[Federal Register Volume 68, Number 136 (Wednesday, July 16, 2003)]
[Notices]
[Pages 42184-42188]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-17990]



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Part III





Department of Housing and Urban Development





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Responses to Notice of Certification and Funding of State and Local 
Fair Housing Enforcement Agencies Under the Fair Housing Assistance 
Program (FHAP); Notice

  Federal Register / Vol. 68, No. 136 / Wednesday, July 16, 2003 / 
Notices  

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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-4688-N-02]


Responses to Notice of Certification and Funding of State and 
Local Fair Housing Enforcement Agencies Under the Fair Housing 
Assistance Program (FHAP)

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

ACTION: Notice.

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SUMMARY: Under HUD's regulations addressing the certification of state 
and local fair housing enforcement agencies under the Fair Housing 
Assistance Program (FHAP), HUD is required to (1) Periodically inform 
the public of certified and interim certified agencies and identify 
those agencies where a denial of interim certification or withdrawal of 
certification has been issued or proposed; and (2) solicit comments 
from the public, prior to HUD granting certification to state or local 
fair housing enforcement agencies. On February 27, 2002, a notice 
fulfilling these requirements was published. The following notice 
identifies and responds to the comments received.

DATES: Effective Date: July 16, 2003.

FOR FURTHER INFORMATION CONTACT: Myron P. Newry or Kenneth J. Carroll, 
FHIP/FHAP Support Division, Office of Programs, Office of Fair Housing 
and Equal Opportunity, Department of Housing and Urban Development, 451 
Seventh Street, SW., Room 5222, Washington, DC 20410-0001, at (202) 
708-2215 (this is not a toll-free number). Persons with speech or 
hearing impairments may contact the Office of Programs by calling 1-
800-290-1617, or 1-800-877-8399 (the Federal Information Relay Service 
TTY).

SUPPLEMENTARY INFORMATION: Seven organizations responded to the 
February 27, 2002, public notice. Four of the seven organizations 
identified issues with the Tennessee Human Rights Act (THRA) and with 
the way that the Tennessee Human Rights Commission (THRC) administers 
that law. One organization identified issues with the New York State 
Human Rights law and with the way that the New York State Division of 
Human Rights administers that law. One organization identified issues 
with the Pennsylvania Human Relations Act. Finally, one organization 
expressed support for the Vermont Human Rights Commission (this comment 
will not be discussed below).

