bisexual and transgender concerns in this Subcommittee hearing is a notable marker for the government addressing the issue, and we are very thankful for it. 

We are very supportive of HUD pursuing the path that they have 

talked about in terms of finding out more about discrimination 

against LGBT people through their nationwide study and are 

pleased that they have started their town halls. 

We certainly offer our expertise and those of our colleague organizations to ensure that not only couples are—that HUD is not 

only gathering information on couples, but on individuals, that we 

117 

are not just looking at urban areas, but also rural areas where discrimination—— 

Mr. NADLER. So this is a question of administrative action by 

HUD? 

Ms. CAREY. Well, I would also add that while HUD is conducting 

its study, it is our position that we very much need for the Fair 

Housing Act to be amended to include sexual orientation and gender identity. As we have talked about in our testimony—— 

Mr. NADLER. Well, we introduced that legislation—— 

Ms. CAREY [continuing]. People are experiencing the discrimination now. 

Mr. NADLER. I introduced that legislation today, along with several others, as you know. Absent that legislation being approved, 

does HUD have jurisdiction here? 

Ms. CAREY. I am sorry? 

Mr. NADLER. Without that legislation being approved, does HUD 

have jurisdiction to engage in this type of testing or looking into 

it? 

Ms. CAREY. Yes. HUD has—as many people know, HUD has conducted other tests before on racial discrimination, and we are 

pleased that they will be including sexual orientation and gender 

identity. However, the piecemeal protections across the country 

that exist in municipal and State law is not enough for many people who are experiencing discrimination, so we very much need the 

Federal law. 

Mr. NADLER. Thank you. 

Dean Dark, could you respond to the argument that has been 

made that the Community Reinvestment Act and other efforts to 

provide low-and moderate-income individuals and families with access to homeownership are responsible for the prevalence of 

subprime loans and for the foreclosure crisis? 

Ms. DARK. Well—— 

Mr. NADLER. I gather from your expression you don’t agree with 

that particular—— 

Ms. DARK. I am sorry. I just—— 

Mr. NADLER. I gather from your expression you don’t agree with 

that statement. 

Ms. DARK. Oh, I definitely disagree with the statement. I guess 

my response would be that—to take a look at the record, which was 

extensive, that the commission had—I mean, the commission was 

able to establish, by looking at exactly what happened. 

And so I will just share with you some testimony from Mr. Jose 

Hernandez, who is a real estate broker in Sacramento area, and he 

was experienced in residential sales and financing. He stated that 

generally subprime lenders target borrowers who have poor credit 

histories with mortgage products that bring an unusually high 

yield to lending institutions and their investors. 

That is what happened, such excessive profit margins realized 

through a pricing structure that includes periodic interest rate increases, prepayment penalties, balloon payments, that sort of 

thing, so that the subprime borrowers were six to nine times more 

likely to be in foreclosure. 

Mr. NADLER. Of course. 

Ms. DARK. That is the kind—that is what. 

118 

Mr. NADLER. Let me ask you a different question on the same 

area. The Chicago Reporter found that, of the more than 8.5 million mortgages granted nationwide in 2006, African-American borrowers were nearly 2.5 times more likely than their White counterparts to get so-called high-cost home loans and that the racial gap 

was even wider among the wealthier individuals. So you are not 

talking about poor people. African-Americans earning $100,000 a 

year or more were three times more likely than their White counterparts to get high-cost loans. 

With these statistics, and having been a victim of housing discrimination, can you speak to how class or education may not protect against discriminatory housing practices in this area, in sales, 

rent, or lending? 

Ms. DARK. I guess what I wanted to say is that no one sees the 

education or sees the fact that you are—they don’t see it. They see 

that you are Black. And so they may—so you don’t get offered the 

various products. It doesn’t mean this is—— 

Mr. NADLER. And the education—the fact that you are a professor of English literature doesn’t necessarily mean that you 

are—— 

Ms. DARK. It doesn’t mean that you are necessarily up to date 

or that you are very knowledgeable—— 

Mr. NADLER. That you are going to be wise to these scams. 

