This post was authored by Zoe Ferguson, JD
A New Jersey zoning ordinance did not violate the Fair Housing Amendments Act (FHAA) in excluding assisted living facilities from a single-family district but explicitly allowing them as of right only in one different district, the Third Circuit held in October. The court reversed the District Court’s previous ruling, which had granted a preliminary injunction blocking enforcement of the ordinance, finding that the ordinance did not constitute facial discrimination against the elderly.
Two developers, 431 East Palisade Avenue Real Estate LLC and 7 North Woodland Street LLC, sought to build a 150-bed assisted living facility in the city of Englewood, New Jersey to serve memory impaired patients in a residential district labeled a “one-family residence district,” or R-AAA zone, under the city’s zoning ordinance.
The city zoning ordinance does not expressly prohibit or discriminate against disabled or elderly people in the R-AAA zone, but it allows assisted living facilities to be built as of right only in one district, the “Research, Industrial, Medical (RIM) District.” To build an assisted living facility outside the RIM zone, a developer would need a use variance.
Under the FHAA, it is unlawful “to discriminate against any person in the terms, conditions, or privileges of sale or rental of a dwelling, or the provision of services or facilities in connection with such dwelling, because of a handicap of […] (B) a person residing in or intending to reside in that dwelling after it is so sold, rented, or made available […].” The FHAA defines a “handicap” as “a physical or mental impairment which substantially limits one or more of [a] person’s major life activities.”
The developers sought a preliminary injunction barring enforcement of the ordinance against their facility, arguing that the ordinance was facially discriminatory. They brought a disparate treatment claim under the FHAA, claiming the ordinance intentionally discriminated against people with handicaps because it impliedly prohibited any developer from building a living facility for elderly people in the R-AAA zone.
The District Court granted the preliminary injunction, agreeing that the ordinance was facially discriminatory because it expressly allowed assisted living facilities only in the RIM zone and therefore effectively excluded them from residential zones.
The Third Circuit reversed, holding that the ordinance did not violate the FHAA for two reasons: first, the ordinance does not identify assisted living facilities on its face in the relevant R-AAA section, and second, allowing the facilities in the RIM zone as of right does not make the ordinance facially discriminatory.
Though the Third Circuit was “not entirely persuaded” that an assisted living facility “necessarily” refers to a facility covered by the FHAA, the court said that even if it does, “the mere fact that some general terms in the ordinance operate to disallow assisted living facilities and other terms expressly permit assisted living facilities as of right in another district, does not transform the ordinance into one that discriminates on its face.”
The court explained that the developers had not shown the required intent for facial discrimination under the FHAA—that the restriction on development is “because of” discrimination—because they found “no indication that disabled status […] is the dispositive trait, singled out for different treatment.” Id.
Reversing the District Court’s grant of a preliminary injunction, the Third Circuit suggested that the developers might have found success had they chosen a different path: while their claim that the restrictions made it practically impossible to operate their business in the R-AAA zone did not meet the disparate treatment standard, it was “more in line with a disparate impact claim.”
431 East Palisade Avenue Real Estate, LLC v. City of Englewood, 977 F. 3d 277 (3rd Cir CA 2020).
LAW OF THE LAND 
There is no way that a 150-bed assisted living facility (ALF) should be allowed in single family districts — and the FHA doesn’t require that they be. There’s no way that a 150-person development belongs in a single-family district — maybe in a multifamily district, but certainly not single-family districts. However, limiting ALFs to a single district, “Research, Industrial, Medical (RIM) District,” sounds like pretty obvious housing discrimination. And let’s keep in mind that ALFs can be small enough to emulate a family (10 or fewer residents) and should be allowed in all residential districts as permitted uses like other community residences that provide long-term housing and small enough to emulate a family as long as they are licensed/certified and not clustered with other community residences.
By: Daniel Lauber on December 4, 2020
at 8:42 pm