Rule2021-12114
Restoring Affirmatively Furthering Fair Housing Definitions and Certifications
Primary source
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Published
June 10, 2021
Effective
July 31, 2021
Issuing agencies
Housing and Urban Development Department
Abstract
The Department of Housing and Urban Development (HUD) publishes this interim final rule to restore certain definitions and certifications that have been through notice-and-comment scrutiny and that are grounded in legal precedent to its regulations implementing the Fair Housing Act's requirement to affirmatively further fair housing (AFFH) and reinstate a process by which HUD will provide technical assistance and other support to funding recipients who are engaged in fair housing planning to support their certifications. No program participant will be required to participate in this process, which is for the benefit of those who want assistance in fulfilling their statutory obligations. HUD will provide these services prior to the effective date of this interim final rule. HUD determined that it is necessary for this narrowly focused rule to go into effect on July 31, 2021, because HUD funding recipients must certify compliance with their duty to AFFH on an annual basis and HUD itself has a continuous statutory obligation to ensure that the Fair Housing Act's AFFH obligations are followed. HUD finds that the definitions in the current regulation, which was promulgated in 2020 without notice-and-comment procedures, are at odds with the statutory AFFH duty as described in decades of judicial precedent and agency practice. This risks confusing funding recipients, who are certifying compliance with a regulatory definition that does not in fact satisfy their statutory AFFH obligation. While HUD therefore has determined that this rule will go into effect on July 31, it nonetheless solicits comments on this action so that it may consider public views before the effective date. HUD promulgates this interim final rule to ensure that program participants have regulatory certainty, while delaying the effective date long enough to provide time for HUD to review comments and, if necessary, act on them prior to the effective date.
Full Text
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<title>Federal Register, Volume 86 Issue 110 (Thursday, June 10, 2021)</title>
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[Federal Register Volume 86, Number 110 (Thursday, June 10, 2021)]
[Rules and Regulations]
[Pages 30779-30793]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-12114]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Parts 5, 91, 92, 570, 574, 576, 903
[Docket No. FR-6249-I-01]
RIN 2529-AB01
Restoring Affirmatively Furthering Fair Housing Definitions and
Certifications
AGENCY: Office of Fair Housing and Equal Opportunity, HUD.
ACTION: Interim final rule; request for comments.
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SUMMARY: The Department of Housing and Urban Development (HUD)
publishes this interim final rule to restore certain definitions and
certifications that have been through notice-and-comment scrutiny and
that are grounded in legal precedent to its regulations implementing
the Fair Housing Act's requirement to affirmatively further fair
housing (AFFH) and reinstate a process by which HUD will provide
technical assistance and other support to funding recipients who are
engaged in fair housing planning to support their certifications. No
program participant will be required to participate in this process,
which is for the benefit of those who want assistance in fulfilling
their statutory obligations. HUD will provide these services prior to
the effective date of this interim final rule. HUD determined that it
is necessary for this narrowly focused rule to go into effect on July
31, 2021, because HUD funding recipients must certify compliance with
their duty to AFFH on an annual basis and HUD itself has a continuous
statutory obligation to ensure that the Fair Housing Act's AFFH
obligations are followed. HUD finds that the definitions in the current
regulation, which was promulgated in 2020 without notice-and-comment
procedures, are at odds with the statutory AFFH duty as described in
decades of judicial precedent and agency practice. This risks confusing
funding recipients, who are certifying compliance with a regulatory
definition that does not in fact satisfy their statutory AFFH
obligation. While HUD therefore has determined that this rule will go
into effect on July 31, it nonetheless solicits comments on this action
so that it may consider public views before the effective date. HUD
promulgates this interim final rule to ensure that program participants
have regulatory certainty, while delaying the effective date long
enough to provide time for HUD to
[[Page 30780]]
review comments and, if necessary, act on them prior to the effective
date.
DATES:
Effective date: July 31, 2021.
