Melissa Parham
Since HUD published its April 4, 2016 policy statement on how criminal application criteria may violate fair housing laws under a disparate impact theory, we have received many calls and e-mails from clients, and have made several presentations about how to handle background screening. We have created new sample policies and procedures for communities to follow.
Landlords should immediately take steps to avoid being test cases for fair housing violations. We believe that each community operator should immediately ensure that its staff is aware that blanket prohibitions against criminal convictions are no longer enforceable.
We know for a fact that HUD, state attorney generals, and private entities have begun testing landlords. We expect that the first disparate impact fair housing complaints will be filed against landlords who answer the following question incorrectly: “I have a felony on my record--will you rent to me?” In the past, most landlords would automatically say “no.” Now, however, that answer will very likely result in a fair housing complaint.
Community managers should answer that question by saying, “except in very limited circumstances, we do not have blanket prohibitions on criminal convictions, and we suggest that you apply so that we can determine whether you are qualified to rent here.” Managers may also make their written application standards available i
n pe
rson or online), and applicants can speculate as to whether they would qualify.
A manager should never pre-qualify or pre-judge an applicant. Instead, the manager should always suggest that anyone who inquires complete an application. It does not matter if the manager believes that the applicant will not qualify, and the manager is trying to be nice to save them from paying the application fee--always have applicants complete the application and pay the fees.
This ensures that there are not misunderstandings, and that the landlord has all of the necessary information to review the application. Remember, in the world of fair housing, it is always better to have documentation to rely upon rather than to end up in a "he said, she said" situation.
Another reason managers should suggest that all interested persons complete an application is because of HUD’s opinion that, even if an applicant does not meet the criminal background standards, he or she must be given an opportunity to present mitigating factors as to why he or she should still be accepted. The 2016 MHCA application form has a space for mitigating circumstances.
Unfortunately, this new obligation has a subjective aspect since landlords will have to review evidence presented regarding the unique facts surrounding each and every denied applicant’s criminal conviction, and determine whether that applicant poses a risk to the property or other tenants. The more documentation managers have to support their decisions, the less likely it is that such decisions can be challenged as discriminatory.
The other most important change landlords must make is to actually change their written screening criteria so that there are no blanket prohibitions based upon criminal convictions—this will be the subject of a future article. It is important to make sure that your written policies comply with the HUD policy.
Landlords should have different timeline bans based on the severity of the crime and the length of time that has elapsed since the conviction and/or release date.