[House Report 104-91]
[From the U.S. Government Publishing Office]



104th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES

 1st Session                                                     104-91
_______________________________________________________________________


 
                 HOUSING FOR OLDER PERSONS ACT OF 1995

_______________________________________________________________________


 March 28, 1995.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______


    Mr. Canady, from the Committee on the Judiciary, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 660]

      [Including cost estimate of the Congressional Budget Office]
    The Committee on the Judiciary, to whom was referred the 
bill (H.R. 660) to amend the Fair Housing Act to modify the 
exemption from certain familial status discrimination 
prohibitions granted to housing for older persons, having 
considered the same, report favorably thereon with an amendment 
and recommend that the bill as amended do pass.
                                CONTENTS

                                                                   Page
The Amendment....................................................     1
Purpose and Summary..............................................     2
Background and Need for the Legislation..........................     3
Hearings and Subcommittee Consideration..........................     5
Committee Consideration..........................................     5
Votes of the Committee...........................................     5
Committee Oversight Findings.....................................     8
Committee on Government Reform and Oversight Findings............     8
New Budget Authority and Tax Expenditures........................     8
Congressional Budget Office Cost Estimate........................     8
Statement Required by Pub. L. No. 104-1..........................     9
Inflationary Impact Statement....................................     9
Section-by-Section Analysis and Discussion.......................    10
Agency Views.....................................................    11
Changes in Existing Law Made by the Bill, as Reported............    13

    The amendment is as follows:
    Strike out all after the enacting clause and insert in lieu 
thereof the following:
SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Housing for Older Persons Act of 
1995''.

SEC. 2. DEFINITION OF HOUSING FOR OLDER PERSONS.

    Subparagraph (C) of section 807(b)(2) of the Fair Housing Act (42 
U.S.C. 3607(b)(2)) is amended to read as follows:
          ``(C) that meets the following requirements:
                  ``(i) The housing is in a facility or community 
                intended and operated for the occupancy of at least 80 
                percent of the occupied units by at least one person 55 
                years of age or older.
                  ``(ii) The housing facility or community publishes 
                and adheres to policies and procedures that demonstrate 
                the intent required under clause (i), whether or not 
                such policies and procedures are set forth in the 
                governing documents of such facility or community.
                  ``(iii) The housing facility or community complies 
                with rules made by the Secretary for the verification 
                of occupancy. Such rules shall allow for that 
                verification by reliable surveys and affidavits and 
                shall include examples of the types of policies and 
                procedures relevant to a determination of compliance 
                with the requirement of clause (ii). Such surveys and 
                affidavits shall be admissible in administrative and 
                judicial proceedings for the purposes of such 
                verification.''.

SEC. 3. GOOD FAITH ATTEMPT AT COMPLIANCE DEFENSE AGAINST CIVIL MONEY 
                    DAMAGES.

    Section 807(b) of the Fair Housing Act (42 U.S.C. 3607(b)) is 
amended by adding at the end the following:
    ``(5) Good Faith Reliance.--(A) A person shall not be held 
personally liable for monetary damages for a violation of this title if 
such person reasonably relied, in good faith, on the application of the 
exemption under this subsection relating to housing for older persons.
    ``(B) For the purposes of this paragraph, a person engaged in the 
business of residential real estate transactions may show good faith 
reliance on the application of the exemption by showing that--
          ``(i) such person has no actual knowledge that the facility 
        or community is not, or will not, be eligible for such 
        exemption; and
          ``(ii) the facility or community has certified to such 
        person, in writing and on oath or affirmation, that the 
        facility or community complies with the requirements for such 
        exemption.''.
                          Purpose and Summary

