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Texas Department of Housing and Community Affairs v. Inclusive Communities Project, Inc.

United States Supreme Court
135 S. Ct. 2507 (2015)


The Texas Department of Housing and Community Affairs (Department) (defendant) was a state agency that distributed federal tax credits to developers to build low-income housing. The Department determined which developers would be distributed credits based on specific selection criteria that the Department had established. The Inclusive Communities Project, Inc. (ICP) (plaintiff) was a nonprofit corporation that aided low-income families in obtaining housing. ICP claimed that the Department’s selection criteria had resulted in a disproportionately high allocation of tax credits to predominantly black neighborhoods as compared to white neighborhoods. ICP argued that the Department’s conduct was unlawful in that it created a disparate impact on black neighborhoods. ICP sued the Department for violating provisions of the Fair Housing Act (Act), 42 U.S.C. § 3601 et seq. Specifically, ICP claimed that the Department had violated 42 U.S.C. § 3604(a), which prohibited an entity from otherwise making a dwelling unavailable to a person because of the person’s race, color, or national origin. ICP also alleged that the Department had violated 42 U.S.C. § 3605(a), which similarly prohibited an entity involved in real-estate transactions from discriminating against a person because of race, color, or national origin. The district court found in favor of ICP, and the Department appealed. The court of appeals held that disparate-impact claims are cognizable under the Act but reversed and remanded the case on the merits. The United States Supreme Court granted certiorari to consider the question of whether disparate-impact claims are cognizable under the Act.

Rule of Law


Holding and Reasoning (Kennedy, J.)

Dissent (Alito, J.)

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