This document discusses barriers to obtaining rental housing due to tenant screening practices. It notes that tenant screening reports often contain inaccuracies and improper information that can unjustly deny applicants housing. Blanket exclusions of applicants with criminal or eviction histories can have a disparate discriminatory impact and may violate fair housing law if not justified by business necessity. The document advocates addressing these issues through legislation limiting screening costs, requiring disclosure of screening criteria, and prohibiting exclusions based on dismissed records.

1. No Filter for You:
Advocating for Rental
Housing Access in the
Modern Rental Market
Eric Dunn, Staff Attorney
Northwest Justice Project
401 Second Ave. S., Ste. 407
Seattle, Washington 98104
Tel. (206) 464-1519
EricD@nwjustice.org

2.  Old RCW 59.18.257
 LL could charge actual costs for screening
 LL had to disclose name & address of screening
service and “what screening entails”
 $100 statutory penalty + costs & attorney fees
 New RCW 59.18.257
 Pre-disclosure of criteria, screening information
 Written adverse action notice that must give
reason
RCW 59.18.257

4. What makes a good tenant?
Can meet • Amount and stability of income, assets
financial • Other obligations are manageable
• Credit history does not suggest likelihood of default
obligations
Behavioral • Applicant not likely to damage the premises
• Applicant likely to follow basic rules
Suitability • Applicant likely to coexist well with neighbors
• Denial for reason(s) not related to any of the
above considerations: red flag
• Fair Housing, CPA/UDAP (some states)

5. Evaluating Rental Applicants

6. Tenant-Screening Reports
 Consumer report designed to assist a residential housing
provider in deciding whether to accept a rental applicant
 Usually prepared by specialty CRA
 Approximately 650 in USA (NY Times, 11/26/2006)
 Typical Contents:
 Financial credit report (usually from “Big 3”)
 Criminal background check
 Civil litigation/eviction records
 Interviews with past landlords, references
 Recommendation/score/analysis

7. What does a tenant-
screening report look like?

8. Miscellaneous
Disclaimers
Credit Information
ID Verification
Employment
Verification
Terrorist Database
Search
Public Records
Disclaimer

9. Reference Check
Criminal History
Sex Offender Check

10. Eviction History
Collection Accounts
& Civil Judgments
Recommendations

11.  Duplicative fees
 Inaccurate/Improper
consumer reports
 Overly-restrictive
admission policies
Barriers to Obtaining Housing

12.  Tenant-screening reports typically cost about $30-$75 per
adult applicant
 Landlords pass 100% screening charge on to applicants
 Moral hazard: landlord chooses product but applicant pays
 Applicants who are rejected must usually pay screening fees
over again to apply elsewhere (to purchase new report)
 New report will contain substantially identical information
Tenant-Screening: Costs

13.  Limit screening fees
 Nominal cap
 Require refund if
applicant denied
 “Portable” screening
reports
Controlling Screening Costs

14.  Applicant purchases one screening report
 Has all the basic components, is prepared
according to recommended methods
 Applicant can shop that report around to
unlimited number of housing providers for a
specified time period (30 days)
 Landlords can access the report for free
 Landlords can order a different report at their
own expense
“Portable” Screening Reports

15. 1. Tenant orders report, pays fee to Moco, Inc.
2. Moco prepares report, uploads to secure website
3. Tenant receives password to access report
 Tenant can review accuracy, completeness
4. Tenant can share the report unlimited number of
times simply by providing password
MyScreeningReport.com

16. Applicants with negative
background info. often must pay
$hundreds before finding housing
• Substantial drain on low-income
households and on social service
agencies, philanthropic orgs.
Fair housing impact is unknown
• Screening fees deter applicants with
imperfect credentials from applying
to housing perceived as more
selective
• What is racial/ethnic impact?
Policy implications

17. Characteristics of a Tight
Rental Market
 Ubiquitous, comprehensive
screening of applicants
 Applicants compared with
each other (most qualified
applicant) rather than to an
objective policy (first
qualified applicant)
 Categorical exclusions
(evictions, criminal records)

18. Rental Vacancy Rates 2005-Present
12
10
8
6
4
2
0
Wash. USA
Washington’s rental vacancy rate has consistently
remained significantly below average U.S. levels

20. As of August 2012, average rent for an apartment
within 10 miles of Seattle is $1,517
 1-BR average: $1,303/mo.
 2-BR average: $1,763/mo.
 Washington: 64.8% home ownership rate
 On any given night, it is estimated that almost
23,000 people are homeless ; over 100,000
people become experience homelessness at
some point each year