    H.R. 660, introduced by Congressman Clay Shaw of Florida, 
removes the ``significant facilities and services'' requirement 
for housing for older persons from the Fair Housing Act, 42 
U.S.C. 3601-3631. In 1988, when Congress amended the Fair 
Housing Act to prohibit discrimination against families with 
children, it specifically exempted certain housing for older 
persons in order to protect the rights of the elderly to live 
in age-restricted housing. Generally, housing for older persons 
where 80% of the units have at least one person 55 years of age 
or older are exempt if they have or provide ``significant 
facilities and services.'' Unfortunately this exemption has 
been narrowly construed and does not offer the protection to 
the elderly intended by Congress in passing the 1988 
amendments. Consequently, legislation is necessary to establish 
a workable and fair exemption to protect senior citizens who 
wish to live in retirement communities.
    H.R. 660 sets forth an objective standard for determining 
whether a facility or community qualifies for the exemption. 
Under the bill, if a community can show that eighty percent of 
its units have one or more occupants aged 55 or older, and 
meets certain other requirements, it passes the ``housing for 
older persons'' test. In addition, the bill would exempt real 
estate agents and condo board members who acted in ``good 
faith'' from liability for monetary damages in suits stemming 
from the seniors-only provision.

                Background and Need for the Legislation

    In general, the Fair Housing Act makes it unlawful to 
discriminate based on race, color, religion, sex, familial 
status, handicap or national origin in the sale or rental of a 
covered dwelling or to threaten, intimidate, coerce or 
interfere with an individual's exercise or enjoyment of a right 
secured under the Act. The prohibition on discrimination based 
on ``familial status'' was added through the 1988 amendments to 
the Fair Housing Act, Pub. L. No. 100-430.
    Under 42 U.S.C. 3602(k) familial status is defined as:

          One or more individuals (who have not attained the 
        age of 18 years) being domiciled with; (1) a parent or 
        another person having legal custody of such individual 
        or individuals; or (2) the designee of such parent or 
        other person having such custody, with the written 
        permission of such parent or other person.

    In passing the Fair Housing Amendments of 1988 and 
protecting families with children against discrimination, 
Congress specifically recognized the particular needs of older 
people to live among their peers in age-restricted communities. 
The Fair Housing Act exempts ``housing for older persons'' from 
the prohibition on familial status, 42 U.S.C. 3607(b)(1). 
``Housing for older persons'' is defined as housing that is 
occupied by persons 62 years of age or older or housing that is 
intended for occupancy by persons 55 years of age or older 
where there are ``significant facilities and services 
specifically designed to meet the physical or social needs of 
older persons.''
    The ``significant facilities and services'' provision has 
been a source of controversy since the law took effect in 1989. 
Seniors' communities throughout the country have been faced 
with lawsuits challenging their qualifications under this 
provision. The lack of clear guidelines have made it difficult 
for senior's communities to qualify for the exemption. In 
addition, seniors with low or fixed incomes are often unable to 
afford to pay the fees or rents necessary to defray the costs 
for such additional services or facilities.
    The Housing and Community Development Act of 1992 required 
HUD to issue a revised rule defining the term ``significant 
facilities and services.'' \1\ On July 7, 1994, HUD issued 
proposed rules to define the meaning of these terms. 
Unfortunately, the proposed rules were also a source of 
controversy because, as drafted, they would have imposed 
expensive and unnecessary burdens on seniors-only housing.\2\ 
On November 30, 1994 Assistant Secretary Achtenberg announced 
that HUD was withdrawing the proposed regulations for 
``seniors-only'' housing.
    \1\ Pub. L. No. 102-550, Title IX, Section 919, October 28, 1992, 
106 Stat. 3883, provided that: ``The Secretary of Housing and Urban 
Development shall, not later than 180 days after the date of enactment 
of this Act make rules defining what are `significant facilities and 
services especially designed to meet the physical or social needs of 
older persons' required under section 807(b)(2) of the Fair Housing Act 
to meet the definition of the term `housing for older persons' in such 
section.''
    \2\ The proposed rules were criticized for requiring housing 
providers to furnish costly alterations, modifications and 
accommodations for elderly, disabled persons. The proposed regulations 
assumed that older persons would have ``mobility, visual and hearing 
impairments'' and required housing providers to furnish ``significant 
facilities and services'' for individuals with those impairments, even 
if the older persons in the community seeking the exemption were 
healthy and had no need for such services.
    On March 14, 1995, HUD published a new proposed rule to 
define significant facilities and services. The new proposed 
rule will establish a broad checklist of potential services and 
facilities and allow communities to ``self-certify'' that they 
are eligible for the exemption. Assistant Secretary Achtenberg 
has acknowledged, however, that in crafting these regulations, 
she was constrained by certain judicial decisions, like, for 
example, the opinion of the Ninth Circuit Court of Appeals in 
U.S. v. City of Hayward, 36 F.3d. 832 (1994). In Hayward, the 
court found that providers of housing seeking an exemption for 
older persons did not qualify for the exemption even though it 
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furnished services and facilities including:

