Justice Department Secures Settlement in Race Discrimination Lawsuit Against Public Housing Authority and Property Owners in Alabama

The Justice Department announced that the U.S. District Court for the Northern District of Alabama has approved a consent decree resolving the department’s Fair Housing Act lawsuit alleging race discrimination by the Housing Authority of Ashland, Alabama. The consent decree also resolves the department’s claims against Southern Development Company of Ashland Ltd., Southern Development Company of Ashland #2 Ltd., and Southern Development Company LLC, the private owners and agent of two of the eight low-income housing communities managed by the Housing Authority.

“Racial steering is a patently unlawful practice that destabilizes communities, fuels racial tensions, and perpetuates modern day racial segregation in communities across the country,” said Assistant Attorney General Kristen Clarke for the Civil Rights Division. “Racial steering violates federal law, and runs contrary to the principles of equal housing opportunity that animated the work of Dr. Martin Luther King, Jr., who fought to bring an end to practices that locked Black people out of certain communities. This resolution should send a strong message to housing providers — both public and private — that they will be held responsible when they engage in unlawful conduct that violates the Fair Housing Act.”

“The consent decree entered today ensures access to housing opportunities for individuals and families without fear of discrimination,” said U.S. Attorney Prim F. Escalona for the Northern District of Alabama. “My office will continue to devote resources to vigorously pursue housing providers who deny equal housing opportunities to applicants or separate tenants based on their race.”

The lawsuit, filed in December 2020, alleged that since at least 2012, the defendants maintained largely segregated housing and steered residents to different housing communities based on race. For example, the defendants steered Black applicants away from four overwhelmingly white communities (known as Ashland Heights I, Ashland Heights II, East Side, and Clay Circle) that are located in predominately white neighborhoods to two predominantly Black communities (known as West Side and Pine View) that are located in predominately Black neighborhoods.

In investigating and litigating this case, the department conducted over 100 interviews with former and current tenants and other longtime residents of the Ashland area. The tenants and residents repeatedly highlighted the deep psychological stigma and harm suffered by hundreds of Black families who have lived in segregated housing for generations.

Under the court-approved decree, the defendants are required to pay $275,000 in damages to 23 current or former tenants who were allegedly harmed by the defendants’ conduct and pay a civil penalty to the United States; implement policies and procedures to remedy the alleged segregation and to ensure nondiscrimination, transparency and consistency in processing applications and offering units to applicants; contact a group of approximately 145 individuals who are disproportionately Black who applied to Ashland Heights I or II but were not placed on the waiting list(s), and offer them spots on the waiting list based on their original dates of application if they still qualify; undergo fair-housing training; and submit periodic compliance reports to the Justice Department.

This case was jointly litigated by attorneys in the Civil Rights Division and the U.S. Attorney’s Office for the Northern District of Alabama.

The federal Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin, and disability. More information about the Civil Rights Division and the civil rights laws it enforces is available at www.justice.gov/crt. Individuals may report housing discrimination by calling the Justice Department at 1-833-591-0291, emailing fairhousing@usdoj.gov, or submitting a report online. Individuals also may report discrimination by contacting HUD at 1-800-669-9777, or by filing a complaint online.