Texas Department of Housing and Community Affairs v. Inclusive Communities Project, Inc.

Summary

The Supreme Court held that disparate-impact claims are cognizable under the Fair Housing Act. The Court explained that such liability is subject to important limits, including a robust causality requirement and consideration of whether a less discriminatory alternative would serve the defendant's legitimate interests. The Court affirmed and remanded the Fifth Circuit's decision concerning a challenge to Texas's allocation of low-income housing tax credits.

Holdings

1. The Fair Housing Act authorizes disparate-impact claims under §§ 804(a) and 805(a).
2. A plaintiff asserting FHA disparate-impact liability must identify a specific policy or policies causing the alleged statistical disparity and establish a robust causal connection; racial imbalance alone is insufficient.
3. After a plaintiff establishes a prima facie disparate-impact case, the defendant may justify the challenged practice by proving that it is necessary to achieve a valid interest; the plaintiff may then prevail by showing that the interest could be served by another practice with a less discriminatory effect.
4. Remedial orders in FHA disparate-impact cases must be consistent with the Constitution and should concentrate on eliminating the offending practice through race-neutral means; racial targets or quotas may raise serious constitutional questions.

Questions Presented

1. Whether disparate-impact claims are cognizable under §§ 804(a) and 805(a) of the Fair Housing Act.
2. What limitations and burden-shifting requirements govern FHA disparate-impact claims.
3. Whether a plaintiff must identify a specific policy causing the alleged disparity and demonstrate a robust causal connection.
4. What constitutional and remedial limitations apply when liability is imposed under an FHA disparate-impact theory.

Disposition

affirmed_and_remanded