Brian J. Connolly is an attorney at Otten Johnson Robinson Neff & Ragonetti, P.C., Denver, Colorado. He wishes to thank Professor John Nolon, Pace Law School, White Plains, New York and Heidi Aggeler, BBC Research and Consulting, Denver, Colorado for their review and insightful commentary on drafts of this article. Special thanks are also due to Alex Gano, law student at the University of Colorado Law School for his research and writing assistance.
ON JUNE 28, 2016 THE BOARD OF COUNTY COMMISSIONERS OF DOUGLAS COUNTY, COLORADO, a wealthy suburban county of approximately 325,000 residents near Denver, held a public meeting to determine whether the county should submit its annual action plan as required to receive more than $700,000 in U.S. Department of Housing and Urban Development (HUD) funds for the Community Development Block Grant (CDBG) program.1 During the hour-long meeting, county staff informed the board of the benefits of HUD programs, and the initiatives that the county accomplished as a result of the program.2 Despite these benefits, at the end of the meeting, the board voted to decline CDBG funding for the 2016 fiscal year.3
Viewed in a vacuum, the Board of County Commissioners’ decision to reject such a substantial amount of money for community development projects, including rental assistance, capital improvements for community crisis centers, and even infrastructure projects, is striking.4 Similarly striking is the fact that several members of the community attended the board meeting to oppose the county’s receipt of federal funds.5 Yet the board’s decision, and the community opposition that precipitated that decision, did not occur in such a vacuum.
Almost a year prior to the Douglas County board’s decision on July 8, 2015, HUD Secretary Julian Castro promulgated what is now known as the final Affirmatively Furthering Fair Housing rule.6 The Fair Housing Act of 1968 (FHA) requires the Secretary of HUD to affirmatively further fair housing, yet the FHA does not define this concept.7 The AFFH Rule, which attempts just such a definition,8 places new requirements on thousands of state and local governments that receive HUD dollars. Central to the AFFH Rule’s goals, recipients are required to study barriers to fair housing and analyze segregation patterns within their particular communities and regions, which includes inquiries into whether local regulatory practices —particularly planning and zoning — serve as barriers to fair and affordable housing. The final AFFH Rule followed just two weeks after the United States Supreme Court upheld the use of disparate impact analysis reviewing discriminatory effects of facially neutral policies, including zoning and planning policies, under the FHA.9 The combination of the Supreme Court’s decision in Texas Department of Housing and Community Affairs v. Inclusive Communities Project and the AFFH Rule portended a veritable sea change in local governments’ fair housing obligations vis-a`-vis their planning and zoning authority.
The AFFH Rule’s promulgation fanned the flames of controversy over the degree to which a federal administrative agency can and should, through funding programs, scrutinize local government planning and zoning decisions to root out disparate impacts. Even after the issuance of the Notice of Proposed Rulemaking on the AFFH Rule, conservative politicians and media outlets slammed HUD for attempting a “power grab” over local planning and zoning.10 A September 2013 commentary in the Wall Street Journal stated, “if HUD can define what constitutes exclusionary practices, then local zoning as it is known today disappears. Apartments, high rises or whatever else the federal government or a developer wants can be built on any block in America.”11 The National Review decried the AFFH Rule as an effort by the Obama Administration “to punish, control, and fundamentally transform communities that, in its estimation, are too white or too affluent.”12 Prior to the final AFFH Rule’s promulgation, Republicans in Congress introduced legislation to prevent the its implementation.13 In local communities around the country, citizens took matters into their own hands by petitioning their local elected officials to decline HUD funds in the name of protecting local autonomy.14 Some communities, such as Douglas County, Colorado, voted to reject further participation in HUD funding programs.15
While the reaction to the AFFH Rule was caustic in some circles, other media outlets, writers, and communities embraced it. Politically liberal media outlets celebrated its aims, lauding its potential to finally break persistent patterns of racial segregation in American cities and suburbs.16 Particularly in communities that bear disproportionate burdens of providing housing to low-income, minority populations with higher social service needs, the AFFH Rule was welcomed as an opportunity to spread such costs among greater metropolitan regions; other communities embraced the assistance that the AFFH Rule provides to local governments.17
This article reviews the AFFH Rule and its implications for local planning and zoning. Part I of the article examines historical and cur- rent segregation in the United States, and briefly describes federal efforts to assist local governments in rectifying housing challenges. Part II explores the background of the FHA, its application to local planning and zoning, disparate impact theory, and HUD’s role in administering and enforcing the FHA. Part III discusses the AFFH Rule, describing the its roots in litigation involving Westchester County, New York’s affordable housing program and a 2010 Government Accountability Office (GAO) report that exposed problems in HUD’s administration of funding programs. Part IV of the article then inquires into the AFFH Rule’s legal and practical effects on local planning and zoning, and challenges the prospective impact of the AFFH Rule in addressing persistent housing segregation.
While this article does not dispute the AFFH Rule’s meritorious goals, it takes a critical perspective in pushing HUD and local governments to consider whether the means chosen to implement the goals of the FHA will have their intended effect, or will instead result in a perpetuation of past failures to break cycles of discrimination and segregation. The article asserts that, despite the laudatory goals of the AFFH Rule, it conveys several significant legal and practical disincentives upon local governments that may discourage future participation in HUD funding programs. Specifically, this article finds that the AFFH Rule places onerous practical and legal obligations on HUD funding recipients, even as HUD funding streams to localities have been in decline for several years. The article additionally questions whether the AFFH Rule, by demanding more inclusive planning and zoning policies, will actually achieve any discernable level of desegregation in light of the FHA’s prohibitions on profiling and quotas. In light of these limitations of the AFFH Rule, this article concludes that, to the extent local governments elect to opt-out of HUD funding programs, the federal government will, as the AFFH Rule is implemented, find itself in an even less favorable position to encourage and enforce FHA compliance and truly affirmatively further fair housing.
I. Discrimination, Segregation, and Government Housing Programs
Segregation — particularly racial and ethnic — in American cities and metropolitan areas has been well-documented in social science literature.18 However, no discussion of the law of fair housing can be complete without a brief synopsis of the underlying problems of housing discrimination and segregation. This Part provides historical background and an overview of current patterns of segregation in the United States, and concludes with an overview of some of the federal government housing programs that have attempted to rectify fair and affordable housing concerns.
A. Past and Current Patterns of Housing Discrimination and Segregation
U.S. residential segregation patterns are rooted in the beginning of the last century. In 1900, 90% of the black population still lived in mostly rural areas of former Confederate states.19 Cities were still predominantly white, but those African Americans who lived in urban areas before the turn of the twentieth century were residentially well-integrated.20 Over the next two generations, however, some six million African Americans left the South, first in trickles and later in waves.21 In the burgeoning industrial centers of the Northeast, Midwest, and later, West Coast, these migrants sought greater economic opportunity and improved social standing relative to the South.22 By the end of the Great Migration in 1970, only half of African Americans in the United States still lived in the South, and nationally, 80% lived in urban areas.23
During this period of intense urbanization, several discriminatory actions by private parties, in some cases aided by government action, had the effect of quarantining African American migrants in overcrowded and underserved urban enclaves that later became the ghettos of urban America.24 As a country, we are still grappling with the long-term effects of the racial bifurcation of our social geography.25 From the beginning of the twentieth century until the passage of the FHA, many discriminatory acts by private parties were lawful and the federal government actively aided local governments and the real estate industry in achieving segregationist goals.26 However, even since 1968, residential homogeneity has been propped up by municipal planners, housing authorities, and private developers.27
Throughout the Great Migration and in all regions of the country, landlords refused to rent to black families in all but a few neighborhoods with the lowest-quality housing stock.28 Real estate agents either refused outright to deal with prospective black homebuyers or steered them away from properties in white neighborhoods.29 Banks refused to make traditional mortgages on properties in black neighborhoods,30 and aspirational black homeowners were forced into non-amortized contract sales that frequently contained total forfeiture upon default provisions.31 Real estate developers protected racial boundaries by “blockbusting”32 urban neighborhoods and burdening newly constructed residences with racially-restrictive covenants.33 And by most historical accounts, they made handsome profits in the process.34
During this era, all levels of government were complicit in perpetuating segregation. “The role of federal and state government in creating and maintaining racial segregation must be understood, without excuse, as a reality of American history.”35 From 1934 to 1968, the Federal Housing Administration underwrote more than half of all U.S. home loans using criteria that institutionalized racial discrimination in the mortgage lending industry.36 During this era of unprecedented economic growth, the overall homeownership rate in the United States increased by 15% while the homeownership rate for African Americans barely budged.37 Instead of providing subsidized loans to African American borrowers — less than 2% of all FHA loans were made to non-white borrowers38 — the federal government funded the construction of subsidized rental housing projects in black communities.39 Thus, for more than thirty years, the federal government encouraged white families to own their homes while keeping black families in rental housing. The effects of this bifurcated housing system are still reflected in the white-black household wealth gap.40 The federal government, in conjunction with state and municipal governments, also funded transportation infrastructure projects — highways, local roads, and railroads — that have imposed durable physical boundaries between white and minority neighborhoods.41 These highways ensured that wealthier (i.e., white) households that could afford cars could escape cities to housing in the suburbs. The Housing Act of 1949 contained an urban redevelopment initiative that funded urban “slum clearance” efforts that critics claim destroyed as many as 2,000 predominantly black neighborhoods and displaced more than 300,000 families.42
Furthermore, facially discriminatory policies by local governments were rampant until the passage of the FHA in 1968. Until 1917, many towns and cities in the South had ordinances that prohibited blacks from living in white areas and whites from living black ones.43 Even after the Supreme Court invalidated such ordinances, many small towns throughout the Midwest and West continued to enforce “sundown ordinances” that expressly forbade African-Americans from residing within their municipal limits.44 Despite the Supreme Court’s holding in Buchanan, rapidly urbanizing Southern cities maintained racial designations for residential areas into the 1950’s.45 In urban and particularly suburban communities throughout the country during this period, developers imposed racially-restrictive covenants on newly developed residential property.46 Until 1948, most state courts enforced these covenants.47
By the time Congress passed and President Johnson signed the Fair Housing Act in 1968, the damage had been done. U.S. cities and towns were segregated, and fulfilling the Act’s policy goals48 would be frustrated by less invidious but no less effective local land use controls.49 Local politicians, with the aid of urban planners, perpetuated and even exacerbated residential segregation through a myriad of exclusionary zoning policies.50
Before describing these policies, it is important to note that local land use decisions are influenced by many factors. While we can assume that public health, safety, and welfare concerns drive land use decision-making to a point, it would be na¨ıve to ignore occasion- ally-invidious social objectives. Also, the inextricable link between economics and race further complicates the planner’s calculus. Municipalities, acting as rational decision-makers, want to attract citizens who will pay lots of taxes and not burden public services.51 And none of the policies described in this Article should be understood in a vacuum. Since the enactment of the FHA, the federal government, through HUD, has in many ways perpetuated racial segregation through siting of public housing projects and administration of the Section Eight voucher program.52
A central premise of planning from its beginning through the modern era has been a good-faith desire on the part of planners to pursue legitimate objectives in the context of persistent racial segregation.53 The earliest efforts by planners to promulgate housing codes, building restrictions, and remove alley dwellings disproportionately affected black neighborhoods.54 As cities grew, multifamily zone districts were often used as buffers to separate single-family districts — mostly white — and unwanted land uses.55 Cities continue in their patterns of siting new public housing projects in overwhelmingly minority neighborhoods, which fair housing advocates have long-claimed perpetuates racial segregation and which is a direct target of the AFFH Rule described in the balance of this Article.56
While large, established cities pursued policies that effectively isolated the minority communities, growing suburban communities during the twentieth century enacted land use laws that effectively excluded them.57 “By manipulating restrictions on matters such as lot size, lot width, building size, or the number of bedrooms in multiple-family units . . . a municipality can make housing within its borders too expensive for low- and moderate-income groups,”58 and many municipalities, particularly suburban ones, have pursued such exclusionary zoning policies.59 Political and community resistance to the designation of multifamily zone districts has been a hallmark of the suburban planning experience.60
The effect of exclusionary planning and zoning policies plays out in demographic data. Since 1990, there has been an overall decline in segregation levels in the nation’s largest cities,61 but this change has occurred in tandem with white depopulation of urban areas.62 Despite the popular narrative that young whites are flooding back into city centers, the overwhelming statistical trend still points to whites continually, and even increasingly, concentrating in an all-white suburban fringe while racial minorities concentrate in city centers.63 Data from the last three decennial censuses reveals that “the locus of racial differentiation within metropolitan areas resides increasingly at higher scales of geography . . . rather than in neighborhood-to-neighborhood differences.”64 In essence, patterns of residential segregation in the twenty-first century encompass a much larger metropolitan area than they did in the middle of the last century.
Furthermore, while this Part has focused closely on racial and ethnic segregation, housing discrimination and segregation exist with respect to other classes of individuals as well. In particular, people with disabilities have experienced housing discrimination and segregation that rivals or even exceeds discrimination on the basis of race.65 From the late nineteenth century to the mid-twentieth century, people with disabilities were frequently institutionalized and were subject to significant levels of inhumane treatment.66 Only in more recent decades have people with disabilities been afforded independent living arrangements and small-scale congregate living facilities, both of which are more integrated into communities.67 Despite efforts to assimilate people with disabilities into residential neighborhoods, significant neighborhood opposition to group homes, and local planning and zoning policies that facially or effectively prohibit congregate living arrangements or necessitate automobile travel frequently results in shortages of housing opportunities for people with disabilities.68
B. Federal Government Funding Programs Relating to Housing
While the past and current picture of housing segregation along with the federal government’s complicity therein is grim, the federal government has also been the most significant source of grant funds for housing development and maintenance. These grant funds have disproportionately benefited lower-income buyers and renters in obtaining and maintaining access to housing. Below, several HUD funding programs are reviewed in brief.
The largest HUD grant program, in terms of funding levels and impact to local governments, is the Community Development Block Grant (CDBG) program. The CDBG program is authorized by the Housing and Community Development Act of 1974 (HCDA).69 The HCDA’s sweeping community development goals included blight reduction and encouraging development of housing for persons of low and moderate incomes.70 The CDBG program makes funds avail- able to states and local governments for activities such as property acquisition for redevelopment, development of public improvements, code enforcement activities, demolition and rehabilitation of buildings and improvements, projects to improve accessibility for people with disabilities and the elderly, housing development, community planning efforts, and assistance to non-profit housing organizations.71 CDBG program funds are allocated based on a formula basis that is discussed in more detail in Part IV of this Article.72
Other HUD funding programs are available to local governments as well. The HOME Investment Partnership program, authorized by the Cranston Gonzalez National Affordable Housing Act of 1990,73 provides funding to local governments for housing rehabilitation, homebuyer assistance, construction or rehabilitation of rental housing, and tenant assistance.74 HUD’s Emergency Solutions Grant program, authorized by the McKinney-Vento Homeless Assistance Act,75 provides funding to states and local governments to assist homeless children in attending schools, and to provide activities and services for homeless children.76 Finally, HUD’s Housing Opportunities for Persons With AIDS program, authorized by the AIDS Housing Opportunity Act,77 provides grants to states and local governments to give information and facilitate the development of shelter and services for people with AIDS.78
While these HUD funding programs provide funds directly to states and local governments to achieve fair housing goals, in the half-century since the Fair Housing Act was enacted, it has been questionably effective at countering facially-neutral land use policies that perpetuate residential segregation.79 White Flight80 since the mid-twentieth century has been intertwined with the rise of suburban municipal governments that discourage the development of affordable housing.81 As a result of unsubstantiated fears and outright discrimination, local governments are frequently responsible for blocking the entry of housing for people with disabilities into communities.82 But for these exclusionary policies, millions of low-income families could benefit from the opportunity to exit distressed areas and relocate to areas of greater economic opportunity. HUD’s AFFH Rule, discussed throughout the balance of this Article, aims to encourage urban and suburban municipalities to take a hard look at these facially-neutral land use policies.
