Fair housing has played a critical role in addressing racial inequalities and moving forward as a nation. Despite previous failures, we are currently in a historical moment where it is possible to realize our national value of equal opportunity by affirmatively furthering fair housing.

1. The Need for Fair Housing

Congress passed the Fair Housing Act (“the Act”) in response to the grave harms of discrimination, segregation, and concentrated poverty, providing the legislative scaffolding to prevent and redress them for individual families and the nation as a whole. The Act was signed into law in 1968, during a historical moment when the nation and its government were beginning to come to grips with the gravity of segregation and concentrated poverty. A 1966 White House conference warned that “slums and ghettos have grown larger, overcrowding has intensified, and the alienation of the ghetto dweller has become a national crisis.”1 The Kerner Commission, a presidential task force created in response to riots throughout the country, advised taking decisive action toward federal civil rights protections, providing affordable housing outside of segregated and impoverished areas, and expanding decent housing for low- and moderate-income families, in order to “end the destruction and the violence, not only in the streets of the ghetto but in the lives of the people.”2 In April 1968, the same month that Dr. Martin Luther King Jr. was assassinated, Congress passed the Act and President Lyndon B. Johnson signed it.3

The purpose of the Act is to create a policy of “fair housing throughout the United States.”4 The Act does so by prohibiting discrimination in the sale or rental of housing.5 It also goes further. The Act requires that HUD, as well as other federal departments and agencies, administer all of their programs and activities “in a manner affirmatively to further the policies of [the Act].”Thus, not only is discrimination illegal, but the federal government has an affirmative obligation to create “open, integrated residential housing patterns” and to combat segregation;7 act regionally where necessary;8 and ensure that recipients of federal funds comply with these policies.9 The comprehensive reach of the Act, through the affirmative obligation that it places on HUD and recipients of federal funds, is the result of a national understanding that the problem of segregation and concentrated poverty is a pervasive one. The problem’s consequences go well beyond housing and negatively impact communities’ access to jobs, schools, transportation, health, and sustainability.10 Ultimately, Congress concluded, these trends hold us back as a nation, hampering economic prosperity and the principle of equal opportunity. Congress not only understood this reality, but sought to eliminate housing discrimination in all its forms, and to enable people of all backgrounds to live in communities of their choice.

2. How We Benefit from Fair Housing

Giving all families the choice to live in inclusive, high-opportunity neighborhoods can improve the lives of families, and particularly their children, by giving them access to high quality schools, youth programs, health services, more positive peer-group influences, reduced violence, and—due to reduced stress and greater employment— supporting more effective parenting.11 Research shows, for example, that lower-income students attending middle- class schools perform higher than middle-class students in low-income schools, and students of all racial groups perform better academically when they are attending racially integrated schools.12

Affirmatively furthering fair housing expands access to job opportunities that would not otherwise be available.13 It can also reduce families’ proximity to hazardous and radioactive materials, childhood asthma, lead and pesticide poisoning, and poor air quality and other health risks.14 Expanding housing opportunity can improve families’ mental wellbeing by giving them access to neighborhoods with lower crime rates, more park space, safer pedestrian routes, and more and healthier grocery stores.15

Affirmatively furthering fair housing affects not only families, but also benefits entire communities, and the nation as a whole. For example, research shows that residents who live in more diverse neighborhoods express less prejudice based on race and ethnicity; that students who attended more integrated schools are more culturally sensitive, adapt more easily to diverse work environments, and are less likely to use racial stereotypes; and that living in integrated communities allows people of all backgrounds to broaden their social networks and creates significant opportunities for interaction among different races and ethnicities.16 Furthermore, as the congressionally- appointed Bipartisan Millennial Housing Commission confirmed in 2002, expanding housing opportunities “supports overall economic growth.”17 Affirmatively furthering fair housing has numerous societal and economic benefits critical for the nation and our communities.

3. How We Failed

Where implemented, affirmatively furthering fair housing has yielded positive results, as will be shown in Section II of this report (“How We’ve Affirmatively Furthered Fair Housing”). However, the “affirmatively further” provision of the Act has never been fully or consistently implemented or enforced, with the result that HUD has thus far failed to achieve the provision’s critical legislative objectives. HUD regulations require a state that receives federal funds to “certify to the satisfaction of HUD that it will affirmatively further fair housing” by (1) conducting an analysis of impediments to fair housing; (2) taking action to overcome the impediments identified in the analysis; (3) documenting the analysis and action; and (4) ensuring that local governments comply with the state’s certification to affirmatively further fair housing.18 Similarly, a local government receiving federal funds must certify that it will analyze impediments to fair housing, take action to overcome those impediments, and document the analysis and action that it takes.19

"Our nation is moving toward two societies, one black, one white – separate and unequal."

