New Orleans, LA—Today, the Louisiana Fair Housing Action Center (LaFHAC) announced the resolution of a U.S. Department of Housing and Urban Development (HUD) complaint against Sailboat Bay Apartments, its management company, and property manager, alleging that the property used a racially discriminatory blanket ban on renting to anyone with a criminal record. In January of this year, LaFHAC filed a similar suit in federal court against Azalea Gardens Properties, LLC in Jefferson Parish after an investigation showed that Azalea Gardens’ admissions practices exclude anyone with a criminal record, regardless of whether the applicant was convicted of a crime, and without consideration of the age or nature of the charge.  

Both cases arose out of testing for LaFHAC’s 2015 Locked Out: Criminal Background Checks as a Tool for Discrimination report. Testing involves mystery shoppers—or testers—posing as prospective renters. For this report, Black and white testers posed as renters with arrests, misdemeanor convictions, or felony convictions on their record and inquired about properties’ criminal background screening policies. In addition to finding properties with policies that violate the Fair Housing Act and HUD’s guidance on criminal background screening, the report also found that New Orleans-area housing providers quoted stricter or more discouraging policies to Black prospective renters with arrests or convictions than to white prospective renters with the same arrests or convictions.

At Sailboat Bay, testers made multiple inquiries between June 2015 and March 2017 about the admissions policy. The leasing agent at the property repeatedly discouraged testers with arrests or convictions from applying, informing them that “anything on a criminal background check would automatically disqualify” and that “if you’ve been arrested, you’re going to be denied.” 

In 2016, HUD issued guidance explaining that blanket bans barring people with arrests or convictions have a predictable and significantly harmful impact on African Americans and Latinos, who—due to longstanding inequities in the legal system—are disproportionately arrested, convicted, and incarcerated, compared to whites. HUD’s guidance also states that blanket bans on criminal records that don’t take into consideration the time since the offense, the severity of the offense, or what the person has done since, violate the Fair Housing Act. In both the Sailboat Bay and Azalea Gardens cases, LaFHAC provided local, Louisiana, and national statistics documenting the glaring disparities in how the criminal legal system treats Black people in particular, compared to white people. 

To resolve the HUD complaint, Sailboat Bay has agreed to pay $35,000 and to adhere to a new admissions policy drafted by HUD and LaFHAC. The new policy is designed to ensure that arrests, charges, expunged or vacated convictions, misdemeanor convictions, and any felony convictions that took place more than five years ago, will not be considered since the HUD guidance states they are not a “reliable basis upon which to assess the potential risk to resident safety or property posed by a particular individual.” 

LaFHAC’s suit against Azalea Gardens Properties, LLC also alleges discrimination based on race, related to their criminal background screening procedures. The leasing agent at Azalea Gardens repeatedly told testers that any criminal record that showed up on a screening report—even a seven-year-old loitering charge—would disqualify them, and blamed tenant screening software for the admissions policy. 

As with Sailboat Bay, LaFHAC had initially filed a HUD complaint against Azalea Gardens Properties. The Sailboat Bay complaint was investigated by HUD’s headquarters office in Washington, DC, while the Azalea Gardens case was investigated locally. Despite the nearly identical allegations, and contrary to the published guidance on the issue, the local HUD office found no reasonable cause to find that Azalea Gardens’ policy was discriminatory, leading LaFHAC to pursue a case in federal court. 

“Apartment owners and property managers should take note of these cases, because it is long past time that the 49% of Louisiana adults with arrest or conviction records have a fair chance at a place to call home. The Louisiana Fair Housing Action Center remains ready to enforce the federal guidance on ending screening policies that ban people with arrests and convictions in their backgrounds,” said Cashauna Hill, Executive Director of the Louisiana Fair Housing Action Center. “Housing providers should also understand that using tenant screening software does not exempt them from responsibility to follow the law. Owners and managers are ultimately responsible for their decisions to deny families a home,” she continued.

Anyone who suspects they may have experienced discrimination based on a criminal record should contact the Louisiana Fair Housing Action Center at 504-596-2100.

The complaint for Sailboat Bay is available here. The settlement agreement for Sailboat Bay is available here. The complaint for Azalea Gardens is available here.