II. The Fair Housing Act and Disparate Impact: Laying the AFFH Groundwork
To combat several of the problems addressed in the preceding Part, the FHA was enacted by Congress in 1968 during the height of the civil rights movement. The passage of the FHA followed several years of violent race riots in U.S. cities, and followed immediately upon the assassination of Dr. Martin Luther King, Jr. in Memphis, Tennessee.83 Although the legislative history of the FHA is virtually non-existent due to its quick passage through the House and the Senate,84 Congress’s broad goals in enacting the FHA are evident from the declaration of policy in Section 801 of the FHA: “It is the policy of the United States to provide, within constitutional limitations, for fair housing throughout the United States.”85
The FHA’s rushed passage was precipitated by the release of the Kerner Commission Report,86 a federal government research initiative that identified inadequate and highly-segregated housing as one of the principal causes of social unrest that led to riots in Newark and Detroit in 1967.87 Of note, the report stated:
White racism is essentially responsible for the explosive mixture which has been accumulating in our cities since the end of World War II. Among the ingredients in the mixture are: . . . The black ghettos, where segregation and poverty converge on the young to destroy opportunity and enforce failure. Crime, drug addiction, dependency on welfare, bitterness and resentment against society in general and white society in particular are the result.88
The report recommended swift and sweeping national action on housing discrimination, calling for federal housing programs to be given “a new thrust aimed at overcoming the prevailing patterns of residential segregation,” and recommending the enactment of “a comprehensive and enforceable Federal open-housing law to cover the sale or rental of all housing.”89 Remedying the deleterious effects of segregated housing and eliminating barriers to housing desegregation — all of which were identified by the Kerner Commission Report as necessary to end inner-city violence — lie at the heart of the FHA. The following subparts discuss the substantive parts of the FHA and their application to local governments.
A. Overview of the FHA’s Substantive Provisions
The original FHA prohibited discrimination against individuals based on four “protected classes”: race, color, religion, or national origin.90 The list expanded to include sex in 1974, and familial status and handicap in 1988.91 While five of the protected classes are not defined in the FHA, “familial status” is defined in reference to families with children,92 and the term “handicap” is defined as, “with respect to a person — (1) a physical or mental impairment which substantially limits one or more of such person’s major life activities, (2) a record of having such an impairment, or (3) being regarded as having such an impairment.”93 The FHA’s protections for people with disabilities have been applied in the context of people with physical disabilities, people with cognitive disabilities, individuals who have been diagnosed with AIDS or HIV, and individuals recovering from drug or alcohol abuse.94 Today, discrimination on the basis of disability is the most common form of housing discrimination; according to the National Fair Housing Alliance, in 2014, disability discrimination complaints made up over half of all discrimination complaints, while racial discrimination complaints made up approximately one-fifth of such complaints.95
The FHA applies in the sale, rental, and financing of dwellings, and in other housing-related transactions. “Dwelling” is defined broadly: “any building, structure, or portion thereof which is occupied as, or designed or intended for occupancy as, a residence by one or more families, and any vacant land which is offered for sale or lease for the construction or location thereon of any such building, structure, or portion thereof.”96 Generally speaking, the courts interpret the term “dwelling” generously, finding that even short-term living arrangements for people with disabilities, such as sober living homes for people recovering from drug addiction or group homes for people with cognitive disabilities, meet the definition of dwelling and therefore are entitled to the FHA’s protections.97
The FHA’s restrictions and obligations apply to landlords, housing providers, real estate agents, lenders, and, most importantly for purposes of this Article, states and local governments.98 Although the AFFH Rule, as discussed below in Part III, applies only to governments that receive HUD grants, the substantive obligations and prohibitions arising under the FHA apply universally to all local governments.99
Substantive FHA prohibitions include the following: “[t]o refuse to sell or rent after the making of a bona fide offer, or to refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny, a dwelling” on the basis of a protected class; “[t]o discriminate against any person in the terms, conditions, or privileges of sale or rental of a dwelling, or in the provision of services or facilities in connection therewith” on the basis of a protected class; the printing or publishing of preferences on the basis of protected classes; representations that, because of a person’s membership in a protected class, a dwelling is unavailable for sale, rental, or inspection; and inducement or attempted inducement of a person to sell or rent a dwelling on the grounds that persons of a protected class are entering a neighborhood.100 Additionally, with respect to people with disabilities, the FHA affirmatively obligates local governments to permit reasonable modifications of dwellings in the event “such modifications may be necessary to afford such person full enjoyment of the premises” and to make “reasonable accommodations in rules, policies, practices, or services, when such accommodations may be necessary to afford such person equal opportunity to use and enjoy a dwelling.”101 Zoning or other forms of local government actions that discriminate against a member of a protected class violate the prohibition on “mak[ing] unavailable or deny[ing] a dwelling,”102 and disparities in the provision of municipal services violate the prohibition on discrimination in the provision of services or facilities in connection with a dwelling.103
B. Local Government Liability Under the FHA: Disparate Treatment and Reasonable Accommodation
There are three ways in which local government policies or actions can violate the FHA: disparate treatment, disparate impact, or, in the context of persons with disabilities, a failure to reasonably accommodate.104 Disparate treatment and reasonable accommodation are discussed briefly below. The next Part discusses disparate impact.
Disparate treatment comes in two forms. The first is facial discrimination, where a law or policy “on its face applies less favorably to a protected group,”105 such as a zoning provision requiring that group homes for people with disabilities be dispersed at least 1,000 feet from one another. Facially discriminatory laws are presumptively invalid106 unless the government can demonstrate that the law in question benefits the protected class or is otherwise necessary to account for safety concerns.107 The second form of disparate treatment is discriminatory intent, which occurs when a facially-neutral zoning provision or one-time zoning action is pursued with the intention of discriminating against members of a protected class,108 such as a local government’s denial of a rezoning on the grounds that the prospective residents of the area to be rezoned will be from a particular racial group.109 If a plaintiff makes out a prima facie case of discriminatory intent against a local government, the local government must show that the underlying action or decision was supported by a legitimate, neutral public purpose without improper pretext.110 To analyze whether an action has an improper pretext, the courts rely upon a multi-factor test that examines the events leading up to the decision, the legislative history of the decision, any departures from normal procedural sequences, the historical background of the decision, and whether the decision has an actual discriminatory effect.111 In local zoning cases, this analysis often turns on local decision-makers’ comments on and responses to public opposition to unwanted land uses such as group homes or multi-family housing.112
The reasonable accommodation provisions of the FHA require the government to modify rules, policies, practices, or services that may be necessary for person with disabilities to have an equal opportunity to use and enjoy a dwelling. Three elements are required in order for a local government to be obligated to grant an accommodation: (1) the request must be reasonable;113 (2) the requested accommodation must be necessary such that “the desired accommodation will affirmatively enhance [the individual’s] quality of life by ameliorating the effects of the disability”;114 and (3) the proposed accommodation provides equal opportunity.115 An accommodation is generally reason- able where it is “efficacious and . . . proportional” to the costs of the accommodation,116 or where the accommodation does not require a “fundamental alteration in the nature” of the government policy or program from which accommodation is requested.117 A plaintiff must request a reasonable accommodation and exhaust local remedies prior to judicially challenging the local government’s failure to reasonably accommodate.
B. Resuscitating Disparate Impact
Disparate impact is the third form of local government liability under the FHA. Unlike disparate treatment, which requires either facially disparate treatment or discriminatory intent, disparate impact cases address facially-neutral laws and actions with no evidence of discriminatory intent, but which have a discriminatory effect on a protected class.118 A law having a disparate impact could include, for example, a jurisdiction-wide prohibition on multi-family housing development that in practice, due to strong correlations between race and income, prohibits minority racial groups from obtaining housing in that jurisdiction.119 As further discussed in Part III-D, the AFFH Rule’s foundation is disparate impact theory, and thus this subpart reviews disparate impact analysis in some detail.
Before 2015,120 eleven of the federal circuit courts of appeal concluded that disparate impact was cognizable under the FHA.121 But the FHA, unlike Title VII of the Civil Rights Act,122 did not contain an express prohibition on policies or actions having a disparate impact.123 Therefore, even despite the appellate courts’ unanimity on the issue, doubts remained as to whether disparate impact analysis was proper in FHA claims.124 These doubts were exacerbated by the Supreme Court’s acceptance of three petitions for certiorari in three straight Court terms, although the first two cases accepted for review were settled out of Court.125 The third time, however, was the charm. On June 28, 2015, the Supreme Court issued its opinion in Texas Department of Housing and Community Affairs v. Inclusive Communities Project, affirming disparate impact liability under the FHA.126 In Inclusive Communities, an advocacy group argued that the Texas housing agency violated the FHA by distributing Low Income Housing Tax Credits (LIHTCs) to developers in a manner that compounded segregated housing patterns.127 Specifically, the group alleged that statewide criteria for distribution of LIHTCs encouraged the development of subsidized housing in predominantly black urban areas while simultaneously discouraging development in predominantly white suburban areas, thus leading to continued racial segregation in the Dallas metropolitan area.128
Writing for the Inclusive Communities majority, Justice Kennedy was persuaded by the fact that all lower courts confronted by the issue had upheld disparate impact as a cognizable theory of liability under the FHA.129 Furthermore, according to Justice Kennedy, Congress was aware of this “unanimous precedent” in 1988 when it amended the FHA and failed to revise the language relied on by lower courts as the basis for disparate impact liability.130 According to the Court, Congress’s inaction on the question of disparate impact following its endorsement by the courts of appeal implied congressional approval of the ongoing use of disparate impact analysis.131
Finally, Justice Kennedy found that disparate impact liability was “consistent with the FHA’s central purpose”132 of eradicating discrimination, particularly noting the discriminatory effects of local zoning laws.133
While the Supreme Court’s decision was a victory for fair housing advocates, the Court limited the potential exposure of local zoning authorities in five significant ways. First, even if a plaintiff demonstrates a statistical disparity, Inclusive Communities indicates that a local government is not automatically liable under the FHA where the government provides a legitimate justification for its policy or decision.134 The Court’s opinion provides examples of legitimate concerns in the context of a zoning decision, such as cost to the government, traffic patterns, or historic preservation.135 In the course of its discussion on this topic, the Court said, “[t]he FHA does not decree a particular vision of urban development; and it does not put housing authorities and private developers in a double bind of liability, subject to suit whether they choose to rejuvenate a city core or to promote new low-income housing in suburban communities.”136 Thus, the Supreme Court was careful not to allow disparate impact analysis to frustrate or otherwise interfere with valid governmental planning and zoning policies, and the Court’s opinion advises against judicial second-guessing of local policy decisions.137
Second, Inclusive Communities reinforces the required elements of a prima facie disparate impact claim. Acknowledging potential bur- dens on housing authorities as a result of disparate impact analysis, the Court wrote that a plaintiff in a disparate impact claim must provide evidence of causality — showing not only that a statistical disparity exists, but that the defendant’s policy or policies caused the disparity.138 Justice Kennedy contended that the causality requirement would prevent housing authorities from “being held liable for racial disparities they did not create.”139 The Court recognized that establishing causation in disparate impact claims would likely be difficult for plaintiffs due to the “multiple factors that go into investment decisions about where to construct or renovate housing units.”140 Given the multitude of factors that may dictate a particular outcome from a wide variety of policy inputs, determining causation between a policy and an outcome will likely require a multivariate regression analysis and finding of strong statistical significance.141 In many localities with limited demographic data, it may be impossible to even obtain the data necessary to establish causation.
The Court’s third limitation on disparate impact claims was its reminder that one-time actions by defendants are unlikely to establish disparate impact liability.142 This limitation circumscribes potential disparate impact claims in, for example, cases involving one-time decisions regarding zoning of property,143 cases involving special use permits,144 or local governments’ decisions to condemn racially-concentrated neighborhoods.145 In the Court’s eyes, disparate impact claims will need to look more broadly at, say, whether a local government’s pattern of zoning practices create racial disparities or whether the provisions of a local government’s zoning code make it impossible for people with disabilities to live in the community.146
Fourth, Inclusive Communities established heightened pleading standards for disparate impact claims. In the Court’s words, “[a] plaintiff who fails to allege facts at the pleading stage or produce statistical evidence demonstrating a causal connection cannot make out a prima facie case of disparate impact.”147 This heightened pleading standard contradicts and limits prior interpretations of the FHA that have largely focused on the Act’s sweeping and expansive nature and the judicial access — through, for example, broad standing — that is provided by the FHA.148 By requiring a causal connection to be demonstrated at the pleading stage, the Court is apparently asking civil rights plaintiffs to conduct robust statistical analysis prior to filing a disparate impact claim, without the benefit of discovery to identify additional facts that would support such a claim.
Finally, Inclusive Communities warns the lower courts that remedial orders addressing disparate impact claims “must be consistent with the Constitution” and must avoid racial quotas and other approaches that have been invalidated under the Equal Protection Clause.149 The Court stated that such orders “should concentrate on the elimination of the offending practice,” implying a moderated role for the federal courts in resolving disparate impact claims.150
The foregoing limitations on disparate impact theory are critical to understanding disparate impact in the context of local planning and zoning following Inclusive Communities, and are potentially fruitful in analyzing the AFFH Rule. In Inclusive Communities, the five-justice majority reaffirmed disparate impact liability, but the limitations injected into the majority opinion suggest that the Court intends to impose a high bar upon disparate impact plaintiffs. The Court’s reaffirmation of the position that disparate impact should not be used to frustrate valid governmental purposes — such as, for example, the maintenance of stable residential communities, aesthetic beautification, traffic mitigation, and historic preservation — and the Court’s reestablishment of the causation requirement suggest a fairly limited role for disparate impact going forward. Moreover, local governments can presumably take comfort in the Court’s warning that claims based on one-time decisions are not likely disparate impact claims, as such claims must focus on more generalized policies.
D. HUD’s Authority Under the FHA
Having examined the FHA’s application to local governments, understanding the AFFH Rule requires reviewing HUD’s role in carrying out and enforcing the FHA’s sweeping provisions as part of the federal grant programs discussed in Part I-B. Section 808(e)(5) of the FHA requires the Secretary of HUD to “administer the programs and activities relating to housing and urban development in a manner affirmatively to further the policies of [the FHA].”151 The “programs and activities” described in the FHA presumably include programs such as the CDBG program, HOME Investment Partnerships, and other HUD grant programs.152 Yet the statute does not define what it means to “affirmatively . . . further the policies” of the FHA.153 But the language of Section 808(e)(5) of the FHA goes further than the obligations set forth in the other substantive portions of the FHA, and does not simply restate the government’s duties under the FHA or Equal Protection Clause.154 Whereas the FHA’s prohibition against “mak[ing] unavailable or deny [ing] a dwelling” on the basis of a protected class simply bar discriminatory policies and actions, the courts that have reviewed Section 808(e)(5) agree that the “affirmatively to further” requirement imposes a greater, more active obligation on government to take steps to ensure the existence of fair housing.155
Importantly, the “affirmatively furthering” language is not found solely in the FHA. For example, the HCDA also requires federal grantees to certify to the Secretary of HUD that “the grant will be conducted administered in conformity with the Civil Rights Act of 1964 and the Fair Housing Act, and the grantee will affirmatively further fair housing.”156 The same certification requirement is found in the Cranston-Gonzalez National Affordable Housing Act of 1990.157 But the lack of clarity in the “affirmatively furthering” requirements of the FHA and other federal housing laws leads us to today’s AFFH Rule. With this background on the FHA and HUD’s role under the FHA, we now turn to the AFFH Rule.