- Kerner Commission

The current structure falls short of realizing the Act’s affirmative obligation. Regulations fail to provide specific guidance on what is minimally necessary for a recipient of federal funds to affirmatively further fair housing.20 The regulations do not require recipients to submit their analyses of impediments (AI) to HUD, nor must HUD approve their adequacy.21 With HUD passive in the matter, the effectiveness of an AI is often completely dependent on the degree to which a local government is dedicated to combating segregation, poverty, and inequality. Furthermore, localities have not been uniform in analyzing housing patterns and impediments related to race and other characteristics protected by the Act.22 As a result, there is a wide disparity between what many recipients of federal funds are required by law to do and what they actually do in the context of a lack of sufficient standards and scrutiny.23 The current regulations also apply the requirement to affirmatively further fair housing to a jurisdiction as a whole, as opposed to applying the requirement to each federally funded project within the jurisdiction, and they also fail to coordinate HUD’s fair housing enforcement with other equal opportunity enforcement.24 This leads to a scenario in which HUD fails to challenge an AI when the submitting locality has identified and proposed action on discrimination while its federally subsidized housing policies perpetuate segregation and concentrated poverty.25 Thus, a locality can evade HUD scrutiny despite its unlawful failure to affirmatively further fair housing.

As two experts have noted:

[A] variety of factors has impeded residential racial integration over time. One of the most important contributing factors on a structural level has been that, for the past four decades, most municipal recipients of federal housing funds—abetted by successive HUD administrations of both political parties—simply ignored their obligations to affirmatively further fair housing without sanction. That federal collaboration subverted Congress’ intent that recipients would lose those funds if they did not comply with those obligations.26

For example, the National Fair Housing Alliance discovered in 2008 that less than ten percent of jurisdictions that received federal funds through the Community Development Block Grant actually addressed fair housing concerns.27 These concerns included a lack of access to housing for people with disabilities; persistent racial and ethnic segregation; a lack of communication services for people with limited English proficiency; lending discrimination targeting communities of color; discrimination against families with children; and other fair housing barriers.28

Localities, using subsidies from the Low Income Housing Tax Credit (LIHTC) program, the largest source of affordable housing in the nation, disproportionately concentrate their housing units in high-poverty neighborhoods that have high numbers of people of color.29 In 2013, the Fair Housing Justice Center surveyed 52,000 low-income rental units created by LIHTC in New York City and seven surrounding counties between 1998 and 2007.30 It found that 71 percent of the LIHTC units are in neighborhoods of high or extreme poverty and 77 percent are in neighborhoods of color.31

The patterns of racial segregation, concentrated poverty, and inequality of access to community assets that the Fair Housing Act seeks to address are not natural. Rather, they are the legacies of historical decisions and policies within the private housing market and federal, state, and local governments.32 Until the Act was passed by Congress, restrictive covenants and deed restrictions were commonly utilized by white communities to exclude people of color from housing and other opportunities.33 Discrimination was institutionalized through the real estate industry.34 Redlining, a widespread practice through which banks and lending institutions systematically refused loans to African Americans, disinvested and led to the deterioration of many African-American communities during the 1950s and 1960s.35

The government contributed to this racial divide. Beginning in 1934, the Federal Housing Administration (FHA), through its mortgage insurance programs, transformed the national housing market by making homeownership accessible to a large number of whites but excluded African Americans from assistance.36 The Veterans Administration, which administered the GI Bill loan programs, guaranteed mortgages for five million homes but excluded African Americans as well.37 Both agencies endorsed the use of racially restrictive covenants until 1950 and refused to underwrite loans that would enable people of color to move into white neighborhoods.38 FHA’s Underwriting Manual prohibited realtors from underwriting loans to “incompatible” racial groups, explaining that “if a neighborhood is to retain stability, it is necessary that properties shall continue to be occupied by the same social and racial classes.”39 Although FHA removed explicit racial rules from its manuals in the late 1940s, both agencies continued to exclude African Americans from homeownership well into the 1960s.40 By then, local governments, with HUD funds, used “slum clearance” or “urban renewal” policies to thwart integration and concentrate African Americans in public housing.41 The racial and class inequalities created by past policies are now perpetuated by the practices of states and municipalities that concentrate low-income families in low- opportunity neighborhoods and exclusionary zoning.42

