Going to Court for Housing Choices?

Might a handful of lawsuits in the Northwest states open existing bedrooms to roommates, houses to in-law apartments, and neighborhoods to new rooming houses? It’s a question Sightline has long pondered. Today, we have part of the answer, in a legal analysis of occupancy limits’ susceptibility to judicial review.

First, a review of the backstory. Skip ahead, if you’re already in the know.

In late 2012 and early 2013, one of us (Alan) made an argument (articles 4-7 of this series, later synthesized and updated in this book) for the elimination of obscure but powerful provisions in local land-use codes called “occupancy limits.” These innocuous-sounding but pernicious rules (listed here for the biggest Cascadian cities) arbitrarily cap how many roommates may share a dwelling; slow construction of in-law apartments and backyard cottages; and put a brake on development of new rooming and boarding houses. Through these effects, they close off tens of thousands of existing bedrooms—about one-third of which are empty on a typical night in the Northwest—and hobble construction of modest dwellings. They exacerbate housing shortages in cities and contribute to the increase of rents, especially for people with low and moderate incomes. In brief, the argument was:

• Occupancy limits have no justification.
  • They are not crowding rules, because
    • they limit only unrelated adults, not families, and
    • they are untethered to dwelling size.
    • Besides, cities have separate crowding rules, expressed as square feet or rooms per inhabitant.
  • They are poorly defined and exceedingly difficult to enforce. (Who counts as family?)
  • They are badly targeted and morally objectionable if justified as an antidote to crowded street parking, elevating access to free parking for some people over access to affordable housing for other people.
• Because occupancy limits do not do what their proponents purport, the real motivation for occupancy limits is likely the one thing that occupancy limits do powerfully, which is to exclude low-income people from neighborhoods.
• A handful of jurisdictions in Cascadia have eliminated occupancy limits or raised them to high-enough values that they are less constraining, but most cities have not. Few seem willing to even consider the issue, hidden from public view as it is in the fine print of local land-use rules.

In Unlocking Home, Sightline summarized the legal status of occupancy limits:

Occupancy limits cap roommates, not families. That’s been especially true since the mid-1970s, when two key decisions from the US Supreme Court created precedents under which occupancy limits persist. In the first, the court upheld a New York town’s authority to stop a property owner from renting a single-family house to a group of six college students. Justice William O. Douglas, a Northwesterner, wrote for the court [in a ruling known as Belle Terre], “A quiet place where yards are wide, people few, and motor vehicles restricted are legitimate guidelines in a land use project addressed to family needs…. The police power is… ample to lay out zones where family values, youth values, and the blessings of quiet seclusion and clean air make the area a sanctuary for people.”

It sounds good, but it’s a curious argument: aren’t students people? Aren’t they youth? It’s a dated argument: we know now that suppressing population density makes for more traffic and air pollution, not less. And it’s a classist argument, focused on the idyll of fortunate families raising children among other fortunate families amid “the blessings of quiet seclusion” where “yards are wide” (in other words, expensive). The ruling affirms that localities may write land-use rules to exclude people who cannot afford to live in a single-family neighborhood unless they double up with roommates. That’s not exactly “family values” or “youth values” so much as it is class values.

A year later, the Supreme Court extended its own distinction between family members and roommates. It ruled that a community could not restrict members of an extended family from sharing housing. Cities across the United States revised their occupancy limits to eliminate bans on extended family members. Canadian land-use rules now reflect the same principle.

The pro-family bias of these decisions may have reflected mainstream views in the mid-1970s; it is now an anachronism. Household structures have changed dramatically in the intervening years, with high divorce rates, delayed marriage and childbearing, extended lifespans, and the proliferation of cohabitation, melded households, domestic partnerships, and shared housing. US housing laws now make it illegal to discriminate against potential tenants or buyers on the basis of their family status, yet land-use codes persist in precisely this kind of discrimination. State courts in jurisdictions including California, Michigan, and New Jersey have since thrown out roommate caps entirely. Cascadian courts have not yet followed their example.

