HUD Publishes Proposed Rule on Reducing Barriers to Affordable Housing - Including New Criminal Screening Requirements

person A.J. Johnson today 04/28/2024

On April 10, 2024, HUD published a proposed rule titled "Reducing Barriers to HUD-Assisted Housing." Comments on the proposed rule are due no later than June 9, 2024.

In the proposed rule, HUD assumes that everyone deserves to be considered as the individual they are, and everyone needs a safe and affordable place to live. For people with criminal records, having a stable place to live is critical to rebuilding a productive life. Yet too many people who apply for housing opportunities are not given full consideration as individuals but instead are denied opportunities simply because they have a criminal record. Criminal records are often incomplete or inaccurate, and criminal conduct that occurred years ago may not indicate a person's current fitness as a tenant. Criminal screening policies disproportionately impact Black and Brown people, Native Americans, other people of color, people with disabilities, and other historically marginalized and underserved communities.

In April 2016, HUD issued guidance to all housing providers cautioning that unnecessary and unwarranted exclusions based on criminal records may create a risk of Fair Housing Act liability because they can have an unjustified disparate impact based on race. That guidance advised housing providers that individualized assessments considering relevant mitigating information are likely to have a less discriminatory effect than categorical exclusions based on criminal record.

HUD believes that people are still excluded from HUD-assisted housing for convictions that do not reflect current fitness for tenancy, such as stale convictions dating back more than a quarter century or those for low-level, nonviolent offenses, such as riding a subway without paying a fare. As mounting evidence shows, such exclusions do little to further legitimate interests such as safety, as an increasing number of housing providers and public housing agencies (PHAs) now recognize.

This proposed rule would help standardize practices within HUD programs concerning prospective tenants. The goal is to provide clearer rules and standards to help HUD-subsidized housing providers, and PHAs carry out the legitimate and important ends of maintaining the safety of their properties and the surrounding communities and following federal law (which requires exclusion from HUD-assisted housing of people who are engaged in certain conduct or have certain criminal history), but without engaging in overbroad or discriminatory denials of housing. This proposed rule would establish in HUD program regulations a set of practices that already are required of housing providers under state and local law in much of the country; that are consistent with guidance HUD has provided to all housing providers to comply with the Fair Housing Act and to HUD-subsidized providers and PHAs to comply with program rules; and that, as HUD has heard from its industry partners, are already being used and work in practice to effectively balance various equities. In doing so, the proposed rule would clarify a legal landscape many HUD-subsidized housing providers and PHAs find confusing, leading to divergent practices within HUD programs.

While existing HUD regulations generally permit a fact-specific, individualized assessment approach, they have not been updated to require it.

This proposed rule would cover various HUD programs, including public housing and Section 8 assisted housing programs, as well as the Section 221(d)(3) below-market interest rate (BMIR) program, the Section 202 program for the elderly, the Section 811 program for persons with disabilities, and the Section 236 interest reduction payment program, and in doing so would amend existing programmatic regulations. A summary of some of how these changes would impact different program rules is explained below:

Clarifying what counts as relevant criminal activity and how recently it must have occurred: Existing regulations permit an assisted owner or PHA (for voucher applicants) to prohibit admission when the household has engaged in "in a reasonable time prior to admission," (1) drug-related criminal activity; (2) violent criminal activity; (3) other criminal activity that would threaten the health, safety, or right to peaceful enjoyment of the premises of other residents; or (4) other criminal activity that would threaten the health or safety of the PHA or owner or any employee, contractor, subcontractor or agent of the PHA or owner. While public housing regulations do not have a similar "reasonable time prior to admission" qualifier, there is a "relevancy" qualifier preceding these same four substantive categories of criminal activity. Under the proposed rule, PHAs and assisted owners would still be able to deny admission for these four categories of criminal activity; however, the proposed rule would clarify that assisted owners and PHAs may not deny admission for categories of criminal activity beyond those specified in the regulations. The proposed rule would require establishing a "lookback period" limiting the reliance on old convictions. For all programs, it would provide that prohibiting admission for some time longer than three years following any particular criminal activity is "presumptively unreasonable." The general rule would be that PHAs and assisted owners cannot make decisions based on criminal history that research indicates is not predictive of future criminal activity; that is irrelevant to safety, health, or fitness for tenancy; or that is based on incomplete or unreliable evidence of criminal activity ( e.g., a record for an arrest that has not resulted in a conviction).