In light of this history, the lack of compliance with the affirmative obligation to further fair housing is particularly egregious and destructive for the nation. Forty years after Congress passed the Act, “most  major cities across  the country remain highly racially segregated, particularly for African Americans.”43 Segregation is not only a trademark of cities, but remains a part of the national fabric. In general, African Americans, Latinos, and Asian Americans want to live in diverse, integrated neighborhoods provided that they have racial tolerance.44 Yet, according to 2010 census data, the average white resident lives in a census tract that is 79 percent white (despite the fact that whites are only 64 percent of the population), the average African-American resident lives in a tract that is 46 percent African-American (despite African Americans being only 13 percent of the population), and the average Latino resident lives in a tract that is 45 percent Latino (despite being only 16 percent of the population).45

Concentrated poverty remains as well. Overall, 27.2 percent of African Americans and 23.5 percent of Latinos live in poverty, compared to a poverty rate of 9.6 percent for whites.46 The poverty rate for children under 18 years old is 38.3 percent for African Americans and 30.4 percent for Latinos, compared to 10.7 percent for whites.47 For children under 5, the poverty rate is 43.7 percent for African Americans and 33 percent for Latinos, compared to 11 percent for whites.48

The combination of segregation and concentrated poverty, as Congress feared, contributes to the racial divide in virtually all aspects of this nation by closing off the access of communities of color to employment, education, transportation, health, and sustainability. Subsequently, the unemployment rate for African Americans is double the rate for whites and has remained so for the last 40 years.49 Inequalities in income and wealth have widened, as has the gap in educational attainment rates.50 African Americans have much less access to supermarkets and healthy food, are subject to disparate exposure to commercial hazardous waste facilities, and African-American children are five times more likely than white children to suffer from lead poisoning.51 Beyond hindering one racial group, segregation and concentrated poverty prevent critical opportunities for individuals, communities, and the nation as a whole.

4. How We Move Forward

In July 2013, HUD proposed a regulation seeking to “provide HUD program participants with more effective means to affirmatively further the purposes and policies of the Fair Housing Act.”52 The proposed rule attempts to effect this in several different ways.

First, the rule defines affirmatively furthering fair housing as:

[T]aking proactive steps beyond simply combating discrimination to foster more inclusive communities and access to community assets for all persons protected by the Fair Housing Act. More specifically, it means taking steps proactively to address significant disparities in access to community assets, to overcome segregated living patterns and support and promote integrated communities, to end racially and ethnically concentrated areas of poverty, and to foster and maintain compliance with civil rights and fair housing laws.53

The rule also replaces the inefficient analysis of impediments to fair housing with a more effective Assessment  of Fair Housing (AFH).54 An AFH, which will be developed with data that HUD provides, as well as local or regional information gained through community participation, must be performed by any state, local government, or public housing authority that receives HUD funds.55 The uniform local and regional data supplied by HUD will identify: patterns of integration and segregation; concentrated areas of poverty; access to education, employment, transportation, and environmental health; disproportionate housing needs; and representation of people with disabilities and families with children.56 Under the proposed rule, the AFH must identify determinants of segregation, concentrated poverty, and disparities in access to community assets; identify fair housing priorities and goals and justify them; and set one or more goals for addressing the determinants.57 An AFH must also be submitted to HUD, which has the authority to reject it unless 60 calendar days pass, in which case, the AFH is deemed accepted under the proposed rule.58

Furthermore, when it develops its AFH, a recipient of federal funds will have to consult with fair housing, community, and/or other organizations that represent historically excluded groups.59 A recipient must also revise its AFH if there is a “significant material change,” such as a natural disaster, major demographic shift, or a substantial policy change or civil rights violation.60 A recipient must incorporate its AFH into its consolidated plan and/or public housing agency plan and the AFH should guide how a recipient will use its resources.61 Ultimately, a recipient must stipulate how it will affirmatively further fair housing, not only with its HUD funding, but with all of its housing and community development resources.62

HUD can and should strengthen the proposed regulation, as many fair housing and civil rights groups have recommended, and its effectiveness will depend on how it is implemented and enforced. Nevertheless, the release of the proposed rule represents a critical and positive step in a long history of struggles to affirmatively further fair housing.63