US Federal Courts

The crux of the legal issue in federal courts has been whether occupancy limits violate a “fundamental right.” Courts set a higher bar for laws that impinge on fundamental rights than they do for other laws. They put the burden of persuasion on the government, rather than on challengers of the law, and they expect the government to show that the law furthers an important public interest by means that are substantially or even narrowly related to the interest. For cases involving no fundamental right they use a “rational basis test,” which means they give great latitude to legislative bodies, saying, in effect, “we may or may not think your policy is a good solution to the problem you set out to solve, but we’re not going to second-guess you, because our job is to protect fundamental rights, not evaluate the effectiveness of legislation. All we ask is that the law is at least plausibly related to solving the problem.” In the critical 1970s Supreme Court decisions, the judges found a fundamental right to live with family members but not with others.

Thus, unless the US Supreme Court goes against its precedents in future cases, federal courts will be unwelcoming venues for legal challenges to occupancy rules. State courts, however, are more promising.

State Courts

As of 1999, the last time anyone did a comprehensive legal scan of state court rulings on occupancy limits, approximately 22 states had ruled on whether occupancy limits for unrelated persons are legal (see “Belle Terre and Single-Family Home Ordinances,” below in case law). While state courts interpreting their own state constitutions are under no obligation to follow the reasoning of the US Supreme Court interpreting the US Constitution, the vast majority of states have followed the lead of the Belle Terre ruling; they have upheld occupancy limits for unrelated adults.

However, California, Michigan, New Jersey, and New York have gone their own way, throwing out occupancy limits as unconstitutional. None of these states broke from the US Supreme Court by finding a fundamental right in their state constitution’s due process clause that concerns unrelated adults. Instead, Michigan, New Jersey, and New York used rational basis review but found occupancy limits to fit so badly with their purported purpose that the courts invalidated them. (It’s not hard to see why, considering all we argued above.) Indeed, one of the main differences between states that upheld occupancy limits and those that did not was that states that upheld occupancy limits gave more deference to the legislative bodies that passed them.

States that struck down occupancy limits found an inadequate relationship between the means and the end. The courts found that the occupancy limits were both over-inclusive and under-inclusive: the limits both included and excluded more people than they should have. For example, an occupancy limit is under-inclusive when an objective of an occupancy limit is to preserve ample street parking, but the law would not include a family of ten, all of whom have their own cars. The court in New Jersey remarked that more precise methods are available. A caveat: successful over-inclusivity or under-inclusivity arguments are rare because federal courts usually do not use under-inclusivity or over-inclusivity arguments when undergoing rational basis review.

Unlike the other states, the California court did not rely on the theory of fundamental rights (which stems from the due process clause). Instead, it relied on its state constitution’s explicitly stated right to privacy. It thereby triggered strict scrutiny, the highest level of scrutiny in constitutional review. To pass the strict scrutiny test, the court must find that the law furthers a compelling government interest and is narrowly tailored to achieve that interest. In Santa Barbara v. Adamson the court decided that the government may regulate uses of homes but not the occupants of a home. In short, the government has no compelling interest in deciding who may share a dwelling: whom Californians choose to live with is a private matter, protected by the state constitution from city council regulation.

Oregon and Washington

No state court in Oregon or Washington has yet ruled on occupancy limits. Among states, four out of 22 is not an encouraging win-loss ratio, but the California ruling would loom large in any legal challenge in the Northwest, not only because California is the Northwest’s coastal neighbor and the largest and most influential of all states but for three other reasons.

First, Washington’s state constitution, like California’s but unlike Oregon’s, has especially strong protections for its citizens’ right to privacy. Section Seven of the state constitution enshrines privacy rights deeply in state law. Most of the case law on Washington’s right to privacy deals with government surveillance, warrants, and other “search and seizure” issues, not with definitions of family, so no guidance is available on how state courts might respond to an argument like that in Santa Barbara v. Adamson. Still, an argument from an explicit constitutional guarantee of privacy is built on bedrock, not the shifting sands of a rational basis test.

