Court Rules that Voucher Fair Housing Protection Does Not Violate Rights of Owner

In a June 2019 ruling (Fletcher Props v. City of Minneapolis), the Minneapolis Appeals court reversed a lower court ruling and found that a city ordinance prohibiting apartment owners from refusing to accept voucher holders did not violate the owner’s property rights.

Facts of the Case

1. An owner sued the city over a new law that bars owners from screening out prospective tenants who use Housing Choice Vouchers under the Section 8 program;
2. The ordinance has an exception for owners who can show that having to accept voucher holders would create an “undue hardship,” though owners may only use this defense after the filing of a discrimination case with the city’s Civil Rights Department;
3. The suit argued that the mandate conflicts with state law and unfairly forced the owner to comply with requirements of federal housing voucher programs for low-income residents; and
4. The owner also claimed that the law violates the state’s Constitution because it reduces owners’ property values, forces owners to enter into contracts unwillingly, and represents an unnecessary government intervention in their businesses.

Decision of the District Court

The district court granted the owner a judgment without a trial, concluding that the ordinance deprives the owner of its right to substantive due process and equal protection under the state Constitution. The city appealed.

Decision of the Appeals Court

The Minnesota Appeals court reversed the lower court decision.

Reasoning

1. Factors to consider in determining whether a right is fundamental include historical practice and whether the right has uniform and continuing acceptance across the nation;
2. When a fundamental right is not implicated (and such a right was not implicated in this case), the court applies a rational basis analysis, meaning that the court seeks to determine only whether a law is “rationally related” to a “legitimate” government interest;
3. The court did not consider the right to rent property as implicating a fundamental right and the court, in a recent decision, applied rational-basis analysis in considering other legislation affecting rental units;
4. The court concluded that neither the state nor the nation overall has a history of recognizing the right to rent property as a fundamental right. The right to rent property isn’t a right “implicit in the concept of ordered liberty, such that neither liberty nor justice would exist if it were sacrificed;” and
5. The court ruled that the city ordinance rationally serves the public purpose of increasing housing opportunities for voucher holders and is not an unreasonable, arbitrary, or capricious interference with a private interest. As a result, the ordinance was deemed to be constitutional.

There is a growing national trend toward protection for voucher holders, with at least 14 states and 75 local jurisdictions offering such protection. This is an important case that establishes that such protections do not violate the fundamental rights of property owners.