13 July 2017

Legal occupancy standards for Tennessee

Occupancy Standards

In what is referred to as the Keating Memo, the Department of Housing and Urban Development (HUD) stated that it believes that "an occupancy policy of two persons per bedroom, as a general rule, is reasonable under the Fair Housing Act." However, the memo goes on to say that "the reasonableness of any occupancy policy is rebuttable" and HUD clarifies that the memos it issued in the past on the subject of occupancy standards do not state or imply that HUD will determine compliance with the Fair Housing Act based solely on the number of people permitted in each bedroom.

In fact, HUD issued the following statement in the final rule implementing the Fair Housing Amendments Act of 1998:

"Thus, the Department believes that in appropriate circumstances, owners and managers may develop and implement reasonable occupancy requirements based on factors such as the number and size of bedrooms and the overall size of the dwelling unit."

In the Keating Memo, HUD sets forth what factors it will consider when reviewing fair housing complaints involving occupancy issues:

1. Size of the bedroom and unit

2. Age of the children

3. Configuration of the unit

4. Other physical limitations of housing (i.e. capacity of the septic, sewer, or other building systems)

5. State and local law

6. Other relevant factors, such as:

- if the landlord has made discriminatory statements

- if the landlord has taken steps to discourage families with children from living in its housing

- if the landlord has enforced its occupancy policies only against families with children

So what occupancy standard can a landlord set forth that will avoid discrimination complaints and keep the landlord out of trouble? I wish that I could provide you with a simple answer but unfortunately there is no bright line rule.

What I can tell you is the key issue or focus in discrimination cases that involve occupancy limits is always whether or not the landlord is discriminating against a family with children. So even if your occupancy policy is reasonable, if you make some discriminatory comment to the applicant, you can forget about hiding behind your occupancy standards. As such, an occupancy policy based on the number of children per unit is much less liklely to be
found to be reasonable than one which limits the number of persons per unit.


Occupancy Standards – Recommendations and Best Practices

All communities should have occupancy standards to prevent overcrowding of units. In the case of federally assisted properties, the standards should also prevent underutilization of space.

A primary goal of any occupancy standard should be to ensure that it is not restrictive to the point of inhibiting the ability of families with children in their ability to find housing. This is due to the fact that families with children are protected under the “familial status” provisions of federal fair housing law.

The industry standard is generally two persons per bedroom. This policy was first enunciated in the HUD “Keating Memorandum” in 1991, and became official HUD policy in 1998. However, the memo points out that the two person per bedroom standard is not an absolute and that other considerations are important. In fact, there have been recent challenges to the two-person standard, especially in areas where local occupancy laws may permit more than two people per bedroom based on square footage or other factors.

The Fair Housing Act does not specifically address occupancy standards and Congress has recognized the legitimacy of such rules. Subject to state and local laws, every apartment community should set its own standards. Elements that should be considered in setting these standards include –
How large are the bedrooms?
Are there extra rooms (e.g., den, office, or loft) that could serve as a bedroom?
What is the age of the children?
What is the unit configuration?
Does the property have physical limitations (e.g., septic or sewer capacity) that will limit occupancy?

It is not recommended that owners automatically adopt the two-person per bedroom standard. Fair housing settlements have occurred in at least two cases involving the two-person per bedroom standard. Communities with across the board two-person per bedroom policies are at greater risk of testing by fair housing advocacy agencies. If a company wants to set an across the board policy without completing a full review with applicability to the specific property, I recommend a “2+1” standard. This is two-people per bedroom, plus one. So, a two-bedroom unit would permit five occupants.

Generally, the unit size should be a family’s choice – not the owner’s. Even in federally subsidized properties, families should be able to choose between whatever unit sizes they are eligible for. For example, a family of three could be eligible for anything from a one-bedroom to a three-bedroom unit.
Owners should never require children of the opposite sex – regardless of age – to have separate bedrooms. Likewise, there should be no requirement that adults and children of either gender have separate bedrooms. These are all decisions that should be left to the family. Limitations on the number of people per bedroom should be the only consideration; not sex, age, or relationship.


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