III. Affirmatively Furthering Fair Housing: The Rule and Its Background
The affirmatively furthering provisions of the FHA have not been amended since 1968. Thus, that requirement existed long before HUD issued its Notice of Proposed Rulemaking for the AFFH Rule in July 2013.158 So why did HUD issue the AFFH Rule more than forty-five years after the affirmatively furthering obligation first arose? The answer lies in large part in litigation that began in 2006 in Westchester County, New York. This Part discusses the events sur- rounding the Westchester litigation and then proceeds to discuss the substance of the new AFFH Rule.
A. Westchester County’s Affirmatively Furthering Fair Housing Problem
Westchester County is a suburban area located immediately north of New York City, bounded on the west by the Hudson River and on the east by the state of Connecticut.159 The county has forty-five constituent municipalities within approximately 450 square miles, and had approximately 950,000 residents as of the 2010 U.S. Census.160 The county contains several wealthy suburbs, and as of 2010, twenty-four of the forty-five municipalities contained racial concentrations of less than 3% black or African-American population and less than 7% Hispanic or Latino population.161
Over the six-year period from 2000 to 2006, Westchester County received over $50 million in federal funds, including funds it received as a qualifying urban county162 under the CDBG program.163 The county government received and distributed program funds on behalf of thirty-six of the forty-five municipal jurisdictions in the county.164
At the time of Westchester County’s receipt of HUD funds, HUD regulations required the county to prepare a report containing “an analysis to identify impediments to fair housing choice within the area, take appropriate actions to overcome the effects of any impediments identified through that analysis, and maintain records reflecting the analysis and actions in this regard.”165 The report was commonly referred to as an “analysis of impediments” (AI). During the six-year period in question, the county prepared two AIs in connection with the consolidated plans it submitted to HUD describing its strategies to carry out community planning and development programs as well as housing programs.166 In addition, as required under the HUD regulations, Westchester County certified annually to HUD that it was affirmatively furthering fair housing.167 Westchester County’s certification was the beginning of its legal problems.
On April 12, 2006, a non-profit group called the Anti-Discrimination Center of Metro New York, Inc. (ADC) filed a civil action under the qui tam provisions of the False Claims Act,168 claiming that Westchester County had falsely certified to the federal government that it complied with the requirement to affirmatively further fair housing in order to receive federal funds.169 The litigation focused on the AIs prepared by Westchester County, namely, whether the county had conducted an appropriately detailed analysis of patterns of racial segregation and discrimination as part of its HUD grant application process.170 Throughout the litigation, the county contended that it had complied with its fair housing obligation by analyzing impediments to fair housing and concluding that housing affordability was the greatest such impediment.171 Based on this analysis, Westchester County’s AIs provided data regarding the lack of affordable housing in the county and described actions the county would take to increase the supply of and improve access to affordable housing.172 The county did not identify race discrimination or segregated living patterns as obstacles to fair housing.173
ADC asserted that Westchester County failed to satisfy its fair housing obligation because it had not analyzed “the existence and impact of race discrimination on housing opportunities and choice in its jurisdiction.”174 ADC claimed that Westchester County’s focus on afford- able housing alone was insufficient and, as a result, its certifications to the government in order to receive federal funds were fraudulent.175
In February 2009, on a motion for summary judgment, the district court agreed with ADC that the obligation to affirmatively further fair housing required an analysis of race-based impediments to fair housing,176 or, if such impediments did not exist, documentation of analysis concluding the same.177 According to the court, providing affordable housing for low- and moderate-income families was not, in and of itself, sufficient.178 Accordingly, the district court held that the county’s certifications that it complied with the obligation to affirmatively further housing were false because it had not analyzed fair housing issues in terms of race.179 Although the district court granted summary judgment in favor of ADC on the question of whether the county’s certifications were false, the district court did not grant summary judgment as to the question of whether the county’s false certifications were done “knowingly.”180
Following the entry of the summary judgment order, on August 10, 2009, ADC and Westchester County ultimately signed a consent decree pursuant to which Westchester County agreed to pay or allocate resources — including for the plaintiff ’s and the government’s legal fees — in a total amount of $62.5 million.181 The county additionally agreed to develop 750 units of new affordable housing over the course of a seven-year period in predominantly white communities in accordance with CDBG program requirements. The bulk of the latter requirement was required to be completed in municipalities containing populations of less than 3% black or African-American and less than 7% Hispanic or Latino, and the requirement was further delineated by census block.182 Development of the units would be funded, in part, by the amount the county agreed to pay in settlement of ADC’s claims.183 The county was further required to prepare an implementation plan, amend its land use policies, draft a model fair housing ordinance for adoption by municipalities within the county, adopt legislation prohibiting discrimination on the basis of source of income, involve members of the public in the preparation of a new AI, and affirmatively market affordable housing within the county to persons in and outside of the county.184 The county also agreed to take legal action against any of its constituent municipalities that refuse to participate or cooperate in the implementation of the consent decree.185 A federal monitor was appointed to oversee the county’s progress under the consent decree.186
Westchester County’s implementation of the consent decree since 2009 has been rocky. In an order dated January 4, 2012, the district court observed that, in the first three years following the consent decree, the county had failed to develop an implementation plan or to submit an AI that was acceptable to the monitor or HUD, respectively, despite several attempts to do so.187 Although the county’s legislature adopted legislation that prohibited discrimination on the basis of source of income, the county executive vetoed the legislation in June 2010, and in April 2013, the Second Circuit Court of Appeals found that the county was in breach of the consent decree.188 To date, the county has not completed construction of all of the required units pursuant to the consent decree.
B. The GAO Weighs In
The Westchester litigation exposed inconsistencies and obscurities in the federal government’s oversight of HUD grant programs and the affirmatively furthering requirements of the FHA. During the pendency of the Westchester litigation, Congress asked the U.S. Government Accountability Office (GAO) to investigate the extent to which recipients of HUD funds complied with the obligation to affirmatively further fair housing and the effectiveness of AIs as a planning tool.189 The GAO report was issued in September 2010, and contained striking findings regarding HUD’s and local governments’ compliance, or lack thereof, with the FHA, HCDA, and related statutes.
The GAO report reviewed 441 AIs nationally and concluded that a significant number were either out of date or not in compliance with HUD’s guidance.190 The report estimated that 29% of AIs had been prepared more than six years prior to the report, and 11% were prepared more than ten years prior to the report.191 As the report said, “[b]ecause many grantees’ AIs are outdated, they may not provide a reliable basis to identify and mitigate current impediments to fair housing that may exist within their communities.”192 The report also identified serious inconsistencies in the manner in which AIs were conducted and completed,193 including a general lack of timeframes and strategies for implementation of the AI’s recommendations.194 The GAO report attributed the observed weaknesses in AIs to HUD’s lack of oversight and enforcement.195 Specifically, the GAO report noted that HUD had no standards for updating AIs, formatting requirements, and HUD did not even review AIs as part of the grants process.196 In essence, the GAO report noted, the HCDA certification requirement was a self-certification without much additional oversight.
To address the AI weaknesses, the GAO recommended that HUD establish standards for funding recipients to follow when updating their AIs and a format that should be followed. The GAO recommended that, as a part of the prescribed format, HUD require recipients to include timeframes for implementing the recipients’ recommended actions to address fair housing impediments and require signatures of responsible officials to improve accountability.197 The GAO acknowledged HUD’s lack of resources, but recommended that to make AIs a useful tool, HUD require submittal of AIs on a routine basis to allow HUD to evaluate various threshold requirements such as timeliness of the submittal, compliance with the prescribed format, progress in achieving objectives and consistency with other reports submitted by recipients.198
C. Enter the AFFH Rule
In response to the findings of the GAO report and the Westchester litigation, on July 19, 2013 HUD issued its Notice of Proposed Rulemaking (NPRM) for the AFFH Rule.199 In summarizing the proposed AFFH Rule, the NPRM stated:
As recognized by HUD staff, program participants, civil rights advocates, the GAO, and others, the fair housing elements of current housing and community development planning are not as effective as they could be, do not incorporate leading innovations in sound planning practice, and do not sufficiently promote the effective use of limited public resources to affirmatively further fair housing.200
HUD proposed to integrate more data analysis into the AI process through a replacement “Assessment of Fair Housing” (AFH) process; “[i]mprov[e] fair housing assessment, planning, and decision-making by providing data that program participants must consider in their AFHs”; and incorporate fair housing goals into local and regional planning efforts.201
With respect to zoning practices, the NPRM was clear in its intent. According to the NPRM, through the AFH process:
Program participants will also assess whether laws, policies, or practices limit fair housing choice, as well as the role of public investments in creating, perpetuating, or alleviating the segregation patterns revealed by the assessment. Examples of such laws, policies, or practices include, but are not limited to, zoning, land use, financing, infrastructure planning, and transportation.202
The AFH process as proposed would thus require participants in HUD funding programs to analyze factors relevant to the obligation to affirmatively further fair housing, including examinations of “zoning and other land-use practices that are likely contributors to fair housing concerns, and to take appropriate actions in response.”203 It was HUD’s position, per the NPRM, that zoning and land use practices were at least in part responsible for concentrating certain racial and ethnic groups in impoverished neighborhoods without access to community services.204
The NPRM’s comment period extended through September 17, 2013 and, almost two years after issuing the NPRM, HUD issued the final rule on July 16, 2015.205 The purpose of the AFFH Rule, as articulated therein, “is to provide program participants with an effective planning approach to aid program participants in taking meaningful actions to overcome historic patterns of segregation, promote fair housing choice, and foster inclusive communities that are free from discrimination.”206 Critically, for the first time ever, the AFFH Rule assigns a definition to “affirmatively furthering fair housing” — which as noted above is undefined in the FHA — as follows:
Affirmatively furthering fair housing means taking meaningful actions, in addition to combating discrimination, that overcome patterns of segregation and foster inclusive communities free from barriers that restrict access to opportunity based on protected characteristics. Specifically, affirmatively furthering fair housing means taking meaningful actions that, taken together, address significant disparities in housing needs and in access to opportunity, replacing segregated living patterns with truly integrated and balanced living patterns, transforming racially and ethnically concentrated areas of poverty into areas of opportunity, and fostering and maintaining compliance with civil rights and fair housing laws. The duty to affirmatively further fair housing extends to all of a program participant’s activities and programs relating to housing and urban development.207
The AFH lies at the core of the new AFFH Rule. The AFH is required of recipients of HUD funding under the CDBG, Emergency Solutions Grants, HOME Investment Partnerships, and Housing Opportunities for Persons With AIDS programs, and additionally applies to any public housing authority that receives funding under the Housing Act of 1937.208 The AFH may be conducted jointly or regionally through intergovernmental collaboration.209 Unlike the AI, the AFH must be submitted to HUD for review and approval.210 HUD’s review of the AFH is to determine whether the AFH’s analysis, goals, and implementation strategies meet the requirements of the AFFH Rule and are consistent with the FHA.211 HUD’s rejection of a recipient’s AFH may result in a loss of funds.212
In conducting the AFH, grantees are required to review data, examine factors that contribute to fair housing issues in the community, and identify fair housing planning goals.213 The data that is required to be analyzed as part of the AFH is prepared and distributed by HUD through an “Assessment Tool.”214 The Assessment Tool is effectively a questionnaire that requires local governments to analyze and interpret data for their respective jurisdictions in order to gain a complete picture of fair housing issues.215 HUD is providing computer-based data and mapping resources for grantees to analyze data specific to their jurisdictions in the preparation of the AFH.216
Moreover, whereas the AI was governed by a relatively brief set of guidelines, the AFFH Rule lists specific items that grant recipients must consider in the AFH. According to the AFFH Rule:
The AFH must include a summary of fair housing issues in the jurisdiction, including any findings, lawsuits, enforcement actions, settlements, or judgments related to fair housing or other civil rights laws, an assessment of compliance with existing fair housing laws and regulations, and an assessment of the jurisdiction’s fair housing enforcement and fair housing outreach capacity.217
The data analysis required by the AFH includes a requirement to “[i]dentif[y] integration and segregation patterns and trends based on race, color, religion, sex, familial status, national origin, and disability within the jurisdiction and region,” and to conduct statistical analyses of segregation in both the local jurisdiction and region.218
Using the AFH, communities must establish fair housing goals, as well as strategies and actions to achieve those goals.219 As part of their ongoing compliance with the AFFH Rule, funding recipients need to update the AFH with “a summary of progress achieved in meeting the goals and associated metrics and milestones of the prior AFH.”220 Recipients are required to maintain records demonstrating actions taken by the recipient to affirmatively further fair housing.221 States and other local government agencies that receive funding on behalf of consortia of local governments are required to demonstrate that their constituent localities have taken steps to affirmatively further fair housing.222 There is also a significant community participation component to the AFH — not previously mandated as part of the AI process — requiring grantees to communicate information regarding the AFH to the public and to solicit public input on the AFH.223 Specifically, grantees are expected to engage with public and private organizations, including those “that provide assisted housing, health services, and social services (including those focusing on services to children, elderly persons, persons with disabilities, persons with HIV/AIDS and their families, homeless persons), community-based and regionally-based organizations that represent protected class members, and organizations that enforce fair housing laws,”224 as well as prepare a citizen participation plan that includes outreach to individuals.225
The implementation of the AFFH Rule is expected to occur on a rolling basis depending on when a grantee’s consolidated plan is due.226 The first AFH submissions will be required 270 days before the commencement of the program year that begins on January 1, 2017 or nine months after the release of the final Assessment Tool, whichever is earlier.227 Subsequent AFH submissions are required be- fore the commencement of a grantee’s three- or five-year program cycle,228 and HUD funding recipients are required to submit a new AFH at least once every five years.229
D. The AFFH Rule’s Application to Zoning and Planning
Although the AFFH final rule does not reference “zoning” anywhere within its text, it is clear from the AFFH Rule’s expansiveness that it applies in part to planning and zoning activities. HUD intends that the AFH process will identify exclusionary zoning and discriminatory land use practices and that HUD will, through its funding programs, enforce the AFFH Rule against local governments that fail to modify these practices. The AFFH Rule requires grantees to review, as part of the AFH, factors that contribute to fair housing issues in their communities.230 According to the AFFH Rule, “[f]air housing contributing factor (or contributing factor) means a factor that creates, contributes to, perpetuates, or increases the severity of one or more fair housing issues.”231 This expansive definition certainly leaves room for analyzing zoning and land use matters.
