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Foreign Policy Analysis
Criminal History and Occupancy Policy – The Impact of Disparate Impact

Criminal History and Occupancy Policy – The Impact of Disparate Impact

– [Jonathan] Good Afternoon Everyone! I want to thank everyone
for being here for episode three of Criminal
History in Occupancy Policy, the Impact of Disparate Impact. We are grateful for all of
you who are attending today and listening in on this call. Just some house-keeping
items to keep in mind, there will be a recorded version available at some point in the near future. You’ll be able to get that on our website and you’ll be notified via
E-mail when it is ready. So make sure that any
E-mails that you receive from the Fair Housing Institute
go to your main inbox, because sometimes they can
wind up in updates folder or something else. Keep that item in mind. There is going to be an opportunity for questions and answers, so if you do have questions, they may be covered through
this presentation today that Kathelene going to
provide for us shortly. But there will be an opportunity, and if something isn’t covered, we’re going to go through
them if we have a few minutes and cover those together. So we’ll look forward to your
thoughts and your feedback. Any feedback whatsoever! Please feel free to share it via E-mail or our social sites, we welcome any feedback. There will be a three question survey at the end of the webinar today,
at the end of our episode. We’d love your feedback
on how we’re doing, and future episodes that
we’re working on for 2020, if there’s any topics that
you’d like to hear about please share them with us on that survey. The Fair Housing Institute,
many of you are clients, we appreciate your business very much. We’re happy to announce that we’ve just launched a new course, Fairer Housing in Seniors
– What You Need to Know, and there are many more to come. So if you haven’t taken a look
at our Fair Housing catalog, be sure to do that on our
website, and reach out to us if you
have any more questions at all. So let’s get into our session for today. But first of all, let’s warmly
welcome Kathelene Williams. She’s a partner of the law
firm of Williams and Edelstein, and is the president of
the Fair Housing Institute. The Fair Housing Institute
is a full service training and consulting firm, and they will assist you with training either online or in person, on Fair Housing topics and education. Kathy represents the
Housing Industry clients throughout the country, on Fair Housing and other
civil rights matters. So Kathy, I want to welcome you today. – [Kathy] Thank You Jonathan,
delighted to be here. – [Jonathan] Awesome. So
here’s what we’re going to be talking about today, some
very specific topics. HUD’s new regulations, what do they mean? Are they going to provide relief? Or anxiety? What should you expect? So Kathy’s got some updates on
what’s on the horizon for us. Occupancy policies, and criminal history policies, what do those look like? We’re going to have a couple of polls, we’d love your feedback. What can you do to make sure
that you’re in compliance, and you can protect
yourself an as organization from any potential Fair
Housing litigation. Keep in mind, we mention this
in every one of our episodes, this is an educational session, there is no certificate of completion, and even more important, this is not legal advice. If there’s any need for changes, you need to consult legal councils. Just notice that final sentence, do not change the process or policy without proper authority
and change in all places such as policy manuals, leases, etc… So just keep those
particular points in mind. So let’s get into our first
part of our session today, and that’s what’s on the horizon. So Kathy, I’ll turn it over to you. – [Kathy] Thanks Jonathan,
and welcome to everybody. The session that we’re
going to be covering today is somewhat legalistic,
and I apologize for that, but there’s just no getting around that when we talk about this topic, which is Disparate Impact. Let’s begin by explaining what
we mean by Disparate Impact. Under the Fair Housing
act, there are two ways to prove a case of housing discrimination that a plaintiff can use. And by the way, the plaintiffs in our
environment are usually the residents, sometimes the applicants, and other times maybe
an advocacy organization that might sue you
based on what they think is a Fair Housing violation. A defendant is usually a
resident, an applicant… I’m sorry, the plaintiff is a resident, the applicant and the
defendant is of course, your property, your management
company, your owner. So that’s what we’re talking about when we are going to be talking about who makes a claim under Disparate Impact. The most common type of allegations of housing discrimination are made under the first
method of proving a case. That’s called Disparate Treatment. That’s the one you’re very familiar with. The idea is, person A is
treated inconsistently to person B, and the allegation is that it’s because of that persons race, or national origin, or other protected categories. Then we also have this second way that we’re focusing on today,