Second, both Oregon and Washington’s Fair Housing Acts are more extensive than their federal counterpart. The federal version bans discrimination against tenants or home buyers on several bases, including race, religion, and family status (that is, having minor children) but not marital status. Oregon’s and Washington’s laws, however, do include marital status. Consequently, in both states, a landlord may not discriminate against two prospective tenants because they are unmarried, yet almost all cities in both states discriminate explicitly against unmarried adults through their occupancy limits. In Seattle, for example, an extended family of eight can share a big, old house like the drafty, seven-bedroom one where one of us (Alan) grew up in Seattle’s Denny-Blaine neighborhood. If an adult child marries, that new, ninth family member is allowed to move in. If, however, the same adult child wants her partner to move in without benefit of a marriage license—the exact same living arrangement—it would violate city law. Although localities are not covered by the Fair Housing Act, state courts might consider the act’s prohibitions in deciding whether to consider freedom from discrimination on the basis of marital status a fundamental right.

Third, Oregon and Washington, like California, have long valued tolerance and individual liberty perhaps more than most states. This West Coast culture of “live and let live” has been reinforced in recent decades by dramatic changes in household structures and social norms around what constitutes a family. Many northwesterners would object to local governments having any say in who shares their dwellings, if they knew such rules existed. Judges might defer to legislators on such matters, but they might not. They are not isolated from shifting social norms.

Suing for Housing Choices?

Legal challenges to occupancy limits in the Northwest states might fail. That risk is substantial. Only one-fifth of state court challenges have prevailed. Still, losing such challenges would leave the region’s housing shortage no worse than it already is, and even unsuccessful lawsuits might spark public debate that would stimulate reform in some cities. Occupancy limit reform is otherwise at a standstill. What do advocates for more housing, more inexpensive housing, and more compact, walkable neighborhoods  have to lose?

What they have to gain—what all of Cascadia stands to gain—is tens of thousands of additional dwellings in otherwise idle bedrooms, in new in-law apartments and backyard cottages, and in new rooming houses. What other modest set of actions—a lawsuit or two each in Oregon and Washington, in this case—have even a one-in-five chance of creating tens of thousands of new, unsubsidized, affordable homes?

Appendix: Case law and other helpful sources

Here are some of the key legal rulings about occupancy limits:

Charter Township of Delta v. Dinolfo (1984, Michigan) (overturning Michigan’s occupancy limits on a rational basis test)

Gamble v. City of Escondido, 104 F.3d 300 (9th Cir. 1997) (Federal appeals court stating that preserving neighborhood character was legitimate interest in denying a group home permit).

Moore v. City of East Cleveland 431 U.S. 494 (1977) (Ruled that cities cannot restrict extended family members from sharing housing based on substantive due process violation).

Palo Alto Tenants Union v. Morgan (1970, N.D. CA) (Federal court upholding occupancy limits)

Santa Barbara v. Adamson (1980, California) (overturning California occupancy limits on a privacy argument)

State of NJ v. Baker (1979, New Jersey) (overturning New Jersey occupancy limits on a rational basis test)

Village of Belle Terre v. Boraas, 416 U.S. 1 (1974) (allowing occupancy limits for unrelated adults).

Two law review articles are especially helpful: Belle Terre and Single-Family Home Ordinances: Judicial Perceptions of Local Government and the Presumption of Validity 74 N.Y.U. L. Rev. 447, and Five is a Crowd: A Constitutional Analysis of the Boston Zoning Amendment Prohibiting More Than Four College Students From Living Together, Suffolk Law Review (2013). This site on California occupancy laws is also a good resource.

Samir Junejo, an attorney and former Sightline intern, conducted the legal research for this article.