The AFFH Rule’s implied focus on zoning is made express in HUD’s responses to the more than 1,000 comments that HUD received regarding the it. Commenters implored HUD to clarify the extent to which the AFFH Rule would apply to zoning.232 HUD’s response to these comments was clear:
[I]t is a statutory condition of the receipt of HUD funding that program participants certify that they will affirmatively further fair housing. The proposed rule provided that program participants would take meaningful actions to further the goals identified in an AFH conducted in accordance with the requirements of this rule and would take no action materially inconsistent with their obligation to affirmatively further fair housing. While the duty to affirmatively further fair housing derives from the receipt of HUD funds, commenters are correct in saying that the duty applies to all of a program participant’s programs and activities related to housing and urban development.233
In response to another comment regarding the freedom of a grantee to identify what constitutes a fair housing issue, HUD responded:
Fair housing choices are not limited to transactions relating to rental or ownership of housing. Fair housing issues may arise from such factors as zoning and land use; the proposed location, design, and construction of housing; public services that may be offered in connection with housing (e.g., water, sanitation), and a host of other issues.234
Several of the comments that HUD received during the comment period focused on perceived incursions by the federal government into matters of local control, with several comments suggesting that the AFFH Rule intends federal control over local planning and zoning decisions and that HUD’s application of a uniform approach to local jurisdictions around the nation was ignorant of market forces and community circumstances.235 HUD’s response to these comments acknowledged the norm of local control of land use matters,236 yet affirmed the supremacy of federal civil rights laws, including the FHA, Title VI of the Civil Rights Act, Section 504 of the Rehabilitation Act, and the Americans With Disabilities Act, over local zoning.237 HUD’s response to these comments indicated that HUD does not perceive the AFFH Rule as imposing any additional obligations over what was previously required by fair housing and civil rights laws.238
While HUD posits that the AFFH Rule does not change any local government’s obligations under the FHA, the requirement that HUD grantees review zoning and land use policies and decisions, and that they submit their reviews to HUD for review and approval as part of the AFH, is a new concept. Under the regulations existing prior to the AFFH Rule, there was no express requirement by HUD that local governments analyze zoning and planning policies.239 Instead, the prior version of HUD regulations regarding the CDBG program stated:
Each jurisdiction is required to submit a certification that it will affirmatively further fair housing, which means that it will conduct an analysis to identify impediments to fair housing choice within the jurisdiction, take appropriate actions to overcome the effects of any impediments identified through that analysis, and maintain records reflecting the analysis and actions in this regard.240
In implementing these regulations, HUD prepared a Fair Housing Planning Guide that contained recommended AI contents.241 Although the Fair Housing Planning Guide suggested (to the extent zoning and land use policies were barriers to fair housing) including zoning considerations in the AI,242 there was no express mandate contained in the regulations or even in the Fair Housing Planning Guide to undertake any extensive analysis of zoning in light of fair housing requirements. That has now changed under the AFFH Rule.
The AFFH Rule came about as a result of HUD’s recognition that the previous regulations did not provide HUD with sufficient oversight as to the preparation of AIs or the use of HUD grant funds to affirmatively further fair housing, a requirement of the FHA. The eventual AFFH Rule defined the term “affirmatively further fair housing” and gave that previously-undefined concept teeth. Those teeth include the requirement that local governments conduct a robust AFH, including an exhaustive review of local planning and zoning’s effect on protected groups’ access to housing. The next Section enquires into whether the sweeping goals of the FHA are likely to be achieved as a result of the AFFH Rule.
IV. Affirmatively Furthering and Local Zoning: An Analysis of Limitations
The AFFH Rule reflects a sweeping move by HUD to give meaning to a provision of the FHA that, prior to the AFFH Rule, had little definition or enforcement, and in so doing, to eliminate the deleterious effects of racial and other forms of segregation around the United States. The AFFH Rule’s application to planning and zoning provides HUD with additional oversight of grantee local governments’ land use decision making and its impact on access to housing. But how effective will the AFFH Rule really be? The AFFH Rule’s advocates suggest that the AFFH Rule will result in the achievement of a long-dormant, yet significant goal of the FHA,243 while the AFFH Rule’s detractors believe that the federal government is trying to steal the role of planning and zoning from local governments.244 This Part discusses some anticipated results of the AFFH Rule — legal and practical — on local governments, and suggests that the AFFH Rule, while well- intentioned, creates disincentives for local government participation in HUD funding programs, and as such, may ultimately be of limited effect in achieving the ends desired by HUD.
A. Local Government Liability Under the AFFH Rule: Breaking Down Lines of Defense
Understanding the legal implications for local governments of the AFFH Rule requires comparing the AFFH Rule and local governments’ default obligations under the FHA. The conservative media criticism of the AFFH Rule suggests that the Obama Administration is attempting to social-engineer residential settlement patterns in the United States,245 while HUD proclaims that the AFFH Rule does not change a local government’s obligations under the FHA.246 Neither of these statements is entirely correct. Even if the AFFH Rule does not impose any obligations on local governments that substantively differ from those that exist pursuant to the FHA, the AFFH Rule ensures that HUD and potential plaintiffs have enhanced procedural access to challenge local governments’ action.
The AFFH Rule, with the AFH requirement and a special focus on segregation patterns, is based centrally in disparate impact theory. The AFH requires local governments to analyze the effects of zoning and land use planning policies and to determine whether those policies cause or contribute to segregated living patterns and differential access to opportunity between various population groups.247 This type of analysis is central to disparate impact analysis as characterized by the Supreme Court in Inclusive Communities.248 HUD even acknowledged Inclusive Communities in its response to comments on the rulemaking.249 But while the AFFH Rule is concerned with local government policies and actions that have a disparate impact, which the Supreme Court has acknowledged are actionable under the FHA,250 the AFFH Rule effectively requires local governments to conduct disparate impact analysis as a prerequisite to obtaining HUD funds. This proposition may be unpalatable to many local governments, particularly given the limitations imposed on disparate impact analysis in the Inclusive Communities opinion.
It is therefore helpful to look at the AFFH Rule in light of each of the limitations discussed above in Part II-C. First, in Inclusive Communities, the Court blessed policies that may differentially affect protected classes but which are “necessary to achieve a valid interest.”251 For a local government that does not receive HUD funds and is subject only to the standard requirements of the FHA, the Court’s analysis does not demand the modification of a zoning or planning practice that is intended to achieve a valid objective, such as traffic mitigation or quality of urban design.252 With respect to a policy or practice that contributes to segregation, however, the AFFH Rule would characterize such a policy or practice as a “fair housing contributing factor.”253 Moreover, the AFFH Rule expects that a local government will take affirmative steps to overcome such a contributing factor.254 The AFFH Rule does not apparently provide any opportunity for local governments to defend policies on the grounds that they are necessary to achieve a valid governmental interest, while an AFH that does not establish an approach for eliminating contributing factors is likely to be rejected by HUD.255
Second, Inclusive Communities requires, at the pleading stage, a statistical analysis proving that the policy or practice in question actually caused the disparity.256 While many zoning laws or planning practices may well contribute to disparities in access for certain protected classes, in practice, there is often insufficient data or a host of other contributing factors preventing a statistical showing of causation between policy or practice and disparate outcome.257 This heightened pleading standard in Inclusive Communities may bar many otherwise meritorious disparate impact claims, which serves as a line of defense for localities.258
Conversely, under the AFFH Rule, local governments must analyze segregated living patterns, areas of racial and ethnic segregation and poverty, and groups’ access to housing prior to receipt of HUD funding.259 The AFFH Rule does not expressly require a local government to run a multivariate regression analysis to determine whether zoning and land use policies or practices cause such patterns, yet the AFFH Rule appears to assume that zoning and land use policies will be contributing factors.260 Thus, even where disparate impact analysis under the FHA might allow the continuation of a zoning or land use policy or practice that is not a direct cause of a statistical disparity, the AFFH Rule requires local governments to take action to ensure that such policies or practices do not contribute to such statistical disparities.261 Given the foregoing, although the AFFH Rule does not create any new substantive obligations for local governments — local governments must still refrain from policies or practices having a disparate impact and which are not necessary to achieve a valid interest262 — the AFFH Rule potentially strips HUD program participants of one of their most potent defenses in FHA disparate impact litigation. To the extent the AFFH Rule deprives local governments of important protections, these distinctions may deter local governments from participating in HUD programs.
In addition to these distinctions from the Inclusive Communities decision, the AFFH Rule is distinguishable from some of the FHA’s other procedural protections for local governments. Significantly, the AFFH Rule imposes upon local governments the obligation to conduct upfront statistical analyses to understand patterns of segregation and disparate levels of opportunity within local communities, prior to receiving federal funds.263 In many cases, this analysis may put local governments at a serious disadvantage in the event of disparate impact litigation. For example, in the 2016 case of Avenue 6E Investments, LLC v. City of Yuma, the plaintiff used data contained in the city’s AI in successfully claiming that the city had engaged in disparate treatment against the plaintiff.264 While the AI’s use in Avenue 6E Investments was limited to a disparate treatment claim, it is perfectly foreseeable that a plaintiff could use the data and analysis contained in an AFH against the local government in making similar arguments in a disparate impact claim.265 To the extent the AFH becomes a process in which local governments effectively conduct discovery and arrive at conclusions supportive of claims of their prospective challengers (who are required to demonstrate causation at the pleading stage), local governments may be loath to participate in such an analysis.
Finally, local governments’ participation in HUD funding programs exposes them to two potential avenues of enforcement that do not exist solely by virtue of the FHA. Under the FHA, HUD does not have enforcement authority against local governments.266 Under the FHA, local governments are liable only in private judicial actions by ag- grieved persons or, in the case of serious offenses, Department of Justice enforcement actions.267 Conversely, the AFFH Rule allows HUD to take action against local governments that fail to comply with their obligation to affirmatively further fair housing.268 While the HUD regulations have always provided HUD with this avenue for enforcing the terms of HUD grants, the AFFH Rule now means that HUD can now take enforcement actions against local governments that fail to meet the standards articulated in the AFFH Rule.269 For example, if a HUD grantee fails to remedy a zoning policy or practice that is deemed a fair housing contributing factor, HUD could take action to either require the local jurisdiction to modify the policy or practice or reduce or withdraw funds under the grantee.270
Additionally, as was the case with Westchester County, grantees that elect to continue receiving funds remain potentially liable to HUD and private parties under the False Claims Act.271 Where a third party relator concludes that a local government has failed to conduct the proper AFH analysis under the AFFH Rule or has failed to take the required steps to satisfy the AFFH Rule’s definition of affirmatively furthering fair housing, the local government could find itself embroiled in a False Claims Act challenge.272 False Claims Act liability is particularly troubling for local governments, since a local government found liable for a violation of the False Claims Act may be subjected to treble damages,273 including an award to the third-party relator in a qui tam action,274 and payment of attorney’s fees.275
Although local governments receive pecuniary benefit from HUD grant programs, local governments have a lot to fear under the new AFFH Rule.276 The AFFH Rule does not modify the substantive obligations placed on federal grant recipients under the FHA, yet a local government’s decision to receive HUD program funds may place the local government in a more precarious legal position than a jurisdiction that declines participation in HUD programs.
B. Compliance Costs and Relative Benefit of HUD Grants
The preceding subpart highlighted just some of the enhanced compliance costs imposed on local governments as a result of the AFFH Rule. Taken with declining funding streams, the established formulas for distribution of HUD funds and the costs to local governments — in both hard resources and additional scrutiny — may further limit local governments’ willingness to participate in HUD grant programs.
The AFH requirement imposes new administrative costs on local governments that may outweigh or severely limit the benefits of participation in HUD funding programs. The AFH requires a local government to analyze publicly-available data, engage in public outreach, and to prepare reports on an continuing basis.277 While HUD has taken steps to ensure that its data analysis tools are user friendly, the extent of data analysis required to complete the AFH necessitates at least some degree of technical proficiency that many local governments may not have in-house.278 Moreover, the public outreach activities — development of published materials, providing data to citizens and non-governmental organizations, engagement with low- and moderate-income community members, receiving feedback from third-party institutions, public hearings, etc. — required of program participants are almost certain to consume human and financial resources.279 These activities re- quire local government staff or third-party consultant resources at the local government level, and can be costly. Anecdotal evidence suggests that the entire AFH process, if conducted by a third-party consultant, would cost a suburban jurisdiction approximately $50,000, and a regional analysis would come in near $100,000.280
HUD estimated that the total compliance cost burden resulting from the AFFH Rule for all local governments that participate in HUD pro- grams would be $25 million per year,281 although HUD’s analysis pro- vided no information regarding the anticipated cost to specific recipients. The HCDA permits program participants to use funding received from HUD for the payment of reasonable administrative costs,282 which include the payment of staff salaries and payment of third- party consultants in the planning and administration for HUD grant programs.283 The amount of a CDBG grant that may be used for such expenses is capped, however, at 20 percent.284
Given this cap on the use of grant funds for administrative expenses, the administrative burden of certain HUD programs may be significant for some jurisdictions that receive HUD funding. This problem is only exacerbated by the AFH requirement. Take, for example, two jurisdictions on the Front Range of Colorado. The City and County of Denver, a metropolitan city of approximately 680,000 people285 with a diverse population and relatively high proportion of low income households, received a fiscal year 2016 allocation of $6,531,090 in CDBG funds.286 Conversely, Douglas County, referenced in the introduction to this Article, is a relatively affluent suburban jurisdiction with approximately 325,000 residents that received a fiscal year 2016 allocation of $677,982 in CDBG funds.287 Whereas Denver could spend $1.3 million of its CDBG grant on planning and administrative expenses associated with the AFH and program administration, Douglas County could spend just $135,000 of its grant on these expenses.288 Although Denver is a larger and more complex jurisdiction to analyze than Douglas County, it is unlikely that Denver’s cost to deliver a statistical analysis and conduct public outreach would be nine times Douglas County’s cost to prepare the same analysis and outreach.
Moreover, while the AFFH Rule allows and encourages interjurisdictional collaboration on the AFH,289 the transaction costs of such collaboration are high. Such costs include preparation of intergovernmental agreements and decisions regarding cost sharing. Moreover, many jurisdictions have unique fair housing needs and issues, which may undermine the benefit of preparing a joint AFH. Even if Douglas County were to join with, for example, neighboring Arapahoe County, the two jurisdictions together would still be capped at approximately $345,000 for planning and administrative costs, a portion of which could be spent on preparation and continued monitoring of the AFH.290
Furthermore, the use of CDBG or other HUD funds for administrative expenses reduces the overall potential impact of the grant for its intended purposes. If Douglas County used $135,000 of its $677,982 fiscal year 2016 allocation for administrative expenses and preparation of background material necessary to continue receipt of HUD funding (including $50,000 on the preparation of an AFH), the county would have approximately $543,000 to spend on eligible program activities. In a growing suburban community such as Douglas County, which this year has a $346 million budget and is projected to experience an 11.4% year-over-year increase in general revenue from taxes alone,291 a $543,000 grant is likely less impactful to county citizens and decision makers than in a less affluent, more cash-strapped community. Given the legal and administrative burdens of the AFH, the fiscal benefits of HUD programs to a relatively affluent jurisdiction such as Douglas County could therefore be limited.