and that’s Disparate Impact. Disparate Impact is a very different case. It is the claim that you have developed and are enforcing a policy, and the policy’s very neutral, the policy does not, on it’s face, attempt to discriminate against anybody. In fact there doesn’t even need to be an attempt to discriminate. But, when the policy is implemented, it does have, at least the allegation is, that it has a negative, or unfair, impact, or effect, against
an applicant or a resident. So that’s the difference
in the way these cases go, and we’re talking now today
about Disparate Impact. These cases are very complicated, and there’s just no getting around that. But I thought that I’d really briefly try to explain how the burden of proof swings back and forth when this
kind of allegation is made. So we begin with the plaintiff. The plaintiff has the burden
of getting the case started. To do that, the plaintiff has to identify a specific policy that your property has, and then the plaintiff has
to show that that policy is going to have a disparate
effect on the protected… (connection to Kathy lost) versus another population, they’re very expensive and
very technical kind of cases. So if the plaintiff is able to do that, that kicks off the case. They haven’t won yet but they’ve certainly
got a strong beginning. Now the burden shifts… (cell phone signal cuts out) The burden of the housing
provider is to show that whatever that challenged policy is, it’s absolutely necessary
to achieve a substantial, legitimate, and
non-discriminatory interest that the property has. This is where they have to prove why this policy is so important
to how they operate, that they have to keep this policy as a part of their business practice. If the defendant does that, then under the shifting burden proof, we shift back to the plaintiff. And if the plaintiff then moves forward by showing that, Okay,
we’ll accept that this is an important policy, but
we can show a number of… (cell phone signal cuts out) You could accomplish your purpose without eliminating so many people. (cell phone signal cuts out) the policy, but the policy needs
to be much more narrow, and that still would
accomplish your purpose without eliminating (cell phone
signal cuts out) in our case (cell phone signal cuts out) If the plaintiff is successful
on that third wrong, or third shifting of the burden, then the plaintiff will win the case. If the plaintiff is unable to show a different policy that would
still accomplish the purpose, then, in that case,
the defendant will win. So that’s how, as we talk
about the topic coming up now, we’re going to be thinking about why it’s important you
can’t justify the policy that you’re property, you company, leases. – [Jonathan] Okay, very good. Hey Kathy, we’ve had
just a couple of glitches with the audio on your end, it was cutting in and out a little bit, so I don’t know if there’s something that you can see from over there? So, every one who lost audio for a bit, there will be a transcript
of today’s session too. So fear not, if you
missed a couple of points you will have access to the full transcript of today’s session. I apologize for that, you’ve
got to love technology. Sometimes it’s a beautiful thing, and once in awhile it can
be a little bit of a pain. Anyway, good. That’s
awesome Kathy, Thank You. All right, so guess
we’re going to cover now some particular items that
may be on the horizon for us. – [Kathy] (cell phone signal lost) – [Jonathan] Kathy? – [Kathy] (cell phone signal lost) Am I being heard? – [Jonathan] There we
go, now I can hear you. – [Kathy] Okay. I’m
sorry, I’m not quite sure what that could be. But, I will turn up myself louder, and forgive me if it sounds
like I’m shouting at you. So, I was just saying that
HUD has recently announced that it was revising
the federal regulations that it set forth in 2013, about this idea of Disparate Impact. The reality is, that HUD’s regulations, original regulations, came before the supreme
court case on this topic that came out in 2015. That court case by the way, is often referred to as
Inclusive Communities. That very long, detailed decision got to be pretty famous in
the area of fair housing because for the first
time the supreme court acknowledged that Disparate
Impact is a legitimate method of proving housing discrimination. And then it went on to, in some details, explain the limitations of
the use of Disparate Impact and what would be necessary
for the plaintiff to prove, and what would be
necessary for a defendant to defend itself. When the… (cell phone signal cuts out) said it was going to
revise its regulations, there was a lot of
notification about that, that came out from a lot of
the housing associations, and got a lot of questions stirred up. So I thought the first
thing that I would do is just address the, at least what looks like now, will be (cell phone cuts out) on Disparate Impact. What they do (cell phone
cuts out) is clarify what burden that the plaintiff
has on it to make a case. And it is a strong burden. It is not going to be
easy for any plaintiff to make a case against you
