Abstract

In July 2013 the U.S. Department of Housing and Urban Development (HUD) issued a draft rule in order to improve implementation of the 1968 Fair Housing Act’s mandate to address segregated housing patterns. HUD’s 2013 proposed rule replaces its 1995 regulation under Section 3608(e) of the Fair Housing Act, which requires HUD and its grantees to act "affirmatively to further fair housing" (AFFH). This obligation has been in place for over forty-five years and it extends to other federal agencies that administer housing programs. Yet segregated communities persist in cities all across America, leaving large segments of FHA protected classes in high-poverty, low-opportunity neighborhoods.

Under HUD’s 2013 AFFH rule, HUD will provide each jurisdiction with national data on racial segregation, poverty concentration, and access to community assets such as education, transportation, and jobs. The expectation is that HUD grantees (states, local governments and public housing agencies) will use this data in their assessment of fair housing—a new planning process also required under the 2013 rule. Depending on how it is implemented, the 2013 rule stands to improve regional fair housing planning, clarify state and local AFFH obligations and provide for closer HUD oversight of fair housing planning.

However, HUD’s 2013 proposed AFFH rule, as initially written, may not be able to integrate America’s cities on its own. The 2013 rule fails to require segregated jurisdictions to set integration benchmarks that are necessary to hold jurisdictions accountable. Additionally, the 2013 rule may not influence planning under the Low-Income Housing Tax Credit program, which is responsible for developing more affordable housing than all of HUD’s programs combined. The Treasury Department administers the Low-Income Housing Tax Credit program yet it has neglected to promulgate rules to meet its own AFFH obligation. This stands to prevent HUD’s 2013 rule from creating diverse, inclusive communities of opportunity.

This article begins by explaining the history of the AFFH mandate, including its adoption as part of the Fair Housing Act of 1968 and cases interpreting the mandate. Next, this article discusses HUD’s 1995 AFFH rule, compliance reviews and actions brought pursuant to the 1995 rule, and HUD’s 2013 rule that alters how HUD program participants carryout their AFFH obligation. Next, this article analyzes and critiques HUD’s 2013 rule, focusing on how it fails to hold cities accountable for ineffective integration efforts and how it may not prevent new residential racial segregation created by the Low-Income Housing Tax Credit program. This article concludes with suggestions, for HUD’s 2013 proposed rule and other federal actors, which would improve efforts to integrate America’s segregated cities and provide opportunities for marginalized members of FHA protected classes. To this end, the Treasury Department should use the framework set out in HUD’s 2013 AFFH rule in the Treasury’s administration of the Low-Income Housing Tax Credit program.

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