21. That’s not my name!
Problems in Screening Reports

22. Common Problems:
• Report contains negative information that isn’t true
• Report contains true but misleading information
Inaccurate • Incomplete report (omits favorable information that
mitigates other (i.e., negative) information
reports:
• Negative information appears on report despite
some law or policy prohibiting its inclusion, such as
Improper 15 USC 1681c(a) or state law restriction
reports:

23.  “79 percent of all credit reports contain some type of error—
and 25 percent contain such serious errors that those
individuals could be denied credit.”
 Dakss, Brian, “4 in 5 Credit Reports Have Errors,” CBS News, Feb. 11, 2009
 A newspaper investigation concluded that about 30% of credit
reports on Ohio consumers contained significant errors
 Marrison, Benjamin J., “Our digging finds mess that cries for redress,” Columbus
Dispatch, May 5, 2012
Serious errors common in reports

24. Eviction
Credit
Criminal
Tenant Screening Report

25. 15 USC 1681g:
“(a) Every consumer reporting agency
shall, upon request, and subject to section 1681h
(a)(1) of this title, clearly and accurately disclose
to the consumer: (1) All information in the
consumer’s file at the time of the request<”
 Very few screening companies will prepare a report
for a consumer (no information on file)
 Unfair practice under CPA/UDAP statutes?
FCRA disclosure requirements

26. Hundreds of tenant-screening companies are
active in the USA…

27. Application Application Rejected
Received
Report Ordered
Screening
Report
Obtained Report Received
Dispute Submitted
Applicant
Rejected
Reinvestigation
Next Applicant
Considered Results Reported

28. “The Unhouseables”
“<the increasingly popular use of tenant
screening reports has resulted in a new class
of people who are unable to access rental
housing because of past credit
problems, evictions, poor rental histories or
criminal backgrounds...”
 HousingLink, “Tenant screening agencies in the Twin Cities: An
overview of tenant screening practices and their impact on renters,”
Summer 2004

29.  Landlord specifies rental criteria
 Often suggested by CRA
 CRA obtains, reports information
relevant to criteria
 Details, nuance omitted
 CRA makes rental recommendation
 Accept, accept with conditions, deny
 Landlord follows recommendation
Formulaic decision-making

31. Rental applicants are commonly denied for
criminal or unlawful detainer records …

32. “It is thus well established that liability under the Fair
Housing Act can arise where a housing practice is
intentionally discriminatory or where it has a discriminatory
effect. A discriminatory effect may be found where a housing
practice has a disparate impact on a group of persons
protected by the Act, or where a housing practice has the
effect of creating, perpetuating, or increasing segregated
housing patterns on a protected basis.”
--U.S. Dept. of Housing & Urban Development, Proposed Rule on
Implementation of the Fair Housing Act’s Discriminatory Effects
Standard, 76 Fed. Reg. 70921 (Nov. 16, 2011)
Fair Housing Doctrine

33. Disparate Impact/Discriminatory Effects
 Outwardly neutral practice that causes either:
 A significantly adverse or disproportionate impact”
on members of a protected class; or
 That “perpetuates segregation and thereby prevents
interracial association”
 Usually requires proof by statistical evidence
 A practice that has a discriminatory effect is
unlawful unless justified by “business necessity”
 Contributes substantial value to landlord’s business
 No less-discriminatory alternative available

34. Disparate Impact: Criminal Records
 African-Americans are 13.6% of U.S. population
 2010 US Census
 African-Americans are arrested and incarcerated
at rates disproportionate to their numbers
 About 28% of persons arrested each year
 FBI Uniform Crime Reports, 2010
 Make up 40.1% of U.S. prison population
 6.1 times more likely to be incarcerated than whites
 Bureau of Justice Statistics, June 2010
 Blacks are 3.6% of Washington population, but
18.8% of Washington’s incarcerated population
 Wash. Dept. of Corrections, March 31, 2012

35. Blanket exclusions of rental applicants
who have criminal records cannot be
justified by business necessity.

36. Old criminal records do not
reasonably predict future
criminal behavior
After 5 Years, Offenders No More Likely Than Non-Offenders to Be Re-Arrested
(Kurlychek, et al. “Scarlet Letters & Recidivism: Does An Old Criminal Record Predict Future
Criminal Behavior?,” 2006)
36

37. Less-Discriminatory Alternatives
 Housing provider can use a case-by-case review
 Criminal record should result in denial only where the criminal
record suggests the applicant poses an ongoing threat of rule
violations, property damage, or criminal activity
 Factors to consider:
 What was the offense? Does it relate to housing? How?
 What were the circumstances surrounding the offense?
 When did the offense occur? How old was the applicant?
 Is there evidence of changed circumstances?
 Drug/alcohol rehabilitation? Psychiatric treatment?
 Employment/other indicia of stability?

