Rental Issues - Source of Income Discrimination

Oct 9

Updated 10/16/2023

At October 10th’s Social Services & Public Safety (SSPS) Committee meeting, Councilmembers heard a proposal to ban source of income (SOI) discrimination.

In the meeting, Councilmembers asked questions regarding how such a ban would affect landlords, tenants, and rent prices in Lexington. Commissioner for Housing Advocacy and Community Development Charlie Lanter told Council that similar bans in other cities and communities have had little to no effect on rent prices and should not result in any substantial burden on landlords.

Some Councilmembers stated that they have heard from many landlords who have either participated in housing voucher programs in the past but later quit due to frustration, and want to hear more from landlords about why this would be the case.

After much discussion, no decision was made. Committee Chair Councilmember Jennifer Reynolds scheduled a public hearing on this issue for November 14th at 6pm in Council Chambers to hear from tenants, landlords, and community members.

In Tuesday, October 10th’s Social Services & Public Safety (SSPS) Committee Meeting, Councilmembers will hear a presentation on Source of Income (SOI) Discrimination and consider adding language to Lexington’s Fairness Ordinance, which would ban SOI Discrimination in rental housing.

What is source of income discrimination?

The City of Lexington defines SOI Discrimination as refusing to lease a housing unit to a tenant based on their lawful source of income.

This potential ban on Source of Income discrimination aims to provide additional housing options for people who don’t receive their income from an employer. Other sources of income could include:

Social Security
Section 8 Housing Choice Vouchers
Other program vouchers, including VASH for veterans
Child Support
Alimony

According to the City, housing options for people with these forms of income are extremely limited in Lexington. Rental listings from September 15th showed that 96% of units listed did not accept Section 8 vouchers.

Most third-party sources of income are held by low-income individuals and marginalized groups.

In Lexington, 76% of Section 8 vouchers are held by Black households.
Vouchers offered through the Lexington Housing Authority, including vouchers for veterans, foster families, and those needing emergency housing, have high use rates. 83%-100% of their available vouchers are being used.

Currently, many landlords in Lexington do not lease properties to renters with these sources of income. Many voucher programs require an inspection of the property and other administrative work to be done for the voucher to be used for rent at a specific property.

Many state and local governments have adopted legislation banning SOI Discrimination, requiring all landlords to accept these forms of payment from otherwise eligible applicants. According to a 2022 Poverty & Race Research Action Council study, 21 states and 119 cities and counties - including Louisville and Cincinnati - have laws addressing SOI discrimination.

This week’s presentation will present potential language for Council that would ban SOI Discrimination. It also will outline other impacts their decision could have on tenants and landlords in Lexington. If these changes are adopted, the City would allow for a year of education before enforcing the change. You can view the entire presentation here.

Before this presentation, the Department of Housing Advocacy & Community Development reviewed this topic with several relevant groups, including a Landlord Advisory Committee, a Tenant Advisory Committee, the Downtown Landlord Association, and the Homelessness Prevention and Intervention Board.

The Social Services & Public Safety Committee will meet on Tuesday at 1pm in Council Chambers. You can attend in person or watch live on LexTV.