Comments and Responses Regarding the Tennessee Human Rights Commission

    Comment. The THRC had only one administrative hearing in the past 
seven years.
    According to the Department's records, this is not true. From 
December 31, 1995, to December 31, 2002, THRC had two administrative 
hearings. Discrimination was found in each of those cases. In addition, 
during this time period, THRC had one judicial consent order. Finally, 
from December 31, 1995, to December 31, 2002, THRC conciliated 62 cases 
prior to a THRC finding, to the satisfaction of all parties involved. 
THRC has a statutory duty to attempt settlement of cases through 
conference, conciliation, and persuasion during the investigation and 
enforcement process, and the Department views this as an acceptable 
method of case disposition.
    Comment. Complainants and respondents do not receive sufficient 
notice of time frames and forum options during THRC's fair housing 
complaint investigation, conciliation, and enforcement activities.
    THRC sends notification letters to respondents and complainants in 
every case. The notification letters state that the complainant has a 
right to pursue a civil cause of action in chancery court or circuit 
court within one year of the last alleged act of discrimination. The 
notification letters also inform the parties that the time limit to 
file a private cause of action in court will continue to run when the 
complaint is pending at THRC. Finally, the notification letters set 
forth procedures for the election of civil proceedings, the period of 
time parties have to elect, and the amount of time the commission has 
to file in court when a party elects civil proceedings.
    With one exception, the Department views the notification letter as 
sufficiently notifying the parties of time frames and forum options. 
Concerning the issue of informing the parties that the time limit to 
file a private cause of action in court will continue to run when the 
complaint is pending at THRC, the letter shall be revised. Pursuant to 
the Department's recommendation below under the comment, ``The time 
limit for filing a private lawsuit under THRA is not tolled by filing a 
complaint with THRC,'' the letter must clearly inform the parties of 
the procedure (as recommended by HUD) that THRC will utilize when a 
dual-filed complaint being processed by THRC is close to the one-year 
time limit to file a private cause of action in court.
    Comment. THRC complaint forms must be notarized and complainants 
must submit a notarized affidavit form with the complaint form.
    There is no statutory requirement that complaints be notarized 
under the THRA. However, THRC's rules state that ``[t]he complaint 
shall be in writing and must be signed and sworn to before a notary 
public or other person duly authorized by law to administer oaths and 
take acknowledgements.'' The purpose of the notarization requirement, 
according to THRC, is ``to provide some degree of insurance against 
catchpenny claims of disgruntled, but not necessarily aggrieved, 
persons.'' Regulations implementing the Federal Fair Housing Act 
(FHAct), at 24 CFR section 115.202 (a)(3), provide that a state or 
local law that is substantially equivalent to the FHAct must not 
``place excessive burdens on the complainant that might discourage the 
filing of complaints, such as * * * [p]rovisions that could subject a 
complainant to costs, criminal penalties, or fees in connection with 
filing complaints.'' A notarization requirement may place a financial 
and logistical burden on a complainant. However, THRC's rules also 
provide that notary public service ``shall be furnished without charge 
by the Commission.'' Moreover, THRC has recently proposed rules 
allowing complaints to be ``verified'' instead of notarized. According 
to THRC, the term ``verified'' would be defined more broadly than 
notarization, allowing complaints to be sworn to persons other than a 
notary public, including designated representatives of THRC. Complaints 
would also be ``verified'' if they were supported by a declaration in 
writing under penalty of perjury. HUD will require THRC to enact the 
rule that complaints may be ``verified'' (instead of notarized) and all 
that is necessary for a complaint to be ``verified'' is that it be 
supported by a declaration in writing under penalty of perjury.
    Comment. It is not THRC's ``practice'' to interview complainants as 
part of the investigative process.
    THRC disputes this comment. According to THRC, investigators are 
continually instructed and reminded that they cannot complete an 
investigation without interviewing, at a bare minimum, the complainant, 
the respondent, and any relevant witnesses. The Department's 
performance assessments of THRC and the Department's review of THRC's 
dual-filed cases indicate that complainants, respondents, and all 
relevant witnesses

[[Page 42185]]

