DC area complexes pay $425,000 in family/occupancy case

In March, Kay Management Company, a Washington, D.C. area apartment management company,agreed to set up a $250,000 fund to repay any family that may have been discriminatedagainst by the company's occupancy limits at seven of its apartments in the Washingtonarea. The fund, which will pay damages to people who tried to rent apartments or who wereevicted, is part of a huge $425,000 settlement agreement reached with the Fair HousingCouncil of Greater Washington.

Kay Management also agreed to pay $150,000 to the FairHousing Council. The funds will be used to support its fair housing education andenforcement efforts. $25,000 will be spent for a claims administrator who will determinewho can receive settlements from the $250,000 fund.

The Fair Housing Council had charged Kay with violating federal fair-housing laws. Inthe settlement, Kay Management denied wrongdoing.

Silver Spring attorney Jeffrey Schmieler, who represented the company in thesettlement, said that the $250,000 settlement fund "sends a signal that everyone isagainst housing discrimination."

Settlement fund is the first established to pay damages to DC area families withchildren

According to the Fair Housing Council and others in the fair housing field, thefair-housing fund is the first ever created in the Washington area for the sole purpose ofredressing family status discrimination. It has not been determined how many families willreceive settlements from the fund.

"It should have a pretty powerful effect on property managers to let them knowwhat the Fair Housing Act requires," attorney John Relman told the Washington Post.Relman is the fair housing project director at the Washington Lawyers Committee for CivilRights, which

represented the Fair Housing Council in its case against Kay Management. "It alsosets a floor for future fair-housing cases."

According to the Washington Post, Kay Management owns and operates 37 rentalproperties. The Fair Housing Council named seven Washington-area Kay Management apartmentcomplexes in its lawsuit: Kenilworth Towers in Bladensburg; Woodmount Park, London ParkTowers and Hunting Terrace in Alexandria; Pinewood Plaza in Fairfax; and Barcroft Plazaand Barcroft View in Falls Church. All of the complexes named in the suit followedpolicies which had a disparate impact on families with minor children.

Testing evidence showed that management company employed overly restrictiveoccupancy limits

The Fair Housing Council had sent "testers" to the seven apartment complexesand found Kay Management had stipulated occupancy maximums that violated the federalstandard of two people per bedroom. Particularly disturbing to the Council, according to aWashington Post article, was Kay Management's policy of allowing only five peoplein a three-bedroom apartment and, at some of their complexes, allowing only three peoplein a two-bedroom apartment.

Although there is no federal occupancy law, the US Department of Housing and UrbanDevelopment has said those occupancy standards more restrictive than two persons perbedroom are too restrictive and unfairly impact families with children. Many managementcompanies now follow national standards from industry sources like the Building Officials& Code Administrators International, Inc. (BOCA).

Settlement fund administrator will review management records to distributesettlement

Applicants and tenants adversely affected by Kay Management's occupancy rules willbe entitled to receive $2,500 per application or lease or a prorated share of any moneyremaining in the fund. The administrator will determine eligibility by examining guestcards, applications, leases and other Kay Management records.

The Council's fair housing enforcement activities are partially funded by HUD's FairHousing Initiatives Program. To learn more about the Fair Housing Council of GreaterWashington's activities, check their web site at http://www.fairhousing.org.