The problem exemplified by Douglas County is exacerbated by the decline in the amount of funds available for HUD programs over the past several decades. In 1975, the first year of the CDBG program, the amount of funds allocated was almost $2.5 billion, $2.2 billion of which was allocated among 594 entitlement jurisdictions throughout the United States.292 The program’s largest allocation was in 2001,
$4.4 billion, of which $3.1 billion was allocated among 1,013 entitlement jurisdictions.293 In fiscal year 2014, $3 billion was made available for the CDBG program, of which $2.1 billion was allocated among 1,193 metropolitan cities and urban counties.294 Thus, in real dollars, the amount of money available for distribution to entitlement jurisdictions declined by nearly 79% between 1975 and 2014 and nearly 27% between 2001 and 2014. The 2016 appropriation for CDBG is even slightly lower than 2014 in nominal dollars.295 Meanwhile, the number of jurisdictions that are vying for CDBG program funding has nearly doubled since the program’s inception. Similar funding declines have occurred with respect to other HUD funding programs, such as HOME.296 Douglas County was allocated $694,000 in CDBG program funds in 2004, and its allocation dropped to $677,000 for 2016, a 23% decline in real dollars, even as the county’s population grew by nearly 40%.297
Given this funding landscape, it is therefore not particularly surprising that Douglas County’s elected board voted to decline 2016 CDBG funding as described in the introduction.298 Even if the requirements placed on funding recipients have not changed in substance — the previous AI process anticipated that local governments would conduct much of the same process that is required under the AFH — in practice, for many jurisdictions, the AFH requirement represents a dramatically more onerous obligation than the AI. Whereas the scope and requirements for an AI were relatively undefined299 and not well enforced,300 the AFH requirement’s data analysis and public participation requirements are well articulated and will be reviewed and enforced more closely by HUD.301 Smaller, more affluent jurisdictions such as Douglas County, which receive relatively little in HUD program funds, have relatively lean staff and budget resources, and are still required to conduct the same analysis and outreach as is required of much larger jurisdictions, may well determine that the cost of participation in HUD funding programs is not worth the anticipated benefit. Larger jurisdictions may also opt out of participation; in an ironic twist, following many years of litigation over its affordable housing program, even Westchester County has opted out of future participation in the CDBG program.302
This premise does not bode well for the success of the AFFH Rule. One of the clear goals of the AFFH Rule is ensuring that lower income members of protected classes have access to opportunities on par with residents of affluent communities. As was the case in Westchester County, HUD observed that introducing affordable housing into wealthy, white communities could improve access of lower income, minority residents to better schools, improved government services, and employment opportunities. But if affluent communities such as Douglas County elect to withdraw from HUD funding programs, HUD will lose influence over these areas, and by necessity, the AFFH Rule will be left to burden only those communities that already have significant diversity and disproportionately lower levels of educational, economic, and social opportunity. That outcome would sim- ply compound existing problems of metropolitan segregation patterns, undermining the entire principle of the AFFH Rule.
C. Achievement of Fair Housing Goals: Baby Steps at Best?
The sweeping integrationist goals of the AFFH Rule are further tempered by a legal truism: the FHA prohibits the use of quotas and other selection mechanisms that would ensure that any given housing unit is occupied by racial, ethnic, or other groups that such housing is intended to serve.303 Where, for example, a local government zones land for multi-family development, or where the local government participates in the construction of an affordable housing project, the local government, developer, and landowner are legally barred from selecting residents of the prospective development on the basis of race, ethnicity, disability, or any other protected class.304 The AFFH Rule thus relies to a significant degree upon market forces and individual decision-making — two factors that have arguably caused the current, intractable patterns of segregation in U.S. metropolitan regions305 — to achieve its integrationist ends.
With respect to racial segregation, this legal barrier underscores a daunting mathematical reality.306 While affirmative marketing techniques or programs to provide information to prospective buyers or renters of housing may have some effect in connecting home seekers with affordable units, the construction of multi-family housing and mandatory inclusionary housing requirements are the most consequential methods of providing affordable housing.307 Thus, a clear implication of the AFFH Rule is that jurisdictions predominated by single- family homes and lacking in housing diversity will be expected to zone additional lands for multi-family uses and other forms of inclusionary housing.308 The close relationship between income and several protected classes — particularly race309 and disability310 — means that higher proportions of people with disabilities and members of minority racial and ethnic groups are likely to reside in multi-family or other forms of affordable housing than the white population.311 In mandating policies that encourage the development of affordable housing, the AFFH Rule relies on this expected demographic makeup of multi- family and other forms of affordable housing to encourage integration. Even assuming that relatively homogeneous suburban jurisdictions remain participants in HUD funding programs, without the construction of large — perhaps unachievably large — numbers of housing units, the AFFH Rule is not likely to have more than a negligible effect in making inroads against deeply ingrained segregated living patterns.
A recent case involving Garden City, New York illustrates the foregoing problem. Garden City is located in Nassau County, a suburban jurisdiction in the New York City metropolitan area.312 In 2000, minority racial and ethnic groups made up 20.3% of the population of Nassau County, 14.8% of the households in the County, and in the same year, 53.1% of very low income non-elderly renter households in the county were African American or Hispanic.313 Of the individuals on the waiting list for affordable housing in Nassau County, 88% were African American or Hispanic.314 In Garden City in the same year, of the total population of 21,672 residents, just 2.6% of the non-group quarters population315 was African American or Hispanic,316 and just 2.3% of the village’s 7,260 households were headed by an African American or Hispanic person.317 Per an expert in the case, “[i]f minorities comprised the same share of Garden City households as they did of Nassau County households, Garden City would have 1,333 African-American or Hispanic households, as opposed to the actual total of 167.”318 In 2000, Garden City had 6,845 single-family homes, with just 410 condominium units and 691 apartment or co-op units.319
The Garden City case involved Garden City’s failure to zone a parcel of property to allow for the development of 311 multi-family housing units.320 Assuming such a rezoning occurred and the 311 units were constructed, the number of households in Garden City would in- crease to 7,571.321 Further assuming that all 311 multi-family units are eventually constructed and made available only to very low income households on the waiting list for affordable housing, 274 of the 311 units would theoretically be occupied by African American or Hispanic families.322 That scenario would increase the percentage of minority households in Garden City from 2.3% to 5.8%, a significant boost in a presently homogeneous village.
This scenario presents cause for optimism in the potential effect of the AFFH Rule, yet such an outcome is based on several improbable assumptions. First, because Garden City is a small community, a 311-unit apartment project more significantly influences overall statistical outcomes than in a larger community. In a community double the size of Garden City that permits the same 311-unit project, and keeping all other statistics equal, the project would increase the minority population from 2.3% of the community’s total population to 4.3%. Thus, the larger the population of a community, the more diluted the statistical impact of any given affordable housing project. If the projections in Part IV-B above hold true, smaller, more affluent communities will opt to reject HUD funding, leaving larger, more heterogeneous jurisdictions — where individual housing developments have a much more diluted outcome on overall segregation — to absorb new affordable housing projects. This result may even compound problems of segregation in major U.S. metropolitan areas.
Second, the assumption that a particular project will universally serve only very low income households is unrealistic and, from a policy perspective, potentially undesirable. The lessons of mid-twentieth century urban public housing have cautioned against the development of large, publicly-funded low income housing projects, and have instead dictated toward the development of mixed income housing.323 Assuming a 311 unit mixed income housing project in which just 20% of units — sixty-three units total — are affordable to very low income households, and assuming the same statistics as presented above in Garden City, fifty-five of the affordable units would be occupied by minority households. If the balance of the units is absorbed in the same statistical proportions as the countywide household population distribution, i.e., 14% minority, thirty-five of the market rate units would also be occupied by minority households. Under that scenario, the proportion of minority households in Garden City would grow from 2.3% to just 3.5%.
Third, the analysis above assumes that a project contains any affordable housing at all. There is no indication that, in the implementation of the AFFH Rule, HUD will require every local government to establish requirements for mandatory, deed-restricted affordable housing. A local government could therefore potentially comply with its obligations under the AFFH Rule by, among other initiatives, simply zoning additional land for multi-family development. For the same 311-unit project in Garden City without any affordable units, if the project absorbed residents in the same demographic proportions as the County, just forty-three of the 311 units would be occupied by minority households,324 and the proportion of minority households in the village would only increase by 0.4%. If the multi-family project were developed as an “upscale” project, the minority household absorption rate would likely be even lower. In that scenario, bringing Garden City’s minority population equal with the overall county minority population would take several thousand new multi-family units. In a community such as Garden City, with little undeveloped land available, that effort would take several years or even decades of demolition and reconstruction to achieve.
Finally, this analysis presupposes other critical assumptions. Depending on local market conditions, a local government’s decision to zone land for multi-family development does not necessarily mean that the land will develop as an affordable multi-family project. If the market for multi-family development is weak at any given time, the land could develop as single-family housing, another use, or not at all. Furthermore, if the locality in which the property is located is already racially or ethnically homogeneous, racial or ethnic minority groups may elect not to absorb housing in that locality due to the lack of a peer community in that locality. And if the housing constructed does not have sufficient access to employment areas, public transportation, or government services, such new housing may not be attractive to low income or minority populations as compared to existing housing in racially or ethnically isolated but transit-served areas with access to employment and services. All of the factors identified in this Part point to the complex nature of the housing market and the mixed potential for new housing construction to change stubborn patterns of racial and ethnic segregation. These factors may further mute the prospective impact of local government policymaking intended to produce statistical change in perpetual segregation patterns. And if we assume that these changes might only occur in localities that receive HUD funding under CDBG or other programs, the extent of the change will be even further limited in its scope. For example, if affluent communities such as Garden City opt out of CDBG or other HUD funding programs en masse, HUD’s hope of making any dent — let alone a meaningful one — in segregation patterns is all but lost.
While the foregoing analysis pertaining to Garden City is largely hypothetical, the Westchester County experience crystallizes the problem. Data available from Westchester County demonstrate that, as of the first quarter of 2016, of the 349 fair and affordable housing units that have been constructed pursuant to the county’s consent decree with HUD, 195 of the units, or 55% of those constructed, are occupied by white householders.325 Given that these units were required to be constructed in predominantly white areas of the county, the fact that 45% of the units are occupied by non-white householders certain represents some progress in diversifying white areas. But 169 new housing units in a county with nearly a million residents is, in effect, a de minimis response to a significant problem.
The foregoing analysis is not to say that changes in land use planning and zoning that may produce incremental changes in segregation are undesirable. In a nation that has experienced and perpetuated racial and ethnic segregation in our metropolitan areas for more than 100 years, policy changes leading to incremental desegregation may be our best hope for repairing the damage of past attitudes and policy-making. But this analysis underscores the challenge before us. The government planners and policymakers behind the AFFH Rule are well-intentioned, but there is no overnight solution to a decades-old problem. Absent a legal mechanism that permits some form of racial or ethnic selection for particular housing units — a prospect that has been declared unconstitutional by the Supreme Court and is almost certainly politically unpalatable — the incremental but uncertain changes produced by the AFFH Rule may be the least-worst option for rectifying segregation patterns.
HUD promulgated the AFFH Rule to give definition to a longstanding requirement of the FHA and to reaffirm and promote the sweeping goals of the FHA in reducing racial, ethnic, and other disparities in access to opportunity. Through the AFFH Rule, HUD will engage in additional oversight of local governments that receive funds under the CDBG, HOME Investment Partnerships, and other programs administered by HUD, to ensure that localities conduct robust analysis and take affirmative steps to ensure that the goals of the FHA are realized through planning and zoning actions.
Despite the AFFH Rule’s commendable goals, the AFFH Rule leverages declining funding streams for HUD grant programs while imposing substantially higher costs — in the form of enhanced levels of legal risk over the default risk under the FHA, and greater administrative obligations — on HUD grant recipients. For many suburban jurisdictions with whiter, more affluent populations that receive less HUD funds than diverse, less privileged inner city areas, the enhanced potential liability and higher compliance costs associated with the AFFH Rule may prove a risk not worth the reward. As homogeneous suburban jurisdictions withdraw from participation in HUD funding programs, HUD will find itself with even less influence over these jurisdictions, and the obligation to affirmatively further fair housing will increasingly burden only those jurisdictions that already shoulder a sizable share of racial, ethnic, disability and other forms of isolation and lack of access to opportunity.
Moreover, the AFFH Rule’s prospective integrationist result is potentially limited by the sheer magnitude of the task at hand. To produce significant changes in existing patterns of racial segregation and isolation in many homogeneous suburban jurisdictions will potentially require the construction of hundreds or possibly thousands of new housing units, and is dependent on a host of factors such as housing market conditions, land availability, and individual decisions by householders to locate in a particular jurisdiction. Even if local governments elect to adopt inclusionary zoning practices such as providing additional land zoned for multi-family uses, producing meaningful statistical changes could take years or even decades. Even if more affluent, homogeneous jurisdictions continue their participation in HUD grant programs, the AFFH Rule’s broad reach will be subject to these practical, mathematical realities that may ultimately undermine its effectiveness.
None of the foregoing is to say that all is lost. HUD and local governments have a unique opportunity to collaborate on additional worthwhile efforts to strengthen the AFFH Rule in ways that make the AFFH Rule more palatable to local governments while achieving the goals of the FHA. However, additional research and experience with the current version of the AFFH Rule, which will confirm or deny the predictions contained in this Article, is required before additional changes in HUD’s regulatory structure can be recommended.
- Memorandum from Dep’t of Cmty. Dev., Douglas Cty. to Douglas Cty. Bd. of Cty. Comm’rs ( June 23, 2016) [hereinafter Memorandum] http://douglascountyco.iqm2.com /Citizens/FileOpen.aspx?Type=1&ID=1705&Inline=True.
- DOUGLAS CTY. BD. OF CTY. COMM’RS, MEETING MINUTES ( June 28, 2016) [hereinafter MEETING MINUTES] http://douglascountyco.iqm2.com/Citizens/FileOpen.aspx?Type=15&ID=1500&Inline=True.
- Memorandum, supra note 1. It should be noted that Douglas County has a history of declining participation in federal funding programs for which it is eligible, including transit, school nutrition, Section 8 housing vouchers, and other programs; however, Douglas County had participated in the CDBG program for several years prior to its decision to withdraw from the program. Id.
- MEETING MINUTES, supra note 2.
- Affirmatively Furthering Fair Housing, 80 Fed. Reg. 42,272 ( July 16, 2015) (codified at 24 C.F.R. pt. 5).
- 42 U.S.C. § 3608(e)(5) (2012).
- See 24 C.F.R. § 5.152 (2016).
- Tex. Dep’t of Hous. & Cmty. Affairs v. Inclusive Cmtys. Project, Inc., 135 S. Ct. 2507 (2015).
- Rob Astorino, Washington’s “Fair Housing” Assault on Local Zoning, WALL ST. J. (Sep. 5, 2013, 7:01 PM), http://www.wsj.com/articles/SB10001424127887323623304579056721426092030.
- Jeremy Carl, The Obama Administration Thinks Hillary’s Hometown is Racist: Does Congress Agree?, NAT’L REV. (May 18, 2016, 9:42 AM), http://www.nationalreview.com/article/435531/hud-rule-fair-housing-suburbs-zoning-westchester-county-mike-lee.
- Local Zoning and Property Rights Protection Act of 2015, H.R. 1995, 114th Cong. (2015). As of the date of publication, the bill had not been considered by a congressional committee. See id.
- See, e.g., HELP STOP AFFIRMATIVELY FURTHERING FAIR HOUSING, http://affh.net (last visited Sept. 16, 2016).
- MEETING MINUTES, supra note 2; see also Shanna Fortier, How the CDBG Decision Affects Castle Rock Residents, CASTLE ROCK NEWS-PRESS (Sept. 4, 2015, 12:26 PM), http://castlerocknewspress.net/stories/How-the-CDBG-decision-affects-Castle-Rock-residents, 197264.
- See, e.g., Emily Badger, Obama administration to unveil major new rules targeting segregation across U.S., WASH. POST ( July 8, 2015), https://www.washingtonpost.com/news/wonk/wp/2015/07/08/obama-administration-to-unveil-major-new-rules-targeting-segregation-across-u-s/; Ben Mathis-Lilley, America May Give the Whole Desegregation Thing Another Try, SLATE ( July 8, 2015, 3:46 PM), http://www.slate.com/blogs/the_slatest/2015/07/08/obama_desegregation_order_housing_integration_long_unenforced_to_be_priority.html; Valerie Strauss, How, after 60 years, Brown v. Board of Education succeeded—and didn’t, WASH. POST (Apr. 24, 2014), https://www.washingtonpost.com/news/answer-sheet/wp/2014/04/24/how-after-60-years-brown-v-board-of-education-succeeded-and-didnt/; Editorial, The Architecture of Segregation, N.Y. TIMES (Sept. 5, 2015), http://www.nytimes.com/2015/09/06/opinion/sunday/the-architecture-of-segregation.html?_r=0.
