Provider of Housing for Hispanic Persons Settles Discrimination Lawsuit for $101,000

Project Sentinel, Ann Marquart (415) H-O-U-S-I-N-G March 9, 1998
Christopher Brancart (650) 879-0141

Project Sentinel, a Palo Alto-based fair housing agency funded by grants from the Department of Housing and Urban Development's Fair Housing Initiatives Program and the County of San Mateo, has settled a federal court lawsuit alleging that the Beach violated federal and state civil rights laws by discriminating against Hispanic residents and Hispanic prospective residents. Moss Beach is a community on the San Mateo County Coast with a significant population of Hispanic persons, many of whom work in the local nurseries. The Park has 235 spaces for mobile homes.

As part of the settlement, Project Sentinel received $101,000 in payment for investigative and legal expenses, while the other plaintiffs (buyers, sellers and realtors of mobile homes in the Park) settled a separate but related lawsuit under confidential terms. The defendants also agreed to a mandatory fair housing training, to affirmatively market their units to Hispanic people through the use of bilingual newspaper advertisements, and to maintain records that will be made available for review by Project Sentinel should any future claims be raised by Park residents or prospective residents.

In a lawsuit filed in U.S. District Court in San Francisco, Project Sentinel alleged that the defendants failed to approve qualified residency applications submitted by prospective Hispanic residents, applied stricter qualifying standards to Hispanic tenants and operated the Park in a discriminatory manner by making disparaging statements about Hispanic persons living in the Park.

According to federal and state fair housing laws, housing providers must not discriminate against residents or prospective residents on the basis of race, color or national origin, and other group characteristics. "The message this settlement sends is that housing discrimination does not pay," said HUD Secretary Andrew Cuomo. "We will not allow discrimination to stop families across this nation from living in any home, in any apartment or in any neighborhood they can afford."

President Clinton is committed to intensify the fight against housing discrimination and his proposed 1999 federal budget seeks $22 million in increased funding for HUD to battle discrimination, Cuomo said.

In January 1995, a Hispanic couple submitted an application for residency in the Park. Soon after, the Park manager rejected the application on grounds that the couple had "insufficient income." In order to show an even greater ability to pay, the couple added a co-signer to the application, raising their income level well above that required for residency at the Park. The co-signer did not intend to occupy the unit. This application was also rejected, on grounds that the applicants had "insufficient income," that the Park was "not accepting co-signers" and that "all homes must be home-owner occupied."

Suspecting that these grounds were pretexts for discrimination, the couple contacted Project Sentinel, which proceeded to investigate the couple's allegation by interviewing Park residents. Project Sentinel discovered that a Caucasian woman had applied for a unit and had been permitted by the manager to add her brother as a co-signer. The brother was not planning to live in the unit and was added solely to help the woman meet the debt/income ratio requirement for residency at the Park.

Suspecting that the managers were applying a double standard for accepting applications, a stricter standard for Hispanics and a looser one for Caucasians, Project Sentinel next conducted a paired test using testers posed as mobile home-seekers. The first tester, a Hispanic male, submitted an application to the Park on October 12, 1995. In addition, he submitted a job verification form at the manager's request. On November 8, 1995, the Hispanic tester's application was denied. The manager cited an "incomplete application," "insufficient income" and "insufficient credit file" as his reasons for denying the application. On October 26, 1995, a Caucasian male tester with a higher debt/income ratio (thereby making him less qualified than the Hispanic tester) submitted an application to the Park. This tester was asked to submit a rent history verification and proof of income. The manager reportedly told the Caucasian tester that on some applications they verify everything, but on his application, they would only verify landlord and income information. On November 1, 1995, the Caucasian tester's application was accepted by the manager of the Park before the rent history verification and proof of income were submitted by the tester.

Rental application files subsequently subpoenaed by Project Sentinel demonstrated other evidence of similar discrimination against Hispanic persons attempting to obtain residency in the Park.

Christopher Brancart, the attorney representing Project Sentinel, stated, "Interviews, testing, and record review all revealed the use of different qualification standards for white and Hispanic applicants." He added, "The outcome of this case demonstrates that due to the diligent investigative work of fair housing agencies such as Project Sentinel, landlords cannot discriminate against tenants without facing legal consequences."

Ann Marquart, Executive Director of Project Sentinel, said, "Housing is a basic need for every person. When efforts to obtain housing are undermined by discriminatory practices, Project Sentinel will make sure that federal and state fair housing laws are enforced. In this case, the discriminatory practices went undetected for years because of two reasons. First, the Park masked its discrimination in the cloak of 'business necessity.' Second, a significant number of Hispanic persons resided in the Park despite the stricter qualifying standards applied to them. The discrimination was thus very subtle, but nonetheless insidious. Project Sentinel's use of paired testers and resident interviews was critical in detecting the subtle yet illegal discrimination taking place at the Park."