Specifying procedural requirements before denying admission: Program regulations require PHAs and assisted owners to follow various procedural steps before denying admission based on a criminal record but do not provide important specifics. For example, PHAs and assisted owners must notify the household of the proposed denial, supply a copy of a criminal record, and provide an opportunity to dispute the accuracy and relevancy of the record before the denial of admission. However, the current regulations do not specify how much notice a household must receive or the meaning of the opportunity to dispute the accuracy and relevancy of the record before a denial of admission. The proposed rule would clarify that tenants shall be given at least 15 days to challenge the information's accuracy and relevance and provide any relevant mitigating information before an admissions decision.

Requiring a fact-specific and individualized assessment before making a discretionary decision to deny tenancy or admission based on criminal history: Current program regulations note that PHAs and assisted owners "may consider" certain circumstances before making a discretionary denial of admission or termination decision, and the different program regulations provide incomplete and inconsistent lists of appropriate considerations. HUD is proposing amended language that would make clear that for all discretionary admission and termination determinations, PHAs, and assisted owners must consider relevant mitigating circumstances. For admissions decisions, the proposed rule would require a fact-specific and individualized assessment of the applicant, adopting a term and concept familiar in the industry but not previously required in HUD programs. The proposed rule would harmonize the non-exhaustive list of relevant considerations across programs, setting out some specific factors that will frequently be considered relevant, such as how long ago the offense or incident occurred, mitigating conduct that has taken place since ( e.g., evidence of rehabilitation and successful reentry, including employment and tenancy), and completion of drug or alcohol treatment programs. So long as housing providers consider the circumstances relevant to the decision, the ultimate decision to deny tenancy or admission would remain within their discretion.

Revising and making available tenant selection plans and PHA administrative plans: Under existing rules, owners participating in certain assisted housing programs must have a written tenant selection plan. The proposed rule would require these owners to update their tenant selection plans to reflect the relevant policies they employ within six months following this rule's effective date. The proposed rule would also require PHAs and owners to make PHA administrative plans and tenant selection policies more widely available.

Providing additional guidance for PHAs and owners conducting screenings: When PHAs access criminal records from law enforcement agencies, existing regulations require PHAs to obtain consent from families before accessing their criminal records, require them to be kept confidential, and permit disclosure under limited circumstances. The proposed rule would broaden these protections to apply to all criminal record searches conducted by PHAs and assisted owners where appropriate. The proposed rule also would specify that, except in circumstances where housing providers and PHAs rely exclusively on an applicant's self-disclosure of a criminal record, they may not bar admission for failure to disclose a criminal record unless that criminal record would have been material to the decision.

Clarifying mandatory admission denial standards: Language concerning mandatory admission denials based on criminal activity and alcohol abuse, which are required by federal statute, is largely left unchanged by the proposed rule. For example, the requirement that an assisted owner or PHA prohibit the admission of individuals "if any household member has been evicted from federally assisted housing for drug-related criminal activity" in the last three years unless the "the circumstances leading to the eviction no longer exist" has not been modified. Nor have any modifications been made to the prohibition on admission to HUD-assisted housing to those who are "subject to a lifetime registration requirement under a State sex offender registration program." The requirement that assisted owners or PHAs must establish standards to prohibit the admission of individuals "currently engaged in" illegal use of a drug and in situations where individuals' pattern of illegal drug use or alcohol abuse may interfere "with the health, safety, or right to peaceful enjoyment of the premises by other resident[s]" would remain substantively unchanged.

