[Federal Register Volume 63, Number 243 (Friday, December 18, 1998)]
[Notices]
[Pages 70256-70257]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-33568]



[[Page 70255]]

_______________________________________________________________________

Part IV





Department of Housing and Urban Development





_______________________________________________________________________



Fair Housing Enforcement--Occupancy Standards Statement of Policy; 
Notice

  Federal Register / Vol. 63, No. 243 / Friday, December 18, 1998 / 
Notices  

[[Page 70256]]



DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-4405-N-01]


Fair Housing Enforcement--Occupancy Standards Notice of Statement 
of Policy

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

ACTION: Notice of statement of policy.

-----------------------------------------------------------------------

SUMMARY: This statement of policy advises the public of the factors 
that HUD will consider when evaluating a housing provider's occupancy 
policies to determine whether actions under the provider's policies may 
constitute discriminatory conduct under the Fair Housing Act on the 
basis of familial status (the presence of children in a family). 
Publication of this notice meets the requirements of the Quality 
Housing and Work Responsibility Act of 1998.

DATES: Effective date: December 18, 1998.

FOR FURTHER INFORMATION CONTACT:
Sara Pratt, Director, Office of Investigations, Office of Fair Housing 
and Equal Opportunity, Room 5204, 451 Seventh Street, SW, Washington, 
DC 20410, telephone (202) 708-2290 (not a toll-free number). For 
hearing- and speech-impaired persons, this telephone number may be 
accessed via TTY (text telephone) by calling the Federal Information 
Relay Service at 1-800-877-8339 (toll-free).

SUPPLEMENTARY INFORMATION:

Statutory and Regulatory Background

    Section 589 of the Quality Housing and Work Responsibility Act of 
1998 (Pub. L. 105-276, 112 Stat. 2461, approved October 21, 1998, 
``QHWRA'') requires HUD to publish a notice in the Federal Register 
that advises the public of the occupancy standards that HUD uses for 
enforcement purposes under the Fair Housing Act (42 U.S.C. 3601-3619). 
Section 589 requires HUD to publish this notice within 60 days of 
enactment of the QHWRA, and states that the notice will be effective 
upon publication. Specifically, section 589 states, in relevant part, 
that:

    [T]he specific and unmodified standards provided in the March 
20, 1991, Memorandum from the General Counsel of [HUD] to all 
Regional Counsel shall be the policy of [HUD] with respect to 
complaints of discrimination under the Fair Housing Act . . . on the 
basis of familial status which involve an occupancy standard 
established by a housing provider.

    The Fair Housing Act prohibits discrimination in any aspect of the 
sale, rental, financing or advertising of dwellings on the basis of 
race, color, religion, national origin, sex or familial status (the 
presence of children in the family). The Fair Housing Act also provides 
that nothing in the Act ``limits the applicability of any reasonable 
local, State or Federal restrictions regarding the maximum number of 
occupants permitted to occupy a dwelling.'' The Fair Housing Act gave 
HUD responsibility for implementation and enforcement of the Act's 
requirements. The Fair Housing Act authorizes HUD to receive complaints 
alleging discrimination in violation of the Act, to investigate these 
complaints, and to engage in efforts to resolve informally matters 
raised in the complaint. In cases where the complaint is not resolved, 
the Fair Housing Act authorizes HUD to make a determination of whether 
or not there is reasonable cause to believe that discrimination has 
occurred. HUD's regulations, implementing the Fair Housing Act (42 
U.S.C. 3614) are found in 24 CFR part 100.
    In 1991, HUD's General Counsel, Frank Keating, determined that some 
confusion existed because of the absence of more detailed guidance 
regarding what occupancy restrictions are reasonable under the Act. To 
address this confusion, General Counsel Keating issued internal 
guidance to HUD Regional Counsel on factors that they should consider 
when examining complaints filed with HUD under the Fair Housing Act, to 
determine whether or not there is reasonable cause to believe 
discrimination has occurred.

This Notice

    Through this notice HUD implements section 589 of the QHWRA by 
adopting as its policy on occupancy standards, for purposes of 
enforcement actions under the Fair Housing Act, the standards provided 
in the Memorandum of General Counsel Frank Keating to Regional Counsel 
dated March 20, 1991, attached as Appendix A.