        [A] swimming pool, sauna, shuffle board, laundry room 
        and a reading room. There is a clubhouse where coffee 
        is always available, the residents play cards and bingo 
        and meet to socialize, the resident's club and ladies 
        club meet and where potluck dinners and holiday 
        celebrations are held. [C]ounty health officials come 
        to the park monthly to check blood pressure and perform 
        glaucoma checks and annually provide for a more 
        detailed physical. Health authorities also come to 
        administer flue shots. City bus service is available at 
        the entrance to the Park and taxi service is available 
        to one's door. Doctors' offices and a hospital are 
        located within a one mile radius of the Park. 
        Educational and other recreational opportunities are 
        provided in the local community. Hayward, 36 F.3d 832, 
        at 837.

    The Court found that the Park did not qualify for the 55 
and older exemption because many of the facilities and services 
were not ``specifically tailored to seniors' needs.'' Non-
seniors-only housing, the court reasoned, could provide similar 
amenities for its residents. See also, Park Place Home Brokers 
v. P-K Mobile Home Park, 773 F.Supp. 46 (N.D. Ohio 1992) and 
United States v. Keck, WL 357064 (W.D. Wash. 1990).
    Even if HUD does issue its new proposed regulations, two 
issues will continue to be a source of confusion for seniors 
communities seeking to qualify under the ``significant 
facilities and services'' exemption. First, are the services 
and facilities ``specifically designed to meet the physical or 
social needs of older persons'' or are they simply the types of 
services which any landlord might provide? It is difficult, if 
not impossible for a senior community to show that its 
clubhouse, pool, or exercise room and the other facilities and 
service they may provide are distinguishable from those same 
activities in a housing complex which allows children or non-
elderly adults. The second issue which will remain is whether 
the services and facilities rise to the level of being 
``significant'' either in terms of their overall number or in 
terms of the use they receive from the members of the elderly 
community.
    The Legal Counsel for the Elderly Office of the American 
Association of Retired Persons (AARP) has actively monitored 
administrative actions and judicial decisions enforcing the 
seniors-only provision of the Fair Housing Act. AARP reported 
that it was:

        Unable to find any successful defense of a claim of 
        exemption for housing for older persons among cases 
        receiving judicial review. When coupled with widespread 
        anecdotal evidence of rather arbitrary decisions by 
        fair housing investigators, the conclusion is 
        inescapable that implementation of the law has not been 
        consistent with the flexibility intended by Congress. 
        Indeed, widespread dissatisfaction with the statute's 
        enforcement threatens the very viability of the 
        important new protections provided in the Act. Letter 
        of the AARP to Chairman Canady, March 14, 1995.

    H.R. 660 will allow seniors the opportunity to take 
advantage of the exemption for seniors-only housing without 
imposing burdensome and costly requirements.

                Hearings and Subcommittee Consideration

    The Subcommittee on Civil and Constitutional Rights held 
two oversight hearings on Fair Housing Issues on September 28 
and 30, 1994. Testimony on the issue of the requirement of 
``significant facilities and services'' for the exemption for 
housing for older persons was received from Representative Clay 
Shaw; the Hon. Roberta Achtenberg, Assistant Secretary, Office 
of Fair Housing and Equal Opportunity, U.S. Department of 
Housing and Urban Development; Lori Van Arsdale, Councilmember, 
City of Hemet, California and William Williams, president, 
Federation of Mobile Home Owners of Florida, Inc. Additional 
materials were submitted from Representative Al McCandless, 
Hank Schmitz, a resident of Hemet, California, Sheila S. Dey, 
General Counsel, Western Mobile Home Parkowners Association; 
Robert H. Elrod, President, National Association of Realtors; 
the Hon. Kay Ceniceros, Chairman, Riverside County Board of 
Supervisors and Jim Morales, Esq. On March 15, 1995, the 
Subcommittee on the Constitution met in open session and 
ordered reported the bill H.R. 660 by a voice vote, a quorum 
being present.