However, HUD proposes adding greater clarification to the definition of "currently engaging in," which, as described above, triggers a mandatory exclusion concerning illegal drug use and discretionary exclusion authority concerning certain criminal activity. The existing regulations provide only that currently engaging in "means that the individual has engaged in the behavior recently enough to justify a reasonable belief that the individual's behavior is current." The proposed rule would provide that a PHA or assisted owner may not rely solely on criminal activity that occurred 12 months ago or longer to establish that behavior is "current." The proposed rule would also require that any such determination be based on a preponderance of the evidence standard and that such a determination consider mitigating evidence, for example, that the individual has completed substance use treatment services.

Specifying standards of proof in admissions and terminations decisions based on criminal activity: Existing regulations are largely silent on the standards of proof that must be met for admissions and terminations decisions based on criminal activity. Where they speak to the subject at all, they state broadly that an assisted owner or PHA may terminate a tenancy when a household member engages in certain criminal activity, regardless of whether they have been arrested or convicted for such activity, and without satisfying the heightened standard of proof necessary to support a criminal conviction. There is no similar provision in existing regulations regarding admission decisions, nor do existing rules specifically discuss how PHAs and assisted owners may or may not consider arrest records in making either admissions or termination determinations. The proposed rule would (1) prohibit the consideration of arrest records standing alone (in the absence of other reliable evidence of criminal conduct) for any exclusion from the housing and (2) provide that criminal conduct or any other finding on which such an exclusionary decision is made must be based on a preponderance of the evidence. This would establish and clarify certain evidentiary standards and requirements for making key determinations in a manner that is largely consistent with what HUD already recommends in guidance for its housing providers and PHAs.

Implementing limited changes affecting owners accepting Housing Choice Vouchers (HCVs) and Project Based Vouchers (PBVs): Most of the changes in the proposed rule would not apply to owners who participate in the HCV or PBV programs. The proposed rule would not apply most changes to owners participating in the HCV or PBV programs to avoid discouraging owner participation. Those owners who participate in the HCV or PBV programs would still be able to screen for drug-related criminal activity and other criminal activity that is a threat to the health, safety, or property of others. The proposed rule would add language to clarify that this includes "violent" criminal activity and that owners in the HCV and PBV program must also conduct any screening consistent with the Fair Housing Act, which was not previously spelled out in program regulations. Additionally, for tenancy terminations, HUD proposes the same standards regarding the preponderance of evidence and arrest records as would apply for PHAs and assisted owners. Finally, existing regulations note that owners "may consider" certain mitigating circumstances when terminating a tenancy. HUD proposes that where termination is based on criminal activity, illegal drug use, or alcohol abuse, an owner may consider an updated set of circumstances—the same circumstances, including mitigating and contextualizing evidence, that PHAs and assisted owners would be required to consider in the context of admissions and termination decisions.

Collectively, the principles embodied by this proposed rule are meant to ensure that people are considered individuals in HUD-assisted housing. Requiring housing providers and PHAs to make fact-specific determinations based on the totality of the circumstances, rather than denying opportunities based solely on criminal history, would help ensure that stale, inaccurate, and/or incomplete evidence and stigma surrounding people with criminal justice system involvement do not create unnecessary and counterproductive barriers to safe and affordable housing. Research shows that expanding access to such housing reduces the risk of future criminal justice system involvement and, in doing so, strengthens public safety. That does not mean everyone with a criminal history will satisfy legitimate tenant screening criteria that apply to all applicants equally. Housing providers would retain the authority to screen out individuals who they determine, based on consideration of relevant information, pose a threat to the health and safety of other tenants. The proposed rule would bar the categorical, blanket exclusion of people with criminal records without regard to all relevant and contextualizing evidence and consideration of the full life someone has lived.