- Alan Greenblatt, Will New Housing Rules Really Reduce Racial Segregation?, GOVERNING ( July 16, 2015), http://www.governing.com/topics/urban/gov-hud-housing-supreme-court-discrimination.html; Alana Semuels, Can Better Data Help Solve America’s Housing Problems?, THE ATLANTIC ( July 8, 2015), http://www.theatlantic.com/business/archive/2015/07/new-hud-rules-fair-housing/397997/.
- See, e.g., Austin W. King, Note, Affirmatively Further: Reviving the Fair Housing Act’s Integrationist Purpose, 88 N.Y.U.L. REV. 2182, 2192 (2013).
- See generally Campbell Gibson & Kay Jung, Historical Census Statistics on Population by Race, 1790 to 1990, and By Hispanic Origin, 1870 to 1990, For Large Cities and Other Urban Places in the United States (U.S. Census Bureau, Working Paper No. 76, Feb. 2005), https://www.census.gov/population/www/documentation/twps0076/twps0076.html#gd.
- DOUGLAS S. MASSEY & NANCY A. DENTON, AMERICAN APARTHEID: SEGREGATION AND THE MAKING OF THE UNDERCLASS 17 (1993).
- The Great Migration, 1910 to 1970, U.S. Census Bureau (Sept. 13, 2012) https://www.census.gov/dataviz/visualizations/020/.
- See generally ISABEL WILKERSON, THE WARMTH OF OTHER SUNS: THE EPIC STORY OF AMERICA’S GREAT MIGRATION (2010).
- Douglas S. Massey, Residential Segregation and Neighborhood Conditions in U.S. Metropolitan Areas, in AMERICA BECOMING: RACIAL TRENDS AND THEIR CONSEQUENCES 391-99 (Neil J. Smelser et al. eds., 2001).
- See, e.g., Jonathan J. Sheffield, At Forty-Five Years Old the Obligation to Affirmatively Furthering Fair Housing Gets a Face-lift, but Will it Integrate America’s Cities?, 25 U. FLA. J.L. & PUB. POL’Y 51, 56 (2014). The segregation of Hispanic and Asian communities began much later in most parts of the country. See generally John Iceland et al., The Residential Segregation of Detailed Hispanic and Asian Groups in the United States: 1980-2010, 31 DEMOGRAPHIC RESEARCH 593, 597 (2014), http://www.demographic-research.org/volumes/vol31/20/31-20.pdf. The unique historical processes affecting these communities is an important aspect of the current debate surrounding fair housing policy, but it is less important to understanding the impetus for the Fair Housing Act and the development of civil rights law in the housing context. Id.
- See generally Ta-Nehisi Coates, The Case for Reparations, THE ATLANTIC ( June 1, 2014), http://www.theatlantic.com/magazine/archive/2014/06/the-case-for-reparations/361631/.
- See, e.g., Richard Rothstein, How Government Policies Cemented the Racism that Reigns in Baltimore, AM. PROSPECT (Apr. 29, 2015), http://prospect.org/article/how-government-policies-cemented-racism-reigns-baltimore.
- See generally Marc Seitles, The Perpetuation of Residential Racial Segregation in America: Historical Discrimination, Modern Forms of Exclusion, and Inclusionary Remedies, 14 J. LAND USE & ENVTL. L. 89 (1998).
- See MASSEY & DENTON, supra note 20, at 43-47.
- See Note, Racial Steering: The Real Estate Broker and Title VIII, 85 YALE L.J. 808, 809 (1976).
- Background and Summary of the Fair Housing Act: Redlining, Fed. Res. Reg. Serv. 6-1483 (2016), 2016 WL 3948319.
- Rothstein, supra note 26.
- “Blockbusting” is a process by which a real estate developer buys white-owned homes at below-market prices by inciting fear among the homeowners that black families would soon be moving to the neighborhood. Barlow Burke, Jr., Blockbusting, in LAW OF REAL ESTATE BROKERS § 13.04 (2015). The developer then sells the homes at above-market prices to black families desperate to escape tenancy. Id. (providing additionally information concerning “blockbusting’).
- See Seattle Civil Rights & Labor History Project, Racial Restrictive Covenants, UNIV. OF WASH., http://depts.washington.edu/civilr/covenants.htm (last visited Sept. 16, 2016) (containing original verbiage for racial restrictions in various Seattle neighborhoods and subdivisions).
- Dmitri Mehlhorn, A Requiem for Blockbusting: Law, Economics, and Race-Based Real Estate Speculation, 67 FORDHAM L. REV. 1145 (1998).
- Seitles, supra note 27, at 90.
- 1934-1968: FHA Mortgage Insurance Requirements Utilize Redlining, FAIR HOUS. CTR. OF GREATER BOS., http://www.bostonfairhousing.org/timeline/1934-1968-FHA-Redlining.html (last visited Sept. 16, 2016). The FHA refused to insure loans in non-white neighborhoods. See id. The Administration made “neighborhood security maps” that denoted non-white neighborhoods with now-infamous red lines. Id. One researcher has compiled an online database of these FHA maps. See LaDale Winling, Digital HOLC Maps, URB. OASIS, http://www.urbanoasis.org/projects/holc-fha/digital-holc-maps/ (last visited Sept. 16, 2016).
- WILHELMINA A. LEIGH & DANIELLE HUFF, JOINT CTR. FOR POL. & ECON. STUD., BRIEF 1, AFRICAN AMERICANS AND HOMEOWNERSHIP: SEPARATE AND UNEQUAL, 1940 TO 2006 3 (2007), http://www.northstarnews.com/userimages/references/African%20Americans%20and%20Home%20Ownership.Brief_Joint%20Center%20for%20Political%20Studies.pdf.
- Beth J. Lief & Susan Goering, The Implementation of the Federal Mandate for Fair Housing, in DIVIDED NEIGHBORHOODS: CHANGING PATTERNS OF RACIAL SEGREGATION 229-30 (Gary A. Tobin, ed., 1987).
- Richard Rothstein, Public Housing: Government-Sponsored Segregation, AM. PROSPECT (Oct. 11, 2012), http://prospect.org/article/public-housing-government-sponsored-segregation.
- See Laura Shin, The Racial Wealth Gap: Why A Typical White Household Has 16 Times The Wealth of a Black One, FORBES (Mar. 26, 2015, 8:00 AM), http://www.forbes.com/sites/laurashin/2015/03/26/the-racial-wealth-gap-why-a-typical-white-household-has-16-times-the-wealth-of-a-black-one/#7033b32c6c5b.
- Emily Badger & Darla Cameron, How railroads, highways, and other manmade lines racially divide America’s cities, WASH. POST WONKBLOG ( July 16, 2015), https://www.washingtonpost.com/news/wonk/wp/2015/07/16/how-railroads-highways-and-other-man-made-lines-racially-divide-americas-cities/.
- See generally Alexander von Hoffman, A Study in Contradictions: The Origins and Legacy of the Housing Act of 1949, 11 HOUS. POL’Y DEBATE 299 (2000); see also Jim Epstein & Nick Gillespie, The Tragedy of Urban Renewal: The destruction and survival of a New York City neighborhood, HIT & RUN BLOG (Sep. 28, 2011, 10:15 AM), http://reason.com/blog/2011/09/28/the-tragedy-of-urban-renewal-t (citing statistics of number of communities and individuals affected by the urban renewal initiative in the Housing Act).
- See Buchanan v. Warley, 245 U.S. 60 (1917) (holding unconstitutional a Louisville, Kentucky ordinance that forbade any black individuals from owning or occupying property in areas where a greater number of whites resided); see also Christopher Silver, The Racial Origins of Zoning in American Cities, in URBAN PLANNING AND THE AFRICAN AMERICAN COMMUNITY: IN THE SHADOWS 23-42 (Thomas Manning et al. eds., 1997) (discussing facially discriminatory zoning ordinances in Atlanta, Baltimore, Richmond, Birmingham, and New Orleans).
- See generally JAMES LOEWEN, SUNDOWN TOWNS: A HIDDEN DIMENSION OF AMERICAN RACISM (2005) (discussing the use of laws to racially segregate towns, and the prevalence of such laws throughout America).
- Silver, supra note 43, at 38.
- See Valerie Strauss, From Ferguson to Baltimore: The consequences of government-sponsored segregation, WASH. POST (May 3, 2015), https://www.washingtonpost.com/news/answer-sheet/wp/2015/05/03/from-ferguson-to-baltimore-the-consequences-of-government-sponsored-segregation/ (discussing the city-sponsored Committee on Segregation in Baltimore that organized neighborhood associations to circulate and enforce restrictive covenants); see also METRO. INTEGRATION RES. CTR., RACIALLY RESTRICTIVE COVENANTS: THE MAKING OF ALL-WHITE SUBURBS IN MILWAUKEE COUNTY 1-3 (1979), https://www4.uwm.edu/eti/Archives/RaciallyRestrictiveCovenants.pdf (examining property records from the City of Wauwatosa, Wisconsin, the author found that racially-restrictive covenants covered approximately half of habitable land in the City). It should also be noted that the federal government, through the Federal Housing Administration, encouraged the use of restrictive covenants by requiring them for federally-subsidized loans. Coates, supra note 25.
- Shelly v. Kramer, 334 U.S. 1, 19 n.22-24 (citing cases where state courts enforced racially-restrictive covenants).
- 42 U.S.C. § 3601 (2012).
- See S. Burlington Cty. NAACP v. Mount Laurel Twp., 336 A.2d 713 (N.J. 1975) (discussing exclusionary zoning).
- Seitles, supra note 27, at 95-96.
- See generally Charles M. Tiebout, A Pure Theory of Local Expenditures, 64 J. POL. ECON. 416 (1956).
- See Seitles, supra note 27, at 94 n.25 (discussing three cases where federal courts held HUD liable for intentionally discriminatory actions).
- Silver, supra note 43, at 38.
- Id. at 29.
- See generally Daniel Kevin, Environmental Racism and Locally Undesirable Land Uses: A Critique of Environmental Justice Theories and Remedies, 8 VILL. ENVTL. L.J. 121, 124-25 (1997).
- Edward G. Goetz, NEW DEAL RUINS: RACE, ECONOMIC JUSTICE, & PUBLIC HOUSING POLICY 31-32 (2013); see also Gautreaux v. Romney, 448 F.2d 731 (7th Cir. 1971) (“It also is not seriously disputed . . . that the [HUD] Secretary exercised the above described powers in a manner which perpetuated a racially discriminatory housing system in Chicago, and that the Secretary and other HUD officials were aware of that fact.”). Last year’s case upholding disparate impact liability under the FHA—Inclusive Communities—also involved the siting of public housing projects in Texas. Tex. Dep’t of Hous. & Cmty. Affairs v. Inclusive Cmtys. Project, Inc., 135 S. Ct. 2507 (2015).
- See Kenneth T. Jackson, The Cost of Good Intentions: The Ghettoization of Public Housing in the United States, in CRABGRASS FRONTIER: THE SUBURBANIZATION OF THE UNITED STATES 219-31 (1985).
- J. Gregory Richards, Zoning for Direct Social Control, 1982 DUKE L.J. 761, 764 (1982).
- See Gerald E. Frug, CITY MAKING: BUILDING COMMUNITIES WITHOUT BUILDING WALLS 143-65 (1999) (discussing suburban municipalities dominated by homeowner cartels anxious about property values and tax base).
- See Mark Obrinsky & Debra Stein, Overcoming Opposition to Multifamily Rental Housing (Harv. U. Joint Ctr. for Hous. Stud., RR07-14, Mar. 2007), http:// www.jchs.harvard.edu/sites/jchs.harvard.edu/files/rr07-14_obrinsky_stein.pdf; see also Vill. of Arlington Heights v. Metro. Hous. Dev. Corp., 429 U.S. 252 (1977) (discussing allegations of racial discrimination in Chicago suburb’s restrictions on multifamily housing and difficulty of discerning invidious intent in zoning decisions).
- Jacob S. Rugh & Douglas S. Massey, Segregation in Post-Civil Rights America: Stalled Integration or End of the Segregated Century?, 11 DU BOIS REV. 205, 207 (2013).
- Daniel T. Lichter et al., Toward a New Macro-Segregation? Decomposing Segregation within and between Metropolitan Cities and Suburbs, 80 AM. SOCIOLOGICAL R. 843, 844 (2015). The authors of this article conclude that racial minorities are becoming more evenly distributed in urban neighborhoods because of White Flight, rather than true residential integration. Id. at 868.
- Id. at 845.
- Id. at 844.
- Christina Kubiak, Everyone Deserves a Decent Place to Live: Why the Disabled are Systematically Denied Fair Housing Despite Federal Legislation, 5 RUTGERS J.L. & PUB. POL’Y 561, 570 (2008); James T. Hogan, Comment, Community Housing Rights for the Mentally Retarded, 1987 DETROIT C.L. REV. 869, 903 (1987).
- BRIAN J. CONNOLLY & DWIGHT H. MERRIAM, GROUP HOMES: STRATEGIES FOR EFFECTIVE AND DEFENSIBLE PLANNING AND REGULATION 19 (2014).
- Daniel R. Mandelker, Housing Quotas for People With Disabilities: Legislating Exclusion, 43 URB. LAW. 915, 917-22 (2011).
- See CONNOLLY & MERRIAM, supra note 66, at 30.
- 42 U.S.C. § 5301 et seq. (2012).
- § 5301.
- § 5305(a).
- § 5306.
- § 12701 et seq.
- KATIE JONES, CONG. RES. SERV., REP. NO. R40118, AN OVERVIEW OF THE HOME INVESTMENT PARTNERSHIPS PROGRAM 2 (2014), https://www.fas.org/sgp/crs/misc/R40118.pdf.
- 42 U.S.C. § 11431 (2012).
- § 11432(d).
- § 12901 et seq.
- § 12904.
- Janell Ross, A rundown of just how badly the Fair Housing Act has failed, WASH. POST ( July 10, 2015), https://www.washingtonpost.com/news/the-fix/wp/2015/07/10/a-look-at-just-how-badly-the-fair-housing-act-has-failed/ (citing history of poor enforcement as hampering FHA’s success).
- See generally Alana Semuels, White Flight Never Ended, THE ATLANTIC (Jul. 30, 2015), http://www.theatlantic.com/business/archive/2015/07/white-flight-alive-and-well/399980/.
- Frug, supra note 59, at 144.
- Allison Zippay, Trends in Siting Strategies, 33 CMTY. MENTAL HEALTH J. 301, 303 (1997); Michael B. Gerrard, The Victims of NIMBY, 21 FORDHAM URB. L.J. 495, 496 (1994).
- CONNOLLY & MERRIAM, supra note 66, at 38-39.
- Id. at 39; see also Otto J. Hetzel, Reflections on the Enactment of the 1968 Fair Housing Act, 48 URB. LAW. 311 (2016) (sharing the author’s personal perspective of the Act’s passage based on his role as Assistant General Counsel for Equal Opportunity of HUD in 1968).
- 42 U.S.C. § 3601 (2012).
- REPORT OF THE NATIONAL ADVISORY COMMISSION ON CIVIL DISORDERS (1968).
- Id. at 1.
- Id. at 5.
- Id. at 13.
- See 42 U.S.C. § 3604(a)-(f ) (2012). It should be noted that the term “handicap” is a disfavored means to reference people with disabilities; however, where the term “handicap” is used in this Article, it is solely intended for consistency with the FHA.
- § 3602(k). This provision protects pregnant women as well. Id.
- § 3602(h).
