Comply with HUD's Sexual Orientation/Gender Identity Equal Access Rule

HUD recently posted Notice H 2015-01 regarding program eligibility for HUD-assisted sites for all people regardless of sexual orientation, gender identity, or marital status. The notice’s intent is to increase program participants’ awareness of HUD’s Equal Access Rule for actual or perceived discrimination based on these characteristics.

This notice highlights the final rule published on Feb. 3 as “Equal Access to Housing in HUD Programs—Regardless of Sexual Orientation or Gender Identity.” It became effective on March 5, 2012, and bans discrimination by the owners and operators of HUD-assisted or HUD-insured housing based on actual or perceived sexual orientation, gender identity, or marital status. Except in limited circumstances, HUD-funded and -insured housing providers may not ask about sexual orientation or gender identity for the purpose of determining eligibility or otherwise making housing available. The rules also make it clear that HUD’s core programs are open to lesbian, gay, bisexual, or transgender (LGBT) families, regardless of actual or perceived sexual orientation, gender identity, or marital status.

Note Changes to HUD’s General Regulations

The rule revised HUD’s generally applicable definitions at 24 CFR 5.100. The rules include definitions of “sexual orientation” and “gender identity” as currently used in the context of federal law. Borrowing from federal employment guidelines, the rules define “sexual orientation” as “homosexuality, heterosexuality, or bisexuality.” The definition of “gender identity” as “actual or perceived gender-related characteristics” comes from federal hate crimes legislation.

Although most HUD rental housing programs already interpret the term “family” broadly, the new rules clarify that families who are otherwise eligible for HUD programs may not be excluded because one or more members of the family may be LGBT or perceived to be LGBT.

The rule also revises HUD’s general program requirements by adding the following provisions at 24 CFR 5.105(a)(2):

• A determination of eligibility for housing that is assisted by HUD or subject to a mortgage insured by the Federal Housing Administration shall be made in accordance with the eligibility requirements provided for such program by HUD, and such housing shall be made available without regard to actual or perceived sexual orientation, gender identity, or marital status; and
• No owner or administrator of HUD-assisted or HUD-insured housing, approved lender in an FHA mortgage insurance program, or any other recipient or sub-recipient of HUD funds may inquire about the sexual orientation or gender identity of an applicant for, or occupant of, HUD-assisted or HUD-insured housing for purposes of determining eligibility or otherwise making such housing available. However, permissible inquiries into sex are permissible for temporary, emergency shelter with shared sleeping areas or bathrooms, or to determine the number of bedrooms to which a household may be entitled.

Avoid Potential Liability under Fair Housing Act

The notice points out that the Equal Access Rule does not create any additional protected classes under the Fair Housing Act (FHA) or any other civil rights law. Although the FHA does not expressly include sexual orientation, gender identity, and marital status as protected classes, a lesbian, gay, bisexual, or transgender person’s experience with sexual orientation or gender identity housing discrimination may still be covered by the FHA’s prohibition on discrimination based on sex, according to HUD.

HUD says that a claim involving discrimination based on sexual orientation or gender identity could be pursued under the FHA’s ban on sex discrimination. Although the ban on sex discrimination doesn’t apply to claims based on sexual orientation and gender identity per se, HUD says it could apply to claims involving sexual stereotyping—that is, discrimination against an individual whose personal characteristics don’t conform to gender stereotypes. For example, HUD says that it could pursue a claim by a female prospect who alleges that she was denied housing because she wears masculine clothes and engages in other physical expressions that are stereotypically male.

Such claims have support in the cases involving employment discrimination, to which courts often turn when deciding housing discrimination cases. Federal employment law, like fair housing law, doesn’t cover discrimination claims based on sexual orientation or transgender status as a form of sex discrimination, but courts have been more open to employment discrimination claims based on sexual stereotyping or gender nonconformity—that is, when the discrimination is motivated because the perpetrator believed the victim failed to act in the way expected of a man or woman.

In a landmark April 2012 ruling, the Equal Employment Opportunity Commission (EEOC) recognized that a transgender woman could pursue a discrimination complaint based on gender identity, change of sex, and/or transgender status under Title VII, the federal law that prohibits employment discrimination.

The case was filed by a veteran Phoenix police detective who decided to move to California for family reasons; at the time, the detective was still known as a male, having not yet made the transition to being a female. The complaint alleged that the detective had applied for—and was all but guaranteed—a job as a ballistics technician at a federal law enforcement agency’s laboratory in California. After disclosing her gender transition, however, the detective claimed that she was told that funding for the position had been suddenly cut; she said that someone else was then hired for the job.

The EEOC ruled that the detective could pursue a sex discrimination claim under federal employment law. According to the EEOC, “intentional discrimination against a transgender individual because that person is transgender is, by definition, discrimination ‘based on…sex,’ and such discrimination therefore violates Title VII” [Macy v. Holder, EEOC, California, April 2012].

