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Greitens, Republicans warned months in advance that SB 43 would violate Fair Housing Act

JEFFERSON CITY, Mo. – House Democrats are accusing Gov. Eric Greitens and the Republican legislative leadership of legislative malpractice following news that Missouri would be losing hundreds of thousands of dollars in federal funds.

Democrats last week released a letter from the U.S. Department of Housing and Urban Development which informed state officials that Missouri would be suspended from the Fair Housing Assistance Program this year, which is expected to come with a loss of anywhere from $400,000 to $500,000 per year in federal funds for the state.

That’s because, as the HUD letter outlines, the Show-Me State is no longer “substantially equivalent” to federal, thanks to the passage and signing of the employment discrimination bill known as SB 43.

That letter arrived two weeks after the signing of the bill by Gov. Greitens, and upon its release, a number of legislators expressed shock, saying they had been led to believe that the passage of the bill would not affect the program.

“This is terrible. We were told SB 43 mirrored Fed rules, not violated them. We need to fix this ASAP!” Sen. Ryan Silvey, R-Kansas City, tweeted.

The senator, who had voted in favor of the bill, stated they had messed up, and in retrospect, said they should never have voted for it.

But perhaps what is even more alarming is the fact that this very issue was made known much earlier.

A letter released by House Democrats on Wednesday shows that HUD put the Greitens’ administration and the bill’s sponsors on notice of the problem on Feb. 6, three months before the Republican-led legislature passed the measure.

In that letter, Fair Housing Assistance Program Director Joseph A. Pelletier outlined how SB 43 would revise a number of sections of Missouri’s existing fair housing law. (You can read that letter below.)

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Basically, HUD said that SB 43 would violate the Fair Housing Act for several reasons, including:

  • Requiring victims to prove that discrimination was a “motivating factor” for an adverse action, thus prohibiting claims based on seemingly neutral policies that have a discriminatory effect;
  • Imposing caps on actual and punitive damages, which “impermissibly limits the remedies available to victims of housing discrimination;”
  • Removing provisions of previous state law prohibiting retaliation against victims of housing discrimination; and
  • Requiring victims to pursue administrative remedies before filing a civil lawsuit.

But, even the February letter wasn’t the first time that the concerns had been raised. The original fiscal note for the bill, prepared on Jan. 20th, included a warning from the Missouri Department of Labor and Industrial Relations that SB 43 could run afoul of federal law, outlining the issues and the potential noncompliance. An excerpt from that fiscal note reads: 

Officials at the Department of Labor and Industrial Relations (DOLIR) assume a negative fiscal impact to federal funds. DOLIR states there could be possible conformity issues with the Missouri Commission Human Rights’ (MCHR) contracts with the U.S. Department of Housing and Urban Development (HUD) and the Equal Employment Opportunity Commission (EEOC). These federal agencies have determined that the Missouri Human Rights Act is substantially equivalent to the federal civil rights law enforced by EEOC and HUD. If either of these agencies determines Missouri is no longer in conformity with the federal requirements, MCHR could lose the ability to continue contracting with the EEOC for $781,900 and/or HUD for $420,000.

That warning remained in each version of the fiscal note through the bill’s passage in May.

But as Silvey had stated, they had been told SB 43 mirrored federal rules. The question then becomes this: who misled an entire state legislature?

The letter and fiscal note prove that state officials knew of the problem early in the legislative process and did not address it.

“Instead of fixing the problem when they had the chance, Governor Greitens and Republican legislative leaders chose to ignore it,” House Minority Leader Gail McCann Beatty, D-Kansas City, said. “This is nothing short of legislative malpractice, and victims of illegal housing discrimination in Missouri will suffer as a result.”

Beatty’s statement leaves the blame squarely on the executive branch and the majority leaders of the state’s two legislative chambers.

Perhaps the question to ask then is what is being done to address the issue? The Governor’s Office has been quiet on the issue and has not responded to emails and queries on the subject.

House Democrats intend to file legislation in December to repeal portions of the bill that have caused the violation of federal laws.

However, ff that legislation does not pass by March 1, HUD has stated that Missouri’s participation in the Fair Housing Assistance Program will be suspended.