The Fight Over Fair Housing Goes to Court (Again)
Civil rights groups are fighting the suspension of a HUD rule they say helps low-income families move to better neighborhoods.
Suree Barnes needed to get out of Garland, Texas. There were bugs in her home, rowdy neighbors living across the street, and she was worried about the quality of her older daughter’s school.
Barnes, 37, had initially wanted to move to Garland from Richardson, Texas, because it was one of the few places in the Dallas area she could afford using her roughly $1,100-a-month federal housing choice voucher, and one she thought would provide a better neighborhood for her three kids. When Barnes realized she wanted out of Garland, she was able to move again to Royse City, a suburbin Rockwall County that fair housing advocates would call “higher opportunity”: It has better schools and a lower crime rate. Barnes was able to move not because of a radical change in her financial status, but because of a new way of calculating the payments for housing vouchers in the Dallas metropolitan area.
The Housing Choice Voucher (HCV) program, run by the U.S. Department of Housing and Urban Development (HUD), subsidizes the housing costs of more than 2 million low-income households in America. Its current subsidies are based on the Fair Market Rent (FMR) standard, which public housing authorities calculate for each metropolitan area, and is generally around the 40th percentile of rents in the region.
But certain parts of the country, including Dallas, have been testing out a different formula. The Small Area Fair Market Rent (SAFMR) rule calculates the payment standard—the maximum amount of money a voucher provides—using postal Zip codes. The idea is that such payment standards would more accurately reflect the cost of renting in a specific neighborhood. Housing agencies in the Dallas metropolitan area were court-ordered to use the rule in 2011 as part of a fair housing settlement brought by the Inclusive Communities Project (ICP), a nonprofit that works to expand housing options for low-income families. At the Dallas Housing Authority in the City of Dallas, the number of voucher holders who moved Zip codes into high-opportunity neighborhoods tripled after the rule went into effect. Because 40 percent of the median in such a Zip code is higher than the 40 percent median region-wide, more housing in these Zip codes was now within reach of voucher-holders.
In 2016, HUD announced it would be rolling out the SAFMR rule in 24 areas around the country. But this August, the department put out a statement saying it was going to suspend widespread, mandatory implementation of the rule until 2020. In the statement, HUD gave three reasons for the suspension: It felt it had not provided enough guidance to state and local agencies about how to implement the rule; it wanted to review public comments on the rule before implementing it; and it believed a further cost-benefit analysis of the SAFMR demonstration was needed before the rollout could take place.
Civil rights groups challenged this position. In October, five groups—the NAACP’s Legal Defense and Education Fund, the law firm Relman, Dane & Colfax, the Poverty & Race Research Action Council (PRRAC), the Lawyers’ Committee for Civil Rights Under Law, and Public Citizen Litigation Group—filed a lawsuit against HUD. The lawsuit argues that by failing to implement the SAFMR rule, HUD has violated the Administrative Procedures Act, which governs how federal agencies propose and implement regulations.
Sheryl Seiling, the director of rent assistance for the Housing Authority of Cook County, one of the jurisdictions that had implemented the SAMFR rule, notes HUD’s concerns with the burden placed on local authorities. “Initially, it was time-consuming to set up—there’s 122 communities and God knows how many Zip codes,” she says. “But it was definitely worth it. We wouldn’t go back, because we would never be able to move anybody into an area of opportunity. We’re tremendously supportive of SAFMRs.”
Ajmel Quereshi, an attorney from the NAACP who is involved with the case, remains unconvinced by HUD’s other claims, noting that the department solicited two rounds of public comments on SAFMR expansion in 2015 and 2016 and that, in its own detailed interim report on SAMFRs, HUD acknowledges that the rule led to an increased availability of homes in high-rent neighborhoods while decreasing the average payment standard for each voucher.
“HUD studied this for a long time before they came out with this rule; it’s not some half-baked idea,” says Demetria McCain, president of the Inclusive Communities Project. “What they had been doing before was inefficient and inadequate to break up poverty.”
HUD in fact echoed this sentiment in its August 2017 interim report. “HCVs theoretically offer HCV holders the chance to locate in neighborhoods with high-performing schools, low rates of poverty, and other characteristics associated with opportunity for neighborhood residents,” the report states. “In practice, however, HCV holders are frequently concentrated in high-poverty neighborhoods with limited access to the amenities associated with resident opportunity.”
When vouchers were funded based on broader metro averages, “you’d have people who would not be able to move into certain, more expensive parts, because you were taking the area as a whole,” says Quereshi. “Given that the majority of voucher holders are minorities, the [suspension] of the rule is going to continue this pattern in which voucher holders that are primarily minority are segregated in certain areas.”
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