Bottom Line

  • HUD's proposed rule, "Reducing Barriers to HUD-Assisted Housing," aims to address discriminatory practices hindering individuals with criminal records from accessing safe, affordable housing.
  • Emphasizing the importance of considering individuals' circumstances, the rule challenges blanket denials based solely on criminal history.
  • HUD highlights the disproportionate impact on marginalized communities and the flawed nature of relying on outdated or incomplete records.
  • The rule advocates for individualized assessments, considering mitigating factors like rehabilitation efforts and the relevance of past offenses to tenancy.
  • It outlines procedural requirements for admissions decisions, ensuring transparency and fairness for applicants.
  • While maintaining safety standards, the rule discourages overbroad exclusions and encourages housing providers to adopt a nuanced approach in accordance with Fair Housing Act principles.
  • The proposed changes will apply to various HUD programs, including public housing and Section 8 assistance. However, exceptions are made for Housing Choice Voucher and Project-Based Voucher programs to maintain owner participation.
  • Overall, the rule seeks to promote access to housing while safeguarding community well-being. It acknowledges the potential for rehabilitation and the value of considering each individual's unique circumstances.

Owners and operators of HUD programs affected by the Proposed Rule are encouraged to review the rule and provide comments to HUD no later than June 9, 2024.

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Historic Housing Expansion in Reconciliation Act