Ms. DARK. Right, all of the real estate process. You depend a 

great deal, of course, on the people that are helping you through 

the process, and you try to get yourself up to speed, but when you 

are going through the process, it doesn’t necessarily mean just because I am—that I would know, I would know. 

But I just want to emphasize that just—you know, they don’t— 

when someone just doesn’t see that you are a whole person, they 

only see your color, that is what happened with this lady. She just 

couldn’t see me in the apartment. She could only see that I was 

Black. She didn’t ask me—she didn’t have any questions about my 

ability—— 

Mr. NADLER. She saw the obvious. 

Ms. DARK. Correct. 

Mr. NADLER. Thank you. 

I have one more question, and then we will turn to Ms. Chu. Mr. 

Marcus, I started asking you this before. You mentioned the Supreme Court’s decision or lack of decision or coming decisions confronting the question of disparate impact. You said you thought 

they might not uphold it. 

If the Supreme Court were to go the—were to say that disparate 

impact, unlike all the circuit courts, if the Supreme Court were to 

overturn the circuits and were to do so on a constitutional basis, 

what could we do about it? 

Mr. MARCUS. What the circuit courts have dealt with is the statutory question, but I think you are asking me now about the constitutional question, and it is a good question. What do we do about 

it? 

Now, if the Supreme Court finds that the disparate impact doctrine as currently understood is inconsistent with equal protection, 

they could do one of two things. They could narrow it themselves 

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and fix it, or they could strike it down and ask you to put it back 

together again. 

If they do the latter, there will be a period of time where disparate impact is not available, which has a sort of implication that 

you can imagine. If you want to anticipate that and to address the 

doctrine before the Supreme Court deals with it, there are things 

that you could do to ensure that disparate impact is not used in 

a way that violates equal protection. 

The concern is that disparate impact in some cases is used to address something other intentional or unconscious discrimination 

and used in a way that can push institutions either to use quotas 

or other surreptitious means of involving racial preferences or otherwise act in a way that is inconsistent with the Constitution. 

A way of addressing that is ensuring something like a good faith 

defense as a way of addressing a charge of discrimination as a 

means of ensuring that the disparate impact doctrine is used only 

to target essentially intentional or unconscious discrimination even 

when it is hard to find through disparate treatment analysis. 

Mr. NADLER. Thank you. 

I will now yield to the gentlelady from California, Ms. Chu. 

I don’t yield. I recognize her. 

Ms. CHU. Thank you, Mr. Chair. 

Well, I live within a district in Los Angeles, and last November, 

a major real estate owner, Donald Sterling, the L.A. Clippers 

owner, settled with the Justice Department for $2.75 million over 

a discrimination case. He owned around 120 apartment buildings 

in the L.A. area and was discriminating based on race. 

Some apartment buildings were supposed to be Asian-only and 

some were supposed to be Latino-only and so on and so forth. And 

it is clear that many tenants don’t know if this is illegal or don’t 

know that there are apartment buildings that are off-limits because they aren’t advertised or targeted to the community. 

Now, Craigslist does do a superb job in informing both prospective tenants and landlords who post ads what their rights and responsibilities are, but what kind of requirements do rental or housing companies in general have to make sure that prospective residents or buyers are aware of the law? And should the Fair Housing 

Act be changed to make sure that there is greater awareness 

amongst tenants for prospective tenants? And in fact, should it be 

changed to accommodate language and cultural issues? 

Yes? 

Ms. SMITH. I don’t think we have to actually change the Fair 

Housing Act. What would be useful—well, first of all, landlords— 

the California Apartment Association is one of the best in the country. They have excellent education programs that go out. 