are interviewed as a customary part of THRC's investigative process.
    Comment. THRC often stops investigating a complaint once the 
respondent articulates a plausible nondiscriminatory reason for the 
behavior.
    THRC disputes this comment. According to THRC, absent direct 
evidence of discrimination, respondents must articulate legitimate, 
nondiscriminatory reasons for their behavior to rebut a prima facie 
case of discrimination. THRC then verifies those reasons to the extent 
factually possible. Faced with a nondiscriminatory reason, the 
complainant must then provide evidence to THRC showing that the 
respondent's reasons are false and that the real reason is 
discrimination. The Department's performance assessments of THRC 
confirm that THRC sufficiently investigates complaints following a 
respondent's articulation of a plausible nondiscriminatory reason for 
the alleged discriminatory behavior.
    Comment. THRC assigns investigators from one region of Tennessee to 
investigate complaints originating in another region of Tennessee.
    The duty station of an agency's investigators does not affect 
certification so long as complaints are appropriately investigated. The 
assignment of investigators is an internal management decision for 
THRC. Absent credible evidence that parties are being harmed by THRC 
assigning investigators from different regions of Tennessee, HUD will 
not impose requirements on THRC regarding this issue. In any event, 
THRC states that this is not its general practice. THRC has housing 
employees in Knoxville, Memphis, Nashville, and Kingsport, Tennessee. 
While investigators do occasionally investigate cases in regions other 
than their own, this is not THRC's routine practice.
    Comment. If an investigator's employment at the THRC ends during a 
pending investigation and a new investigator is assigned, the 
investigation often starts at the beginning. This result is exacerbated 
by a high turnover rate among THRC investigation staff.
    THRC disputes this comment and contends that it does not have a 
high turnover rate in housing investigators. THRC employs 31 people in 
six offices throughout the state. Since May of 2000, only one housing 
employee left THRC, and this person was not an investigator.
    Comment. THRC knowingly employed at least one investigator with a 
felony conviction.
    THRC acknowledges that this is true. However, the individual no 
longer works at THRC. HUD will require THRC to implement hiring 
procedures to assure that individuals with felony convictions will not 
be hired in the future.
    Comment. THRC did not conduct an initial site visit for a case 
until approximately one year after the complaint for that case was 
filed. In addition, as of March 21, 2002, no one from the named 
complainant organization had been interviewed regarding that case. 
Finally, as of March 21, 2002, THRC had not made a finding in the case.
    THRC declined to discuss the particulars of the case because that 
case is still open and such discussion would violate the 
confidentiality requirement under Tennessee law. Tennessee Code 
Annotated 4-21-303(d) makes THRC investigative files confidential. In 
addition, according to THRC, Tennessee Attorney General Opinions 80-082 
and 87-93 state that investigative case files of the Commission are 
confidential and are exempt from disclosure to all but the parties (or 
their representatives) involved in an action. THRC was especially 
reluctant to discuss the specifics of the case because such comments 
would be published in the Federal Register. HUD did confirm that a site 
visit was conducted in the case, appropriate parties were interviewed, 
and a finding was made.
    Comment. The time limit for filing a private lawsuit under THRA is 
not tolled by filing a complaint with THRC.
    Under THRA, the time limit to file a fair housing complaint with 
THRC is 180 days from the last alleged discriminatory act. The time 
limit to file in court under the THRA is one year from the last alleged 
discriminatory act. The period of time a complaint is with THRC is 
included in calculating the one-year time limit for filing in court. 
This is in contrast to the FHAct, which provides that the time limit 
for filing a private lawsuit is tolled by filing a complaint with HUD. 
HUD will require THRC to adopt a procedure to assure that parties' 
rights will not be compromised by THRA's provision. The procedure will 
apply when a dual-filed case being processed by THRC is close to the 
one-year time limit to file a private cause of action in court.
    Comment. THRA does not specify a time frame within which an 
administrative hearing must be conducted.
    Section 304 of THRA provides that, in housing discrimination cases, 
a hearing shall be ``commenced'' if there is a determination of cause, 
conciliation has not been successful, and neither party has elected for 
a civil suit within 90 days of the filing of the complaint. THRA does 
not specifically provide for a time within which the administrative 
hearing must commence. The FHAct provides that a hearing be conducted 
within 120 days of the issuance of the charge of discrimination. 
Despite the difference, HUD does not view this omission as constituting 
a fatal flaw that would render the statute not substantially equivalent 
to the FHAct.
    Comment. THRA does not sufficiently inform the complainant and the 
respondent of their forum options.
    Section 312 of THRA clearly provides that, within 90 days of the 
complaint having been filed, if it has not been conciliated, THRC shall 
notify the parties that they may elect to have the issues adjudicated 
in a civil action. According to THRA, parties have 20 days from the 
date of receipt of the notice in which to elect (this is 110 days from 
the date of the filing of the complaint). THRA states that a civil 
action shall commence within 60 days of the election. While it is true 
that no provision of THRA explicitly states that a complainant can 
choose either the administrative or the judicial forum, various 
sections of the THRA provide the choice to the parties (See sections 
302 and 304 of the THRA). HUD views THRA as sufficiently informing the 
complainant and the respondent of their forum options.
    Comment. THRA does not include time limits that findings must be 
made, time limits for the issuance of charges, or time limits between 
the reasonable cause finding and the issuance of a charge.
    The regulations setting forth the legal criteria for substantial 
equivalency certification, located at 24 CFR 115.202, mandate that a 
substantially equivalent agency utilize the following time frames: (1) 
The commencement of proceedings after a complaint is filed must be 
within 30 days; (2) the completion of the investigation must be within 
100 days (or if it is impracticable to do so, the agency must notify 
the parties in writing of the reasons(s) for the delay); and (3) final 
disposition of the complaint must be within one year (or if it is 
impracticable to do so, the agency must notify the parties in writing 
of the reasons(s) for the delay). The Department does not require 
substantially equivalent agencies to have time limits above and beyond 
these.
    Section 302 of THRA provides that an investigation of a complaint 
be undertaken promptly within 30 days of the filing of the complaint. 
The THRA does not require that the investigation be completed within 
any specified