    Authority: 42 U.S.C. 3535(d), 112 Stat. 2461.

    Dated: December 14, 1998.
Eva M. Plaza,
Assistant Secretary for Fair Housing and Equal Opportunity.

Appendix A.

March 20, 1991.
MEMORANDUM FOR: All Regional Counsel
FROM: Frank Keating, G
SUBJECT: Fair Housing Enforcement Policy: Occupancy Cases

    On February 21, 1991, I issued a memorandum designed to 
facilitate your review of cases involving occupancy policies under 
the Fair Housing Act. The memorandum was based on my review of a 
significant number of such cases and was intended to constitute 
internal guidance to be used by Regional Counsel in reviewing cases 
involving occupancy restrictions. It was not intended to create a 
definitive test for whether a landlord or manager would be liable in 
a particular case, nor was it intended to establish occupancy 
policies or requirements for any particular type of housing.
    However, in discussions within the Department, and with the 
Department of Justice and the public, it is clear that the February 
21 memorandum has resulted in a significant misunderstanding of the 
Department's position on the question of occupancy policies which 
would be reasonable under the Fair Housing Act. In this respect, 
many people mistakenly viewed the February 21 memorandum as 
indicating that the Department was establishing an occupancy policy 
which it would consider reasonable in any fair housing case, rather 
than providing guidance to Regional Counsel on the evaluation of 
evidence in familial status cases which involve the use of an 
occupancy policy adopted by a housing provider.
    For example, there is a HUD Handbook provision regarding the 
size of the unit needed for public housing tenants. See Handbook 
7465.1 REV-2, Public Housing Occupancy Handbook: Admission, revised 
section 5-1 (issued February 12, 1991). While that Handbook 
provision states that HUD does not specify the number of persons who 
may live in public housing units of various sizes, it provides 
guidance about the factors public housing agencies may consider in 
establishing reasonable occupancy policies. Neither this memorandum 
nor the memorandum of February 21, 1991 overrides the guidance that 
Handbook provides about program requirements.
    As you know, assuring Fair Housing for all is one of Secretary 
Kemp's top priorities. Prompt and vigorous enforcement of all the 
provisions of the Fair Housing Act, including the protections in the 
Act for families with children, is a critical responsibility of mine 
and every person in the Office of General Counsel. I expect 
Headquarters and Regional Office staff to continue their vigilant 
efforts to proceed to formal enforcement in all cases in which there 
is reasonable cause to believe that a discriminatory housing 
practice under the Act has occurred or is about to occur. This is 
particularly important in cases where occupancy restrictions are 
used to exclude families with children or to unreasonably limit the 
ability of families with children to obtain housing.
    In order to assure that the Department's position in the area of 
occupancy policies is fully understood, I believe that it is 
imperative to articulate more fully the Department's position on 
reasonable occupancy policies and to describe the approach that the 
Department takes in its review of occupancy cases.
    Specifically, the Department believes that an occupancy policy 
of two persons in a bedroom, as a general rule, is reasonable under 
the Fair Housing Act. The Department of Justice has advised us that 
this is the

[[Page 70257]]

general policy it has incorporated in consent decrees and proposed 
orders, and such a general policy also is consistent with the 
guidance provided to housing providers in the HUD handbook 
referenced above. However, the reasonableness of any occupancy 
policy is rebuttable, and neither the February 21 memorandum nor 
this memorandum implies that the Department will determine 
compliance with the Fair Housing Act based solely on the number of 
people permitted in each bedroom. Indeed, as we stated in the final 
rule implementing the Fair Housing Amendments Act of 1988, the 
Department's position is as follows:

    [T]here is nothing in the legislative history which indicates 
any intent on the part of Congress to provide for the development of 
a national occupancy code. * * *
    On the other hand, there is no basis to conclude that Congress 
intended that an owner or manager of dwellings would be unable to 
restrict the number of occupants who could reside in a dwelling. 
Thus, the Department believes that in appropriate circumstances, 
owners and managers may develop and implement reasonable occupancy 
requirements based on factors such as the number and size of 
sleeping areas or bedrooms and the overall size of the dwelling 
unit. In this regard, it must be noted that, in connection with a 
complaint alleging discrimination on the basis of familial status, 
the Department will carefully examine any such nongovernmental 
restriction to determine whether it operates unreasonably to limit 
or exclude families with children.
    24 C.F.R. Chapter I, Subchapter A. Appendix I at 566-67 (1990).
    Thus, in reviewing occupancy cases, HUD will consider the size 
and number of bedrooms and other special circumstances. The 
following principles and hypothetical examples should assist you in 
determining whether the size of the bedrooms or special 
circumstances would make an occupancy policy unreasonable.

