HUD Housing Notice § 2015-06

               U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
                                      WASHINGTON, DC 20410-8000


ASSISTANT SECRETARY FOR HOUSING-
FEDERAL HOUSING COMMISSIONER




Special Attention of:                                     NOTICE:       H 2015-06

Multifamily Regional Center/Hub Directors                 Issued: July 13, 2015
Multifamily Program Center/Satellite Office
Directors
Rural Housing Services (RHS) Directors                    Expires: This notice remains in effect
Contract Administrators                                            until amended, rescinded or
Multifamily Owners and Management Agents                           superseded.

                                                          Cross References: 24 CFR 5.100, 24
                                                          CFR 5.105(a)(2), 24 CFR 5.403, 24
                                                          CFR 200.3 and 200.300, and 24 CFR
                                                          891.105.



        Subject: Program Eligibility in Multifamily Assisted and Insured Housing
        Programs in Accordance with HUD’s Equal Access Rule

  I.    Purpose and Background. On February 3, 2012, HUD published a final rule entitled
        Equal Access to Housing in HUD Programs Regardless of Sexual Orientation or Gender
        Identity (77 FR 5662) (“Equal Access Rule” or “Rule”). The Rule is intended to ensure
        that housing across HUD programs is open to all eligible individuals and families
        regardless of actual or perceived sexual orientation, gender identity, or marital status.
        This notice provides guidance on how the Equal Access Rule applies to Multifamily
        insured and assisted housing.

 II.    Applicability. The Rule applies to all HUD-assisted and HUD-insured housing.

III.    Eligibility Determinations and Definitions. The Rule revised program requirements at
        PART 5—General HUD Program Requirements; Waivers, by adding the following
        provisions at 24 CFR 5.105, and by revising generally applicable definitions at 24 CFR
        5.100 and 24 CFR 5.403.

        24 CFR 5.105
        (a)(2) Equal Access to HUD-assisted or insured housing.

        (i) Eligibility for HUD-assisted or insured housing. 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.

                                                 1
      (ii) Prohibition of inquiries on sexual orientation or gender identity. No owner or
      administrator of HUD-assisted or HUD-insured housing, approved lender in an FHA
      mortgage insurance program, nor any (or any other) recipient or subrecipient of HUD
      funds may inquire about the sexual orientation or gender identity of an applicant for, or
      occupant of, HUD-assisted housing or housing whose financing is insured by HUD,
      whether renter- or owner-occupied, for the purpose of determining eligibility for the
      housing or otherwise making such housing available. This prohibition on inquiries
      regarding sexual orientation or gender identity does not prohibit any individual from
      voluntarily self-identifying sexual orientation or gender identity. This prohibition on
      inquiries does not prohibit lawful inquiries of an applicant or occupant’s sex where the
      housing provided or to be provided is temporary, emergency shelter that involves the
      sharing of sleeping areas or bathrooms, or inquiries made for the purpose of determining
      the number of bedrooms to which a household may be entitled.

      24 CFR 5.100:
      Gender identity means actual or perceived gender-related characteristics.

      Sexual orientation means homosexuality, heterosexuality, or bisexuality.

      24 CFR 5.403:
      Family includes, but is not limited to, the following, regardless of actual or perceived
      sexual orientation, gender identity, or marital status:
             (1) A single person, who may be an elderly person, displaced person, disabled
             person, near-elderly person or any other single person; or
             (2) A group of persons residing together and such group includes, but is not
             limited to:
                      (i) A family with or without children (a child who is temporarily away
                      from the home because of placement in foster care is considered a member
                      of the family);
                      (ii) An elderly family;
                      (iii)A near-elderly family;
                      (iv) A disabled family;
                      (v) A displaced family; and
                      (vi) The remaining member of a tenant family.

