Source-of-income discrimination has been illegal in NYC since 2008 under local law
Court Sides With Landlords, Overturns New York’s Housing Voucher Protections
A New York appeals court struck down a state law banning discrimination against tenants who use Section 8 vouchers, ruling that the 2019 source-of-income protections violate landlords’ Fourth Amendment rights. The five-judge panel sided with Ithaca landlord Jason Fane, who argued that accepting Section 8 tenants would require allowing housing officials to inspect his properties without a warrant.
The judges acknowledged Section 8 as a critical tool for expanding affordable housing and noted that source-of-income discrimination often serves as a proxy for other forms of bias, but ultimately concluded the law was unconstitutional on its face.
Attorney General Letitia James, who sued Fane in 2022 for refusing to accept vouchers, said her office is reviewing the decision. Around 123,000 New York City households use Section 8 to pay part of their rent, with tens of thousands more across the state relying on the program.
The ruling comes at a particularly bad time for New York’s housing voucher programs. Mayor Zohran Mamdani said in February he no longer intends to support expansion of a city-run voucher program that allows tenants to pay 30% of their income toward rent with the city covering the remainder.
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Source-of-income discrimination has been illegal in New York City since 2008 under local law, and it’s unclear what effect the state court ruling will have on those city protections. The city is evaluating the implications.
The decision could ripple beyond New York. Seventeen states and the District of Columbia have passed source-of-income discrimination laws that protect Section 8 holders, with nine of those states enacting protections since 2018. Around 120 municipalities have their own ordinances.
The constitutional argument that accepting vouchers forces landlords to consent to government searches could be tested in other jurisdictions with similar laws. Landlords have long pushed back against source-of-income protections, citing concerns about regulatory burden, inspection requirements, and payment delays.
Research shows the laws work when enforced. Urban Institute studies found that source-of-income protections increase voucher utilization rates and help voucher holders move to lower-poverty neighborhoods, though the impact can take up to five years to materialize.
The New York ruling hands property owners a legal framework to challenge these protections, potentially making it harder for low-income renters to find housing in markets where source-of-income laws were one of the few tools preventing blanket discrimination against voucher holders.
Source: Propmodo
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