HUD Secretary Demolishes an Obama-Biden Rule that Meddled in Local Zoning Decisions

AP Photo/Rod Lamkey, Jr.

Housing and Urban Development Secretary Scott Turner announced Wednesday that he had eliminated an Obama-era regulation strengthened under the inept and incompetent leadership of the improbably named Marcia Fudge. In withdrawing the rule, Secretary Turner said:

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“Local and state governments understand the needs of their communities much better than bureaucrats in Washington D.C. Terminating this rule restores trust in local communities and property owners, while protecting America’s suburbs and neighborhood integrity,” Secretary Turner said.

“By terminating the AFFH rule, localities will no longer be required to complete onerous paperwork and drain their budgets to comply with the extreme and restrictive demands made up by the federal government. This action also returns decisions on zoning, home building, transportation, and more to local leaders. As HUD returns to the original understanding and enforcement of the law without onerous compliance requirements, we can better serve rural, urban and tribal communities that need access to fair and affordable housing.

“We are aware of communities that have been neglected or negatively impacted due to the demands of recent AFFH rules. Returning to the law as written will advance market-driven development and allow American neighborhoods to flourish.”

The regulation, known as the Affirmatively Furthering Fair Housing Rule, was allegedly based on a provision of the 1968 Fair Housing Act. I say "allegedly" because that portion of the law is anodyne and aspirational, not a call for federal nannyism. It says

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All executive departments and agencies shall administer their programs and activities relating to housing and urban development (including any Federal agency having regulatory or supervisory authority over financial institutions) in a manner affirmatively to further the purposes of this subchapter and shall cooperate with the Secretary to further such purposes.

In short, federal agencies providing housing must ensure that the Fair Housing Act is followed. The hyperactive leftists in the housing bureaucracy came up with the cute name, Affirmatively Furthering Fair Housing provision, pretending it required federal action. That meaning of the law went undiscovered for 47 years until Obama's HUD secretary, the aptly named Julian Castro, discovered it in 2015.

The 2015 rules required cities and towns, in order to receive funding from HUD to document patterns of racial bias in their neighborhoods, to publicly report the results every three to five years, and to set and track goals to reduce segregation. Under the new rules, any jurisdiction that receives money from HUD must analyze its housing occupancy by race, disability, familial status, economic status, English proficiency, and other categories. It must then analyze factors which contribute to any prohibitive barriers in housing and formulate a plan to remedy the impediments.

The plan can be approved or disapproved by HUD. This is done at both the local and regional level. For example, a major city, such as Chicago, will have to analyze any racial disparities within Chicago, and Chicago suburbs will analyze their own racial disparities. In addition, Chicago and the suburbs will have to analyze any disparities as compared with each other. Thereafter, the community has to track progress (or lack thereof). The planning cycle will be repeated every five years. If the Federal government is not satisfied with a community's efforts to reduce disparities, federal funds could be withheld.

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In my view, the rule had three functions. First and foremost, it used awarding Community Development Block Grants to allow advocacy groups to control all zoning decisions. Communities knew if they went against advocacy groups, they would face loss of funds and probably a costly court battle. Second, it was a way of declaring war on established communities and neighborhoods by using their demographics as a way of forcing the construction of no- or low-income housing units. Third, it was another way that the federal bureaucracy could be weaponized to punish political opponents by using lawfare. Oh, it also provided guaranteed employment for a consultant class that could be hired to help communities navigate the rule and its interpretations.

Everyone knew that the racial bean-counting imposed upon cities, down to the neighborhood level, would inevitably trickle down and result in landlords being strong-armed to, as Strother Martin would say, get their mind right and lease to the correct kind of people.

 

An analysis by the libertarian Cato Institute showed that the language of Obama's rule had virtually no focus on housing but was obsessed with meddling in local zoning decisions and achieving racial and ethnic integration at the community level.

So, a costly and destructive rule has been sent to the scrap heap. But we can't rest on our laurels. Just as Trump took down the Obama rule, Biden replaced it. We have to create a regulatory web that will take decades to unravel to prevent this kind of nonsense from happening again and shrink government so that even if a future administration wanted to create the rule, they wouldn't be able to enforce it. Yes, it would be easier for Congress to amend the Fair Housing Act, but I stopped believing in leprechauns a long time ago. 

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