Occupany limits vex associations

Many associations have faced the problem of the perception of too many people living in a single unit. This can occur as a result of a number of different scenarios. For example, a second or subsequent marriage where both spouses have custody of children; three generations living under one roof; a business owner "storing" his employees, an outlaw biker gang, and so forth. Over the years, boards of directors faced this challenge by enacting rules or even amending declarations to limit occupancy.

A paradigm shift took place in the 1990s where these types of restrictions were considered in some quarters to be "per se" discriminatory and were banned by certain courts and housing agencies. Further, political action groups began to form for the purpose of challenging these types of restrictions as discriminatory against minorities viz. affordable housing. The debate went on and on and associations were admonished to proceed cautiously on this issue.

My standard answer included making an argument for cause; i.e. overuse of utilities, garbage, noise, parking etc. A good yardstick for these types of restrictions was to check and see what type of limits local zoning ordinances contained. If the municipality or county had specified limitations such as bedroom counts or square footage, an Association would be on much safer ground than being a trailblazer and face a possible challenge.

However, after developing some guidelines due to a heavy number of complaints, the U.S. Department of Housing and Urban Development have published a "statement of policy". H.U.D. has taken the position that it would use a subjective test in evaluating whether a policy is discriminatory. This is good news for associations experiencing problems in this area, since it is always an obligation to develop non-discriminatory policies, anyway.

H.U.D. has stated that it will look at these policies to "determine whether actions under the provider's policies may constitute discriminatory conduct under the Fair Housing Act on the basis of familial status (the presence of children in a family).

The Fair Housing Act prohibits discrimination in any aspect of race, color, religion, national origin, sex, or familial status. (Discrimination involving handicapped or disabled status are dealt with in a separate section of the Code) Since its inception in 1988, H.U.D. has been charged with receiving, investigating and resolving complaints. (Although complainants always have the option of filing a complaint at the State, County and local level as well).

It is clear from all documentation that the department did not want to engage in establishing as well as enforcing occupancy policies nor create a definitive test whether a manger would be liable in a particular case, but preferred to examine complaints on a case by case basis. The primary focus has returned to engage in prompt and vigorous enforcement of the act against any party found to be utilizing policies which are used to exclude families with children or unreasonably limit the ability of families with children to obtain housing.

What came out of this review was an initial conclusion that "two persons in a bedroom, as a general rule, is reasonable under the Fair Housing Act". (Memo of General Counsel, December 22, 1998, Federal register/Vol. 63, No. 245/) This is a typical restriction that an association would want to adopt and for probably the last 10 years has been cautioned to avoid. "... the Department believes that in appropriate circumstances, owners and managers may develop and implement reasonable occupancy restrictions based on factors such as the number and size of sleeping areas or bedrooms and the overall size of the dwelling unit".

Here are some specific examples for additional guidance in developing such policies:

• Restricting a family of five from a large two bedroom unit with a spacious living area versus a small two-bedroom mobile home may be a violation in the first instance, and not, in the second.

• Restricting a two-parent family with an infant from a one-bedroom unit may be a violation wherein two-parents with a teenager may not be.

• Prohibiting a five-person family from occupying a two-bedroom unit may or may not be a violation depending upon whether the unit also has a study or den.

H.U. D. will also defer to state and local requirements if they in fact exist. The other relevant factors to be considered are whether discriminatory statements have been made, or incorporated into policies regarding the use of common facilities, or will limit the number of children as opposed to "people" per unit to discourage families with children from taking occupancy. Wherein, an "over 55" community can be established, but an "adults only" community might be viewed as improper.

The most important things to consider are making the policies age neutral, to err on the side of caution, to apply them uniformly and when children are involved to be as reasonable as possible. Also, it is important to check local or municipal standards for additional guidance. Once all of these tests have been met, an association could establish and enforce an occupancy limitation within reason.