A contingent of New York City landlords and real estate brokers are promising to give low-income renters a fairer shake, as part of the settlement of a federal discrimination lawsuit filed by the advocacy group Housing Rights Initiative (HRI).

Earlier this month, HRI announced a proposed agreement with 23 landlords and real estate brokers, including some of the biggest names in the industry. They were accused in a 2021 lawsuit of routinely turning away apartment applicants who get government help paying their rent, in violation of laws barring such source-of-income discrimination.

Attorney Matthew Handley of the law firm Handley, Farrah and Anderson is representing HRI, whose lawsuit targets 88 landlords and brokers. He spoke with Gothamist about the lawsuit and what’s next for the ongoing litigation. This interview has been lightly edited for content.

Before we talk about the settlement, would you tell us how this case came about?

Housing Rights Initiative is a non-profit organization that focuses on preserving and maintaining access to affordable housing, which is particularly important in the ongoing affordable housing crisis all over the country and in particular in New York City. And it has historically done that by educating tenants about their rights to transparency from landlords and to their rights under rent stabilization laws and tax transparency. But it realized in the last several years that all of the gains that it was making there were really jeopardized by the fact that it didn't matter if rents were stabilized at affordable rates for voucher holders, there were a lot of landlords throughout the city who were nonetheless refusing to accept housing vouchers, even though the voucher would have covered the rates.

Who relies on these housing vouchers? How many prospective tenants are we talking about? And really, what's the impact of being turned away?

Currently over 100,000 families in New York City rely on the voucher program. It's the largest rental-assistance program administered by the U.S. Department of Housing and Urban Development. And that coupled with the fact that there are tens of thousands of individuals sleeping each night in the city's homeless shelter system, almost a 100,000 children who have lived in shelters are doubled up in apartments with family or friends and the pandemic making that situation even more dire. Vouchers are a path by which New York and the federal government have offered government-subsidized housing to these low-income families to secure housing in the private rental market.

So, what are the terms of the settlement?

The key terms are number one, the brokers who were settling have agreed to pay a higher commission for renting apartments to voucher holders than they otherwise would pay their agents who are renting to non-voucher holders. What this does is incentivizes agents to want to rent to voucher holders. Before this, they often would say that it was too much of an administrative burden or they didn't want to have to deal with it. But this is a way for agents to also see a financial benefit to themselves if they actually place a voucher holder in an apartment. They're going to train their staff up on how voucher holders work. They're committing to non-discrimination policies, including removing minimum-income requirements for voucher holders. And they're agreeing to ensure that their advertising does not contain language that discriminates against voucher holders.

Now, wouldn't big fines have the same end impact on compliance? Do watchdogs need better tools to keep landlords and brokers in line? And we should also note that another 60-plus defendants are still in the case.

That's correct. And we intend to hold those other 60-plus defendants accountable and hitting them in the pocket book certainly does have a deterrent effect on the bad behavior also. And we encourage the agencies that have the power to levy fines, whether it be the New York Attorney General's Office or the New York City Human Rights Commission, to continue the work that they have also been building up in recent years to hold these entities and businesses accountable. I think that to your question about whether or not we have adequate tools, the law has been changed in recent years to help protect tenants better by adding the source of income protections into the state law, which has just been a recent addition in the last couple of years, and stepping up enforcement by public agencies. And I think the key now is making sure that both private and public entities are actually using these tools that we've been provided.

Now the defendants, they are sophisticated parties. They certainly know what they can and can't do. Why does this keep happening?

So that's an excellent question and I don't have one answer to it. I think that there are a variety of reasons why this has continued to happen. I think on one end of the spectrum, I think there are landlords and brokers who do harbor prejudiced beliefs about who voucher holders are, about whether or not these are desirable people to have living in their buildings for one reason or another. But that's not the only reason why brokers and landlords have turned voucher holders away. I think there's also a belief by many that there are administrative burdens that are associated with trying to accept vouchers that they don't want to have to deal with. And I think a large part of it is just plain ignorance that they have not educated themselves. And it’s not been required to educate themselves about what the housing choice voucher program is and what the law requires them to do when housing choice voucher holders apply to them.

Gothamist reached out to Compass, one of the biggest defendants in the case, which also includes such notables as Century 21 and Corcoran. A Compass spokesman referred us to a joint statement put out with HRI. It said the agreement will reinforce Compass’s policies and practices in New York – and its commitment to ensuring voucher holders don’t face discrimination.

Additional reporting by Kerry Nolan and Herb Pinder.