- Daniel Lauber, A Real LULU: Zoning for Group Homes and Halfway Houses Under the Fair Housing Amendments Act of 1988, 29 J. MARSHALL L. REV. 369, 374 (1996).
- NATIONAL FAIR HOUSING ALLIANCE, WHERE YOU LIVE MATTERS: 2015 FAIR HOUSING TRENDS REPORT 21 (2015), http://www.nationalfairhousing.org/LinkClick.aspx?fileticket=SYWmBgwpazA%3d&tabid=3917&mid=5321.
- 42 U.S.C. § 3602(b).
- See, e.g., Lakeside Resort Enters. v. Bd. of Supervisors, 455 F.3d 154 (3d Cir. 2006); Hovsons, Inc. v. Twp. of Brick, 89 F.3d 1096 (3d Cir. 1996); McKivitz v. Twp. of Stowe, 769 F. Supp. 2d 803 (W.D. Pa. 2010); Conn. Hosp. v. City of New London, 129 F. Supp. 2d 123 (D. Conn. 2001); Baxter v. City of Belleville, 720 F. Supp. 720 (S.D. Ill. 1989).
- See, e.g., 42 U.S.C. § 3610(g)(2)(C) (2012) (stating that, where HUD receives a complaint regarding the legality of a local zoning ordinance or other land use, such matter is required to be referred to the Department of Justice); City of Edmonds v. Oxford House, 514 U.S. 725, 728 (1995) (addressing the application of a definition of “family” in a local zoning code to congregate living for people with disabilities).
- See § 3610.
- § 3604(a)-(e).
- § 3604(f )(3)(A)-(B).
- Southend Neighborhood Imp. Ass’n v. St. Clair Cty., 743 F.2d 1207, 1209 (7th Cir. 1984) (“[C]ourts have construed the phrase ‘otherwise make unavailable or deny’ in subsection (a) to encompass . . . exclusionary zoning decisions, and other actions by individuals or governmental units which directly affect the availability of housing to minorities.”).
- See, e.g., Cmty. Servs., Inc. v. Wind Gap Mun. Auth., 421 F.3d 170 (3d Cir. 2005); Hayden Lake Recreational Water & Sewer Dist. v. Haydenview Cottage, LLC, 835 F. Supp. 2d 965 (D. Idaho 2011).
- CONNOLLY & MERRIAM, supra note 66, at 72.
- Cmty. House, Inc. v. City of Boise, 490 F.3d 1041, 1048 (9th Cir. 2007).
- See CONNOLLY & MERRIAM, supra note 66, at 73.
- Cmty. House, 490 F.3d at 1050; Larkin v. Mich. Dep’t of Soc. Servs., 89 F.3d 285, 290 (6th Cir. 1996); Bangerter v. Orem City Corp., 46 F.3d 1491, 1501 (10th Cir. 1995).
- CONNOLLY & MERRIAM, supra note 66, at 76.
- See, e.g., Avenue 6E Invs., LLC v. City of Yuma, 818 F.3d 493, 501 (9th Cir. 2016).
- See, e.g., Reg’l Econ. Cmty. Action Program, Inc. v. City of Middletown, 294 F.3d 35, 49 (2d Cir. 2002).
- Avenue 6E, 818 F.3d at 504 (citing Vill. Of Arlington Heights v. Metro. Hous. Corp., 429 U.S. 252, 266-68 (1977)).
- See, e.g., Avenue 6E, 818 F.3d at 505.
- See, e.g., Cinnamon Hills Youth Crisis Ctr. v. St. George City, 685 F.3d 917, 923-24 (10th Cir. 2012).
- See, e.g., Dadian v. Vill. of Wilmette, 269 F.3d 831, 838 (7th Cir. 2001).
- See, e.g., Lapid-Laurel, LLC v. Zoning Bd., 284 F.3d 442, 460 (3d Cir. 2002).
- Vande Zande v. Wis. Dep’t of Admin., 44 F.3d 538, 543 (7th Cir. 1995).
- Erdman v. City of Fort Atkinson, 84 F.3d 960, 962 (7th Cir. 1996). The United States Supreme Court, in the context of the reasonable modifications provisions of the Americans with Disabilities Act, 42 U.S.C. § 12131(2), has similarly stated that such provisions need not be read to require a “fundamenta[l] alter[ation]” of programs and policies. Olmsted v. L.C., 527 U.S. 581, 603 (1999) (internal citations omitted).
- CONNOLLY & MERRIAM, supra note 66, at 80.
- See, e.g., Metro. Hous. Dev. Corp. v. Vill. of Arlington Heights (Arlington Heights II), 558 F.2d 1283, 1288 (7th Cir. 1977), remanded from 429 U.S. 252 (1977). In Arlington Heights II, the Seventh Circuit found the Village of Arlington Heights, Illinois liable for an FHA violation where the village refused to zone land for subsidized multi-family housing development where a greater number of black, rather than white, residents in the region fulfilled the income requirements for such subsidized housing. Id.
- See generally Tex. Dep’t of Hous. & Cmty. Affairs v. Inclusive Cmtys. Project, 135 S. Ct. 2507 (2015).
- Respondent’s Brief in Opposition of Petition for Writ of Centiorari at 13, Tex. Dep’t of Hous. & Cmty. Affairs v. Inclusive Cmtys. Project, 135 S. Ct. 2507 (2015) (No.13-1371), 2014 WL 3589783, at *13; see also CONNOLLY & MERRIAM, supra note 66, at 81; Arlene S. Kanter, A Home of One’s Own: The Fair Housing Amendments Act of 1988 and Housing Discrimination Against People with Mental Disabilities, 43 AM. U.L. REV. 925, 980-81 (1994).
- 42 U.S.C. § 2000e-2(k) (2012).
- Inclusive Cmtys., 135 S. Ct. at 2533-34 (Alito, J., dissenting).
- See generally Stacy E. Seicshnaydre, Is Disparate Impact Having an Impact? An Appellate Analysis of Forty Years of Disparate Impact Claims Under the Fair Housing Act, 63 AM. U.L. REV. 357 (2013).
- Twp. of Mount Holly v. Mt. Holly Gardens Citizens in Action, Inc., 133 S. Ct. 2824 (2013), granting cert. to 658 F.3d 375 (3d Cir. 2011), dismissed per stipulation, 134 S. Ct. 636 (2013); Magner v. Gallagher, 132 S. Ct. 548 (2011), granting cert. to 619 F.3d 823 (8th Cir. 2010), dismissed per stipulation, 132 S. Ct. 1306 (2012). For a comprehensive review of the pre-Inclusive Communities state of disparate impact review, see generally Valerie Schneider, In Defense of Disparate Impact: Urban Redevelopment and the Supreme Court’s Recent Interest in the Fair Housing Act, 79 MO. L. REV. 539 (2014).
- Inclusive Cmtys., 135 S. Ct. at 2525 (majority opinion).
- Id. at 2514.
- See id.
- Id. at 2519.
- See id. at 2519-20.
- Id. at 2521.
- See id. at 2521-22.
- See id. at 2522 (“[D]isparate-impact liability has always been properly limited in key respects that avoid the serious constitutional questions that might arise under the FHA, for instance, if such liability were imposed based solely on a showing of a statistical disparity. Disparate-impact liability mandates the ‘removal of artificial, arbitrary, and unnecessary barriers,’ not the displacement of valid governmental policies.”).
- Id. at 2523.
- Id. (emphasis added).
- See id. (“Just as an employer may maintain a workplace requirement that causes a disparate impact if that requirement is a ‘reasonable measure[ment] of job performance,’ so too must housing authorities and private developers be allowed to maintain a policy if they can prove it is necessary to achieve a valid interest.” (internal citations omitted)).
- Id. at 2523-24.
- See, e.g., A Woman’s Choice-East Side Women’s Clinic v. Newman, 305 F.3d 684, 713 n.3 (7th Cir. 2002) (“A regression takes a dependent variable . . . and tests it against a number of independent variables. The independent variables are chosen before the regression is run. . . . Once the data is collected, the researcher runs a regression on each variable, which shows the effect of that variable, in isolation, on the dependent variable. If a variable is found to have no meaningful correlation to the dependent variable, it is discarded.”).
- Inclusive Cmtys., 135 S. Ct. at 2523 (“[A] plaintiff challenging the decision of a private developer to construct a new building in one location rather than another will not easily be able to show this is a policy causing a disparate impact because such a one-time decision may not be a policy at all.”).
- Cf. Metro. Hous. Dev. Corp. v. Vill. of Arlington Heights, 558 F.2d 1283, 1286 (7th Cir. 1977).
- E.g., Bangerter v. Orem City Corp., 46 F.3d 1491, 1501 (10th Cir. 1995).
- Cf. Mt. Holly Gardens Citizens in Action v. Twp. of Mt. Holly, 658 F.3d 375, 382 (3d Cir. 2011).
- See id. at 386.
- Inclusive Cmtys., 135 S. Ct. at 2523.
- See, e.g., Gladstone Realtors v. Vill. of Bellwood, 441 U.S. 91, 100, 102-03 (1979); Trafficante v. Metro. Life Ins. Co., 409 U.S. 205, 209-10 (1972).
- See Inclusive Cmtys., 135 S. Ct. at 2523.
- 42 U.S.C. § 3608(e)(5) (2012).
- § 3608; see also Affirmatively Furthering Fair Housing 80 Fed. Reg. 42,272 ( July 16, 2015) (codified at 24 C.F.R. pt. 5) (“The Act itself does not define the precise scope of affirmatively furthering fair housing obligation for HUD’s program participants.”).
- See Matthew J. Termine, Promoting Residential Integration Through the Fair Housing Act: Are Qui Tam Actions a Viable Method of Enforcing “Affirmatively Furthering Fair Housing” Violations?, 79 FORDHAM L. REV. 1367, 1383 (2010).
- Id. at 1383-84 (“If the [‘affirmatively furthering’] language was interpreted as merely imposing a prohibition of intentional discrimination on HUD . . . then fair housing would not be ‘affirmatively furthered’ with respect to private and institutional actors that significantly contribute to the working of the housing market.”).
- 42 U.S.C. § 5304(b)(2) (2012) (internal citations omitted).
- § 12705(b)(15).
- Sheffield, supra note 24, at 57-58.
- King, supra note 18, at 2197.
- WESTCHESTER COUNTY FAIR AND AFFORDABLE HOUSING IMPLEMENTATION PLAN app. E-1(ii) (Aug. 9, 2010), http://homes.westchestergov.com/images/stories/settlementpdfs/AppendixE-1-ii.pdf.
- Based on population and governance structure, local governments qualify to receive CDBG program funds as either a “metropolitan city” or “urban county.” 42 U.S.C. § 5306 (2012). The HCDA defines an urban county as:
any county within a metropolitan area which—
(i) is authorized under State law to undertake essential community development and housing assistance activities in its unincorporated areas, if any, which are not units of general local government; and
(I) has a population of 200,000 or more (excluding the population of metropolitan cities therein) and has a combined population of 100,000 or more (excluding the population of metropolitan cities therein) in such unincorporated areas and in its included units of general local government (and in the case of counties having a combined population of less than 200,000, the areas and units of general local government must include the areas and units of general local government which in the aggregate have the preponderance of the persons of low and moderate income who reside in the county) (a) in which it has authority to undertake essential community development and housing assistance activities and which do not elect to have their population excluded, or (b) with which it has entered into cooperation agreements to undertake or to assist in the undertaking of essential community development and housing assistance activities; or
(II) has a population in excess of 100,000, a population density of at least 5,000 persons per square mile, and contains within its boundaries no incorporated places as defined by the United States Bureau of the Census.
42 U.S.C. § 5302(a)(6).
- 163. United States ex rel. Anti-Discrimination Ctr. v. Westchester Cty. (Westchester I), 495 F. Supp. 2d 375, 377 (S.D.N.Y. 2007).
- Westchester Urban County Council, WESTCHESTER GOV’T, http://planning. westchestergov.com/urban-countycouncil (last visited Sept. 16, 2016). The balance of the county’s jurisdictions either received HUD funds as a metropolitan city or declined HUD funds. Id.
- 24 C.F.R. § 91.425(a) (2016).
- United States ex rel. Anti-Discrimination Ctr. v. Westchester Cty. (Westchester II), 668 F. Supp. 2d 548, 553 (S.D.N.Y. 2009).
- Westchester I, 495 F. Supp. 2d at 377.
- 31 U.S.C. § 3730(b) (2012).
- Westchester I, 495 F. Supp. 2d at 377. The False Claims Act provides a basis for liability for any person who knowingly makes a claim to the federal government for payment. 31 U.S.C. § 3729(a)(1)(A). Recognizing taxpayers’ interest in ensuring their money is not fraudulently spent, the False Claims Act enables citizens to sue on behalf of the government by authorizing qui tam actions. See Stephen F. Hayes, Enforcing Civil Rights Obligations Through the False Claims Act, 1 COLUM. J. RACE & L. 29, 31 (2011). In the Westchester litigation, ADC utilized the qui tam provisions of the False Claims Act to file suit against Westchester County on behalf of HUD, although HUD later joined the suit as a party. See id.
- See Westchester II, 668 F. Supp. 2d at 563.
- Id. at 556.
- Id. at 556-59.
- Id. at 557, 559.
- Westchester I, 495 F. Supp. 2d at 376.
- Id. at 377-78.
- Westchester II, 668 F. Supp. 2d at 561-62.
- Id. at 563.
- Id. at 564.
- Id. at 565.
- Id. at 568.
- See Stipulation and Order of Settlement and Dismissal at 4-6, Westchester II, No. 06 Civ. 2860 (S.D.N.Y. Aug. 10, 2009) [hereinafter Settlement Order].
- Id. at 6-11. The units were prohibited from being:
[D]eveloped in any census block which had, according to 2000 Census data, (A) a ‘single race African-American only’ population of more than ten (10) percent and a total African-American population of twenty (20) or more, or (B) a Hispanic population of more than ten (10) percent and a total Hispanic population of twenty (20) or more, as calculated after removing people living in group quarters from the relevant population.
Id. at 7.
- See id. at 4-5.
- See id. at 19-30.
- Id. County governments in New York do not have authority to regulate zoning or land use. See, e.g., N.Y. Gen. Mun. Law § 239-e (2016) (authorizing counties to adopt official maps for infrastructure planning purposes). One of Westchester County’s arguments throughout the litigation was that, although it had the authority to receive and distribute HUD funds, the county did not have the requisite authority to zone land for the construction and development of affordable housing units. See Westchester II, 668 F. Supp. 2d at 561-63. The settlement agreement obligates the county government to take legal action against any of its constituent municipalities that do not cooperate with the county’s implementation of the settlement agreement. Settlement Order, supra note 181, at 11.
- Settlement Order, supra note 181, at 11.
- United States ex rel. Anti-Discrimination Ctr. v. Westchester Cty. (Westchester III), No. 06 Civ. 2860, 2012 WL 13777, at *2-3 (S.D.N.Y. Jan. 4, 2012).
- United States ex rel. Anti-Discrimination Ctr. v. Westchester Cty. (Westchester IV), 712 F.3d 761, 771 (2d Cir. 2013).
- U.S. GOV’T ACCOUNTABILITY OFF., GAO-10-905, HOUSING AND COMMUNITY GRANTS: HUD NEEDS TO ENHANCE ITS REQUIREMENTS AND OVERSIGHT OF JURISDICTIONS’ FAIR HOUSING PLANS 3 (2010).
- Id. at 9.
- See id. at 14-15.
- See id. at 19-20.
- Id. at 22.
- Id. at 32-33.
- See id. at 33.
- Affirmatively Furthering Fair Housing, 78 Fed. Reg. 43,710 ( Jul. 19, 2013) (codified at 24 C.F.R. pt. 5).