based on Disparate Impact. The regulations also, and
I think they do a good job, in clearly explaining
what role the defense has to be able to rebut an
allegation of Disparate Impact. So that way, these proposed
regulations are much clearer, and in a way, much better,
for the housing industry, just because, they will make it clear that we can defend
ourselves if challenged. They also will make it
clear to the plaintiffs, that if they want to
file one of these cases, they have a pretty big hurdle
to get over in their proof. – [Jonathan] So how does that effect data? And maintaining data? Retaining data? What are any comments
you have on requirements, or along those lines Kathy? – [Kathy] Well, these
regulations do make it clear that nobody has to maintain racial data, or data on any of the
protected categories, to be able to defend itself. Now, if you get charged,
you get a case against you, you’re going to want to go out and obtain that kind of information, but you don’t have to keep it, you don’t have to maintain
it on a regular basis. For most of you who operate
in the multi-family world, of course, in private market housing, you don’t keep track of
ethnic or racial data on your residence. In the world of federally-funded housing, those management agents
have to keep that data and provide it to the
government when they request it. One limitation on any rule
that HUD ends up adopting, is that it really can’t,
HUD does not have, the authority to change the law, as it was set forth in
inclusive communities. So, I think these
regulations do what they can, and don’t get carried away with trying to actually make a change in what the legal requirements are. – [Jonathan] Awesome. So lots of things, again, sorry friends for the audio issues, you’ll be able to get
the transcript in here. A lot of things on the horizon, a great summary from Kathy. That kind of leads us
now into our next topic, which is Criminal History Screening. This is one of those items that is a lot more of a sensitive topic, especially when we look in the news today and everything is very
heated when it comes to anything related to race
or ethnic background. So, in the housing industry, we know we have to maintain
equality no matter what. So what an important topic on what we do and how we set the policy when it comes to Criminal History Screening. What are you seeing Kathy? And what can all of us on the call today think about and institute
as best practices? – [Kathy] Well, Criminal History Screening is one of several topics
that are being challenged under this concept of Disparate Impact. And that’s why I wanted to focus on this, and Occupancy, today. To begin to understand why Criminal History Screening
polices are the focus of Disparate Impact claims, we need to look at where we get Criminal History Screening data. We go to our screening companies usually, and they look at county, and state, and Federal Criminal Justice data. Then we make our decisions accordingly. The stats show, indeed, that historically, minorities in this country, and in particular, African-Americans, have been arrested, prosecuted,
tried, and sentenced, at a much higher rate, for a
much longer time, than White’s. And indeed, I think the statistics, when you look at the studies, and there has been many studies done, that confirm that our
Criminal History data, and Criminal History
process in this country, has not been consistent, has not been fair. So any policy that a housing provider has that relies on that data, can be challenged as having a negative, or a discriminatory impact on African-American’s,
and probably Hispanic’s, but predominantly I
think, African-American’s. Therefore, the policy is automatically, whatever it is, however it’s written, is probably going to have
a discriminatory impact. That’s why we have to talk
about justifying those policies. – [Johnathan] Awesome. Awesome. Okay. All right, so I think that
brings us to our first poll. So let’s put that up on
the screen for everyone. Okay. Can everybody see that poll? All right, Thanks for getting the answers, they’re coming in now Kathy. And then we’ll put the results
up on the screen for you. So what is the Criminal History
policy for your property? Choose all that apply. Thank You for your votes! It’s going to be interesting to see what the final tally are. So far, at the moment,
everyone of the questions is neck and neck overall. We’ll give everyone
about ten more seconds, and then we’re going
to put the big results upon the screen here. Okay. So let’s share the results. Everybody should be able to see that now. All right, Kathy, any
comments on the results what you see there? – [Kathy] Yes, I see, you
know those are interesting, and I think it’s good that we an all see that we have all kinds
of policies out there. The one that has the, I guess it was the most
common in the responses, was the forth one. And that is probably, a very, very safe policy
to have and justify. The one at the top, any
failings will cause rejection, and I’m about to explain
why that is going to be almost impossible to defend
if it ever gets challenged. – [Jonathan] Got it.