                        Committee Consideration

    On March 22, 1995, the Committee met in open session and 
ordered reported the bill H.R. 660 with an amendment, by a 
recorded vote of 26-6, a quorum being present.

                         Votes of the Committee

    The Committee considered the following with recorded votes:
    1. Mr. Conyers offered an amendment to strike section 3 
which creates a defense against the imposition of money damages 
for compliance where a person has relied in good faith on the 
application of the exemption relating to housing for older 
persons. Mr.P
Conyers' amendment was defeated by a rollcall vote of 7-22, 
with 1 member voting present.
        AYES                          NAYS
Mr. Conyers                         Mr. Hyde
Mr. Nadler                          Mr. Moorhead
Mr. Scott                           Mr. Sensenbrenner
Mr. Watt                            Mr. Gekas
Mr. Becerra                         Mr. Coble
Mr. Serrano                         Mr. Smith (TX)
Ms. Jackson Lee                     Mr. Gallegly
                                    Mr. Canady
                                    Mr. Inglis
                                    Mr. Goodlatte
                                    Mr. Buyer
                                    Mr. Bono
                                    Mr. Heineman
                                    Mr. Bryant (TN)
                                    Mr. Chabot
                                    Mr. Flanagan
                                    Mr. Barr
                                    Mr. Schumer
                                    Mr. Boucher
                                    Mr. Bryant (TX)
                                    Mr. Reed
                                    Ms. Lofgren
Present: Mr. Frank
    2. Ms. Jackson Lee offered an amendment to require housing 
providers who wish to qualify for the exemption for housing for 
older persons under the Act to demonstrate intent to provide 
such housing by setting forth the appropriate policies and 
procedures in the facility or community's governing documents. 
Ms. Jackson Lee's amendment was defeated by a rollcall vote of 
8-24.
        AYES                          NAYS
Mr. Conyers                         Mr. Hyde
Mrs. Schroeder                      Mr. Moorhead
Mr. Nadler                          Mr. Sensenbrenner
Mr. Scott                           Mr. Gekas
Mr. Watt                            Mr. Coble
Mr. Becerra                         Mr. Smith (TX)
Mr. Serrano                         Mr. Gallegly
Ms. Jackson Lee                     Mr. Canady
                                    Mr. Inglis
                                    Mr. Goodlatte
                                    Mr. Buyer
                                    Mr. Bono
                                    Mr. Heineman
                                    Mr. Bryant (TN)
                                    Mr. Chabot
                                    Mr. Flanagan
                                    Mr. Barr
                                    Mr. Frank
                                    Mr. Schumer
                                    Mr. Berman
                                    Mr. Boucher
                                    Mr. Bryant (TX)
                                    Mr. Reed
                                    Ms. Lofgren
    3. Motion to report H.R. 660 favorably, as amended, to the 
House. The motion was agreed to by a rollcall vote of 26-6.
        AYES                          NAYS
Mr. Hyde                            Mr. Berman
Mr. Moorhead                        Mr. Bryant (TX)
Mr. Sensenbrenner                   Mr. Scott
Mr. McCollum                        Mr. Watt
Mr. Gekas                           Mr. Becerra
Mr. Coble                           Mr. Serrano
Mr. Smith (TX)
Mr. Gallegly
Mr. Canady
Mr. Inglis
Mr. Goodlatte
Mr. Buyer
Mr. Bono
Mr. Heineman
Mr. Bryant (TN)
Mr. Chabot
Mr. Flanagan
Mr. Barr
Mr. Conyers
Mrs. Schroeder
Mr. Frank
Mr. Schumer
Mr. Boucher
Mr. Reed
Ms. Lofgren
Ms. Jackson Lee

                      Committee Oversight Findings

    In compliance with clause 2(l)(3)(A) of rule XI of the 
Rules of the House of Representatives, the Committee reports 
that the findings and recommendations of the Committee, based 
on oversight activities under clause 2(b)(1) of rule X of the 
Rules of the House of Representatives, are incorporated in the 
descriptive portions of this report.

