The Supreme Court will hear oral arguments on Wednesday that may drastically change the way in which the 1968 Fair Housing Act has been interpreted.  In the case, Texas Department of Housing and Community Affairs v. The Inclusive Communities Project, the State of Texas is asking the Court to bar law suits charging discrimination on the basis of impact rather than requiring proof of intent.

The suit has been wending its way through the courts since 2008 when Inclusive Communities, a fair housing organization based in Dallas sued the state agency.   Inclusive Communities alleged that the state had disproportionally awarded the most important federal tax credits for low income housing in areas that already had a large populations of both poor and black residents.  Its method of scoring applications for those credits and thus the subsequent awards helped keep those residents from moving into mostly white areas.

Since the very first suits brought 40 years ago under the Fair Housing Act the courts have tended (with exceptions) to rule that plaintiffs had only to prove that an action had a "disparate impact" on a protected group rather than that the action itself had been intentionally discriminatory.  Writing in Forbes Rich Samp explains the legal distinctions behind the competing impact and intent theories.  The language of the Fair Housing Act bars housing discrimination "because of" race, color, religion, sex, familial status, or national origin."  Samp says the phase "because of" "suggests volition by the defendant, not merely that the effects of his actions were felt more strongly by members of protected groups."  The argument in favor of the disparate impact claim maintains that Congress later expanded the language of the statute by inaction in the face of court and Executive Branch decisions interpreting the Act as encompassing disparate-impact claims.

During the original trial in Dallas the State argued that there were lawful reasons for its scoring system that favored keeping projects in the heavily minority communities.  Inclusive Communities could not prove that the pattern over which they were suing had been intentionally discriminatory but showed that 92 percent of all low-income housing units were in areas where whites made up less than 50 percent of the residents thus proving to the court's satisfaction that there was a disparate impact, a decision upheld of the 5th Circuit Court of Appeals.

SCOTUS has twice before agreed to hear housing cases that might have determined the impact versus intent argument but one suit was withdrawn and the second was settled at the urging of the Obama Administration which fears the court is poised to weaken the Fair Housing Act in the same manner it did with the Voting Rights Act in 2013. 

Civil rights groups argue strongly that the disparate intent interpretation of the law is at the heart of most civil rights legislation beyond housing, including education and employment.  Businesses, including the lending industry, argue that the law is misinterpreted and has exacted penalties for actions that were unintentional and forced them to settle lawsuits at considerable expense. 

The court is expected to hand down its ruling in June of this year.