U.S. Rep. Randy Neugebauer (R-Texas) issued a statement of support on Monday for a Washington, D.C., district court judge who vacated the Department of Housing and Urban Development’s disparate impact rule.
Judge Richard Leon ruled that the regulatory principle used to build discrimination cases based on racial statistical disparities was not justified by existing law and called it an “artful misrepresentation of Congress’s intent.” Leon wrote in his decision that the Fair Housing Act only permits claims based on intentional discrimination.
Neugebauer, the chairman of the House Financial Services Housing and Insurance Subcommittee, said the rules are unnecessary because the McCarran-Ferguson Act established a system of state-based insurance regulation that has worked for nearly 70 years.
“HUD’s application of the disparate impact standard to homeowners insurance would not only be duplicative, inefficient and impractical, but also contrary to existing state and federal law,” Neugebauer said.
He added that he applauds Leon “for recognizing that Congressional intent trumps the faulty housing policy desires of the Obama administration. It is my hope that the Supreme Court looks to this case and quickly addresses disparate impact.”
The legal challenge was brought to Leon by the American Insurance Association and the National Association of Mutual Insurance Companies.