         Committee on Government Reform and Oversight Findings

    No findings or recommendations of the Committee on 
Government Reform and Oversight were received as referred to in 
clause 2(l)(3)(D) of rule XI of the Rules of the House of 
Representatives.

               New Budget Authority and Tax Expenditures

    Clause 2(l)(3)(B) of House Rule XI is inapplicable because 
this legislation does not provide new budgetary authority or 
increased tax expenditures.

               Congressional Budget Office Cost Estimate

    In compliance with clause 2(l)(3)(C) of rule XI of the 
Rules of the House of Representatives, the Committee sets 
forth, with respect to the bill H.R. 660, the following 
estimate and comparison prepared by the Director of the 
Congressional Budget Office under section 403 of the 
Congressional Budget Act of 1974.

                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, March 27, 1995.
Hon. Henry J. Hyde,
Chairman, Committee on the Judiciary,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
reviewed H.R. 660, the Housing for Older Persons Act of 1995, 
as ordered reported by the House Committee on the Judiciary on 
March 22, 1995. CBO estimates that enacting this legislation 
would result in no significant cost to the federal government 
or to state and local governments. Because enactment of H.R. 
660 would not affect direct spending or receipts, pay-as-you-go 
procedures would not apply to the bill.
    Under the Fair Housing Act, it is unlawful to discriminate 
based on family status in the sale or rental of a dwelling. 
However, current law affords an exemption for ``housing for 
older person'' (age-restricted communities), generally defined 
as housing that includes significant facilities and services 
specifically designed to meet the physical or social needs of 
older persons. H.R. 660 would define this exemption to apply to 
housing where at least 80 percent of the units are occupied by 
at least one person 55 years of age or older. In addition, the 
bill would exempt real estate agents or other persons who acted 
in good faith from liability for monetary damages in suits 
stemming from the seniors-only provision.
    The intent of H.R. 660 is to clarify the meaning of 
``housing for older persons.'' This issue has been a source of 
housing discrimination lawsuits for a number of years, 
involving both the Department of Justice (DOJ) and the 
Department of Housing and Urban Development (HUD). It is 
possible that H.R. 660 could lead to a reduction in these 
lawsuits and thus lower the caseload of DOJ and HUD. Based on 
information from these agencies, however, we do not expect that 
enacting the bill would have a significant effect on the costs 
incurred by DOJ or HUD.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Mark 
Grabowicz.
            Sincerely,
                                              James L. Blum
                                   (For June E. O'Neill, Director).

                Statement Required by Pub. L. No. 104-1

    Pursuant to Pub. L. No. 104-1, the provisions of this bill 
are not applicable to the legislative branch because this bill 
applies to housing, for older persons.
                     Inflationary Impact Statement

    Pursuant to clause 2(l)(4) of rule XI of the rules of the 
House of Representatives, the Committee estimates that H.R. 660 
will have no significant inflationary impact on prices and 
costs in the national economy.