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period. However, the Agreement for the Interim Referral of Complaints 
and Other Utilization of Services (Interim Agreement) between HUD and 
THRC requires that THRC complete the investigation within 100 days or, 
if THRC is unable to do so, it shall notify the parties in writing of 
the reasons for the delay. Similarly, THRA does not require that final 
disposition be within one year of receipt of the complaint. However, 
the Interim Agreement between HUD and THRC requires that final 
disposition of complaints occur within one year, or if THRC is unable 
to do so, it shall notify the parties in writing of the reasons for the 
delay. When HUD conducts performance assessments of THRC and reviews 
cases dual-filed with THRC, HUD monitors THRC's compliance with the 
time frames enumerated in THRA and the time frames enumerated in the 
Interim Agreement.
    Comment. The FHAct's design and construction requirements mandate 
that all ground floor units of covered dwellings be accessible. THRA 
only mandates that each covered building have one accessible entrance.
    The comment is confusing. The commenter is identifying seemingly 
contradictory provisions of the FHAct and THRA. However, further 
analysis indicates that the provisions are not inconsistent. It is true 
that the FHAct's design and construction requirements require that all 
ground floor units in covered dwellings contain certain accessibility 
features. However, HUD accessibility requirements further clarify that 
each covered building need only have one accessible entrance to the 
building itself. Similarly, THRA requires that all ground floor units 
in covered dwellings contain certain accessibility features. As the 
commenter points out, THRA also states that each covered building need 
only have one accessible entrance to the building itself. The FHAct and 
THRA are consistent on this issue.

Comments and Responses Regarding the New York State Division of Human 
Rights (the Division)

    Comment. A complainant in New York should be able to choose whether 
his/her complaint is processed in the federal administrative forum or 
in the state administrative forum.
    Allowing a complainant in New York to choose whether his/her 
complaint is processed in the federal administrative forum or the state 
administrative forum would contravene the FHAct. When HUD grants 
certification or interim certification to a state or local fair housing 
enforcement agency, it has determined that the agency administers a law 
that is substantially equivalent to the FHAct. Section 810(f) of the 
FHAct provides that HUD shall refer complaints to agencies with 
certification when the complaint alleges a discriminatory housing 
practice within a jurisdiction served by the certified agency. Except 
in limited circumstances, HUD will take no further action with respect 
to complaints that it refers to certified agencies. These circumstances 
include the following: (1) If the certified agency is either untimely 
in its commencement of proceedings or if, after commencement, it 
carries forward such proceedings without reasonable promptness; (2) 
when HUD determines that the agency no longer qualifies for 
certification; and (3) if the agency agrees to HUD's reactivation of 
the complaint. If none of these circumstances apply, once a complaint 
is dual-filed at HUD and at the substantially equivalent agency, the 
substantially equivalent agency will conduct the complaint 
investigation, conciliation, and enforcement activities.
    Similarly, the commenter stated that if a complainant withdraws a 
complaint from the Division, the complaint should not automatically be 
withdrawn from HUD. Again, under the FHAct, a complainant is not 
permitted to choose between HUD and the Division. If a complainant 
withdraws a complaint, the complaint will be considered withdrawn from 
both the Division and HUD.
    Comment. Staff of the New York State Division of Human Rights (the 
Division) has received insufficient training in handling fair housing 
cases.
    Since the Division received interim certification in 1999, Division 
staff has received extensive fair housing training. HUD-sponsored 
training has included instruction on conducting intake, investigation, 
conciliation, interviewing techniques, and case management. 
Additionally, Division staff have been trained on fair housing 
investigation and law in general as well as disability fair housing 
issues, testing, discriminatory advertising, and proving intimidation, 
harassment, and retaliation.
    Shortly after the Division received interim certification, a four-
day, Division-specific fair housing training was held at HUD's New York 
State Office. The Division's executive staff, investigators, attorneys, 
and administrative law judges attended this training. Division staff 
has also participated in national and regional HUD-sponsored fair 
housing training, including the FHIP/FHAP Quad Regional Conference in 
Philadelphia, Pennsylvania, during August 2001 and the National Fair 
Housing Policy Training Conference in Orlando, Florida, during June 
2002. Training sessions have been held in all of the Division's 
offices. HUD reviews cases investigated by the Division. HUD staff 
travel to all Division offices on an on-going basis and provide 
training and technical assistance. Finally, since 1999, HUD has had 
frequent, often daily, communications with the Division's executive 
staff, regional directors, housing unit staff, and investigators.
    Comment: After issuing a finding in a particular case, the Division 
failed to notify the complainant's designated representative of the 
determination.
    The Division admits that it failed to inform the designated 
representative of the determination in a particular case. The Division 
responded that this was an oversight and, once learned, the mistake was 
``quickly remedied.''
    Comment: The Division limits its investigations to violations of 
the New York State Human Rights Law and does not investigate violations 
of the federal Fair Housing Act.
    The Division limits its investigations to violations of the New 
York State Human Rights Law because it has no authority to administer 
or enforce the FHAct. The power to administer and enforce the FHAct 
lies with HUD.
    HUD has certified New York State Human Rights Law as 
``substantially equivalent'' to the FHAct. The Division has the 
authority to administer and enforce this law. Any complaints that 
allege a violation of the FHAct that are not covered by the New York 
State Human Rights Law, will be referred by the Division to HUD for 
processing. Similarly, HUD will not refer complaints it receives to the 
Division that are not covered by the New York State Human Rights Law.
    Comment: The Division does not process and investigate complaints 
in a timely manner.
    HUD's review of the Division's work indicates that complaints are 
usually processed and investigated in a timely manner and, when it is 
impracticable to meet required time frames, the Division informs 
parties of the reasons for the delay.
    Comment: After HUD refers a complaint to the Division, there are 
delays of approximately two to four weeks in which the Division 
requires that the complainant have complaints notarized and drafted in 
Division language and forms.
    The Division disagrees that there are delays of two to four weeks 
and alleges that necessary documentation is mailed to the complainant 
and the respondent

