Do Leasing Offices and Model Apartments Have To Be Handicap Accessible?

Every community has a leasing office.  Almost every community has a model apartment.  Disability discrimination is the number one ground for fair housing complaints.  Disability advocacy organizations continue to file more and more lawsuits over handicap accessibility issues.  These lawsuits have increasingly targeted the rental industry for failure to make leasing offices and models handicapped accessible.  For this reason, this month we address the issue of whether or not leasing offices and models have to be handicapped accessible.

Both the Federal Fair Housing Act (FHA) and the Americans with Disabilities Act (“ADA”) address this issue.  Courts are in agreement that the FHA does not preempt the ADA, and both the ADA and the FHA can apply to certain portions of a multi-family community.  The FHA covers any building designed for first occupancy after March 13, 1991.  The FHA requires that “public use and common use portions” of an apartment community be handicapped accessible.

No court has published a decision holding a landlord liable under the FHA for failing to have an accessible leasing office or model.  Regardless, the safer course to avoid potential liability under the FHA would be to have an accessible leasing office and model if your community was built after March 13, 1991.  Even if a court eventually rules that the leasing office and model do not have to be handicapped accessible under the FHA, a community would still face liability under the ADA for non-accessible leasing offices and models.

Unlike the FHA, the law is clear that leasing offices are covered by the ADA.  The ADA applies to any apartment community designed for first occupancy after January 26, 1992.  Similar to the FHA’s application to “public use and common use portions” of an apartment community, the ADA applies to any areas of an apartment community that are considered “public accommodations”.  Generally, a public accommodation is any place open to the public.  Because the ADA specifically states that a “rental establishment” is a place of public accommodation, courts have universally held that leasing offices must be handicapped accessible.

The Department of Justice (“DOJ”) is responsible for enforcing the ADA, as well as the FHA.  The big debate under the ADA is whether model apartments are covered. The DOJ has alleged in ADA enforcement lawsuits that models are covered by the ADA because model apartments are public accommodations, and must be readily accessible to and usable by individuals with disabilities.  The DOJ has taken this position with respect to apartment communities even though the DOJ’s own ADA guidance states that generally, models are not covered, as discussed further below.  Court decisions on models have not been so clear, but some legal trends are emerging.

Some courts have found models exempt from ADA requirements.  However, when courts have found models to be exempt, the models have only been used as examples of the goods offered for sale.  But the same courts have implied that when a model is being used not just as an example of a good for sale, but also as a place where potential buyers can receive information and meet with sales representatives about a party’s goods, it is a place of public accommodation.  This means that under the ADA, the model must be accessible; otherwise disabled individuals are denied access to goods in violation of the ADA.  Under this theory, the model is a “sales office” because it is just an extension of the leasing office.

To facilitate ADA compliance, the DOJ has published the ADA Technical Assistance Manual.  The manual provides some comfort that models are not covered, but does not conclusively resolve the issue because the manual does not state without qualification that models aren’t covered by the ADA.  The manual only states that “generally” models aren’t covered.  The manual then states that if a “sales office” is located in a model home, the area used for the sales office falls under the ADA.  The manual further states “the Department encourages developers to voluntarily provide at least a minimal level of access to model homes for potential homebuyers with disabilities. For example, a developer could provide physical access (via ramp or lift) to the primary level of one of several model homes and make photographs of other levels within the home as well as of other models available to the customer.”

Under the model is a “sales office” theory; disabled residents have sound legal arguments that models should be ADA compliant.  Disabled residents could argue that the DOJ ADA Technical Assistance Manual dictates that model apartments are covered by the ADA because leasing agents meet, show, or tour almost all prospective residents at the model.  A court could find a model is a “sales office” regardless whether brochures, leaflets, or other written marketing materials are available or distributed at a model because leasing agents sell in models.  Leasing agents point out the benefits and features of models, and answer other sales related questions.

Because of the ADA’s potentially retroactive effect, the model apartment issue is even murkier.  The ADA became effective in January of 1992.  Places of public accommodation built after this date must be accessible.  However, the ADA also requires existing places of public accommodation (built prior to January of 1992) to remove architectural barriers to access, where such removal is “readily achievable”. Theoretically, this means that leasing offices and models built prior to 1992 must be made handicapped accessible to comply with the ADA.  “Readily achievable” is defined as “easily accomplishable and able to be carried out without much difficulty or expense.”  The ADA statute lists the factors to consider when determining if an action is readily achievable.  These factors include the cost, and your financial resources.

For communities built prior to 1991, if leasing offices and models can be made handicapped accessible for minimal cost, why take a chance?  You should make them handicapped accessible, regardless of when your community was built. If built after 1991, the safest course is to make sure that your leasing office and model are ADA compliant.  If you are concerned that your property’s leasing office or model doesn’t comply, you should seek expert advice.  As lawsuits have increased, so have the number of firms and businesses that offer expert ADA compliance advice. In the final analysis, it doesn’t matter whether models are covered or not by the ADA.  The reality is that disabled residents can and will sue if they believe you are violating the ADA or the FHA.  An expert opinion that you are in compliance might head off a lawsuit.

Finally, if you’re in compliance, don’t take action that might cause you to be out of compliance.  For example, Restive Ranch was built after the ADA was adopted.  Currently, both Restive Ranch’s leasing office and model are handicapped accessible in compliance with ADA requirements.  Restive Ranch is undergoing renovations, and wants to move or add a model apartment.  The new model will be on the third floor and is not handicapped accessible.  Restive Ranch has gone from zero potential liability to being found potentially liable for violating the ADA.  The outcome of the issue will depend largely on whether a court determines that the third floor model is a “sales office”.  Restive Ranch will find out the answer to this question when the judge tells them.  Cost to not have a model on the third floor $0.00.  Minimum cost to defend an ADA lawsuit alleging that the third floor model should be handicapped accessible, $25,000.00.

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