## Facts

- Nassau County, New York owned a roughly 25-acre parcel known as the “Social Services Site” within the Incorporated Village of Garden City.
- Early planning contemplated multi-family zoning that could support substantial affordable rental housing, but Garden City ultimately adopted a restrictive townhouse zoning classification that limited density and made affordable rental development economically infeasible.
- Community opposition to multi-family and affordable housing arose during local hearings, including statements framed around preserving “community character,” traffic, schools, and public safety concerns.
- After the rezoning, Nassau County solicited bids subject to a minimum price; MHANY concluded affordable housing could not be built under the new zoning and bid constraints, and the County sold the site to another developer for a single-family home project.
- MHANY (a nonprofit affordable housing developer), an advocacy organization, and individual prospective minority residents sued Garden City and Nassau County under the Fair Housing Act (FHA), 42 U.S.C. §§ 1981, 1983, Title VI, and the Equal Protection Clause.
- Following summary judgment, the district court held Garden City liable after a bench trial for intentional discrimination and disparate impact under FHA § 3604(a), and for intentional discrimination under §§ 1981 and 1983 and Equal Protection; the court largely granted summary judgment to Nassau County on zoning-related theories.

## Issues

1. Whether the plaintiffs had Article III standing and whether the case became moot after the property’s sale and development.
2. Whether Garden City’s rezoning from a multi-family concept to restrictive townhouse zoning was motivated in part by racial discrimination, violating FHA § 3604(a), §§ 1981 and 1983, and Equal Protection.
3. Whether Garden City’s rezoning created unlawful disparate impact under the FHA and whether the correct burden-shifting test applied.
4. Whether Nassau County could be held liable for the rezoning decision or for broader FHA § 3604(a) and Title VI violations based on alleged steering of affordable housing.

## Decision

- The Second Circuit held the plaintiffs had standing and the claims were not moot because meaningful declaratory and injunctive relief could address ongoing segregation-related harms.
- The court affirmed the finding that Garden City acted with discriminatory intent in adopting the restrictive zoning and that Garden City failed to prove it would have made the same decision absent racial considerations.
- The court vacated the FHA disparate-impact liability ruling against Garden City and remanded because the district court used a superseded burden-shifting framework rather than HUD’s 2013 disparate-impact regulation.
- The court affirmed summary judgment for Nassau County on disparate-treatment theories tying the County to Garden City’s zoning choice, finding no genuine dispute that the County had legal responsibility for the Village’s adoption of the restrictive zoning.
- The court remanded for further proceedings on plaintiffs’ FHA § 3604(a) and Title VI claims alleging Nassau County steered affordable housing toward minority areas and away from predominantly white communities.

## Legal Principles

- Organizational plaintiffs may establish injury-in-fact where discriminatory housing practices frustrate their missions and cause diversion of resources; individuals may be injured by loss of opportunity to live in an integrated community and by perpetuation of segregation.
- Housing-discrimination challenges to zoning are not moot if effective relief remains available despite changes in property ownership or development.
- Discriminatory intent in zoning may be proven with circumstantial evidence under the Arlington Heights factors, including sequence of events, procedural departures, and decisionmaking shaped by racially tinged community opposition.
- In mixed-motive housing-discrimination cases, once race is shown to be a motivating factor, the defendant must prove it would have taken the same action absent discriminatory considerations.
- FHA disparate-impact claims in the Second Circuit are governed by HUD’s regulation, requiring: (1) a showing of discriminatory effect; (2) proof by defendant of substantial, legitimate, nondiscriminatory interests; and (3) a showing by plaintiff that a less discriminatory alternative would serve those interests.
- A county that owns land and sets bid conditions is not liable for a municipality’s zoning choice absent proof of legal responsibility or control, but countywide housing policies may still support FHA and Title VI liability if they steer affordable housing in a discriminatory pattern.

## Conclusion

The Second Circuit upheld Garden City’s liability for intentional discrimination in exclusionary rezoning, required reconsideration of disparate-impact liability under HUD’s regulation, limited Nassau County’s liability for the municipal zoning decision, and reopened potential County liability for alleged discriminatory steering through broader affordable-housing policies.


Mhany Mgmt., Inc. v. County of Nassau, 819 F.3d 581 (2d Cir. 2016)