Trump administration sued after it changes rules about housing segregation

"HUD's reasoning for removing it does not hold water.”

WASHINGTON, DC - APRIL 18:  HUD Secretary Ben Carson testifies before the Transportation, Housing and Urban Development, and Related Agencies Subcommittee on Capitol Hill April 18, 2018 in Washington, DC. The committee heard testimony on proposed budget estimates and justification for FY2019 for the Housing and Urban Development Department.  (Photo by Win McNamee/Getty Images)
WASHINGTON, DC - APRIL 18: HUD Secretary Ben Carson testifies before the Transportation, Housing and Urban Development, and Related Agencies Subcommittee on Capitol Hill April 18, 2018 in Washington, DC. The committee heard testimony on proposed budget estimates and justification for FY2019 for the Housing and Urban Development Department. (Photo by Win McNamee/Getty Images)

Housing advocates are suing the Trump administration over its decision to delay an Obama-era rule intended to combat housing segregation. The rule would force cities to abide by the 1968 Fair Housing Act by forcing them to submit a comprehensive plan to combat segregation in their own neighborhoods in order to receive federal funds.

The Department of Housing and Urban Development, under Secretary Ben Carson, decided to suspend the rule in January, giving no notice or comment period as required by law. Its reasoning for doing so was inadequate, a coalition of fair housing advocates claim in a lawsuit filed at U.S. District Court in Washington D.C. on Tuesday. And by suspending the rule, the lawsuit asserts, HUD is not taking care of its legal obligation to take meaningful steps to address housing segregation.

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By suspending the rule, HUD would allow cities and towns seeking federal funds to ignore segregation in their neighborhoods, and those cities and towns would not be forced to take any steps to reduce segregation without proper oversight by HUD.

“Segregation within our country is so deeply embedded and has been for decades. We need a systematic and meaningful assessment to address it and move forward,” said Megan Haberle, deputy director of the Poverty & Race Research Action Council. “We think the rule has been very effective, which is why HUD’s reasoning for removing it does not hold water.”

The Fair Housing Act of 1968 intended to address racial segregation and housing discrimination, and it was a key victory in the civil rights movement. It has been poorly enforced since its passage, and Secretary Ben Carson has characterized the Fair Housing Act and other government initiatives to desegregate neighborhoods, including the Obama-era rule, as a failed “social experiment.”

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In 2010, the Government Accountability Office found that many communities failed to make even a minimal effort to comply with reporting requirements, and HUD’s enforcement failures were exposed in a False Claims Act case against Westchester County, New York around that same time. The county was found lying to HUD, claiming it had been complying with the Fair Housing Act. In reality, it had been concentrating affordable housing to a small number of cities with high minority populations, while distributing community block grant funds to overwhelming white neighborhoods that refused affordable housing development. HUD had been neglecting to check whether that reported data was correct, providing no oversight.

The Obama administration passed the Affirmatively Furthering Fair Housing (AFFH) rule in 2015, that allowed HUD to force communities to provide accurate data or concrete steps to address segregation, and created more clear, structured, and robust guidance for communities to create their analysis.

The rule has been rolled out on a staggered basis since October 2016, with a number of communities seeking grants having completed the new analysis, including New Orleans and the Philadelphia Housing Authority. A number of communities had its analysis due in April but due to HUD’s suspension of the rule, those cities will not be required to complete them until sometime between 2020 and 2024.

“Although HUD is couching this as a somewhat short-term suspension, most communities will not have to do anything until 2024,” said Sasha Samberg-Champion, an attorney with Relman, Dane and Colfax, one of the firms involved in the lawsuit.

HUD spokesperson Brian Sullivan in January said the agency delayed the rule because people who responded to a public comment period indicated it was “excessively burdensome or unclear” and the Assessment of Fair Housing tool for local governments “wasn’t working well.” He claimed more than a third of the early submitters failed to produce an acceptable assessment and the extension of the deadline will allow HUD to invest resources towards improving the tool.

That comment period Sullivan referred to was part of a broader public comment period that allowed people to weigh-in on any regulation they wanted — it was not focused on the AFFH rule, according to Samberg-Champion. Instead, HUD changed the rule without holding a public comment period and responding to concerns about AFFH, in violation of the Administrative Procedure Act.

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“That is something that is not going to stand up in court,” Samberg-Champion said. “This is just another way in which this action is totally lawless and will not stand up to judicial scrutiny.”

Also, since the Fair Housing Act forces HUD to distribute federal dollars to communities that are taking steps to solve racial segregation, taking away a mechanism that is designed to solve the agency’s proven inability to do just that is against the law, the lawsuit alleges.

The lawsuit also claims HUD did not give sound reasons for delaying the rule. The errors by the first wave of submitters outlined by HUD as a reason for the delay, were expected by the agency when they first created the rule, Samberg-Champion said. It was not unexpected that the agency would have to provide additional resources to implement it and that there would be a learning curve.

“It is certainly not a reason to suspend the rule,” he said.