HUD’s Housing Mandate: A Shift from Federal Control to Local Authority
The Biden administration’s ambitious diversity, equity, and inclusion (DEI) agenda faced scrutiny, particularly regarding its impact on individual opportunities like hiring and college admissions. However, a less publicized initiative within the Department of Housing and Urban Development (HUD) aimed to implement DEI principles at a community-wide level, potentially reshaping planning and zoning regulations across the nation.
This initiative, built upon the Affirmatively Furthering Fair Housing (AFFH) rule, mandated that communities receiving HUD funding develop comprehensive "equity plans." These plans were intended to address historical patterns of segregation, promote fair housing choices, eliminate disparities in opportunities, and foster inclusive communities free from discrimination. The approach leaned heavily on altering local planning and zoning regulations to achieve these goals.
Now, under the leadership of HUD Secretary Scott Turner, the department is reversing course. Citing concerns about excessive red tape and a desire to restore decision-making power to state and local governments, HUD has replaced the AFFH mandate with a simpler requirement: a locality’s self-certification of compliance with existing fair housing laws.
This policy shift represents a significant change, impacting local governments nationwide. The AFFH program, initially adopted by the Obama administration, then suspended by President Trump, required any community seeking HUD funding to submit an equity plan based on responses to a detailed 92-question survey. Failure to comply could jeopardize a community’s access to vital financial assistance.
While proponents argued that AFFH aimed to ensure fair housing practices and combat discrimination, critics contended that it went far beyond this objective. They asserted that the required equity plans constituted a federal overreach into local zoning decisions, exceeding the scope of addressing overt housing discrimination.
According to the Biden HUD’s description, the AFFH mandate compelled the agency and its program participants to proactively take meaningful actions to overcome patterns of segregation, promote fair housing choice, eliminate disparities in opportunities, and foster inclusive communities free from discrimination. In practice, this meant that communities seeking federal assistance had to pledge to open their doors to "affordable" (subsidized) housing and actively work to ensure residents of such housing had access to quality schools, recreational facilities, supermarkets, and other community amenities.
Essentially, AFFH encouraged communities to both permit affordable housing and actively locate it in "high opportunity" (more affluent) neighborhoods. The underlying principle was "deconcentrating poverty," based on the assumption that dispersing low-income households would improve their overall well-being.
The AFFH rule’s reach was extensive. HUD distributes Community Development Block Grant (CDBG) funds to over 1,200 "entitlement communities," including major metropolitan cities, cities with populations of 50,000 or more, and urban counties with populations of 200,000 or more (excluding entitlement city populations). These funds are crucial for supporting various local initiatives, from infrastructure improvements to health and safety programs.
To gain HUD approval for their equity plans, local governments had to consider the Biden administration HUD’s broader "equity action plan." This plan encompassed a wide range of goals, including environmental justice, climate resilience, and improved services for LGBTQIA+ youth experiencing homelessness and housing instability.
In demonstrating their commitment to affirmatively preventing housing discrimination, communities were required to develop extensive plans, often running hundreds of pages. These plans not only had to showcase their ability to prevent individual cases of housing discrimination but also identify "barriers to fair housing," which could include school district boundaries or local zoning regulations.
HUD denial letters to local governments that failed to meet AFFH standards shed light on the program’s demands. For example, one Georgia county seeking affordable housing to improve job opportunities for low-income residents was deemed insufficient by HUD, which argued that the county’s plan lacked clarity on how it would address segregation and racial/ethnic concentrations of poverty, or on the location of proficient schools.
The concept of adding affordable housing, particularly through denser, privately built housing, is not inherently problematic. Many communities, especially those with restrictive zoning regulations, face challenges in providing housing for their own workforce and younger generations. Implementing modest changes in zoning, such as allowing for "light-touch density," can help address these issues.
However, the AFFH rule often focused on subsidized, low-income housing, which can be expensive to construct. In California, for instance, a single tax-credit-funded affordable unit can cost upwards of $700,000 to build.
Furthermore, critics argue that the AFFH program rests on flawed assumptions. They suggest that "high opportunity neighborhoods" are not simply bastions of privilege and discrimination but are the result of the commitment and civic engagement of their residents. They believe that factors such as marriage, work ethic, and savings habits contribute significantly to the success of families and communities.
Simply relocating low-income households to more affluent areas, they contend, bypasses this natural process and offers no guarantee of long-term success. They argue that a HUD directive to fundamentally alter the demographics and zoning regulations of communities across the country is unlikely to achieve the desired outcomes.
The recent policy shift by HUD signals a move away from federal mandates and towards empowering local governments to address housing issues in a way that best suits their specific needs and circumstances. While the long-term effects of this change remain to be seen, it represents a significant departure from the approach taken by the previous administration.