38. “’It is the policy of 99 percent of our
customers in New York to flat out reject
anybody with a landlord-tenant record, no
matter what the reason is and no matter
what the outcome is, because if their
dispute has escalated to going to court, an
owner will view them as a pain,’ said Jake
Harrington, a founder of On-Site.com…”
--New York Times, Nov. 26, 2006

39. Eviction Records
 Eviction filings detected through court databases
 Data entered by court clerk upon case filing
 Circumstances, case outcomes not reported because
they are not relevant to decision matrix

40. Public Records Systems
 Public records are often created for some purpose
other than serving as de facto consumer reports.
 May be inaccurate, incomplete or out-of-date
 Best remedy: seal/delete/correct the public record
 Failure to have procedures for correcting or removing
harmful information from public records may violate
due process clause
 Humphries v. LA County, 554 F.3d 1170 (9th Cir. 2009), rev’d
on other grounds, 130 S.Ct. 447 (2010)
 “Stigma-Plus Test;” Paul v. Davis, 424 U.S. 693 (1976)
 Deprivation occurs if state creates a “stigma;” and
 State imposes tangible burden on person’s ability to obtain a
right or status recognized by state law

41. Unlawful Detainer Records
 Milwaukee, Wisc. 2009: low-income African-
American women, especially single
mothers, faced eviction at disproportionately
higher rates.
 Desmond, Matthew, “Eviction and the Reproduction of
Urban Poverty,” Paper presented at the American
Sociological Association Annual Meeting, Hilton San
Francisco, San Francisco, CA, Aug 08, 2009
 Oakland, Cal. 2002: 78% of “30-day no cause”
evictions were issued to “minority households”

42. Empirical Studies (2)
 Chicago, Ill. 1996:
 72% of defendants appearing in eviction court were
African American, 62% were women
 Philadelphia, Penn. 2001:
 83% of tenants facing eviction were “nonwhite,” 70%
were “nonwhite women”
 Other studies in Baltimore, NYC, and LA “have shown
that those who are evicted are typically
poor, women, and minorities.”
 Hartman, Chester & David Robinson, “Evictions: The Hidden Housing
Problem,” 14 Housing Policy Debate 461 (2003)

43. Eviction Demographics: King County, WA

44. King County Eviction Data
 A 2010 Study by students in the UW-Bothell Policy
Studies Program* found that:
 A moderate negative relationship exists between the
percentage of white tenants in a zip code area and that
zip code area’s UD rate
 A moderate positive relationship exists between the
percentage of non-white tenants in a zip code area and
that zip code area’s UD rate
 Strongest Correlations: Black, Multi-Racial tenants
*Gehri, Leah M., John Lee, Logan Micheel and Damian Rainey,“Tenant
Screening Practices: Evidence of Disparate Impact in King
County, Washington,” March 16, 2010

45. Suspect admissions policies
 Citizenship/Immigration status requirements
 Disparate impact on basis of national origin
 “No Section 8”/source of income discrimination
 Disparate impacts on women, people of
color, families with children, and people with
disabilities
 Restrictions on military deployment/absence from unit
 Tends to cause disparate effect on military personnel
 Charging for background checks on young children
 Disparate impact on families with children
 Blanket exclusion of people with eviction suits
 Disparate impact on racial, gender, fwc grounds

46. Addressing categorical exclusions
 Fair Tenant Screening Act (Wash. SSB 6315 of 2012)
 Requires disclosure of criteria, reason for adverse action
 Facilitates fair housing challenges
 Original bill would have prohibited CRAs from reporting
certain dismissed UDs (also DV-related records)
 Companion Bill (SB 6321 of 2012)
 Would have facilitated unlawful detainer defendants in
obtaining orders to seal dismissed eviction suits
 California does automatically on filing, Cal Civ. Pro. Code 1161.2;
 Minnesota has an “expungement” procedure, Minn. Stat. 484.014
 Amendment would have prohibited LL from denying
applicant based on dismissed eviction suit (SSB 6321)