               Section-by-Section Analysis and Discussion

    Section 1 sets forth the short title for the legislation, 
the ``Housing for Older Persons Act of 1995.''
    Section 2 amends subparagraph (C) of section 807(b)(2) of 
the Fair Housing Act (42 U.S.C. 3607(b)(2)). This section 
deletes the ``significant facilities and services'' requirement 
for housing for older persons intended and operated for 
occupancy by at least one person 55 years of age or older per 
unit. The major inquiry that H.R. 660 requires in order to 
determine whether a facility or community qualifies for housing 
for older persons is whether, in fact, the community is 
comprised of elderly individuals. The housing provider can 
demonstrate its intent to provide housing for persons 55 years 
of age or older, even if it allows persons under age 55 to 
continue to occupy dwelling units or move into the housing 
facility and occupy dwelling units, as long as the housing 
facility maintains the 80% occupancy threshold.
    Subsection (C)(i) retains the exemption for housing that is 
``intended and operated for the occupancy of at least 80 
percent of the occupied units by at least one person 55 years 
of age or older'', but does not require a showing of the 
existence of ``significant facilities and services.'' 
Subsection (C)(ii) requires the housing facility or community 
to publish and adhere to ``policies and procedures'' 
demonstrating the intent to provide housing for occupancy of at 
least 80 percent of the occupied units by at least one person 
55 years of age or older per unit. This subsection specifically 
states that such policies and procedures need not be set forth 
in the governing documents of such facility or community.
    Subsection (C)(iii) requires the housing facility or 
community to comply with rules made by the Secretary of Housing 
and Urban Development for the verification of occupancy. The 
rules issued by the Secretary must allow for verification by 
reliable surveys and affidavits and ``shall include examples of 
the types of policies and procedures relevant to a 
determination of compliance with the requirement of clause 
(ii).'' In addition, this section specifically allows such 
surveys and affidavits to be admissible in administrative and 
judicial proceedings for the purposes of such verification.
    Section 3 creates a defense against the imposition of money 
damages for compliance where a person has relied in good faith 
on the application of the exemption relating to housing for 
older persons. The Committee adopted, by a voice vote, an 
amendment by Mr. Frank to allow a person engaged in the 
business of residential real estate to make a showing of ``good 
faith'' reliance on the application of the exemption if that 
person has no actual knowledge that the facility or community 
is not eligible for the exemption and the facility or community 
has certified to such person, in writing and on oath or 
affirmation, that it complies with the requirements for such 
exemption.
    This section allows an individual to raise a defense which 
will prevent the imposition of money damages where he or she 
relies, in good faith, on the existence of an exemption for 
``housing for older persons'' and it is later found that the 
exemption did not apply. This section will preclude an award of 
money damages, but does not shield a person from injunctive 
relief. This exemption is necessary with respect to real estate 
agents because they are in a position of having to rely on the 
information given to them by the facility or community claiming 
the exemption. Because the exemption contemplates a fact-
intensive showing that the community meets the age and 
occupancy requirements, it is not practical to require real 
estate agents to conduct this inquiry each time they seek to 
list a home, apartment or condo for sale or lease. If a real 
estate agent has ``actual knowledge'' that the facility or 
community is eligible for the exemption, the good faith 
exemption shall not apply.