Got it. Okay, very good. Thank You everyone for
participating in that poll. All right, what’s next,
Kathy, on the list? – [Kathy] All right, so, the idea of your Criminal History policy, to be able to justify it, since as I said, it probably could be shown
to have a Disparate Impact. So now we have to, if you remember, the housing provider has to show that this is absolutely an essential
policy that they need to be able to do a good job
operating their business. And we can do that I think, by showing that the idea of
Criminal History Screening is to try to avoid applicants, who then become residents, and could, in a reasonable belief system, turn out to be, maybe
a dangerous resident, or problem resident. So the policy has to be written with that overall purpose in mind, and it cannot be just
really simplistic that says, if anyone’s had any contact
with the criminal justice system or if they’ve ever had a conviction, they can’t live here, because when you think about it, that is a very broad statement
to make about Africans. The next couple of slides
gives us some general ideas of what to think about when
you look at and review, your own Criminal History policy. First of all, the more simple, the more blanket they are, and probably, the more risky
they are to fall victim to a claim of Disparate
Impact discrimination. The policy should try to
achieve its basic purpose without being overly restrictive. And a, if you’ve ever been
convicted you can’t live here, it’s very, very restrictive, it’s going to just automatically eliminate a very large number of people. So to show that the policy is thoughtful, that it was crafted to
be the least restrictive, the way to do that is to break out crime based on their seriousness, their violent nature, and then attach various lookback
periods to those crimes. A lookback period is the time
between the conviction date and the application date. That is what we talk about when we talk about lookback period. The first rule is, you
should not be denying housing to someone based only on arrest records. So even though sometimes, we’re concerned that someone’s
been arrested multiple times, even if they have not
been convicted at all, we might consider that
that person is dangerous, or not the kind of resident
you want in your property. But that kind of rule
is impossible to defend because an arrest isn’t a conviction. An arrest doesn’t prove anything. So if you have arrests
listed in your policy, you might want to consider removing them. Now if someone has been
arrested fairly recently when you get their application and it shows up on their record, and they’ve been indicted
or charged with that crime, if convicted, that
conviction would make them ineligible for your property. One way to deal with this is to put their application on hold. Do not reject it, but don’t finalize it until that outstanding
issue has been resolved one way or the other. By the way, if your
property is HUD-funded, HUD does have a couple of requirements that you have to follow, along the lines of Criminal Screening. For instance, you cannot
house anybody that’s listed on a state lifetime sex offender registry. And if you do public housing, you can’t house anybody
that’s ever been convicted of manufacturing meth-amphetamines. Those types of requirements
should continue, and are not affected by anything
we’re talking about today. – [Jonathan] Okay, awesome guys. Somebody was asking about some
highlighted items yesterday. For everyone whose asked the questions, we’re going to be getting into policies, I think they’re coming up in the next couple of
slots right now I think. – [Kathy] Yes. So I’m going to give you a couple of suggestions for
consideration in your policy. First of all, regardless
of what your policy is, I think it is made much stronger, much easier to defend, if you attach an appeal process to it. Meaning that, if an applicant is rejected because of Criminal History, you give that applicant
the right to make an appeal back to your company, or your property, wherein the applicant can try to explain mitigating circumstances
that may change your mind about whether they are a potentially dangerous resident or not. Be aware, that if you do that, that is favored by the
law, not disfavored. Sometimes I’ve had clients
who have come back to me and said, if we do that, aren’t we treating people differently? Is that not inconsistent
that I would let this guy in, and keep that guy out,
for maybe the same crime? And what I can say to you, is while consistency
absolutely is important in Fair Housing, there are several areas
where you are being, almost required, to at least consider, taking individual situations into account when you make decisions. Certainly, reasonable
accommodation, that you all know, is one of those. And now, what we are
saying is Criminal History is another where there may
be mitigating circumstances that may change your mind and as a result, you do admit someone. That doesn’t mean you have to! After hearing an appeal, that just means that you would give it a good-faith consideration. Another area that I think
you all need to be aware of, is, regardless of what your policy says, if you are relying on a
third-party screening company to tell you whether an
applicant’s criminal history either violates or satisfies your policy, you need to make sure that your Criminal
History screening company is applying your policy correctly. Because the housing provider
is going to be liable for any mistakes made by
your screening company in this regard. I have a good friend, Linda Richer, who works with AMRENT,
a top screening company, and she has come to be my go-to authority on the various limitations that screening companies
have by state law. For example, I think there
are maybe four states that limit a lookback period
for Criminal History purposes, to seven years. I am always forgetting
what those states are, but, to Linda, if you are out there today, I’d love it if you would
share those with us, maybe as a chat, so that we
can just remind our audience that in those states, you’re
going to be very limited to the criminal background
you can get on people. – [Jonathan] Yes, she did.