IV.   Program Regulations Revised to Reference Part 5. The Rule made several changes to
      program regulations, including changes to PART 200—Introduction to FHA Programs
      and to PART 236—Mortgage Insurance and Interest Reduction Payment for Rental
      Projects, covering HUD-insured programs, such that:

      (1) Under 24 CFR 200.3, Definition, “family” has the same meaning as provided in
       Part 5; and

      (2) Under 24 CFR 200.300, Nondiscrimination and fair housing policy, the
      nondiscrimination policies in Part 5, including the prohibition on inquiries regarding
      sexual orientation or gender identity apply to FHA programs;

                                               2
      In addition, PART 891—Supportive Housing for the Elderly and Persons with
      Disabilities is amended at 24 CFR 891.105, Definitions, to refer to the same definition of
      “family” in Part 5.

V.    Compliance and Enforcement. Violations of the rule could result in HUD’s
      determination that the owner has failed to comply with program requirements. HUD may
      pursue any available remedy, including sanctions, that it determines appropriate to
      remedy the violation. HUD or a Contract Administrator may review an owner’s tenant
      selection plan or other policies and procedures to determine if it complies with the Equal
      Access Rule. In addition, the civil rights review done at the time of the Management and
      Occupancy Review may include a review to determine if the owner is in compliance with
      the Equal Access Rule. A review may also include requests for information concerning
      allegations of noncompliance. Owners will cooperate with HUD and provide access to
      staff, records or any information needed to conduct the review.

      More extensive guidance on civil rights laws and nondiscrimination policies as they
      apply to Multifamily assisted housing can be found in Chapter 2 of the HUD Handbook
      4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This
      Chapter of the Handbook will be updated to reflect the provisions of the Equal Access
      Rule. Note that Section 4 of that Chapter, on Housing Discrimination Complaints and
      Compliance Reviews, provides direction in the event that an applicant or tenant believes
      that he or she has been subject to discriminatory treatment from the owner of an assisted
      property. See also the Office of Fair Housing and Equal Opportunity (FHEO) webpage
      on lesbian, gay, bisexual, or transgender (LGBT) housing discrimination, which provides
      instructions for contacting HUD if a person believes he or she has experienced housing
      discrimination.

      http://portal.hud.gov/hudportal/HUD?src=/program_offices/fair_housing_equal_opp/LG
      BT_Housing_Discrimination

      The webpage provides instructions for contacting HUD to obtain answers to questions
      about LGBT fair housing issues or information about HUD regulations intended to ensure
      equal access of LGBT persons.

VI.   Enforcement Options. If, after conducting a thorough investigation of a complaint
      brought to HUD or to the Contract Administrator or other information brought to the
      attention of HUD or the Contract Administrator, the Regional Center/Hub Director
      determines that the owner or agent has committed one or more violations of the
      requirements contained in the Equal Access Rule, the Regional Center/Hub Director will
      provide written notice of the violations to the owner. The notice will describe the
      violations and call for a response within 30 days. If the applicable regulatory agreement
      and/or HAP contract requires the owner to “provide management for the project that is
      acceptable to HUD” or to “administer the subsidy contract in accordance with HUD
      regulations and requirements,” the Regional Center/Hub Director’s notice will further
      inform the owner that its violations of the Equal Access Rule constitute unacceptable

                                               3
management and, therefore, are also violations of the regulatory agreement and/ or the
HAP contract.

If the owner fails to respond, or the response does not satisfactorily address the
violations alleged in the Regional Center/Hub Director’s letter, then the Regional
Center/Hub Director or designee may send a referral to the Departmental Enforcement
Center (DEC) and the owner must be flagged in the Active Partners Participation System
(APPS).

Owners, management agents, principals, or affiliates of projects that are under an insured
mortgage or are assisted, who violate any provision of the Equal Access Rule may be
liable for one or more of the following sanctions:

   A. Debarment - an exclusion of an individual, organization and its affiliates from
      conducting business with any Federal Agency government-wide. Debarment is a
      very serious compliance sanction and is typically imposed for a three-year period.
      See 2 CFR Parts 180 and 2424 (applies only to nonprocurement activities with the
      federal government).