The EEOC’s decision follows a clear trend by federal courts in recent years holding that transgender people are protected by Title VII’s prohibition against sex discrimination, according to the Transgender Law Center, which filed the complaint on the detective’s behalf.

Avoid Potential Liability Under State and Local Law

In addition to complying with federal requirements, sites must adhere to a sizable number of state, county, and municipal laws banning discrimination based on sexual orientation and gender identity. HUD has been enforcing a policy to closely examine complaints of sexual orientation/gender identity discrimination to determine whether they can be prosecuted under current federal law banning sex or disability discrimination. When that’s not possible, HUD has pledged to forward complaints to state or local officials in the growing number of jurisdictions that ban housing discrimination against LGBT individuals.

At last count, 22 states and the District of Columbia have adopted fair housing protections based on sexual orientation—all but three also cover gender identity or expression. In general, “sexual orientation” means heterosexuality, homosexuality, or bisexuality; while gender identity or expression is defined as “a gender-related identity, appearance, expression or behavior of a person, regardless of the person’s assigned sex at birth.” Sometimes, the term “transgender” is used to refer to gender identity and gender expression.

Some states are teaming up with HUD to eliminate discrimination based on sexual orientation and gender identity. In June 2012, for example, the Illinois Department of Human Rights and HUD issued a joint letter to emphasize their commitment to protect LGBT rights under federal and state law.

The letter, issued in honor of Gay Pride Month, noted that HUD now uses its authority under federal law to accept housing complaints related to gender identity as sex discrimination. The letter also stated that HUD is already pursuing enforcement actions based on complaints about violations of its new regulation barring HUD-funded and HUD-insured housing providers from basing eligibility determinations on actual or perceived gender identity, sexual orientation, or marital status.

Additionally, the letter emphasized that HUD no longer sends its funds to entities that violate state and local laws, such as the Illinois Human Rights Act, that specifically prohibit sexual orientation, gender identity, and marital status housing discrimination. Since 2006, when the Illinois law was adopted, the human rights department has investigated numerous complaints of housing discrimination based on sexual orientation or gender identity and has sought and obtained remedies for victims of discrimination. The letter offered some examples of complaints:

• A gay couple applied for a one-bedroom apartment, but the owner refused to rent to them once she learned they were both men;
• A married couple was denied rental based on the transgender status of the wife; and
• A lesbian couple alleged that after renting to them, the property manager refused to make needed repairs and made disparaging comments about their sexual orientation.

Even when state law doesn’t protect sexual orientation or gender identity, many sites are subject to county and municipal laws that ban housing discrimination based on sexual orientation, most of which also cover gender identity. Be sure to determine whether your site is subject to county, parish, city, or town laws that ban discrimination based on sexual orientation. Just as with state laws, the details of local laws protecting sexual orientation vary widely. You’ll have to get the specifics to determine whether local laws also cover gender identity/expression. And if your company owns sites in more than one municipality within a state—or in more than one state—then you’ll have to check all applicable state and local requirements.

Prevent Discrimination During Application Process

You should review your site’s standard interview questions and application forms to ensure that they do not contain any biased questions—or questions that might be used in a discriminatory manner. You may want to determine if inquiries about gender, sexual orientation, or marital status are required. The notice emphasizes that you cannot ask about gender identity for eligibility purposes. Since these criteria are not considered when determining eligibility, owners may want to remove such inquiries or, at the very least, consider making responses optional if appropriate.

You may also want to modify certain sample forms provided by HUD, including the Citizenship Declaration (HUD Handbook 4350.3, Exhibit 3-5), the Family Summary (HUD Handbook 4350.3, Exhibit 3-4), and the Owner Summary (HUD Handbook 4350.3, Exhibit 3-7). It’s important to note that Office of Management and Budget (OMB)-approved forms posted on the HUDClips website may not be edited without HUD approval. Since these are not OMB forms, you can modify these forms.

And with regard to the TRACS forms, the HUD Form 50059 and 50059A include fields asking owners to identify the sex of household members. However, with the release of TRACS version 202D, response is optional and the field may be left blank.

Refrain from Unlawful Steering

To avoid discrimination claims based on sexual orientation, you may not discourage prospects from living at your site because of their sexual orientation. HUD’s definition of “family” protect both actual and “perceived” gender-related characteristics. Therefore, you could be liable if you discourage a prospect from living at your site based on an assumption that he is gay, even if he’s really straight.

To avoid fair housing trouble, you must show prospects all available units within your site that meet their needs, regardless of their sexual orientation. You may not limit an applicant’s choice of units by engaging in unlawful steering—that is, directing, encouraging, or discouraging applicants from living in certain areas or buildings within your site—because of the prospect’s sexual orientation.

It’s also unlawful to provide inaccurate or untrue information about the availability of units for discriminatory reasons. For example, you may not tell a prospect that an available unit has been rented, or limit information about suitably priced available units, because of his sexual orientation.