Thank You Linda for doing that. So, Linda’s comment, Kathy, was, “The states of California,
New Mexico, and New York, “convictions limited to
displaying for seven years, “Colorado is five years
for most convictions.” Thank You for that info. That will be part of the
show notes to everyone. There’s a whitepaper from AMRAD regarding that particular topic. So look forward to that on the recorded version
of today’s episode. – [Kathy] Thanks Linda.
I really appreciate learning, from you, about
all these various state laws, because I think property
management companies need to be better educated
about what their limitations are when they do screening. – [Jonathan] Thank You Linda. All right, so, comments
on how to model policy, what do you think Kathy? – [Kathy] You know, first of all, I begin by separating
felonies from misdemeanors. I don’t think you need
to cover all felonies, and I don’t think you need
to cover all misdemeanors, but at the very least, your lookback period should
be longer for a felony, than a misdemeanor. And again, remember the lookback period, is from the date of conviction
to the date of application. There may be, and Doug,
I saw your question as I just glanced out here, there may be times when
you may also be interested in how long it’s been since this applicant has been out of prison. You can have your screening
company get that information, and they’ll have to tell you
whether they can get it or not, but you can include that in your policy. For instance, I have
quite a few clients who, as a part of their criminal
screening policy have, that the applicant must have been out, released from prison,
for at least one year. Other companies use two years, with the idea that if they’ve been able to interact in society appropriately, and without further crime
since their release, then that gives you a little bit of time to have that ability to
judge how they’re doing since they’ve been released. So that’s something that you
can include in your policy. Focus primarily on the crimes that could indicate that the
applicant could pose a danger. Some policies that I’ve seen, have what I would call an outright ban. In other words, if you’ve ever been
convicted of these crimes, you can’t live here. No matter when it was
that you were convicted. If you’re going to use that, and I don’t know that I, again, I’m not giving you legal advice, but I think any of those
crimes that you list as a ban, does slightly raise your
risk, if challenged, of justifying the policy. So I would keep those to the
bare minimum of the most, of what we can think of as
heinous crime felony convictions. Also, don’t forget in your policy, to address multiple felony convictions. What I’m talking about with this is multiple, different crimes. Different instances,
different dates of crime. It is possible to be convicted of a crime, and within that crime you have
four different felony counts. So that’s not what I’m talking about. I’m talking about a crime
committed this year, and an entirely different crime
committed a year from now, and if the pattern of a
number of multiple crimes appears that you just can’t
keep yourself out of trouble, then that is the very type of applicant that you are probably wanting
to keep out of your property with your Criminal History policy. – [Jonathan] Absolutely. – [Kathy] You know when we talk about the various types of crime,
there are so many crimes, and different states have
different definitions of crimes, so you have to take that into account too. So I would not try to
cover every crime possible, I would cover the important ones, the ones that give you the most pause. Certainly sex offenses. And there are a variety of sex offenses. There’s rape, there’s sexual assault, there’s sex offense against children, there’s so many different
types of sex offenses. So you want to make sure that however your policy addresses those, it is broad and general
enough to not eliminate some that you maybe thought
you wanted to include. Again, sometimes using more
narrow language in this area might not be a good thing because you might want
to cover all sex offenses against adults and children, or just against children, or however you address it. And of course, you want
to address violent felony. There are four, in most states, four different counts of homicide. They are all very different. The First degree in homicide
is seen as maybe, the worst. And third and forth degree homicide, it’s usually one of those, it’s usually a homicide, a murder, or a killing that occurred
in a traffic accident. I don’t know that you want to use that, or address as long of a lookback period for something like that, than you would maybe first
or second degree murders. So that’s another thing you’ve got to, both consider in your policy, and make sure that your screening company can identify what count
of homicide or murder was involved in a conviction. Robberies and Burglary. Burglary particularly, is a serious, potentially violent crime