   B. Suspension - a temporary action with the same effect as debarment. See 2 CFR
      Parts 180 and 2424.

   C. Limited Denial of Participation (LDP) - an action that excludes a party from
      further participation in a certain HUD program area. The scope of the LDP may
      also be limited to a certain geographic area, and generally remains in effect for up
      to 12 months. See 2 CFR Parts 180 and 2424.

   D. Civil Money Penalties - fines which may be imposed on owners, principals of
      owners, and management agents who knowingly and materially fail to comply
      with any provision of the Equal Access Rule, and, therefore, fail to provide
      management for the project acceptable to the Secretary, or fail to administer the
      subsidy contract in accordance with HUD regulations and requirements. By
      adjustment under the Federal Civil Penalties Inflation Adjustment Act of 1990,
      the maximum civil money penalty for each offense is currently $42,500, but the
      actual amount of the penalty is determined by applying the factors listed in 24
      CFR 30.80. These include, among other things, the gravity of the offense, the
      Owner's history of prior offenses, injury to the public resulting from the
      violations, the Owner's culpability for the violations, and the Owner's ability to
      pay the penalty. As these will vary from case to case, there is no schedule of
      Civil Money Penalty (CMP) amounts. The actual amount sought in any
      particular case depends on the Departmental Enforcement Center's (DEC)
      analysis of the factors as they apply to each case.

The enforcement options under A., B., and C., above, may be applied to any insured or
assisted project owner, agent or affiliate. Option D., Civil Money Penalties, may only be
applied to projects under an insured mortgage or that have a project-based Section 8

                                        4
        contract that has been renewed under the Multifamily Assisted Housing Reform and
        Affordability Act of 1997 (MAHRA). In addition, HUD may also pursue abatement of,
        or termination of, a Section 8 contract to sanction an owner or agent who HUD
        determines has violated any provisions of the Equal Access Rule.

VII.    Fair Housing Implications. Although the Fair Housing Act does not expressly include
        sexual orientation, gender identity or marital status as protected characteristics, a lesbian,
        gay, bisexual, or transgender person may still be protected by one or more of the Fair
        Housing Act’s prohibitions against discrimination. For example, courts have recognized
        that the Fair Housing Act’s prohibition against discrimination because of sex includes
        discrimination based on non-conformance with sex stereotypes. Therefore, under certain
        circumstances, complaints involving sexual orientation or gender identity may be
        investigated under the Fair Housing Act.

        Persons alleging such discrimination should be informed of their right to file a fair
        housing discrimination complaint with HUD and directed to HUD’s Office of Fair
        Housing and Equal Opportunity at (800) 669-9777 (voice) or (800) 927-9275 (TTY).
        Housing discrimination complaints may also be filed by visiting
        www.hud.gov/fairhousing, or by downloading HUD’s free housing discrimination mobile
        application, which can be accessed through Apple and Android devices.

        If HUD lacks jurisdiction to investigate a complaint from an LGBT person, such person
        may still be protected under state and local laws that include sexual orientation, gender
        identity and/or marital status as protected classes.

        Many states and local jurisdictions prohibit housing discrimination based on sexual
        orientation, gender identity and/or marital status, and HUD may refer complaints or other
        information concerning these protected classes to appropriate state and local fair housing
        enforcement agencies.

VIII.   Paperwork Reduction Act. The information collection requirements contained in this
        Equal Access Housing Notice were approved by the Office of Management and Budget
        (OMB) in accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).
        Compliance and Enforcement are covered by OMB control numbers 2502-0577 and
        2502-0598. An agency may not conduct or sponsor, and a person is not required to
        respond to, a collection of information unless the collection displays a valid control
        number.

 IX.    Contact Information. Inquiries about this notice may be directed to Kate Brennan at
        Catherine.M.Brennan@hud.gov in the Office of Multifamily Housing Programs.



                               ___________________________________
                             Edward L. Golding, Principal Deputy Assistant Secretary
                              for Housing

                                                  5