On December 9, 2025, the Department of Justice (DOJ) published a final rule rescinding certain provisions its Title VI implementing regulations under The Civil Right Act of 1964, which prohibits discrimination in federally funding programs. The Final Rule removes regulatory language that previously prohibited conduct that resulted in a disparate impact in federally funded programs.
The DOJ bypassed the issuance of Notice of Proposed Rule-making and public comment, by asserting that the rule falls under the Administrative Procedure Act’s exception for rules involving “public property, loans, grants, or contracts”
This Final Rule does not change a PHA or owner/agent’s obligations under the Fair Housing Act as it relates to disparate-impact liability under Federal Fair Housing Law.
What Disparate Impact Means In Civil Rights Law
Disparate impact refers to policies or practices that appear facially neutral, but in application result in disproportionate harm to individuals based a protected class ( race, religion, color, national origin, sex, familial status and disability).
Simply put, a policy does not need to be intentionally discriminatory for it to produce discriminatory effects. Disparate Impact acknowledges the reality that the current Administration wants to deny: Intent is not the only way discrimination occurs.
Under a disparate-impact framework, a policy or practice that produces racial disparities must be justified by a legitimate, non-discriminatory objective, and no less discriminatory alternative exists.
Rescinded Protections Under title VI
This Final Rule dismantled the core regulatory protections within Title VI that recognized disparate impact as discrimination, or that prohibited disparate impact discrimination, provisions that have been in place, in some form, for over 50 years.
DOJ’s Core Legal Theory
The DOJ’s overarching justification for the rescission of these provisions rests on a single interpretive position of a specific phrase in the statutory text of Title VI : “on the ground of”.
Section 201 of the Civil Rights Act of 1964 states: “All persons shall be entitled to the full and equal enjoyment of the goods, services, facilities, privileges, advantages, and accommodations of any place of public accommodation, as defined in this section, without discrimination or segregation on the ground of race, color, religion, or national origin”
The DOJ’s position is that the usage of the phrase “on the ground of” in the statue only prohibits intentional discrimination and not effect-based discrimination. Based on this, the DOJ seems to be signaling that ‘discrimination is fine, just try not to look like you did it on purpose’ which is deeply troubling.
The specific provisions removed from the regulation are outlined below:
Provision : § 42.104(b)(2)
A recipient, in determining the type of disposition, services, financial aid, benefits, or facilities which will be provided under any such program, or the class of individuals to whom, or the situations in which, such will be provided under any such program, or the class of individuals to be afforded an opportunity to participate in any such program, may not, directly or through contractual or other arrangements, utilize criteria or methods of administration which have the effect of subjecting individuals to discrimination because of their race, color, or national origin, or have the effect of defeating or substantially impairing accomplishment of the objectives of the program as respects individuals of a particular race, color, or national origin.
Modification: Provision completely eliminated.
Provision : § 42.104(b)(3)
In determining the site or location of facilities, a recipient or applicant may not make selections with the purpose or effect of excluding individuals from, denying them the benefits of, or subjecting them to discrimination under any program to which this subpart applies, on the ground of race, color, or national origin; or with the purpose or effect of defeating or substantially impairing the accomplishment of the objectives of the Act or this subpart.
Modification: Word “effect” was eliminated.
Provision : 42.104(b)(6)
In administering a program regarding which the recipient has previously discriminated against persons on the ground of race, color, or national origin, the recipient must take affirmative action to overcome the effects of prior discrimination.
(ii) Even in the absence of such prior discrimination, a recipient in administering a program may take affirmative action to overcome the effects of conditions which resulted in limiting participation by persons of a particular race, color, or national origin.
Modification: Provision completely eliminated.
Provision : § 42.104(c)(2)
In regard to Federal financial assistance which does not have providing employment as a primary objective, the provisions of paragraph (c)(1) of this section apply to the employment practices of the recipient if discrimination on the ground of race, color, or national origin in such employment practices tends, on the ground of race, color, or national origin, to exclude persons from participation in, to deny them the benefits of or to subject them to discrimination under the program receiving Federal financial assistance. In any such case, the provisions of paragraph (c)(1) of this section shall apply to the extent necessary to assure equality of opportunity to and nondiscriminatory treatment of beneficiaries.
Modification: Provision completely eliminated.
What Should PHAs & Owner/Agents of Federally Assisted Housing Do Now?
The DOJ Final Rule does not impose any new requirements on PHAs or federally assisted owner/agents, nor does it mandate revisions to existing policies. Housing providers should remain attentive to the legal framework that continues to apply under the Fair Housing Act, and ensure that policies and practices are compliant with the Fair Housing Act and other civil rights laws not affected by this rule.
This article serves solely as informational content and does not constitute legal advice. Readers are strongly advised to seek guidance from qualified legal professionals in matters of specific legal significance.