City's Section 8 Antidiscrimination Ordinance Doesn't Violate Owner's Rights

Facts: An owner sued the city over a new law that bars owners from screening out prospective tenants who use Section 8 vouchers. Under the new rules, owners can screen prospective renters but can no longer stipulate that Section 8 tenants aren’t allowed. The ordinance grants reprieve for landlords who can show compliance would create an “undue hardship,” though only after a discrimination claim is filed with the city’s Civil Rights Department.

The lawsuit argued that the mandate conflicts with state law and unfairly forces the owner to comply with requirements of federal housing voucher programs for low-income residents. The owner also claimed the law violates the state’s Constitution because it reduces owners’ property values, forces owners to enter into contracts, and represents an unnecessary government intervention in their businesses.

The district court granted the owner a judgement without a trial, concluding that the ordinance deprives the owner of its right to substantive due process and equal protection under the state Constitution. The city appealed.

Ruling: The Minnesota Appeals court reversed the lower court’s decision.

Reasoning: According to the court, factors to consider in determining whether a right is fundamental include historical practice and whether the right has uniform and continuing acceptance across the nation. When a fundamental right is implicated in a substantive due-process or equal-protection claim, the court applies a higher level of scrutiny. But when a fundamental right isn’t implicated, the court applies a rational-basis analysis, meaning the court seeks to determine only whether a law is “rationally related” to a “legitimate” government interest.

Here, the court didn’t consider the right to rent property as implicating a fundamental right and the court, in a recent decision, applied rational-basis analysis in considering legislation affecting rental units. So the court concluded that neither the state nor the nation overall has a history of recognizing the right to rent property as a fundamental right. The right to rent property isn’t a right “implicit in the concept of ordered liberty, such that neither liberty nor justice would exist if [it] were sacrificed.”

The court ruled that the city ordinance rationally serves the public purpose of increasing housing opportunities for voucher holders and isn’t an unreasonable, arbitrary, or capricious interference with a private interest. As a result, the ordinance wasn’t deemed unconstitutional.

• Fletcher Props. v. City of Minneapolis, June 2019