Since being signed into law on July 4, I have read the "One Big Beautiful Bill twice, in an effort to determine its impact on housing - especially affordable housing. What follows is my take on the impact of the bill on affordable housing in the United States. The "One Big Beautiful Bill Reconciliation Act marks the most significant expansion of affordable housing programs in over twenty years, permanently transforming the Low-Income Housing Tax Credit program and delivering the largest housing investment in its 39-year history. Signed into law by President Trump on July 4, 2025, the legislation will fund an estimated 1.22 million additional affordable rental homes over the next decade through improved tax credit provisions and streamlined financing methods. This expansion comes at a critical time when the nation faces a serious affordable housing shortage, with the changes taking effect on January 1, 2026, and offering unprecedented long-term stability for developers and investors. The legislation narrowly passed along party lines 218-214 in the House and 51-50 in the Senate, with Vice President Vance casting the deciding vote as part of a massive $3.4 trillion reconciliation package that reshapes federal fiscal policy across multiple sectors. While the broader bill includes controversial provisions like significant tax cuts and reductions to safety net programs, the housing provisions have received bipartisan praise from industry stakeholders who see them as vital for addressing America s housing crisis. Legislative details and comprehensive scope The One Big Beautiful Bill Act (H.R. 1, P.L. 119-21) originated from the budget reconciliation process as a lengthy 870-1,000 page package that includes broad tax cuts, targeted spending hikes, and social program adjustments. The legislation is estimated to have a fiscal impact of $3.4 trillion over a decade, with housing provisions accounting for $15.7 billion in tax credit expansions. The bill s path through Congress highlighted strong partisan divides, with Democrats consistently opposing the legislation despite backing many of its housing provisions. The reconciliation process allowed Republicans to bypass the Senate filibuster, making it possible to pass the bill with a simple majority. The legislation includes provisions from 11 House committees and 10 Senate committees, showing its wide-ranging scope across federal policy areas. Beyond housing, the act makes the 2017 Tax Cuts and Jobs Act individual tax rates permanent, eliminates taxes on tips and overtime pay, raises the state and local tax deduction cap to $40,000 for earners under $500,000, and allocates $350 billion for border security. However, these benefits come with significant cuts to Medicaid and SNAP programs, creating a complex policy landscape that impacts housing affordability in conflicting ways. Transformative LIHTC program enhancements The legislation provides the most significant Low-Income Housing Tax Credit expansion since the program started in 1986. The main feature is a permanent 12% increase in 9% LIHTC allocations, raising the per-capita allocation from $3.00 to about $3.36 beginning in 2026. Although this percentage increase appears small, it results in an extra $132 million per year in tax credit authority across the country, with proportional increases for the eight states, D.C., and four territories that get small-state minimum allocations. The second major LIHTC change permanently lowers the private activity bond financing threshold from 50% to 25% of total project costs for 4% credit deals. This change fundamentally shifts the economics of affordable housing development by making projects eligible for non-competitive 4% credits with much less bond financing. According to a Novogradac analysis, this single change will enable 1.14 million more affordable rental homes between 2026 and 2035, forming the majority of the legislation s housing production impact. The Congressional Budget Office estimates these LIHTC changes will cost $15.7 billion over 2026-2035, making them highly cost-effective compared to other federal housing programs. The permanent nature of these provisions sets this expansion apart from previous temporary measures, offering unmatched certainty for the affordable housing sector s long-term planning and investments. The legislation initially included extra provisions for rural and tribal communities, but these were removed in the final version. The House bill would have provided an automatic 30% basis boost for properties in rural areas and tribal lands, but these enhancements did not make it through the reconciliation process, marking a significant narrowing of the original scope. Broader affordable housing provisions and opportunity zones Beyond LIHTC, the legislation includes several other housing-related provisions that expand development incentives and homeownership opportunities. The act makes the Opportunity Zones program permanent with enhanced incentives, allowing investors to defer taxation of capital gains from qualified opportunity zone investments until December 31, 2033, and providing a 10% basis increase for investments held five or more years. The legislation requires that 33% of newly designated opportunity zones be in rural areas, with automatic qualification for rural and tribal regions. This geographic focus addresses previous criticisms that opportunity zones mainly benefited already-developing urban areas while overlooking rural communities that could gain the most from investment incentives. The New Markets Tax Credit program has received permanent reauthorization with $5 billion allocated annually, ensuring stability for community development financial institutions and community development entities that fund affordable housing and commercial projects in low-income areas. This permanent setup removes the uncertainty caused by repeated short-term extensions. For homeownership, the legislation reestablishes the tax deduction for mortgage insurance premiums and makes permanent the 20% deduction for