[Federal Register Volume 61, Number 154 (Thursday, August 8, 1996)]
[Rules and Regulations]
[Pages 41480-41482]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-20201]



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Part V





Department of Housing and Urban Development





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24 CFR Part 103



Revision of HUD's Fair Housing Complaint Processing; Interim Rule

  Federal Register / Vol. 61, No. 154 / Thursday, August 8, 1996 / 
Rules and Regulations  

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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Part 103

[Docket No. FR-4031-I-01]
RIN 2529-AA79


Office of the Assistant Secretary for Fair Housing and Equal 
Opportunity; Revision of HUD's Fair Housing Complaint Processing

AGENCY: Office of the Assistant Secretary for Fair Housing and Equal 
Opportunity, HUD.

ACTION: Interim rule.

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SUMMARY: This interim rule amends HUD's regulations governing fair 
housing complaint processing. Specifically, this rule removes the 
provision allowing a respondent to request a subpoena during a fair 
housing investigation. The removal of this provision will eliminate the 
delays associated with subpoena requests and expedite the investigation 
process. Further, the rule will prevent the appearance of a conflict of 
interest between HUD's dual role as investigator and impartial arbiter 
of discovery disputes between complainants and respondents. This 
interim rule will also conform HUD's investigation practices with those 
of other Federal administrative agencies.

DATES: Effective date: September 9, 1996.
    Comments due date: October 7, 1996.

ADDRESSES: Interested persons are invited to submit comments regarding 
the interim rule to the Office of the General Counsel, Rules Docket 
Clerk, Room 10276, Department of Housing and Urban Development, 451 
Seventh Street, SW, Washington, DC 20410-0500. Communications should 
refer to the above docket number and title. Facsimile (FAX) comments 
are not acceptable. A copy of each communication submitted will be 
available for public inspection and copying during regular business 
hours (7:30 a.m. to 5:30 p.m. Eastern Time) at the above address.

FOR FURTHER INFORMATION CONTACT: Susan Forward, Deputy Assistant 
Secretary for Enforcement and Investigations, Room 5106, Department of 
Housing and Urban Development, 451 Seventh Street, SW., Washington, DC 
20410, telephone number (202) 708-4211. For hearing- and speech-
impaired persons, this number may be accessed via TTY by calling the 
Federal Information Relay Service at 1-800-877-8339. (With the 
exception of the ``800'' number, these numbers are not toll free.)

SUPPLEMENTARY INFORMATION:

I. Background

A. Respondent's Right to Request Subpoena

    The Fair Housing Amendments Act of 1988 amended section 811 of the 
Fair Housing Act (title VIII of the Civil Rights Act of 1968, as 
amended, 42 U.S.C. 3601 et seq.) (the Act). Section 811, as amended, 
authorizes the Secretary of HUD to issue subpoenas and order discovery 
in aid of fair housing investigations and hearings. The Secretary has 
delegated this investigative authority to the Assistant Secretary for 
Fair Housing and Equal Opportunity. The Secretary's authority to 
conduct hearings has been delegated to HUD's administrative law judges.
    Prior to the Fair Housing Amendments Act of 1988, the Act did not 
contain an administrative hearing process with discovery available to 
the parties. However, the original language of section 811(b) of the 
Act permitted a respondent to request the issuance of a subpoena during 
a fair housing investigation:

    Upon written application to the Secretary, a respondent shall be 
entitled to the issuance of a reasonable number of subpoenas by and 
in the name of the Secretary to the same extent and subject to the 
same limitations as subpoenas issued by the Secretary himself.
    Subpoenas issued at the request of a respondent shall show on 
their face the name and address of such respondent and shall state 
that they were issued at his request. 42 U.S.C. 3611(b) (1969).

    The Fair Housing Amendments Act of 1988 removed the above-quoted 
provision from the Act and granted the Secretary sole authority for 
conducting discovery during fair housing investigations. However, HUD's 
regulation at 24 CFR 103.215, published on January 23, 1989, includes a 
provision which permits a respondent to request a subpoena during an 
investigation. HUD's regulations do not provide a complaining party 
with the opportunity to request issuance of a subpoena. However, the 
complainant is permitted to request that the Assistant Secretary for 
Fair Housing and Equal Opportunity revoke, quash or modify a 
respondent's subpoena. This difference was based, in part, on the 
assumption that HUD would be representing the interests of the 
complaining party, and therefore the respondent should be offered the 
ability to discover information in its own defense.
    A recent Department of Justice memorandum 1 calls that 
assumption into question. The memorandum states that the responsibility 
of the government in the conduct of fair housing cases is not to 
advocate for the complainant, but to serve the government's goals of 
doing justice and correcting societal wrongs. Consequently, HUD's role 
in a fair housing investigation is to objectively consider the facts 
and determine whether cause exists to believe that a violation of the 
Act has occurred, not to represent the interests of the complainant.
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    \1\  Assistant Attorney General Walter Dellinger, memorandum to 
Deval L. Patrick, Assistant Attorney General for Civil Rights, The 
Relationship Between Department Attorneys and Persons on Whose 
Behalf the United States Initiates Cases Under the Fair Housing Act 
(January 20, 1995).
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B. Revision of 24 CFR 103.215