But when people walk into an apartment complex, there is no 

fair housing material or literature available to them. So if the Fair 

Housing Initiative Program had funding in the national media part 

of it to create these kinds of materials that could either be 

downloaded and printed by an apartment complex, real estate 

agents, or as they are now, available, that we make available to 

communities, that would be useful. 

Craigslist only recently put up more information about the Fair 

Housing Act. But what we found in our investigation of Craigslist, 

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where we found 7,500 violations of the Fair Housing Act, we filed 

1,000 complaints with HUD. And when we were talking to the people who posted the ads, they said to us they simply would cut and 

paste existing ads and those existing ads had discriminatory statements in it. 

So we think Craigslist has to go a step farther, like newspapers 

do. They have a filter put in so that the discriminatory language 

can’t be published at all. 

And, you know, Craigslist and other Internet providers could create those same kinds of filters that, you know, thousands of newspapers have used since 1988, particularly in this area. 

But we need more money in the Fair Housing Initiatives Program. We need to have Congress tell HUD that the education campaign that we do now, we educate potential victims of discrimination, but we also educate the industry. 

And if we had more money to do that kind of education, to have 

prints, posters that could go to all the apartment complexes, so 

that when I walk in, I may not know anything about the Fair 

Housing Act, but it is up there, and we could—we have special ads 

that talk about sexual harassment in housing. 

And if those were in the apartment complexes, people could see 

that and go, ‘‘Well, you know what? You can’t do that to me, because here is what the law says.’’ 

And apartments have large, quick turnover of managers. So it is 

very hard to make sure your employees, if you are an apartment 

owner, are always following the law. And this kind of literature 

right in the apartment manager’s office, in the community rooms, 

in the laundry facilities would be very useful. 

Ms. CHU. Are they required to post it? 

Ms. SMITH. No. There is absolutely no requirement for anybody 

to post anything about the Fair Housing Act. 

Ms. CHU. Wouldn’t it be good to have such a requirement? 

Ms. SMITH. I think that would be very useful to have that requirement. At the national commission hearing, people also talked 

about landlords having a census about people who live there. We 

often talk to real estate companies to say, when you are showing 

houses, why don’t you create maps to see if your real estate agents 

are really showing people of all races and national origins homes 

in that same price range so that they can self-monitor to make sure 

that nobody is limiting someone’s choice? 

With lenders, they do have the equal lending opportunity slogan 

that is required, but any more information about what discrimination looks like in lending is not required. And I just refinanced my 

house last year. At first, they didn’t know I was the president of 

the National Fair Housing Alliance. They just saw a name, 

‘‘Shanna Smith,’’ and their profiling of that name was for an African-American. 

And then, they were not giving me good rates, and I had 799 

credit score, and I wanted a 15-year conventional loan, couldn’t get 

an offer on that. Then, when I put my signature as National Fair 

Housing Alliance, somebody responded, but I had to go through 

four closings because they made mistakes with my interest rates, 

the APR, and the closing cost, and they knew who I was. 

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So with Congressman Nadler, you are saying, does education 

matter? If they think they can get away with this, they will just 

make these changes at the last minute, and most of us don’t read 

those documents. So if it was possible to have more—not a long 

piece of paper describing things, but even just the print ads that 

tell people very cleverly what to watch out for and how to recognize 

discrimination and where to report it. And that just doesn’t exist 

in the housing, lending or insurance industry right now. 

Ms. CHU. Well, my time is up, but it just seems to me that if in 

work places you are required to post something about labor laws, 

that there should be some way that a similar thing should be posted or information should be handed out. 

And I don’t know. Could the other persons respond here? 

Mr. NADLER. By all means. 

Ms. ARNWINE. Yes, I was going to make that precise point, that 

we are required to as employers to post, you know, employment notices of equal opportunity and other kind of wage and hour notices. 

There is no reason why there should be any limitation on the same 

kind of, you know, requirement for posting, you know, fair housing 

laws or requirements. 