qualified business income, which specifically benefits real estate professionals. The act also raises the child tax credit to $2,500 per qualifying child through 2028 and offers various other tax incentives that could indirectly boost homeownership capacity. Market dynamics and development impacts The legislation s housing provisions will fundamentally change affordable housing development patterns and market dynamics. Lowering private activity bond requirements from 50% to 25% for 4% LIHTC deals will shift significant development activity from the competitive 9% credit market to the non-competitive 4% market. This change provides developers with greater certainty and faster project timelines, as 4% credits don t need the lengthy competitive allocation process that characterizes 9% credits. State housing finance agencies will need to modify their allocation strategies to handle increased demand while overseeing their private activity bond capacity. States with oversubscribed multifamily bond programs will benefit most from the 25% threshold reduction, as more projects will become feasible with lower bond financing requirements. The ongoing 12% increase in 9% LIHTC allocations will strengthen states ability to fund competitive projects, potentially lowering the oversubscription ratios that make 9% credits highly competitive. 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The National Association of Home Builders described the act as "the first time in a long time that housing has been prioritized, while the National Association of Realtors commended the achievement of their "top 5 priorities, including permanent lower tax rates and improved business income deductions. The Mortgage Bankers Association emphasized that the legislation preserves "pro-housing and pro-economic growth tax provisions, especially highlighting the permanent mortgage interest deduction and the reestablished mortgage insurance premium deduction. These industry groups see the legislation as offering crucial long-term certainty for housing investment and development. However, housing advocacy organizations offer a more nuanced view. The National Low Income Housing Coalition supports expanding the LIHTC but strongly opposes the broader legislation s cuts to Medicaid and SNAP programs. Executive Director Kim Johnson stated that "while LIHTC is an important program, LIHTC units are rarely affordable enough for households with the lowest incomes, who will be most affected by safety net reductions. The National Housing Conference praised the legislation, with President David Dworkin calling the housing provisions "the most consequential and positive housing legislation in decades. This highlights the industry s focus on production capacity rather than broader affordability issues. Implementation timeline and administrative challenges The legislation s housing provisions take effect on January 1, 2026, with state housing agencies already preparing for implementation. States will receive their enhanced LIHTC allocations starting with the 2026 allocation year, requiring updates to Qualified Allocation Plans and application processes to handle the increased volume. The Treasury Department and IRS need to develop regulatory guidance for the new private activity bond threshold calculations and basis boost provisions. State housing finance agencies are updating their technology systems and training staff for the expected increase in application volume, with some smaller states worrying about their ability to handle the expanded program scale. The Congressional Budget Office estimates that the housing provisions will cut the primary deficit by $85 billion through economic growth effects, indicating that increased housing production will generate enough economic activity to partly offset the legislation s fiscal costs. However, this estimate relies on successful implementation and full use of the expanded credit authority. Rural and tribal communities face specific implementation challenges because these areas often lack the developer capacity and technical expertise needed to fully utilize LIHTC programs. The legislation provides for enhanced technical assistance, but successful implementation will require ongoing efforts to build local capacity and expertise. Comparison to previous housing policy initiatives The One Big Beautiful Bill Act represents the largest federal housing investment since the Housing and Economic Recovery Act of 2008, but it has fundamentally different characteristics. While HERA provided temporary expansions in response to the financial crisis, the current legislation implements permanent program improvements that offer long-term stability. The 2008 legislation included a temporary 10% increase in LIHTC allocations and established the 9% minimum credit rate, but these provisions were meant as crisis response measures. The permanent nature of the current expansion sets it apart from earlier temporary initiatives and offers unmatched certainty for industry planning. Compared to Obama-era housing initiatives, the current legislation adopts a supply-side approach that emphasizes tax incentives rather than direct spending programs. The Obama administration focused on foreclosure prevention, GSE reform, and crisis response, while the current strategy prioritizes increasing production capacity through enhanced tax credits and development incentives. The 2018 Consolidated Appropriations Act increased LIHTC allocations by 12.5% for 2018-2021, but this temporary boost expired and required yearly congressional approval. The current legislation s permanent structure removes this uncertainty and allows the industry to plan for the long term. Conclusion and long-term implications The One Big Beautiful Bill Act s housing provisions mark a historic expansion of federal affordable housing programs, with the potential to significantly increase housing production over the next decade. 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USDA Proposes Mandatory Market Studies for Section 538 Projects