    The lack of statutory support discussed above has prompted HUD to 
publish this interim rule, which revises Sec. 103.215 to delete the 
requirement that HUD issue a subpoena at the request of a respondent. 
There are additional reasons for HUD's decision to take this action:
1. Prevents Appearance of Conflict of Interest
    This interim rule prevents the appearance of a conflict of interest 
between the Assistant Secretary's dual roles as investigator and as 
impartial arbiter of discovery disputes between complainants and 
respondents by removing the requirement that HUD engage in discovery at 
the direction of one of the parties. The refereeing of these disputes 
is a function more properly allocated to the administrative law judges 
in the context of administrative hearings, or district court judges in 
the context of elected federal litigation.
2. Expedites Investigation Process
    This interim rule eliminates delays in the investigation process 
which are associated with processing subpoena requests from 
respondents. The Act charges HUD with completing all fair housing 
investigations within a 100-day period, if practicable. If the fair 
housing investigation cannot be completed within that time, the 
Secretary is required to notify the complainant and the respondent of 
the reasons for the delay. (42 U.S.C. 3610(a)(1).) However, the United 
States Commission on Civil Rights noted, in its report on enforcement 
of the Act, that the complexity of some cases and the heavy caseload 
burden on investigative staff

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bore out the observation that HUD frequently is not able to close 
complaints or make determinations in 100 days.2 HUD has determined 
that pursuing discovery at the direction of the respondent, in addition 
to the discovery that HUD determines is necessary to the investigation, 
is not necessary to a fair and impartial determination and can actually 
impede HUD's efforts to complete the investigation in a timely manner.
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    \2\ United States Commission on Civil Rights, The Fair Housing 
Amendments Act of 1988: The Enforcement Report, at 40-42 (1994).
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3. Conforms HUD's Investigative Practices to Other Federal Agencies
    This interim rule will conform HUD's investigation practices with 
those of other Federal administrative agencies, which do not provide 
for discovery by parties during the investigation of civil rights 
complaints. HUD's review of the relevant regulations of the Equal 
Employment Opportunity Commission for Title VII of the Civil Rights Act 
of 1968 (29 CFR part 1601), the Americans with Disabilities Act (29 CFR 
part 1630), the Equal Pay Act (29 CFR part 1620), and the Age 
Discrimination in Employment Act (29 CFR part 1626) revealed that a 
respondent does not have an opportunity to request a subpoena during 
the government's investigation of a civil rights complaint under any of 
these regulations. Similar regulations governing the Department of 
Education's enforcement of Title IX of the Education Amendments of 1972 
(34 CFR part 106), and the Department of Justice's enforcement of the 
Immigration Reform and Control Act of 1986 (28 CFR part 44) also do not 
contain any provisions authorizing a respondent to request a subpoena 
during a civil rights investigation under these statutes.
    HUD believes that the experience of other Federal administrative 
agencies provides positive guidance for this decision to streamline and 
simplify the investigation process.

C. Respondent's Ability To Prepare Its Defense

    HUD believes it is important to emphasize that this interim rule 
does not compromise a respondent's ability to prepare its own defense. 
A respondent may continue to conduct an independent investigation of 
the facts underlying the fair housing complaint and may obtain the 
Final Investigative Report on which HUD's determination is based. This 
interim rule does not change a respondent's ability to compel discovery 
or request a subpoena from an administrative law judge during the 
administrative hearing process. (See 24 CFR 104.500-104.590.) This 
interim rule only affects the ability of a respondent to compel the use 
of HUD's resources to subpoena evidence independent of the evidence 
which HUD has determined is necessary to the investigation.

