A “Golden Ticket” Doesn’t Guarantee Admittance

Section 8 blog graphic

By: Eric Dunn, Attorney at the Northwest Justice Project

On September 29th, The Seattle-Times ran a compelling story about Seattle bartender Dana Disharoon and her struggle to find housing for herself and her family in Seattle with a “Housing Choice Voucher” (formerly known as a “Section 8 voucher”).  The somewhat ironic headline called the voucher her “golden ticket to landing a home,” while the story itself chronicled Ms. Disharoon’s frustrating interactions with landlords and property management firms, social service agencies, and other players in the leasing game.  And several of those experiences were particularly frustrating because they were legally dubious—if not blatantly contrary to law. So why can’t a participant of the Section 8 voucher program find housing? As demonstrated by Ms. Disharoon’s case, it’s because some people don’t play by the rules. 

One landlord with whom Ms. Disharoon inquired, William Ernst of Northgate, reports having told Ms. Disharoon he “wasn’t set up” to accept her voucher—supposedly because “[t]here’s a lot of paperwork involved.”  As The Seattle-Times article made clear, Seattle’s Open Housing Ordinance clearly prohibits discrimination against voucher tenants.  See SMC 14.08.020(M).  One common way in which residential landlords engage in housing discrimination is through improper steering—such as by making statements that deter certain kinds of applicants from applying—for this reason, most any fair housing statute will address such statements.  The Open Housing Ordinance is no exception, making it an unfair practice to “[p]ublish, print, circulate, issue or display … any communication, notice, advertisement, statement, or sign of any kind relating to a real estate transaction or listing of real property which indicates directly or indicates an intention to make any preference, limitation or specification based on … participation in a Section 8 program[.]”  SMC 14.08.070(B).

Mr. Ernst protests that he “didn’t say [he] wouldn’t accept” Ms. Disharoon’s voucher.  But this still appears to have been a clear-cut case of unlawful housing discrimination.  Telling Ms. Disharoon he “wasn’t set up” to take the voucher and was concerned about the paperwork involved was the kind of statement likely to deter a voucher holder from applying—and that appears to have been precisely the effect that statement had.

But we’re not done with Mr. Ernst.  He also told The Seattle-Times he “had 30 different parties interested in the house” and “ran credit checks on ‘the most qualified.’”  Of course, one wonders precisely how Mr. Ernst determined who the “most qualified” applicants were before he ran the credit checks; presumably the information from which to determine who the most qualified applicant was would have been in those credit checks.

Most likely Mr. Ernst collected written applications from his 30 interested parties and pared down the list based on information in those applications.  He probably interviewed those candidates personally, as well. This process, which I call “competitive admissions,” is very difficult to reconcile with a landlord’s core responsibilities under not only fair housing law but also under Washington’s basic Residential Landlord-Tenant Act (or “RLTA”).

One requirement under the RLTA is that a landlord establish written rental criteria and furnish those to a prospective tenant before taking an application or otherwise collecting information about an applicant.  See RCW 59.18.257(1).  The same statute entitles an applicant who is turned down to receive a “written notice of the adverse action … that states the reasons for the adverse action.”  RCW 59.18.257(1)(c).  This statute implicitly presumes landlords will accept or reject applicants on a first-come, first-served basis; it does not explicitly prohibit competitive admissions, but if it is possible for a landlord using a competitive admissions process to comply with these pre-application and post-adverse action disclosure requirements, I have yet to see it accomplished.  If the landlord has not made clear the criteria under which he distinguishes the “most qualified” candidates (i.e., those warranting a credit check) from the others, then one also cannot dismiss the possibility that impermissible characteristics—such as ethnicity, disability, the presence of children, or housing voucher status—played into that analysis.  What better way to mask active housing discrimination against voucher tenants than to “consider” their applications, only to have them inevitably lose out to “better qualified” applicants?

Indeed, this is the deeper problem with a competitive admissions process.  Even assuming Mr. Ernst disclosed all of his criteria for choosing the most qualified candidates, and even assuming all of those criteria were at least superficially legitimate, a competitive process will inherently disadvantage many of the same applicants our fair housing laws are meant to protect.  Voucher tenants, who are by definition low-income, will inevitably appear less qualified than applicants employed in highly-compensated jobs.  Ditto for disabled or elderly applicants who rely on Social Security benefits.  Tenants with children may have comparable incomes but greater expenses than childless applicants, and thus similarly appear less desirable from a purely economic standpoint.  Tenants with less accumulated wealth—who are more likely to be people of color—will fare poorly in comparison with their wealthier counterparts, who are more likely to be white.

As the U.S. Supreme Court recently reaffirmed, even a facially non-discriminatory admission practice still runs afoul of laws like the Fair Housing Act if it has a disproportionate negative effect on members of a protected class and is not necessary to achieve some substantial, legitimate purpose.  Choosing good tenants is certainly a substantial, legitimate interest for landlords, but using competitive admissions procedures is hardly necessary to choose good tenants.  A good tenant is someone who has enough money to afford the rent, utilities, and other costs of the tenancy, and who will take proper care of the rental premises, get along well in the community, and abide by the relevant rules and policies; that a tenant might have access to additional funds beyond what is needed, or might work for a preferred employer, or might simply be the owner’s preferred type of person, is of minimal if any relevance.  That’s why most landlords already consider tenants one at a time, and why all of them should do so.

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