- Id. at 43,711.
- Id. at 43,715.
- Id. at 43,716.
- Id. at 43,725.
- Affirmatively Furthering Fair Housing, 80 Fed. Reg. 42,272 (July 16, 2015) (codified at 24 C.F.R. pt. 5).
- 24 C.F.R. § 5.150 (2016).
- § 5.152.
- § 5.154(b)(1).
- § 5.156.
- §§ 5.154(b), 5.162.
- § 5.162(b).
- § 5.162(d).
- § 5.152 (defining “Assessment of Fair Housing (AFH)”); § 5.154 (containing requirements for the AFH).
- § 5.154(c).
- The proposed Assessment Tool for local governments can be found online. Proposed AFFH Assessment Tools, HUD EXCHANGE (Dec. 31, 2015), https://www.hudexchange.info/programs/affh/proposed-tools/. HUD created separate Assessment Tools for states and public housing authorities. Id. The proposed Assessment Tool was published on December 31, 2015 by HUD. Id.; see also Affirmatively Furthering Fair Housing Assessment Tool, 80 Fed. Reg. 81,840 (Dec. 31, 2015). The 60-day comment period on the Assessment Tool commenced on March 23, 2016. Information Collection Renewal: Solicitation of Comment, 81 Fed. Reg. 15,546 (Mar. 23, 2016).
- See Affirmatively Furthering Fair Housing Tool, U.S. DEP’T OF HOUS. & URB. DEV., https://egis.hud.gov/affht/ (last visited Sept. 16, 2016).
- 24 C.F.R. § 5.154(d)(1).
- § 5.154(d)(2).
- § 5.154(d)(4)-(5).
- § 5.154(d)(7).
- § 5.168(a)(3).
- § 5.168(a)(6).
- § 5.158.
- § 91.100(a).
- § 91.105.
- § 5.160.
- § 5.160(a)(1)(i)-(ii).
- § 5.160(b).
- § 5.160(d).
- § 5.154(d)(3).
- § 5.152.
- See Affirmatively Furthering Fair Housing, 80 Fed. Reg. 42,272, 42, 285 ( July 16, 2015) (codified at 24 C.F.R. pt. 5) (“Commenters stated that the final rule should make explicit what is already implicit and that is that the duty to affirmatively further fair housing applies to a program participant’s activities that do not involve the use of HUD funds. . . . [I]n many cases, meaningful goals designed to address fair housing contributing factors may require actions on the part of program participants that do not involve the use of HUD funds. The commenters offered as an example that a jurisdiction’s existing zoning ordinance may be identified as one of the contributing factors influencing existing residential segregation, concentrations of poverty, disparities in access to community assets, and disproportionate housing needs based on protected class.”).
- Id. (emphasis in original).
- Id. at 42,286.
- Id. at 42,309-10.
- Id. at 42,309 (“This rule does not impose any land use decisions or zoning laws on any local government.”).
- Id. (“[The AFH] must be consistent with fair housing and civil rights requirements, which do apply nondiscrimination requirements to the land use and zoning process. However, this rule does not change those existing requirements under fair housing and civil rights law.”).
- See Consolidated Submission for Community Planning and Development Programs, 60 Fed. Reg. 1,878, 1,905 ( Jan. 5, 1995) (codified at 24 C.F.R. pt. 91).
- U.S. DEP’T OF HOUS. & URB. DEV., HUD-1582B, FAIR HOUSING PLANNING GUIDE VOL. 1, 2-26-2-28 (1996) [hereinafter PLANNING GUIDE] http://www.hud.gov/offices/fheo/images/fhpg.pdf.
- Id. at 2-31, 4-5, 5-4.
- See, e.g., Jamelle Bouie, Opinion, America’s fair housing backlash, L.A. TIMES (July 23, 2015), http://www.latimes.com/opinion/op-ed/la-oe-0723-bouie-affirmative-fair-housing-20150723-story.html; Kamila Rose & Lisa C. Barrett, Fair housing rule helps local leaders counteract persistent segregation, THE HILL (May 18, 2016, 12:26 PM), http://thehill.com/blogs/congress-blog/civil-rights/280351-fair-housing-rule-helps-local-leaders-counteract-persistent.
- See, e.g., Stanley Kurtz, Attention America’s Suburbs: You Have Just Been Annexed, NAT’L REV. ( Jul. 20, 2015, 10:01 AM), http://www.nationalreview.com/corner/421389/attention-americas-suburbs-you-have-just-been-annexed-stanley-kurtz.
- See, e.g., Stanley Kurtz, Massive Government Overreach: Obama’s New AFFH Rule Is Out, NAT’L REV. ( Jul. 8, 2015, 10:47 AM), http://www.nationalreview.com/corner/420896/massive-government-overreach-obamas-affh-rule-out-stanley-kurtz.
- See, e.g., Affirmatively Furthering Fair Housing, 80 Fed. Reg. 42,272, 42,282-83 ( July 16, 2015) (codified at 24 C.F.R. pt. 5).
- 24 C.F.R. § 5.154(d)(2)(i)-(iv) (2016).
- See Tex. Dep’t of Hous. & Cmty. Affairs v. Inclusive Cmtys. Project, Inc., 135 S. Ct. 2507, 2521-22 (2015).
- See Affirmatively Furthering Fair Housing, 80 Fed. Reg. 42,283.
- See Inclusive Cmtys., at 2522.
- Id. at 2523.
- 24 C.F.R. § 5.152 (2016).
- §§ 5.154(d)(4)(ii)-(iii), 5.156(b)(i)(B).
- § 5.156(b).
- Inclusive Cmtys., 135 S. Ct. at 2523.
- See, e.g., Marcel C. Garaud, Comment, Legal Standards and Statistical Proof in Title VII Litigation: In Search of a Coherent Disparate Impact Model, 139 U. PA. L. REV. 455, 469 (1990) (addressing the same problems in Title VII disparate impact litigation as are presented in FHA disparate impact litigation).
- See id.
- 24 C.F.R. § 5.154(d)(2).
- § 5.152.
- § 5.154(d)(4)(ii)-(iii).
- Inclusive Cmtys., 135 S. Ct. at 2522.
- 24 C.F.R. § 5.154(d)(2).
- Avenue 6E Invs., LLC v. City of Yuma, 818 F.3d 493, 498 (9th Cir. 2016).
- Id. at 508.
- 42 U.S.C. § 3610(g)(2)(C) (2012) (stating the FHA provides HUD with enforcement authority only as against private parties, not against local governments).
- §§ 3613(a), 3614(a).
- See, e.g., 24 C.F.R. § 570.910 (2016) (pertaining to enforcement under the CDBG program).
- Westchester I, 495 F. Supp. 2d 375, 384 (S.D.N.Y. 2007).
- Jan P. Mensz, Note, Citizen Police: Using the Qui Tam Provision of the False Claims Act to Promote Racial and Economic Integration in Housing, 43 U. MICH. J.L. REFORM 1137, 1173 (2010).
- 42 U.S.C. § 3729(a)(1) (2012).
- § 3730(d).
- § 3730(d)(1)-(2).
- For a hyper-politicized view of the situation described in this Part, see Stanley Kurtz, Don’t Take HUD Money: Feds Will Swallow You Whole, NAT’L REV. ( Jan. 11, 2016, 9:52 AM), http://www.nationalreview.com/corner/429550/affh-refuse-hud-money.
- See generally 24 C.F.R. § 5.154 (2016).
- § 5.154(d)(2).
- See, e.g., § 91.105.
- Email from Heidi Aggeler, BBC Consulting, to author (July 24, 2016) (on file with author).
- Affirmatively Furthering Fair Housing, 80 Fed. Reg. 42,272, 42,348 ( July 16, 2015) (codified at 24 C.F.R. pt. 5).
- 42 U.S.C. § 5305(a)(12)-(13) (2012).
- 24 C.F.R. § 570.206 (2016).
- § 570.200(g).
- Annual Estimates of the Resident Population: April 1, 2010 to July 1, 2015, U.S. CENSUS BUREAU, http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=CF (last visited Sept. 16, 2016).
- Community Planning and Development Program Formula Allocations for FY 2016, U.S. DEP’T OF HOUS. & URB. DEV., http://portal.hud.gov/hudportal/HUD?src=/program_offices/comm_planning/about/budget/budget16 (last visited Jul. 24, 2016) [hereinafter Allocations].
- See id.; 24 C.F.R. § 570.200(g) (2016).
- § 5.156.
- Allocations, supra note 286.
- Letter from Douglas J. DeBord, Douglas Cty. Manager, et al., to Douglas Cty. Bd. of Cty. Cmm’rs, (Dec. 15, 2015), http://www.douglas.co.us/documents/2016-budget-message.pdf.
- CDBG FUNDING AND NUMBER OF METRO CITIES & URBAN COUNTIES, BY FISCAL YEAR, U.S. DEP’T OF HOUS. & URB. DEV. (2015), https://www.hudexchange.info/onecpd/assets/File/CDBG-Allocations-History-FYs-1975-2014.pdf.
- The 2016 appropriation was $2.993 billion, with $2.095 billion allocated to entitlement jurisdictions. CPD Appropriations Budget, U.S. DEP’T OF HOUS. & URB. DEV., http://portal.hud.gov/hudportal/HUD?src=/program_offices/comm_planning/about/budget/ (last visited Sept. 16, 2016).
- See, e.g., JONES, supra note 74, at 12 (reporting that appropriations for the HOME program have dropped from $1.5 billion in 1992 to $1.0 billion in 2014).
- Allocations, supra note 286 (select “Colorado” from the list of states, prompting the download of a spreadsheet; then find “Douglas County” on the spreadsheet to view its statistics).
- Douglas County is not the only jurisdiction in the United States that has recently opted to decline HUD funds. See, e.g., Fortier, supra note 15. The Town of Castle Rock, Colorado declined HUD funds in August 2015. Id. Also, the Town of Goffstown, New Hampshire declined HUD funds in September 2013 due to similar concerns. GOFFSTOWN PLANNING BD., MEETING MINUTES (Sept. 12, 2013), http://www.goffstown.com/BoardCommitteeMinutes/2013/Planning/09-12-13_Planning.pdf.
- PLANNING GUIDE, supra note 241, at 2-8.
- See generally U.S. GOV’T ACCOUNTABILITY OFF., supra note 189.
- 24 C.F.R. §§ 5.154, 5.160 (2016).
- See Kate Stone Lombardi, Home Sweet Affordable Home?, WESTCHESTER MAG., Apr. 2016, http://www.westchestermagazine.com/Westchester-Magazine/April-2016/Home-Sweet-Affordable-Home/.
- See, e.g., United States v. Starrett City Assocs., 840 F.2d 1096, 1100-01 (2d Cir. 1988). Quotas are also suspect under the Equal Protection Clause of the Fourteenth Amendment to the Constitution. Regents of Univ. of Cali. v. Bakke, 438 U.S. 265, 289-90 (1978).
- Starrett City, 840 F.2d at 1100-01.
- See supra Part I.
- The mathematical problem is less daunting when it comes to disability discrimination, as there is a well-documented shortage of housing for people with disabilities. CONNOLLY & MERRIAM, supra note 66, at 29. Further, absorption rates for congregate living facilities are fairly high. See Brian J. Connolly & Dwight H. Merriam, Planning and Zoning for Group Homes: Local Government Obligations and Liability Under the Fair Housing Amendments Act, 47 URB. LAW. 225 (2015).
- See, e.g., ALLISON ALLBEE ET AL., CHANGELAB SOLS., PRESERVING, PROTECTING, AND EXPANDING AFFORDABLE HOUSING: A POLICY TOOLKIT FOR PUBLIC HEALTH 31 (2015); SANFORD IKEDA & EMILY WASHINGTON, MERCATUS CTR., HOW LAND-USE REGULATION UNDERMINES AFFORDABLE HOUSING 6 (George Mason Univ. 2015) (noting that cities that have expanded housing supply remain more affordable than those that have not); JONATHAN WOETZEL ET AL., MCKINSEY GLOB. INST., A BLUEPRINT FOR ADDRESSING THE GLOBAL AFFORDABLE HOUSING SHORTAGE 46 (2014); Todd Litman, Evaluating Affordable Housing Development Strategies, PLANETIZEN, (Mar. 23, 2016 6:00 AM), http://www.planetizen.com/node/85106/evaluating-affordable-housing-development-strategies.
- See Affirmatively Furthering Fair Housing, 80 Fed. Reg. 42,272, 42,285 ( July 16, 2015) (codified at 24 C.F.R. pt. 5).
- See, e.g., RAY BOSHARA ET AL., FED. RES. BANK. ST. LOUIS, THE DEMOGRAPHICS OF WEALTH: HOW AGE, EDUCATION AND RACE SEPARATE THRIVERS FROM STRUGGLERS IN TODAY’S ECONOMY 5-7 (2015); Rakesh Kochhar & Richard Fry, Wealth inequality has widened along racial, ethnic lines since end of Great Recession, PEW RESEARCH CTR. (Dec. 12, 2014), http://www.pewresearch.org/fact-tank/2014/12/12/racial-wealth-gaps-great-recession/.
- CONNOLLY & MERRIAM, supra note 66, at 29.
- MHANY Mgmt. v. Cty. of Nassau, 819 F.3d 581, 588 (2d Cir. 2016).
- Id.; MHANY Mgmt. v. Vill. of Garden City, 985 F. Supp. 2d 390, 397-98 (E.D.N.Y. 2013).
- Garden City, 985 F. Supp. 2d at 397-98.
- It was noted that 61% of Garden City’s African-American population lived in dormitories. Id. at 398. The Census Bureau defines “group quarters” as “a place where people live or stay other than the usual house, apartment, or mobile home. Group Quarters and Housing Unit Estimates Terms and Definitions, U.S. CENSUS BUREAU, https://www.census.gov/popest/about/terms/housing.html (last visited Sep. 16, 2016). Two general types of group quarters are recognized: institutional (for example, nursing homes, mental hospitals or wards, hospitals or wards for chronically ill patients, hospices, and prison wards) and non-institutional (for example, college or university dormitories, military barracks, group homes, shelters, missions, and flophouses). Id.
- Garden City, 985 F. Supp. 2d at 398.
- MHANY Mgmt. v. Cty. of Nassau, 819 F.3d 581, 590 (2d Cir. 2016).
- See Garden City, 985 F. Supp. 2d at 398. The author derived the total household population from the court’s statement that:
In 2000, 2.3% of the households in Garden City were headed by an African-American or Hispanic person. . . . If minorities comprised the same share of Garden City households as they did of Nassau County households, Garden City would have 1,333 African-American or Hispanic households, as opposed to the actual total of 167.
Id. U.S. Census Bureau data from 2000 indicate that the actual number of households in Garden City in 2000 was 7,366. American FactFinder, U.S. CENSUS BUREAU, http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=CF (last visited Sept. 29, 2016). For consistency purposes, this Article proceeds using the numbers used in the court’s opinion.
- See, e.g., Cara Hendrickson, Racial Desegregation and Income Deconcentration in Public Housing, 9 GEO. J. POVERTY L. & POL’Y 35, 42-43 (2002).
- Garden City, 985 F. Supp. 2d at 398.
- WESTCHESTER COUNTY FAIR AND AFFORDABLE HOUSING QUARTERLY REPORT FOR THE PERIOD JANUARY 1, 2016 THROUGH MARCH 31, 2016, app. I-3 (May 12, 2016), https://9c9ca5fb-a-92b60e93-s-sites.googlegroups.com/a/westchesterhousingmonitor.org/monitor/2016%201Q%20Final%20Report.pdf.