## Facts

- Familystyle of St. Paul, Inc., a provider of residential group homes and rehabilitative services for persons with mental illness, operated community-based facilities in St. Paul, Minnesota.
- Minnesota licensing law and the St. Paul zoning code imposed a dispersal rule generally requiring new residential programs for the mentally ill to be at least 1,320 feet (one-quarter mile) from an existing program unless local authorities granted a conditional or special use permit.
- Familystyle sought permission to establish three additional homes adjacent to an existing Familystyle group home, which would violate the spacing requirement absent special permission.
- The City granted temporary special use permits conditioned on Familystyle’s efforts to locate dispersed sites; when Familystyle did not meet the dispersal condition, the temporary permits expired and the City denied renewal.
- Familystyle claimed the spacing requirement and permit denials unlawfully discriminated against handicapped persons in housing and were preempted by the Fair Housing Act (as amended in 1988).

## Issues

1. Whether state and municipal spacing requirements limiting the clustering of group homes for persons with mental illness constitute unlawful discrimination under the Fair Housing Act’s disability provisions.
2. Whether the Fair Housing Act preempts state licensing and local zoning dispersal requirements for residential programs serving persons with mental illness.
3. Whether the spacing requirement is justified by legitimate governmental objectives related to deinstitutionalization and community integration rather than exclusion.

## Decision

- The district court granted summary judgment for the City and state defendants, upholding the spacing requirements and dismissing the complaint.
- The Eighth Circuit affirmed.
- The court held the one-quarter-mile dispersal requirement was valid under the Fair Housing Act because it furthered deinstitutionalization and integration goals and was viewed as beneficial to residents’ mental health.
- The court rejected the argument that federal fair-housing law displaced the state and local scheme, concluding the dispersal approach was consistent with the Act’s purposes.

## Legal Principles

- A dispersal (spacing) requirement for residential programs serving persons with mental illness can comply with the Fair Housing Act when reasonably tied to integration and avoidance of institutional-like clustering.
- Regulation directed at the siting of service-providing facilities, rather than a direct bar on disabled individuals residing in a neighborhood, may be treated as non-discriminatory when implemented to advance integration-oriented policy.
- The Fair Housing Act does not preempt state and local housing-related regulations that are not inconsistent with federal objectives and that aim to place disabled persons in ordinary residential settings.
- Governmental objectives such as deinstitutionalization and ensuring community-based living conditions may constitute legitimate, non-discriminatory justifications defeating an FHA challenge to dispersal rules.

## Conclusion

The Eighth Circuit upheld Minnesota’s licensing and St. Paul’s zoning dispersal requirements for group homes serving persons with mental illness, concluding the spacing rule furthered deinstitutionalization and integration, did not violate the Fair Housing Act, and was not preempted by federal law.


Familystyle of St. Paul, Inc. v. City of St. Paul, 923 F.2d 91 (8th Cir. 1991)