because it’s usually done with a weapon in mind, or in play. That’s something you
probably need to address. Then, when we talk about lookback periods, I’ll just mention that seven years is probably the gold standard. As far as, again, we’re
talking defense here. Being able to defend yourself. And that’s because there has
been Criminal Justice studies that show that after seven years, statistically, an ex-offender, who has gone beyond seven
years after release, is no more likely to commit
another crime than anyone, including people who have
never had a conviction. So seven years is golden. I think it’s easy to push that up to ten and still be fairly safe in
your Criminal History policy. Going beyond that, is not impossible, I’m just saying that it raises your risk if you’re challenged in a
Disparate Impact lawsuit. So after you’ve covered the
major, most concerning felonies, you may want to include other felonies. There’s felonies for bad check writing, and felonies for just about
any activity you can think of. Computer violations, and stalking. So you have to kind of take a look at that and decide whether your policy should include other felonies, and it can, but then I would have a much
less lookback period for those. Three years, five years,
something like that. And don’t forget there
are violent misdemeanors, you should definitely
address those in your policy. Less than the felonies, but violent misdemeanors
are still violent actions, so it could be five years for instance. And again, I’m just throwing
these years out there. There is no bright-line, right or wrong. Well there are wrong
ways to do it. (laughs) I just can’t say there’s
one right way to do it. And then multiple misdemeanors,
don’t forget those. Just like the multiple felonies. And you need to address domestic abuse because certainly that is something that, as housing providers, we are all getting much
more sensitive about. That leads us to drugs. And by the way, I wouldn’t waste your time covering all misdemeanors. I just don’t think they’re that important for your applicants, or your property. Drugs are a matter of concern, obviously. The Fair Housing Act is
a pretty broad leeway to housing providers to determine whatever policies they choose on drugs. I think it makes sense to divide the cases between people who have had convictions, either felonies or misdemeanors, for manufacture or distribution. They were making it, and
they were selling it. And in a way, that is
a more serious crime, maybe, depends on how you look
at it, than user possession. So you might want to
divide them out like that. Some screening companies use drug offense one, two,
three, four, to do that. And then finally, all drug offenses do not have to be treated the same. And there’s an argument today for maybe why they shouldn’t be. So if your screening company can tell you that their offense was
for use of marijuana, you could certainly have a much lower lookback period for that, than use of meth-amphetamines, or crack cocaine, or one of
the other more serious drugs. – [Jonathan] Right. So, you and I were talking about this,
Kathy, earlier today. Would you recommend
that, especially since, on the topic of marijuana, a
lot of things are changing, potentially on a state level, on a local level, is that something that
property management companies would have to make an adjusted policy, perhaps by location? What is your comment on that? – [Kathy] I would certainly
think that’s something to take into consideration. If your state for instance, says that, recreational marijuana use is not illegal, I think your Criminal History
policy should reflect that. So yes, I think definitely
you would take that into consideration when
creating your policy. – [Jonathan] Okay, awesome. All right, so we’re about
45 minutes into our program, and that brings us to our concluding topic. And that has to do with
Occupancy Policies. And by the way, great coverage
on Criminal Screening, I’m sure everyone one the
call today, you were riveted, because there is a lot of notes, more than likely you have to take, some intriguing items that
you have to pay attention to and take back to your team. So, moving into Occupancy Policies, what are some items, Kathy, that we need to pay attention to? What do we need to implement to make sure that we’re in compliance
for Fair Housing laws? – [Kathy] Well this is the second topic that is commonly used in
Disparate Impact cases to challenge housing
provider’s neutral policy. This one’s a little different obviously, because the protected category, that maybe have a negative impact on, with your Occupancy Policy, is families with children. It is families with children that usually live together in a group, and the household may be made up of two, three, four,
five, six or more people. And again, most of the time, that is a family with children. So an Occupancy Policy is almost always going to restrict, at a higher rate, families with children,