I think that, also, you know, Shanna and, you know, NFHA and 

so many fair housing agencies have done a great job of testing. And 

I think more testing is necessary, that that is one of the reasons 

why, you know, FHIP money is so critical, so that you can then 

find out affirmatively that there are these practices that are blocking people and you can also have the opportunity through more of 

these fair housing agencies to hear from people when they are in 

segregated housing, because this reality of multiple-unit apartments with identifiable towers that are African-American, that are 

White, that are Asian, that are, you know, Latino, we see it all the 

time. But it is a lack of people, as you said, understanding that 

that is, in fact, steering and that it is a violation of the law, and 

that that is also critical. 

I also wanted to say, on the question that was brought out, I 

think, regarding the fair lending, you know, practices and what can 

be done about them, you know, I just want to—you know, and the 

whole characterization of this is the fault of, you know, subprime 

mortgages, really, the fault of African-American and Latino communities, I just wanted to say that that can be one of the most infamous and notorious, you know, themes that I have heard running 

around in the Congress. 

I think that what people need to look at is some of the 23 cases 

that have been filed by the National Consumer Law Center where 

they have, you know, really shown in their allegations how discretionary pricing practices of banks actually included the practice of 

producing yield spread premiums to brokers, thereby incentivizing 

the discriminatory marketing and pricing of expensive subprime 

loans. You made more money if you did the subprimes. 

And in African-American communities too often, the prime lenders are missing. And that is one of the big issues, that—you know, 

I live in Prince George’s County, which has been really hit hard by 

this subprime crisis, and a lot of people who were eligible for prime 

loans were steered into subprime loans. 

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This is really a tragedy. It is something that has led to—you 

know, it is an incredible crisis for those borrowers when they 

should have been into different loan instruments that would have 

been more favorable to them, more affordable. 

But also I just want to say lastly that no African-American community created any CDOs or any of these horrible financial instruments that led to the financial crisis. So I just want everybody to, 

you know, remember that we bundled nothing. We were victims 

here, drastically. 

Mr. NADLER. Thank you very much. The time of the gentlelady 

is expired. All time is expired. 

Without objection, all Members will have 5 legislative days to 

submit to the Chair additional written questions for the witnesses, 

which we will forward, and ask the witnesses to respond as 

promptly as they can so that their answers may be made part of 

the record. 

Without objection, all Members will have 5 legislative days to 

submit any additional materials for inclusion in the record. And 

with that, I would like to thank the witnesses and the Members. 

And the hearing is adjourned. 

[Whereupon, at 3:10 p.m., the Subcommittee was adjourned.] 

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A P P E N D I X 

MATERIAL SUBMITTED FOR THE HEARING RECORD

PREPARED STATEMENT OF THE HONORABLE F. JAMES SENSENBRENNER, JR., A REPRESENTATIVE IN CONGRESS FROM THE STATE OF WISCONSIN, AND RANKING MEMBER, SUBCOMMITTEE ON THE CONSTITUTION, CIVIL RIGHTS, AND CIVIL LIBERTIES

The Obama Justice Department has made it clear it intends to follow the Clinton 

Administration and file more lawsuits under what is called the ‘‘disparate impact’’ 

theory. Disparate impact lawsuits challenge practices that lead to statistically worse 

results for a particular group relative to other groups without alleging that the practice is actually discriminatory in its terms, design, or application. That is, disparate 

impact lawsuits claim there is discrimination when there is often no discrimination 

at all under any reasonable definition of the term. 

Disparate impact theories arose out of Title VII of the Civil Rights Act of 1964, 

which was designed to protect individuals from intentional discrimination in employment. The Senate floor managers of Title VII, Senators Clifford Case and Joseph Clark, made clear that Title VII prohibited only intentional discrimination, and 

that it did not require statistical parity in hiring. In their exhaustive memorandum 

distributed prior to Senate debate on the bill, the Senators wrote ‘‘There is no requirement in title VII that an employer maintain a racial balance in his work force.’’ 