                              Agency Views
                        U.S. Department of Justice,
                             Office of Legislative Affairs,
                                    Washington, DC, March 15, 1995.
Hon. Henry J. Hyde,
Chairman, Committee on the Judiciary,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: This presents the views of the 
Department of Justice on H.R. 660, the ``Housing for Older 
Persons Act of 1995,'' as ordered reported today by the 
Subcommittee on the Constitution. We generally defer to other, 
more directly affected agencies with respect to whether this 
proposal should be enacted. We do, however, have serious 
concerns, as explained below, about two provisions of the 
legislation that could be construed as both ``anti-family'' and 
`'anti-children.''
    1. Section 2 of the bill would amend the ``exemption'' 
section of the Fair Housing Act (i.e., section 807(b)) to 
provide a new definition for ``housing for older persons.'' 
Under the Fair Housing Act, discrimination on the basis of 
familial status is prohibited, with a limited exemption 
provided for ``housing for older persons.'' We believe that the 
legislation will not add clarity to determinations on whether 
housing is or is not ``housing for older persons,'' an issue 
that has been a major concern of persons seeking to determine 
whether or not a property complies with the housing for older 
persons criteria.
    Congress enacted civil rights protections for families with 
children in housing in response to demonstrated pervasive 
discrimination against families with children during 
Congressional hearings in 1986 and 1987. See, Hearings before 
the Subcommittee on Civil and Constitutional Rights, Committee 
on the Judiciary, U.S. House of Representatives, on H.R. 4119, 
99th Congress (Serial No. 120), and on H.R. 1158, 100th 
Congress (Serial No. 9). See also, H. Rept. 100-711. But while 
providing these important protections, Congress also recognized 
the need to allow bona fide retirement communities to continue 
without the presence of children. See H.R. 1158, 100th 
Congress, as introduced.
    Existing law provides an exemption for legitimate 
retirement communities from compliance with the familial status 
antidiscrimination protection in the Fair Housing Act. Two 
types of exemptions are provided. First, de facto retirement 
communities in which all residents are 62 years of age or older 
are exempt. No other requirements except age are necessary to 
obtain the exemption.
    Second, organized retirement communities that have 
``significant facilities and services'' to meet the needs of 
their older residents are also exempt. Because these 
communities provide significant facilities and services, 
flexibility is provided for occupancy by some residents under 
55, such as spouses of residents 55 or older. These organized 
communities must be intended for occupancy by at least one 
person 55 years of age or older per unit, and at least 80 
percent of the units must be occupied by at least one person 55 
years of age or older.
    The Department of Justice strongly opposes the proposed 
amendment to existing law. Enactment of section 2 would 
severely weaken anti-discrimination protection based on 
familial status, and would allow the very proliferation of 
``all-adult'' housing facilities the law sought to proscribe.
    By enacting protections for families with children, 
Congress was responding to proven pervasive discrimination 
against families and children. At the same time, Congress 
clearly demonstrated its intent to allow housing that was 
housing genuinely designed for senior citizens. Both concepts 
can be protected, not by amending a major piece of civil rights 
legislation, but by clarifying the standards for housing for 
older persons. The Administration strongly supports providing 
protection and opportunities for families with children, and 
strongly supports continuation of this protection. Weakening of 
existing law would allow increased discrimination in housing 
against families with children.
    A proposed regulation soon to be published by the 
Department of Housing and Urban Development (HUD), which 
interprets the ``significant facilities and services'' portion 
of the current 55-and-older exemption, promises to provide the 
certainty and clarity that has been lacking in the past. 
Following five public hearings around the country and 
consideration of over 15,000 written comments on the former 
proposed rule describing ``significant facilities and 
services,'' HUD is developing a workable standard that will be 
sufficiently precise to achieve the level of certainty the 
public has demanded, without requiring great expense or 
services or facilities that only serve the frail elderly. 
Because it addresses the major concerns expressed about 
implementation of the Act in this regard, HUD's proposed new 
rule should be carefully examined and assessed before any 
additional amendments to the Act are considered.
    By eliminating the ``significant facilities and services 
requirement,'' section 2 would also in effect eliminate the 62-
and-over exemption and dramatically lower the minimum 
requirements for housing for older persons. Instead of 
requiring that all persons living in the facility be 62 and 
over, or that the community provide ``significant facilities 
and services'' for its 55 and older residents, section 2 would 
require only that one person 55 or older live in 80 percent of 
the units, without any requirement that significant facilities 
and services be provided for the senior citizen residents.
    Thus, under the proposed amendment, more than half the 
persons living in a facility designated as ``housing for older 
persons'' could be younger than 55, and that facility would not 
be required to provide any significant facilities and services 
specifically designed to meet the needs of older persons. For 
example, assume a 100-unit facility, with two persons per unit, 
and 80% of the units occupied by one person 55 or older. Under 
the proposed amendment, using this hypothetical example, of the 
two hundred residents in the facility, as few as 80 residents 
could be 55 or over, while 120 could be under 55.
    Exemptions to civil rights laws should be limited, and 
created only with great care and deliberation. When Congress 
enacted this exemption in 1988, it recognized the legitimate 
need of senior citizens to continue to live in retirement 
communities. The exemption was crafted to allow exemption for 
de facto informal retirement communities, in which everyone was 
old, and for organized communities that provided significant 
facilities and services to meet the needs of its elderly 
residents. The statute provides an alternative way for a 
housing provider to meet the requirement for ``housing for 
older persons'' if it is impracticable to provide significant 
facilities and services.
    The Department of Justice recognizes the need to provide 
clear standards for housing providers as to what constitutes 
``significant facilities and services.'' Towards that end, the 
Department of Housing and Urban Development has been conducting 
public hearings on this issue to provide additional guidance on 
the parameters of that requirement.
    2. Section 3 of the bill would amend the Fair Housing Act 
to create a ``good faith reliance'' defense against imposition 
of money damages.
    In order for monetary damages to serve as a deterrent, they 
must remain available for use in every case. Adoption of a 
``good faith reliance'' standard would allow a willful and 
egregious lawbreaker to claim good faith reliance and thus 
avoid imposition of damages. Nothing in existing law prevents a 
court from considering good faith reliance, yet codifying a 
standard into the law would encourage persons to violate the 
law by claiming good faith reliance. We think this would be an 
undesirable result.
    Section 3 would be superfluous if section 2 were enacted. 
Under section 2, there would be no need to allow ``good faith 
reliance,'' because compliance would be just a matter of 
verifying the occupancy status of each unit. The judgment of 
whether the facility had ``significant facilities and 
services'' would no longer be required. Moreover, if HUD adopts 
a final rule providing a flexible and workable approach to the 
``significant facilities and services'' problem, there would be 
no need for a ``good faith reliance'' defense, because the 
needed clarity will have been achieved through interpretation 
of the existing statute.
    Thank you for the opportunity to present our views on this 
proposal. Please let us know if we may be of additional 
assistance in this or any other matter. The Office of 
Management and Budget has advised that there is no objection 
from the standpoint of the Administration's program to the 
presentation of this report.
            Sincerely,
                                               Kent Markus,
                                 Acting Assistant Attorney General.
         Changes in Existing Law Made by the Bill, as Reported