II. Justification for Interim Rulemaking

    HUD generally publishes a rule for public comment before issuing a 
rule for effect, in accordance with its own regulations on rulemaking 
in 24 CFR part 10. However, part 10 provides for exceptions to the 
general rule if the agency finds good cause to omit advance notice and 
public participation. The good cause requirement is satisfied when 
prior public procedure is ``impracticable, unnecessary, or contrary to 
the public interest'' (24 CFR 10.1). HUD finds that in this case prior 
public comment is contrary to the public interest, since immediate 
implementation of this interim rule will benefit the public.
    This interim rule removes a respondent's right to request a 
subpoena during the course of a fair housing investigation. HUD's 
processing of these subpoena requests may delay, and often has delayed, 
its investigation of complaints alleging discriminatory housing 
practices. By eliminating these delays, this interim rule expedites 
HUD's investigations and its ability to enforce the Act. Further, the 
rule prevents the appearance of a conflict of interest between HUD's 
dual roles as investigator and impartial arbiter of discovery disputes 
between complainants and respondents. Such an appearance weakens HUD's 
ability to conduct fair housing complaint investigations.
    This interim rule does not compromise a respondent's ability to 
prepare its own defense. Respondents will still be able to compel 
discovery or request subpoenas during the administrative hearing 
process. The rule only affects the ability of a respondent to compel 
use of HUD's resources to subpoena evidence over and above the 
information which HUD has determined is necessary to a full and fair 
investigation.
    Although HUD believes issuing this interim rule for immediate 
effect will benefit the public, HUD welcomes public comment. All 
comments will be considered in the development of the final rule.

III. Other Matters

A. Regulatory Flexibility Act

    The Secretary, in accordance with the Regulatory Flexibility Act (5 
U.S.C. 605(b)), has reviewed and approved this final rule, and in so 
doing certifies that this rule will not have a significant economic 
impact on a substantial number of small entities. This rule streamlines 
HUD's regulations governing fair housing complaint processing. The rule 
will have no adverse or disproportionate economic impact on small 
businesses.

B. Environmental Impact

    This rulemaking does not have an environmental impact. This 
rulemaking amends an existing regulation by streamlining provisions and 
does not alter the environmental effect of the regulations being 
amended. A Finding of No Significant Impact with respect to the 
environment was made in accordance with HUD regulations in 24 CFR part 
50 that implement section 102(2)(C) of the National Environmental 
Policy Act of 1969 (42 U.S.C. 4332) at the time of development of 
regulations implementing the Act. That finding remains applicable to 
this rule, and is available for public inspection between 7:30 a.m. and 
5:30 p.m. weekdays in the Office of the Rules Docket Clerk, Office of 
General Counsel, Room 10276, Department of Housing and Urban 
Development, 451 Seventh Street, SW., Washington, DC.

C. Executive Order 12612, Federalism

    The General Counsel, as the Designated Official under section 6(a) 
of Executive Order 12612, Federalism, has determined that this rule 
will not have substantial direct effects on States or their political 
subdivisions, or the relationship between the Federal government and 
the States, or on the distribution of power and responsibilities among 
the various levels of government. No programmatic or policy changes 
will result from this rule that would affect the relationship between 
the Federal Government and State and local governments.

D. Executive Order 12606, The Family

    The General Counsel, as the Designated Official under Executive 
Order 12606, The Family, has determined that this rule will not have 
the potential for significant impact on family formation, maintenance, 
or general well-being, and thus is not subject to review under the 
Order. No significant change in existing HUD policies or programs will 
result from promulgation of this rule.

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E. Executive Order 12866, Regulatory Planning and Review

    This interim rule was reviewed by the Office of Management and 
Budget under Executive Order 12866, Regulatory Planning and Review. Any 
changes made to the interim rule as a result of that review are clearly 
identified in the docket file, which is available for public inspection 
in the office of the Department's Rules Docket Clerk, Room 10276, 451 
Seventh Street, SW., Washington, DC 20410-0500.

List of Subjects in 24 CFR Part 103

    Administrative practice and procedure, Aged, Fair housing, 
Individuals with disabilities, Intergovernmental relations, 
Investigations, Mortgages, Penalties, Reporting and recordkeeping 
requirements.

    Accordingly, 24 CFR part 103 is amended as follows:

PART 103--FAIR HOUSING--COMPLAINT PROCESSING

    1. The authority citation for 24 CFR part 103 continues to read as 
follows:

    Authority: 42 U.S.C. 3535(d), 3601-3619.

    2. Section 103.215 is amended by revising paragraph (b) to read as 
follows:


Sec. 103.215  Conduct of investigations.

* * * * *
    (b) The Assistant Secretary may conduct and order discovery in aid 
of the investigation by the same methods and to the same extent that 
discovery may be ordered in an administrative proceeding under 24 CFR 
part 104, except that the Assistant Secretary shall have the power to 
issue subpoenas described in 24 CFR 104.590 in support of the 
investigation. Subpoenas issued by the Assistant Secretary must be 
approved by the General Counsel as to their legality before issuance.

    Dated: April 23, 1996.
Elizabeth K. Julian,
Deputy Assistant Secretary for Policy and Initiatives.
[FR Doc. 96-20201 Filed 8-7-96; 8:45 am]
BILLING CODE 4210-28-P