Size of bedrooms and unit

    Consider two theoretical situations in which a housing provider 
refused to permit a family of five to rent a two-bedroom dwelling 
based on a ``two people per bedroom'' policy. In the first, the 
complainants are a family of five who applied to rent an apartment 
with two large bedrooms and spacious living areas. In the second, 
the complainants are a family of five who applied to rent a mobile 
home space on which they planned to live in a small two-bedroom 
mobile home. Depending on the other facts, issuance of a charge 
might be warranted in the first situation, but not in the second.
    The size of the bedrooms also can be a factor suggesting that a 
determination of no reasonable cause is appropriate. For example, if 
a mobile home is advertised as a ``two-bedroom'' home, but one 
bedroom is extremely small, depending on all the facts, it could be 
reasonable for the park manager to limit occupancy of the home of 
two people.

Age of children

    The following hypotheticals involving two housing providers who 
refused to permit three people to share a bedroom illustrate this 
principle. In the first, the complainants are two adult parents who 
applied to rent a one-bedroom apartment with their infant child, and 
both the bedroom and the apartment were large. In the second, the 
complainants are a family of two adult parents and one teenager who 
applied to rent a one-bedroom apartment. Depending on the other 
facts, issuance of a charge might be warranted in the first 
hypothetical, but not in the second.

Configuration of unit

    The following imaginary situations illustrate special 
circumstances involving unit configuration. Two condominium 
associations each reject a purchase by a family of two adults and 
three children based on a rule limiting sales to buyers who satisfy 
a ``two people per bedroom'' occupancy policy. The first association 
manages a building in which the family of the five sought to 
purchase a unit consisting of two bedrooms plus a den or study. The 
second manages a building in which the family of five sought to 
purchase a two-bedroom unit which did not have a study or den. 
Depending on the other facts, a charge might be warranted in the 
first situation, but not in the second.

Other physical limitations of housing

    In addition to physical considerations such as the size of each 
bedroom and the overall size and configuration of the dwelling, the 
Department will consider limiting factors identified by housing 
providers, such as the capacity of the septic, sewer, or other 
building systems.

State and local law

    If a dwelling is governed by State or local governmental 
occupancy requirements, and the housing provider's occupancy 
policies reflect those requirements, HUD would consider the 
governmental requirements as a special circumstance tending to 
indicate that the housing provider's occupancy policies are 
reasonable.

Other relevant factors

    Other relevant factors supporting a reasonable cause 
recommendation based on the conclusion that the occupancy policies 
are pretextual would include evidence that the housing provider has: 
(1) made discriminatory statements; (2) adopted discriminatory rules 
governing the use of common facilities; (3) taken other steps to 
discourage families with children from living in its housing; or (4) 
enforced its occupancy policies only against families with children. 
For example, the fact that a development was previously marketed as 
an ``adults only'' development would militate in favor of issuing a 
charge. This is an especially strong factor if there is other 
evidence suggesting that the occupancy policies are a pretext for 
excluding families with children.
    An occupancy policy which limits the number of children per unit 
is less likely to be reasonable than one which limits the number of 
people per unit.
    Special circumstances also may be found where the housing 
provider limits the total number of dwellings he or she is willing 
to rent to families with children. For example, assume a landlord 
owns a building of two-bedroom units, in which a policy of four 
people per unit is reasonable. If the landlord adopts a four person 
per unit policy, but refuses to rent to a family of two adults and 
two children because twenty of the thirty units already are occupied 
by families with children, a reasonable cause recommendation would 
be warranted.
    If your review of the evidence indicates that these or other 
special circumstances are present, making application of a ``two 
people per bedroom'' policy unreasonably restrictive, you should 
prepare a reasonable cause determination. The Executive Summary 
should explain the special circumstances which support your 
recommendation.

[FR Doc. 98-33568 Filed 12-17-98; 8:45 am]
BILLING CODE 4210-28-M