[[Page 42187]]

within a few days of receipt of a referral from HUD. HUD's review of 
the Division's work corroborates its position.
    Comment: The Division legal staff has insufficient state court and 
federal court trial experience.
    According to the Division, a majority of the Division legal work is 
not in state court, but in administrative hearings. Given this, the 
Division has hired an attorney with extensive state court trial 
experience. In regards to federal court trial experience, HUD will not 
require the Divison's legal staff to have such experience because HUD 
certified the Division to administer and enforce a substantially 
equivalent state law, not a federal law.
    Comment: The Division should not separate cases when an 
organization and a bona fide complainant file with the Division.
    The commenter responded on behalf of an organization. The 
organization alleges that the separation of complaints arising out of 
the same set of facts places unreasonable demands on an organization's 
time. The organization must respond to the Division's requests for 
information on its own behalf. Additionally, if it is a designated 
representative of the bona fide complainant, the organization will 
assist the complainant in providing information to the Division.
    The Division states that it separates complaints to assure that 
organizations, which may have legitimate claims for damages, receive 
compensation when appropriate. Though the complaints arise out of the 
same alleged act of discrimination, issues of standing and damages may 
be different and may require different fact-finding and analysis. The 
lack of commonality on these issues justifies breaking the case into 
different complaints.
    To save the organization time, the Division permits submission of 
the same documentation for its complaint and the bona fide 
complainant's complaint, provided identical documentation is 
appropriate for both the organization and the bona fide complainant. 
HUD will not require the Division to change its procedure on this 
issue.
    Comment: The Division often fails to provide notice for conferences 
or fails to provide correct and adequate notice to parties and 
designated representatives in fair housing cases. In addition, prior to 
scheduling conferences, the Division often fails to check on the 
ability of parties and designated representatives to attend.
    The organization that commented on this issue identified two cases 
where respondents failed to appear at conferences. The Division 
contends that it sufficiently informed the respondents of the 
conference in both of these cases and always does. The Division stated 
that at intake it records the names and addresses of the respondents. 
The Division then mails all notices to the parties at the addresses 
that were provided at intake. If the notice is not returned by post 
office, there is a presumption of receipt. HUD will suggest to the 
Division that it conduct some additional investigation to assure that 
the respondent's address is correct prior to sending the notice of 
conference. Hopefully, such a process would lessen the number of 
respondents who fail to show up at conferences.
    The organization states that a more efficient practice in notifying 
parties of conferences is to check the parties' schedules prior to 
scheduling a conference. In response, the Division stated that it has 
always rescheduled matters at any party's request (including the 
organization's) and will continue to do so in order to conduct a 
thorough investigation. HUD concludes that the method of scheduling 
conferences is an internal management decision for the Division and 
will not require the Division to adopt a particular scheduling 
procedure for purposes of maintaining substantial equivalency 
certification.
    Comment: The Division did not follow up when notified of a 
respondent's failure to perform some settlement term. The settlement 
term involved fair housing training for the respondent.
    In the case that the organization is referring to, the Division 
does not recall being notified that training had not been conducted. 
The Division has a compliance unit that ensures that the terms of the 
orders and settlements are satisfied. The Division has informed HUD 
that it will investigate this matter and ensure that the settlement 
term is met.
    Comment: Unlike the federal Fair Housing Act, New York law exempts 
all 2-family, owner-occupied housing from application of fair housing 
laws.
    The relevant regulation, at 24 CFR section 115.202 (a) (4), 
provides that ``[i]n order for a determination to be made that a state 
or local fair housing agency administers a law which, on its face, 
provides rights and remedies for alleged discriminatory housing 
practices that are substantially equivalent to those provided in the 
Act, the law or ordinance must * * * not contain exemptions that 
substantially reduce the coverage of housing accommodations as compared 
to section 803 of the Act.''
    The New York law exempts rental units in two-family homes occupied 
by the owner. This exemption does not substantially reduce the coverage 
of housing accommodations as compared to section 803 of the Act. In its 
counterpart provision at section 803(b)(2), the FHAct exempts an owner 
from coverage if he/she rents out rooms in a house that contains 
quarters for four or fewer families and the owner lives in the house.
    In actuality, the New York law increases the coverage of housing 
accommodations compared to section 803 of the FHAct since, unlike the 
FHAct, individuals will be protected from discrimination if there are 
quarters for three or four families. These individuals would not be 
protected under the FHAct. While such complaints may not be dual-filed, 
the Department does not view New York's divergence on this issue as 
jeopardizing the Division's substantial equivalency certification.
    Comment: The Division largely ignores requests for prompt 
intervention.
    The commenter refers to two cases where a request for prompt 
intervention was denied. In one case, the complainant alleged a denial 
of housing in February 2001. However, the complaint was not filed until 
March 2002. Since the complaint was filed more than one year after the 
alleged discriminatory act, the Division correctly dismissed the 
complaint for untimeliness. In the other case, prompt intervention was 
unnecessary because the Division was able to secure the landlord's 
withdrawal of the termination of tenancy. Moreover, contrary to the 
comment, the Division contends that it has been successful on several 
occasions in staying eviction proceedings pending the Division's 
administrative process.