than maybe the opposite, which is, what, single people
who live alone, let’s say. And so that’s why sometimes we see these cases being filed. Again, while a statistical imbalance is not a slam dunk with
families with children, an Occupancy Policy may be the way it is with criminal screening
and racial imbalance. There’s still a concern that the statistics might
be there to show that. So, just like the criminal screening, it’s important your Occupancy
Policy be protected, be defended, as something that is a
significant, legitimate, and non-discriminatory policy, to achieve your business interests. – [Jonathan] Okay. I think that
leads us into our next poll. Thank You for our tech
support on the chats. Someone mentioned about pop-up blockers, and things along that line. Some of you weren’t able to see the poll. So, I’m putting it up now, and I’m going to read it out to everyone. I’ll leave it up for about a minute or so. So, the question is, What do your Occupancy Policies include? Choose all that apply. We’ve got a few selections, No occupancy limits, Two persons per bedroom, Two heartbeats per bedroom, Two plus one, Policy does not count infants, Policy expands number
if unit has den or loft, and then an Other column. So we’ll give everyone
another 30 seconds or so. And Thanks again for
all the chat everyone. Everyone’s sharing some nice thoughts, some articles, some tips. A lot of the questions, it seems from the questions and answers, are being, I think Kathy,
you’ve covered already, so we’ll see when we get towards the end what we need to still cover in that. – [Kathy] While we’re
waiting for the poll answers let me just mention, when I was talking about
Criminal History screening, and the topic of marijuana,
that was not in any way, suggesting whether you should permit marijuana use on
your property or not. That’s a different topic
for a different day. – [Jonathan] Very good.
I saw a few questions pop up in the discussion there, so Thank You for clarifying that. Okay, so we’re going to end the poll, and I’m going to share the results. So, it looks like 6% say No Occupancy, 47% for Two Persons per Bedroom, 15% for Two Heartbeats per Bedroom, 19% Two Plus One, 14% Policy Does Not Count Infants, 13% Policy Expands Number
If Unit Has Den Or Loft, and 18% is Other. Wow! All over the board there. Except for the Two Persons Per Bedroom, that would seem to be
the most popular one. – [Kathy] Yeah. That’s very interesting. I think it’s good for everyone to know that companies handle
occupancies in all kinds of ways. And the fact that you use a
Two Person Per Bedroom policy, is not necessarily safe, but it shows you that that
is the industry standard. That certainly is the most common one. But there are lots of other options too that I’ll talk about in just a minute. – [Jonathan] Thank You everyone for participating in that poll. I’m going to take it off the screen here. Oops, sorry Kathy, I went to far ahead. There we go. Okay. Take it away. – [Kathy] Okay. So, first
of all, I want to mention, that anybody, any property, any company, that has an Occupancy Policy, needs to take the time to research what the applicable state
and local codes are, that include an Occupancy Provision. That doesn’t mean that
you have to adopt it, I’m just saying you
need to know what it is, and you need to know how it’s dated. Because if your Occupancy
Plan is challenged, that is the first thing the
advocacy groups will go to. So you need to know what’s out there and not be surprised by that. Just like with Criminal History screening, you need to be able to justify
the policies that you have, that you use, as being important to your business, and not unnecessarily
restricting occupants from your property. So, you have to think
through how to do that. – [Jonathan] What are
some thoughts then Kathy, on, like, how do you implement that? What are you suggestions? And what would be some best
practices along that line? – [Kathy] So, first of all,
let me mention this Heartbeat, that’s the reason we asked it on the poll. You do not want to have
any Occupancy Policy that talks about heartbeats. And all I can say to that is, if you’re a pregnant woman with triplets, how many heartbeats is
that in that unit? (laughs) You do not want to get
into that kind of detail. You just want to talk about people, okay. How many people in your unit,
and forget the heartbeat. The most common Occupancy Policy is Two Persons Per Bedroom. Historically, that’s what
the industry has used. I think in this day and age, with how common Disparate
Impact cases have become, that in private market housing, a Two Per Bedroom standard
is somewhat risky. So I would just throw out
there for your consideration, ways that you can perhaps
expand that policy, make it a little more open
to families with children. For instance, some
properties have adopted, and we show that on the poll, Two Persons Per Bedroom Plus One. And what that means is
two persons per bedroom, plus one additional person per unit. Those policies would
