COMPLIANCE WITH THE FAIR HOUSING ACT.

LONG-TERM CARE FACILITIES HAVE RECENTLY BECOME THE TARGET OF ANTI

One of the long-established, yet seemingly overlooked federal laws that applies to senior care and senior living facilities is the Fair Housing Act (FHA). A simple test to see what percentage of facilities are in compliance with the FHA is to review the Sunday real estate ads for local nursing homes and assisted living facilities (or search the Internet for their ads). Look for the FHA logo or symbol. More often than not, you'll see neither. That's a potential problem for these facilities.

What does the FHA require? In general, it prohibits discrimination "in the sale or rental" of "a dwelling." Even though neither the relevant definitional sections of the FHA nor applicable regulations adequately define "dwelling" to determine whether it would apply to senior care and/or senior living facilities, this has not stopped courts from beginning to address discrimination claims against retirement housing complexes, assisted living facilities and nursing homes under the FHA.

For example, in 1996 the U.S. District Court of Appeals for the Third Circuit, in Hovsons, Inc. v. Township of Brick, held that the township's argument that a nursing home is not a "dwelling" under the FHA "is simply without merit." The court stated that "to the handicapped elderly persons who would reside there, [the nursing home] would be their home, very often for the rest of their lives." Therefore, a nursing home would be subject to the regulations of the FHA. Similarly, in a 1998 decision, the U.S. District Court for the Northern District of Ohio held, "Clearly, the FHA prohibits discrimination in the sale or rental of a dwelling, including the admission of residents to a nursing home" (United States v. Lorantffy Care Center).

Recent case law in general indicates a trend toward holding senior living and senior care facilities accountable for noncompliance with the FHA, including their accountability for practices that are not intended to be discriminatory and might not result in identifiable discrimination, but fail to meet the FHA's requirements nonetheless. Both the Department of Justice and various public interest groups are involved in current litigation against such facilities under the FHA. The above-mentioned Lorantffy Care Center case was the first of its kind to be initiated by the Department of Justice. Meanwhile, public action groups are targeting, among other things, the advertising practices of senior housing and senior care facilities for noncompliance with the FHA.

Arkansas ACORN Fair-Housing, Inc., for example, filed suit in 1997 against the Catlett Corporation, which owns and manages retirement and nursing homes and residential care facilities in various locations in Arkansas. The complaint alleged, in part, that Catlett (I) advertises "in a manner that indicates an illegal preference and exclusivity based on race and/or color," and (II) fails

to include an Equal Housing Opportunity logotype anywhere on its marketing brochures.

The FHA is enforced by the Secretary of Housing and Urban Development (HUD), as well as through private action and the U.S. Attorney General. If a charge is filed with the Secretary and a discriminatory housing practice is proven, penalties could be as high as $10,000 for a single discriminatory practice, $25,000 for one other such practice in five years, or $50,000 for two or more such practices in seven years. If a private individual (including a public action group) files a civil action in federal court and proves a discriminatory practice, the court may award actual and punitive damages, including reasonable attorneys' fees (and there is no cap on the award). Finally, if the U.S Attorney General (through the Department of Justice) commences a civil action in federal court and is successful, penalties may be assessed of up to $50,000 for a first offense and $100,000 for a subsequent offense.

What should facilities do? In light of these recent developments, senior living and senior care facilities need to evaluate the need to develop and implement a policy based on the FHA and taking into consideration the FHA regulations. The policy should apply to print materials, television, radio, the Internet, videos, audiovisual materials, pictures depicting residents, brochures, pamphlets, billboards, signs, annual reports, applications, specialty marketing devices or gadgets, and business cards. It should also apply to statements made by persons marketing senior care and senior living facilities.

Sample guidelines would include:

1. All advertising should contain either the Fair Housing logo (see figure) or the Fair Housing statement:

"We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. We encourage and support an affirmative advertising and marketing program in which there are no barriers to obtaining housing because of race, color, religion, sex, handicap, familial status or national origin."

2. If the Fair Housing statement is used as an alternative to the logo, the suggested size is 3 to 5% of the overall ad space.

3. If the Fair Housing logo is used, it should be the same size as other logos used in the same ad. However, the symbol should never be used without the slogan "Equal Housing Opportunity."

4. The size of the Fair Housing logo should be based on the size of the advertisement. HUD recommends the following proportions:

Ad Size                 Logo Size
1/2 page or larger       2" x 2"
1/8 page to 1/2 page     1" x 1"
4 column inches to
  1/8 page             1/2" x 1/2"
Less that 4 column
  inches             Do not use logo

5. If no logo is used in the advertisement, there is no requirement to use either the Fair Housing logo or the Fair Housing statement. However, the slogan "Equal Housing Opportunity" must be included in bold, easily readable type.

6. If human models are used in advertising, they should reflect both sexes, as well as the ethnic makeup of the community served. They should also be depicted in equivalent social settings.

7. The HUD guidance also prohibits advertising targeted to attract one ethnic group over another. For this reason, any ZIP code advertising should be carefully reviewed to avoid the appearance of targeting any particular ethnic group.

Each facility should post the Fair Housing statement in a conspicuous place so that it is clearly visible by residents, staff and guests.

Elizabeth Lynn Gordon is an associate with the law firm of Ungaretti & Harris, Chicago.