    In compliance with clause 3 of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

                  SECTION 807 OF THE FAIR HOUSING ACT

                               exemption

    Sec. 807. (a) * * *
    (b)(1) Nothing in this title limits the applicability of 
any reasonable local, State, or Federal restrictions regarding 
the maximum number of occupants permitted to occupy a dwelling. 
Nor does any provision in this title regarding familial status 
apply with respect to housing for older persons.
    (2) As used in this section, ``housing for older persons'' 
means housing--
          (A) provided under any State or Federal program that 
        the Secretary determines is specifically designed and 
        operated to assist elderly persons (as defined in the 
        State or Federal program); or
          (B) intended for, and solely occupied by, persons 62 
        years of age or older; or
          [(C) intended and operated for occupancy by at least 
        one person 55 years of age or older per unit. In 
        determining whether housing qualifies as housing for 
        older persons under this subsection, the Secretary 
        shall develop regulations which require at least the 
        following factors:
                  [(i) the existence of significant facilities 
                and services specifically designed to meet the 
                physical or social needs of older persons, or 
                if the provision of such facilities and 
                services is not practicable, that such housing 
                is necessary to provide important housing 
                opportunities for older persons; and
                  [(ii) that at least 80 percent of the units 
                are occupied by at least one person 55 years of 
                age or older per unit; and
                  [(iii) the publication of, and adherence to, 
                policies and procedures which demonstrate an 
                intent by the owner or manager to provide 
                housing for persons 55 years of age or older.]
          (C) that meets the following requirements:
                  (i) The housing is in a facility or community 
                intended and operated for the occupancy of at 
                least 80 percent of the occupied units by at 
                least one person 55 years of age or older.
                  (ii) The housing facility or community 
                publishes and adheres to policies and 
                procedures that demonstrate the intent required 
                under clause (i), whether or not such policies 
                and procedures are set forth in the governing 
                documents of such facility or community.
                  (iii) The housing facility or community 
                complies with rules made by the Secretary for 
                the verification of occupancy. Such rules shall 
                allow for that verification by reliable surveys 
                and affidavits and shall include examples of 
                the types of policies and procedures relevant 
                to a determination of compliance with the 
                requirement of clause (ii). Such surveys and 
                affidavits shall be admissible in 
                administrative and judicial proceedings for the 
                purposes of such verification.
          * * * * * * *
    (5) Good Faith Reliance.--(A) A person shall not be held 
personally liable for monetary damages for a violation of this 
title if such person reasonably relied, in good faith, on the 
application of the exemption under this subsection relating to 
housing for older persons.
    (B) For the purposes of this paragraph, a person engaged in 
the business of residential real estate transactions may show 
good faith reliance on the application of the exemption by 
showing that--
          (i) such person has no actual knowledge that the 
        facility or community is not, or will not, be eligible 
        for such exemption; and
          (ii) the facility or community has certified to such 
        person, in writing and on oath or affirmation, that the 
        facility or community complies with the requirements 
        for such exemption.