Record Fine for Housing Bias

Hit 'em again, hit 'em again, harder, harder.

That’s the cheer that’s echoing around Washington, as the Obama administration whacks businesses that violate federal laws with much tougher penalties than were assessed during the Bush administration.

Last week, the Occupational Safety and Health Administration proposed a record $87 million fine against BP. It alleged the oil company had failed to correct safety problems at a Texas City, Texas, refinery where a 2005 explosion killed 15 workers.

Tuesday, the Department of Justice announced that a Los Angeles apartment-building owner had agreed to pay $2.7 million to settle allegations that he discriminated against blacks, Hispanics, and families with children. It’s the largest penalty ever obtained by the department in a housing-discrimination case involving apartments.

“The magnitude of this settlement should send a message to all landlords that we will vigorously pursue violations of the Fair Housing Act,” said Thomas Perez, assistant attorney general for the department’s civil rights division.

Give the Bush administration some credit, though. The Department of Justice filed the lawsuit against Donald Sterling, who owns 199 buildings with 5,000 apartments in Los Angeles, in 2006. The suit alleged that Sterling told his employees at apartment buildings in the Koreatown section of Los Angeles that blacks and Hispanics were not desirable tenants. Far fewer apartments were rented to blacks and Hispanics in these buildings than would be expected based on income and other demographic characteristics, according to the lawsuit.

Under the settlement, Sterling will pay a $100,000 fine to the federal government and contribute $2.6 million to a fund that would be used to pay damages to the victims of his alleged discrimination. Those victims include a black family and an interracial couple who alleged that Sterling demolished their apartments’ private yards for racial reasons.

In addition, an independent contractor will test Sterling’s compliance with fair-housing laws at his Los Angeles properties for three years and provide training to his apartment managers and leasing agents on fair-housing rules.

That’s got to be embarrassing for Sterling, but losing $2.7 million, plus whatever legal fees he spent on this case, has got to hurt.

So landlords be warned: Make sure your open house really is an open house.