Comments and Responses Regarding the Pennsylvania Human Relations Act 
(PHRA)

    Comment: In discriminatory advertising cases, the PHRA limits civil 
penalties to a maximum of $500 where the complainant is not actually 
denied housing based upon discriminatory language of the advertisement.
    This is different than the FHAct. The FHAct does not require that 
the complainant demonstrate that he or she was actually denied housing 
before the full range of civil penalties may be imposed on a respondent 
in a discriminatory advertising case. Rather, advertisers and 
publishers of discriminatory advertisements bear full liability under 
the Fair Housing Act. See, United States v. Hunter, 459 F.2d 205 (4th 
Cir. 1972), cert. denied, 409

[[Page 42188]]

U.S. 934 (1972). Discriminatory housing advertisements represent 
``precisely one of the evils the [Fair Housing] Act was designed to 
correct.'' Id., at 211.
    The Department objects to any attempt to limit the liability of 
advertisers or publishers, regardless of the fact that the limitation 
applies to civil penalties payable to the government, rather than to 
actual damages payable to an aggrieved person(s). In addition, the 
practical effect of the provision is to treat one class of respondents 
differently, i.e., more favorably, than any other class of respondents. 
Such an approach is inconsistent with the goals and purposes of the 
Fair Housing Act. PHRA's civil penalty cap is especially inappropriate 
in that the maximum allowable civil penalty in any case where a 
complainant is not actually denied housing is significantly less than 
that allowed for even a first violation under the FHAct.
    As such, discriminatory advertising complaints received by HUD that 
do not involve an actual denial of housing will not be referred to the 
Pennsylvania Human Relations Commission (PHRC) for dual filing and will 
be processed under the provisions of the FHAct, not the provisions of 
the PHRA. In addition, HUD will require PHRC to refer to HUD for 
processing any discriminatory advertising complaints that do not 
involve an actual denial of housing.
    Comment: PHRA sets forth affirmative defenses to a finding that an 
advertiser has knowingly and willfully violated PHRA. Such affirmative 
defenses are not included in the FHAct.
    Section 9.1(c) of the PHRA sets forth several affirmative defenses 
to a finding that an advertiser has knowingly and willfully violated 
PHRA. The affirmative defenses include the following: (1) If the 
advertiser in good faith attempted to comply with the list and specific 
examples of impermissible housing advertisements promulgated and 
published by the PHRC; (2) if the advertiser complied with an 
interpretation of the commission or its personnel concerning what 
constitutes appropriate housing advertisements; and (3) if the 
advertiser has made reasonable efforts in good faith to comply with 
PHRA. These affirmative defenses do not exist in the FHAct. The 
Department concludes that the affirmative defenses narrow the rights of 
aggrieved persons. As such, discriminatory advertising complaints 
received by HUD that implicate the affirmative defenses enumerated in 
section 9.1(c) of the PHRA will not be referred to PHRC for dual filing 
and will be processed under the provisions of the FHAct, not the 
provisions of the PHRA. In addition, HUD will require PHRC to refer to 
HUD for processing any discriminatory advertising complaints that may 
implicate the affirmative defenses enumerated in section 9.1(c) of the 
PHRA.