result in a one bedroom that would permit three people, a two bedroom would permit five people, and so on. That, just in and of itself, and you can run the numbers on your unit, may not result in an excessively
over-crowded situation. And they show that you
are being more expansive, and less restrictive, when it comes to families with children. Another idea that could be adopted with a Two Plus One, or with a Two Per Bedroom, is not counting infants. You’d need to exactly
say what an infant is. Most policies say either
12 months or under, or 24 months or under, with the idea that in, for
instance, in a one bedroom, a child of that age could
live in the parents bedroom, and comfortably, without
creating additional problems with over-crowding. So that is another way
of expanding your policy. I would note, that in HUD-funded housing, I would be very careful
about adopting any policy except Two Per Bedroom, and
that’s because HUD views a three-person in a one bedroom household as over-crowding that unit. So unless HUD changes its
rules and its handbook, I would be very cautious
about expanding your policy. And also, as you’re thinking about the various policies you could have, remember that this is really
about families with children. So if you want to have a
separate policy for room-mates, if you’re in a college area for instance, and you do not want for instance, three people in a one bedroom, if they’re room-mates, you can do that. You can have a standard that applies to an all adult household, and a different standard, that applies to a household with children, as long as the household
with children standard is more expansive, is less restrictive, than the policy you have
for adult household. A lot of people try to justify their Two Per Bedroom standard based on a very old memorandum that came out of HUD in the early 90’s. That memorandum did say
that in many circumstances the Two Per Bedroom policy will be deemed, considered as reasonable,
under the Fair Housing Act. Nowadays, things have changed
and HUD is not reviewing, and not accepting a Two Per
Bedroom standard as reasonable. Instead, it is looking at
the special considerations that are listed in that memo. Those considerations were the
size and layout of a unit, the extra room that might exist in some, especially private market units, they can have lofts,
and dens, and libraries, and things like that. And also the age of children. They way they look at this is usually, do you permit, for instance, an infant to not be counted as a person when you are tallying up the number of people in a household. Again, as you’re looking at all of this, take a look at those local
and state codes that apply, some of them will apply,
some of them won’t, and then be able to justify
how your policy fits in with those codes. Those codes are made as an
inch and a square foot basis, and so they may not exactly be identical to your Occupancy Policy, but that’s okay, you just need to know how to
compare and contrast those. – [Jonathan] Okay, awesome. – [Kathy] You might get some
relief from your state laws. For instance, Indiana has passed a law about what’s deemed
reasonable for occupancy in the state of Indiana. And there are other states like that, so don’t forget to look at state law. And your apartment association ought to be able to tell you that. So see if you can get any assistance, support for your policy from there. And when you are justifying
an occupancy policy we really have to put
some numbers to the paper. Although I guess nobody
uses paper nowadays. But what you need to do is, work out the costs of over-crowding. What does it cost to your
parking lot having too many cars? Your sewer water and other utilities, and the demand on those
from over-crowding, and of course things like,
when you turnover a unit, how often do you have
to replace the carpet? And do painting? And does it make a difference
if there are two people or six people in that unit
to make those decisions? And then the burden of 500 other people living on your property
and using amenities. So there are ways of evaluating
the costs of over-crowding, and that is about the
best defense you can have when you’re supporting
your Occupancy Policy. And you don’t want your
one or two bedroom units to look like this. That would be my final thought of the day. – [Jonathan] (laughs) Classic
movie. Classic, classic movie. Thank You so much Kathy. That was incredible. A lot of information. We want to Thank everyone
for being here today. Kathy, did you have a concluding statement to wrap up the webinar? Or did you want me to go into
what’s going to be available after the conclusion of the webinar today? – [Kathy] Yeh, I think my
overall suggestion would be, take a look at these policies
with Disparate Impact in mind, and see if you want to
keep the same policy, or see if maybe it needs to be revised. And then get about doing so, just in case.

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