This was reiterated by Senator Hubert Humphrey, who said ‘‘If [a] Senator can find 

in title VII . . . any language which provided that an employer will have to hire 

on the basis of percentage or quota related to color, race, religion, or national origin, 

I will start eating the pages one after another, because it is not there.’’ 

But then Alfred Blumrosen, the Equal Employment Opportunity Commission’s 

first chief of compliance, admitted in a law review article years later that he employed ‘‘[c]reative administration’’ to draft regulations under Title VII allowing disparate impact claims He admitted that those regulations did not ‘‘flow from any 

clear congressional grant of authority.’’ 

When those regulations were challenged in court, liberal Justice Harry Blackmun 

wrote that ‘‘I fear that a too-rigid application of the EEOC guidelines will leave the 

employer little choice, save an impossibly expensive and complex validation study, 

but to engage in a subjective quota system of employment selection.’’ 

With Justice Blackmun’s concerns in mind, the Supreme Court, in a 1989 case 

called Wards Cove Packing Co. v. Atonio, made clear that the regulations must be 

subject to what it called ‘‘a reasoned review of the employer’s justification for his 

use of the challenged practice [such that] there is no requirement that the challenged practice be ‘essential’ or ‘indispensable’ to the employer’s business for it to 

pass muster.’’ 

But then Congress responded two years later by legislatively overruling that reasonable interpretation of the regulations in Wards Cove. That legislation passed 

over my opposition. As a result, disparate impact lawsuits were encouraged. 

The abuse of the disparate impact theory in courts has had real-world consequences. There were many pressures on mortgage lenders to relax the standards 

under which loans were extended in the 1990’s. But one factor was the Clinton Administration Justice Department’s aggressive pursuit of disparate impact claims in 

which it sought to prosecute entities whose mortgage lending policies did not intentionally discriminate, but only had a disparate impact on one group or another. 

In 1998, for example, Clinton Administration Housing Secretary Andrew Cuomo 

announced the results of a federal lawsuit settlement in which a bank was made 

to extend $2 billion in loans to people who posed a greater credit risk. Secretary 

Cuomo even admitted during a press conference televised on C-Span that ‘‘the 2.1 

billion, lending that amount in mortgages, will be a higher risk and I’m sure there’ll 

be a higher default rate on those mortgages than on the rest of the portfolio.’’ 

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A leading article published in the Banking Law Journal at the time made clear 

that ‘‘Lenders relying on written standards and criteria in making decisions as to 

whether to grant a residential mortgage loan application run the risk of exposure 

to liability under the civil rights law doctrine known as disparate-impact analysis. . . . Several underwriting guidelines that are fairly common throughout the 

mortgage lending industry are at risk of disparate-impact analysis [including] creditworthiness standards.’’ 

At the same time, in order to alleviate disparate impacts in lending, the Federal 

Financial Institutions Examination Council issued a report that suggested to lenders that, rather than focusing on credit history as defined in a credit report, such 

lenders should focus on evidence of a borrower’s ability and willingness to repay a 

loan, including a record of regular payments for utilities and rent. 

These lawsuits pressured lenders to bend traditional and time-tested accounting 

rules and extend more mortgages to many who could not afford them. These relaxed 

lending standards are now widely regarded as being a prime cause of the current 

financial crisis. Even The Washington Post editorialized that ‘‘the problem with the 

U.S. economy . . . has been government’s failure to control systemic risks that government itself helped to create. We are not witnesses a crisis of the free market but 

a crisis of distorted markets . . . [G]overnment helped make mortgages a purportedly sure thing in the first place.’’ 

In our efforts to enforce the nation’s housing laws, I hope we do not repeat past 

mistakes. I look forward to hearing from all our witnesses today. 

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PREPARED STATEMENT OF JOE SOLMONESE, PRESIDENT, 

HUMAN RIGHTS CAMPAIGN


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