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RD to Implement HOTMA Income and Certification Rules on July 1, 2025

Although HUD has postponed implementation of HOTMA for its Multifamily Housing Programs until January 1, 2026, the USDA Rural Housing Service (RHS) Office of Multifamily Housing has announced that the Housing Opportunity Through Modernization Act (HOTMA) will take effect on July 1, 2025, bringing significant changes to income calculation rules for multifamily housing programs. Key Implementation Details To accommodate the federally mandated HOTMA requirements, Rural Development published comprehensive updates to Chapter 6 of Handbook 2-3560 on June 13, 2025. All multifamily housing tenant certifications effective on or after July 1, 2025, must comply with the new HOTMA requirements. Recognizing the challenges of the transition period, Rural Development has announced a six-month grace period. Between July 1, 2025, and January 1, 2026, the agency will not penalize multifamily housing owners for HOTMA-related tenant file errors discovered during supervisory reviews. Legislative Background HOTMA was signed into law on July 29, 2016, directing the Department of Housing and Urban Development (HUD) to modernize income calculation rules established initially under the Housing Act of 1937. After years of development, HUD published the Final Rule on February 14, 2023, updating critical regulations found in 24 CFR Part 5, Subpart A, Sections 5.609 and 5.611. The HOTMA changes specifically affecting the RHS Multifamily Housing portfolio are contained in 24 CFR 5.609(a) and (b) and 24 CFR 5.611, which standardize income calculation methods across federal housing programs. Notable Policy Changes Unborn Child Consideration One of the most significant changes involves how unborn children are counted for household eligibility purposes. Under the new rules, pregnant women will be considered as part of two-person households for income qualification purposes, aligning Rural Development policies with other affordable housing programs, including HUD and the Low-Income Housing Tax Credit (LIHTC) programs. However, the household will not receive the $480 dependent deduction until after the child is born, maintaining consistency in benefit distribution timing. Updated Certification Forms Rural Development has released an updated Form RD 3560-8 Tenant Certification, which was initially published on December 6, 2024, and revised on April 18, 2025. The form is available on the eForms Website for immediate use. The previous version of the form has been renumbered as RD 3560-8A and should be used for all tenant certifications effective before July 1, 2025. Implementation Timeline The HOTMA implementation has experienced some delays. Originally scheduled to take effect on January 1, 2025, the Rural Housing Service announced on October 3, 2024, that implementation would be postponed to July 1, 2025, to allow additional time for property owners and managers to prepare. Rural Development initially implemented HOTMA through an unnumbered letter dated August 19, 2024, which outlined the overview and projected timeline for implementation. Industry Impact The HOTMA changes represent the most significant update to federal housing income calculation rules in decades, affecting thousands of multifamily housing properties across rural America. Property owners and managers have been working to update their systems and train staff on the new requirements. The six-month penalty-free transition period demonstrates Rural Development s commitment to supporting property owners through this complex regulatory change while ensuring long-term compliance with federal requirements. Moving Forward Multifamily housing stakeholders are encouraged to review the updated Chapter 6 of Handbook 2-3560 and ensure their staff is adequately trained on the new HOTMA requirements. Property owners should also verify they have access to the updated Form RD 3560-8 and understand the timing requirements for its use. For ongoing updates and additional resources, stakeholders can subscribe to USDA Rural Development updates through the GovDelivery subscriber page. The implementation of HOTMA represents a significant step toward modernizing and standardizing income calculation methods across federal housing programs, ultimately improving consistency and fairness in affordable housing administration.