    Comment: In certain circumstances, attorney fees may be awarded to 
a respondent under PHRA.
    Section 9(d)(4) of the PHRA states that ``[i]f after a trial, the 
Commonwealth Court finds that a respondent has not engaged in any 
unlawful discriminatory practice as defined in this act, the court may 
award attorney fees and costs to the prevailing respondent if the court 
determines that the complaint is frivolous and that the Commission 
dealt with the party complained against in a willful, wanton, and 
oppressive manner, in which case, the Commission shall be ordered to 
pay such costs and attorney fees.'' The Department does not view this 
as a problem since the FHAct has a similar provision. The FHAct 
authorizes the payment of attorney fees and costs to a ``prevailing 
party'' (other than the United States) whether it be the 
complainant(s), other aggrieved person(s), or the respondent(s). See 42 
U.S.C. section 3612(p).
    Comment: Under PHRA, cases will be dismissed where the respondent 
offered an appropriate remedy and the complainant rejected the remedy.
    Section 9(c.1) of PHRA states that ``The Commission shall dismiss a 
case with prejudice, before, or after a finding of probable cause, 
where in its opinion, appropriate remedy has been offered by the 
respondent and refused by the complainant.'' The FHAct has no 
corresponding provision. The FHAct encourages conciliation and 
settlement but does not require complainants to accept settlement 
offers, however appropriate settlement offers might appear. PHRA has 
informed the Department that since it is impossible to precisely 
quantify embarrassment and humiliation damages, PHRC has interpreted 
the section in such a way that does not cover those cases in which 
embarrassment and humiliation damages are available. PHRC informed HUD 
that it views all cases dual-filed with HUD as possibly resulting in 
embarrassment and humiliation damages. Therefore, it will not dismiss 
these cases in accordance with section 9(c.1). HUD will include a 
provision in the Memorandum of Understanding (MOU) between HUD and PHRC 
stating that section 9(c.1) will not be applied to any dual-filed 
cases. The MOU will also require PHRC to inform complainants in dual-
filed cases that complaints will not be dismissed where the respondent 
offered an appropriate remedy and the complainant rejected the remedy.
    Comment: In Hoy v. Angelone, 720 A.2d 745 (Pa. 1998), the 
Pennsylvania Supreme Court held that punitive damages are not available 
in court proceedings brought under the PHRA.
    The Hoy case involved employment discrimination, and it is unclear 
whether the court would rule in the same manner in a housing case. If 
the Pennsylvania courts were to rule that punitive damages are not 
available in cases involving housing discrimination, this would raise a 
significant substantial equivalency issue because punitive damages are 
available in court proceedings under the FHAct. HUD's understanding is 
that there have been no post-Hoy Pennsylvania court decisions in which 
punitive damages were sought as a remedy for housing discrimination. 
HUD will continue to monitor developments in this area to see how the 
Pennsylvania courts address this issue with respect to housing 
discrimination. HUD will also require PHRC to keep it informed of any 
relevant post-Hoy Pennsylvania court decisions.

    Dated: July 7, 2003.
Turner Russell,
Director, Enforcement Division, Office of Fair Housing and Equal 
Opportunity.
[FR Doc. 03-17990 Filed 7-15-03; 8:45 am]
BILLING CODE 4210-28-P