The Fair Housing Act protects homeowner’s associations from denying membership based on protected classes. ( first touched on FHA in a post about racial discrimination in HOA covenants and restrictions.) These classes include race, color, national origin, religion, sex, family status, and disability. The federal government, however, doesn’t have a law that protects convicted criminals from discrimination. Fortunately, the U.S. Department of Housing and Urban Development (HUD) addressed this issue. While the HOA board does not have control over who purchases a home, it does maintain a lot of sway in the community. Further, members of HOAs that rent their property as short-term rentals should also be aware of this information.

Criminal background checks have been considered to be a legitimate criterion for housing-related decisions. The disproportionate arrest and conviction records on protected classes result in a disproportionate number of individuals in protected classes being shut out from housing opportunities. Fortunately, HUD provides helpful regulatory guidance for housing authorities to ensure rules that rules about criminal records are enforceable.

What kind of federal and state law addresses this issue?

HUD acknowledges that housing can be denied by a seller or a landlord if “recent criminal history makes them dangerous and a risk to other tenants or neighbors.” Anyone who denies housing on this basis must produce evidence that the housing provider has a substantial, legitimate, and non-discriminatory interest in denying the housing opportunity. Further, the denial must demonstrate that the criminal conduct in question generates a demonstrable risk to the safety of the residents or property. The risk cannot only be theoretical or minuscule. The only specific crimes under housing law that are federally regulated are (1) individuals with a lifetime requirement to register as a sex offender and (2) individuals convicted of manufacturing methamphetamine on government property.

HUD suggests incorporating several best practices, which include:

1. Including language that prevents anyone with a criminal history to access housing in contractual agreements.

2. Including language that explicitly bans someone with a criminal background.

3. Applying criminal history checks inconsistently; e.g. completing background checks on individuals of certain races, socioeconomic standards, etc.

4. Considering each case on its own merit and evaluating the nature and severity of the crime and the elapsed time in order to make a determination based on facts and evidence rather than a perceived threat.

In addition to federal law, many state laws address criminal history in housing discrimination. For example, recently-enacted California law known as the Fair Housing regulations do not allow a blanket statement that discriminates based on criminal history. Title 2 Section 12266 states that the criminal history in question must be linked to the safety and security of the HOA’s safety. This regulation supports the HUD recommendations. Check with your legal team to ensure that your HOA board is aware and acting under federal and state regulations regarding housing.

Is this rule unenforceable?

In general, HOA agreements listed in the CC&Rs are legally binding contracts. The rules listed here are legally enforceable. It is possible, however, that a rule listed in an HOA’s CC&Rs is unenforceable. This question is a legal one, and as always, consult with your legal team when assessing your own CC&Rs.

Here are a few ways that a rule can be unenforceable:

1. The rule violates existing federal, state, or local law or individual rights.

Rules that violate enacted law are unenforceable. In our example above, if a California HOA were to include a blanket statement in its CC&Rs that banned anyone with a criminal record from housing opportunities, that would violate the state Fair Housing regulations. This rule would be unenforceable. Rules that violate Constitutional rights, such as the Freedom of Speech or Right to Bear Arms amendments, are also not enforceable.

The best way to avoid a situation like the one above is to include an attorney, familiar with your state and local laws, in the rulemaking process. Attorney fees are expensive, but ensuring that any changes to the CC&Rs comply with the law make it well worth it.

2. The authority, the HOA, has no standing or power to act.

When rules are made in good faith and comply with the law, the HOA may still have an unenforceable rule if it does not have the authority to bring a claim against a homeowner. It may not have the legal standing to impose a fine or pursue a civil case. When the HOA has no standing, the rule is unenforceable.

3. The authority, the HOA, enacted or enforced the rule incorrectly or selectively.

Even when the rule itself complies with the law and the HOA has the authority to bring an action against a homeowner, the rule may be unenforceable if the HOA enacted or enforced the rule improperly. One of the areas of greatest concern to HOAs is the selective or inconsistent application of the rules. If an HOA permits one neighbor to have a pool but denies another under the name of the CC&Rs, that HOA is acting selectively. This type of behavior can taint the rule itself, making it unenforceable.

Blanket bans on individuals with criminal backgrounds are legally questionable. They may violate both federal and state law, which would make them unenforceable. Contact your lawyer to learn more about this issue.

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