HUD’s Proposed Rule to Eliminate Affirmative Fair Housing Marketing Plans: A Critical Analysis

Introduction The Department of Housing and Urban Development (HUD) has proposed eliminating the requirement for Affirmative Fair Housing Marketing Plans (AFHMPs), a cornerstone of fair housing enforcement for decades. This proposed rule, published on June 3, 2025, represents a significant departure from established fair housing practices and raises serious concerns about the federal government s commitment to ensuring equal housing opportunities for all Americans. HUD s justification for this elimination rests on six primary arguments, each of which fails to withstand careful scrutiny and analysis. Background on Affirmative Fair Housing Marketing Plans AFHMPs have long served as essential tools in combating housing discrimination by requiring property owners and managers to actively market housing opportunities to groups that are least likely to apply. These plans ensure that information about available housing reaches all segments of the community, not just those who traditionally have had better access to housing information networks. Analysis of HUD s Justifications 1. Claims of Inconsistency with Fair Housing Act Authority HUD argues that its authority under the Fair Housing Act and Executive Order 11063 is limited to the "prevention of discrimination, claiming that AFHM regulations go beyond this scope by requiring outreach to minority communities through targeted publications and outlets. The agency characterizes this as impermissible "racial sorting. This argument fundamentally misunderstands both the nature of discrimination and the historical context of fair housing enforcement. Information disparities have long been one of the most prevalent and effective forms of housing discrimination. When certain groups systematically lack access to information about housing opportunities, the discriminatory effect is equivalent to being explicitly excluded. The failure to provide equal access to housing information is, in itself, a discriminatory act, not merely a neutral information gap. AFHMPs address this reality by ensuring that housing information reaches all communities, particularly those that have been historically excluded from traditional marketing channels. 2. Constitutional Challenges Under Equal Protection HUD contends that AFHM regulations violate the Equal Protection Clause by requiring applicants to favor some racial groups over others. This characterization is both inaccurate and misleading. AFHMPs do not create preferences or favor any particular group. Instead, they ensure equitable access to information by targeting outreach to communities that are "least likely to apply for specific housing opportunities. This principle applies regardless of the racial or ethnic composition of those communities. For instance, housing developments located in predominantly minority neighborhoods are required to conduct affirmative marketing in white communities since white residents would be least likely to apply for housing in those areas. The regulation is race-neutral in its application it focuses on reaching underrepresented groups regardless of their racial identity. This approach promotes inclusion rather than exclusion and advances the constitutional principle of equal protection under the law. 3. Delegation of Legislative Power Concerns HUD s third argument that the Fair Housing Act s authorization of AFHM regulations constitutes an unconstitutional delegation of legislative power represents perhaps the weakest aspect of their legal reasoning. Congress explicitly mandated that affirmative efforts be made to eliminate housing discrimination. As the administrative agency responsible for implementing congressional intent in this area, HUD possesses both the authority and the responsibility to determine the most effective means of carrying out this mandate. The development of specific regulatory mechanisms to achieve Congress s stated goals falls squarely within HUD s legitimate administrative authority and represents appropriate implementation of legislative intent rather than overreach. 4. The "Color Blind Policy Justification HUD frames its opposition to AFHMPs as part of a "color-blind policy approach, arguing that it is "immoral to treat racial groups differently and that the agency should not engage in "racial sorting. This argument mischaracterizes the function and operation of AFHMPs. These plans do not sort individuals by race or treat different racial groups unequally. Rather, they ensure that all groups have equal access to housing information by specifically reaching out to those who are least likely to receive such information through conventional marketing channels. Critically, AFHMPs require marketing to the general community in addition to targeted outreach. This comprehensive approach ensures broad access to housing information while addressing historical information disparities that have contributed to ongoing patterns of segregation. 5. Burden Reduction for Property Owners HUD argues that "innocent private actors should not bear the economic burden of preparing marketing plans unless they have actively engaged in discrimination. This position suggests that property owners should be exempt from fair housing obligations unless they can prove intentional discriminatory conduct. This reasoning effectively provides cover for property owners who prefer that certain groups remain unaware of housing opportunities. The "burden of creating inclusive marketing strategies is minimal compared to the societal cost of perpetuating information disparities that maintain segregated housing patterns. The characterization of comprehensive marketing as an undue burden ignores the fundamental principle that equal housing opportunity requires proactive effort, not merely passive non-discrimination. This represents a retreat to a "wink and nod approach to fair housing enforcement that falls far short of the Fair Housing Act s aspirational goals. 6. Prevention vs. Equal Outcomes HUD s final argument contends that AFHM regulations improperly focus on equalizing statistical outcomes rather than preventing discrimination. This argument creates a false dichotomy between prevention and opportunity creation. AFHMPs exist not to guarantee equal outcomes but to ensure equal opportunity by providing equal access to housing information. When information about housing opportunities is not equally available to all segments of the community, the opportunity for fair housing choice is compromised from the outset. True prevention of discrimination requires addressing the structural barriers that limit housing choices, including information disparities. The Broader Implications HUD s proposed elimination of AFHMP requirements represents a concerning retreat from decades of progress in fair housing enforcement. The proposal effectively returns to an era when discrimination, while technically prohibited, was facilitated through information control and selective marketing practices. The reality of housing markets is that access to information varies significantly across communities. Property owners and managers possess considerable discretion in how they market available units. Without regulatory requirements for inclusive outreach, there are few incentives to ensure that information reaches all potential applicants. Anyone with experience in affordable housing development and management understands that information flow can be deliberately targeted and shaped. This targeting can either expand housing opportunities for underserved communities or systematically exclude them. Marketing strategies can be designed to minimize applications from certain groups while maintaining technical compliance with non-discrimination requirements. Conclusion The six justifications offered by HUD for eliminating AFHMP requirements fail to provide compelling reasons for abandoning this critical fair housing tool. The arguments reflect a fundamental misunderstanding of how housing discrimination operates in practice and ignore the crucial role that information access plays in maintaining or dismantling segregated housing patterns. Rather than advancing fair housing goals, the proposed rule exacerbates existing disparities by removing a key mechanism for ensuring that all communities have equal access to housing information. The elimination of AFHMPs would represent a significant step backward in the ongoing effort to achieve the Fair Housing Act s vision of integrated communities and equal housing opportunities for all Americans. The current proposal suggests an agency leadership more committed to reducing the regulatory burden on property owners than to expanding housing opportunities for underserved communities. This represents a troubling departure from HUD s mission and responsibilities under federal fair housing law. Moving forward, policymakers, housing advocates, and community leaders must carefully consider whether this proposed rule serves the public interest or merely provides cover for practices that perpetuate housing segregation through more subtle but equally effective means.

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