Civil rights advocates suffered a blow in federal court this month, losing a lawsuit, filed in May, against the U.S. Department of Housing and Urban Development and its secretary, Ben Carson. Unlike the last time advocates sued HUD, in 2017 — a case they won — this time the same judge, U.S. District Court Judge Beryl Howell, dismissed the plaintiffs’ suit for lack of standing.
The lawsuit centered on a desegregation rule, known as the Affirmatively Furthering Fair Housing rule, which was finalized in 2015. The rule was designed to more effectively implement the integration mandates of the Fair Housing Act, the landmark civil rights law passed 50 years ago to eliminate discrimination and segregation in housing.
Despite the Fair Housing Act’s requirements, for decades after its passage, HUD did little to ensure that jurisdictions receiving federal housing dollars were actually working to reduce government-sponsored segregation.
In 2010, the Government Accountability Office released a report detailing how local communities fail to comply with federal fair housing mandates, and how HUD fails to enforce those obligations. This report came on the heels of a 2008 national fair housing commission chaired by two former HUD secretaries, which also found abysmal fair housing compliance.
The Affirmatively Furthering Fair Housing rule was the product of the next five years of work, as stakeholders worked with the Obama administration to design a rule that not only gave communities more tools and resources to carry out their fair housing duties, but also strengthened HUD’s fair housing enforcement mechanisms. Finalizing the new rule in 2015 was considered a major milestone for civil rights.
But advocates worried that the Trump administration would try to dismantle this achievement. Before Carson was appointed HUD secretary, he wrote an op-ed comparing the Affirmatively Furthering Fair Housing rule to other “failed socialist experiments.” After joining the administration, he told the Washington Examiner that the federal government will need to “reinterpret” the rule because he doesn’t believe in “extra manipulation and cost.”
Advocates were right to be worried. In January 2018, HUD announced it would be delaying enforcement of the Affirmatively Furthering Fair Housing rule for almost three years. The federal housing agency released a statement claiming it was simply “extending the deadline” for compliance while HUD works to improve the rule. “HUD stands by the Fair Housing Act’s requirement to affirmatively furthering fair housing,” HUD’s statement read, “but we must make certain that the tools we provide to our grantees work in the real world.”
In May, advocates filed a suit, alleging that HUD was effectively ending oversight over billions of dollars to be doled out to local governments, and that the delay amounted to a suspension of the rule. The lawsuit was filed by Lawyers’ Committee for Civil Rights Under Law, the American Civil Liberties Union, the NAACP Legal Defense and Educational Fund, Public Citizen, the Poverty & Race Research Action Council, and the law firm Relman, Dane & Colfax.
Less than two weeks after the lawsuit was filed, HUD quickly reinstated the rule, but withdrew the rule’s so-called assessment tool, the central accountability mechanism communities use to comply with the rule.
The plaintiffs promptly amended their complaint, arguing that HUD’s new maneuver was simply a rose by another name, and still illegal. In June, the state of New York filed to intervene, arguing that its interests “are directly and adversely affected” by HUD’s actions, which “will make it more difficult for New York’s local jurisdictions to analyze barriers to fair housing” and further “subjec[t] New York’s residents to ongoing segregation and discrimination.”
The hearing was held in the U.S. District Court for the District of Columbia on August 9.
At the hearing, Daniel Halainen, an attorney representing HUD from the Justice Department, admitted the federal government’s track record on fair housing enforcement was highly flawed, but claimed withdrawing the assessment tool would not be reverting to back to the pre-2015 era because communities still have a greater “availability of data” at their disposal. He said it’s “incorrect” that withdrawing the assessment tool would mean jurisdictions are now off the hook for their fair housing obligations.
One argument HUD used to justify withdrawing the assessment tool was that it claimed the federal government would have to spend way more than the $9 million it had budgeted if the rule was fully implemented across the country. Sasha Samberg-Champion, an attorney representing the plaintiffs, pointed out that HUD made no effort to actually estimate what those higher costs would be, despite insisting they’d be exorbitant.
“If [HUD] did the math, and they said: Well, you know what … we did the math, and we calculated this will cost us $100 million to implement in 2018, and that would be, you know, totally beyond our budget, that would be one thing,” Samberg-Champion said in court. “Then we can have an argument about whether that number is reasonable. [But] they haven’t given you [Howell] a number. They haven’t even given you an estimate of what those unreasonable costs are going to be. They have just relied on the costs they have submitted so far, and then they’re asking you to take their word that that will scale. And we don’t think that satisfies the arbitrary and capricious test.”
In her opinion, issued on August 17, Howell disagreed. She not only argued that the plaintiffs failed to prove they’d suffer real harm from HUD’s actions — and thus lacked standing to bring the case — but she also defended HUD’s rationale for pulling the assessment tool. She wrote that HUD is “not obligated to keep in place a system that, in the agency’s view, drained its financial and personnel resources while it simultaneously expended resources working to remedy the defects in the Tool. The plaintiffs’ criticism here evidences a strong policy difference with HUD about resource allocation, rather than a showing that HUD made an arbitrary or capricious policy choice.”
But civil rights advocates argue there’s no real evidence that HUD actually plans to remedy the alleged defects in assessment tool; instead, they argue that this is all a pretext for suspending the rule altogether. Samberg-Champion pointed out in court that HUD has not taken any steps to actually improve the assessment tool it claims needs fixing.
The skepticism of fair housing advocates was bolstered last week, when HUD came out with a new announcement that over the next two months it plans to open up public comment for amending the rule itself, not the assessment tool. HUD claimed “the current regulations are ineffective” and provide jurisdictions “inadequate autonomy in developing fair housing goals as suggested by the principles of federalism.”
Carson then claimed, without evidence, that the current rule is “suffocating investment” in distressed neighborhoods and contributing to a lack of affordable housing. “We do not have to abandon communities in need,” he said in a statement. “Instead we believe we can craft a new, fairer rule that creates choices for quality housing across all communities.”
Conservatives cheered HUD’s latest move. “Secretary Carson’s work to rollback Obama’s overreaching housing rule is a great step in the right direction,” Rep. Paul Gosar, R-Ariz., told NBC News. “I look forward to seeing HUD completely rescind the utopian Obama regulation.”
In a statement released Friday, the fair housing advocacy groups that brought the lawsuit expressed “deep disappointment” in the court for not immediately and fully reinstating the assessment tool.
“Since the law was passed 50 years ago, HUD has not had an effective means for ensuring compliance with the Fair Housing Act. This ruling means a failed system will continue,” the plaintiffs said. “We are deeply concerned particularly since the court’s opinion acknowledges that the current system is flawed. … The evidence is clear that the court’s action will lead to continued fair housing litigation against jurisdictions and housing authorities which is an extremely costly way to achieve the goals of the Affirmatively Furthering Fair Housing mandate. This is a significant setback for the millions of Americans that depend on our government to protect and enforce their civil rights.”
The plaintiffs have not yet decided if they will appeal the decision.