Comment due date: July 12, 2021.
ADDRESSES: Interested persons are invited to submit comments regarding
this interim final rule to the Regulations Division, Office of General
Counsel, Department of Housing and Urban Development, 451 7th Street
SW, Room 10276, Washington, DC 20410-0500. Communications must refer to
the above docket number and title. There are two methods for submitting
public comments. All submissions must refer to the above docket number
and title.
1. Submission of Comments by Mail. Comments may be submitted by
mail to the Regulations Division, Office of General Counsel, Department
of Housing and Urban Development, 451 7th Street SW, Room 10276,
Washington, DC 20410-0500.
2. Electronic Submission of Comments. Interested persons may submit
comments electronically through the Federal eRulemaking Portal at
<a href="http://www.regulations.gov">www.regulations.gov</a>. HUD strongly encourages commenters to submit
comments electronically. Electronic submission of comments allows the
commenter maximum time to prepare and submit a comment, ensures timely
receipt by HUD, and enables HUD to make them immediately available to
the public. Comments submitted electronically through the
<a href="http://www.regulations.gov">www.regulations.gov</a> website can be viewed by other commenters and
interested members of the public. Commenters should follow the
instructions provided on that site to submit comments electronically.
Note: To receive consideration as public comments, comments must be
submitted through one of the two methods specified above. Again, all
submissions must refer to the docket number and title of the rule.
No Facsimile Comments. Facsimile (FAX) comments are not acceptable.
Public Inspection of Public Comments. All properly submitted
comments and communications submitted to HUD will be available for
public inspection and copying between 8 a.m. and 5 p.m. weekdays at the
above address. Due to security measures at the HUD Headquarters
building, an advance appointment to review the public comments must be
scheduled by calling the Regulations Division at 202-402-3055 (this is
not a toll-free number). Individuals with speech or hearing impairments
may access this number via TTY by calling the Federal Information Relay
Service, toll-free, at 800-877-8339. Copies of all comments submitted
are available for inspection and downloading at <a href="http://www.regulations.gov">www.regulations.gov</a>.
FOR FURTHER INFORMATION CONTACT: Sasha Samberg-Champion, Deputy General
Counsel for Enforcement and Fair Housing, 451 7th Street SW, Room
10110, Washington, DC 20410 telephone number 202-402-3413 (this is not
a toll-free number). Persons with hearing or speech impairments may
access these numbers via TTY by calling the Federal Relay Service at
800-877-8339 (this is a toll-free number).
SUPPLEMENTARY INFORMATION:
I. Background
The Affirmatively Furthering Fair Housing Mandate
The Fair Housing Act (title VIII of the Civil Rights Act of 1968,
42 U.S.C. 3601-3619) declares that ``it is the policy of the United
States to provide, within constitutional limitations, for fair housing
throughout the United States.'' See 42 U.S.C. 3601. The Fair Housing
Act prohibits among other things, discrimination in the sale, rental,
and financing of dwellings, and in other housing-related transactions,
because of ``race, color, religion, sex, familial status,\1\ national
origin, or handicap.'' \2\ See 42 U.S.C. 3604 and 3605. The Fair
Housing Act extends beyond this non-discrimination mandate, requiring
HUD to administer its programs and activities relating to housing and
urban development in a manner that affirmatively furthers the purposes
of the Fair Housing Act. 42 U.S.C. 3608(e)(5). While this mandate is
directly imposed on HUD, HUD carries it out primarily by extending the
obligation to certain recipients of HUD funding. Congress has
repeatedly reinforced the AFFH mandate for funding recipients,
embedding within the Housing and Community Development Act of 1974, the
Cranston-Gonzalez National Affordable Housing Act of 1990, and the
Quality Housing and Work Responsibility Act of 1998, the obligation
that certain HUD program participants certify, as a condition of
receiving Federal funds, that they will AFFH. See 42 U.S.C. 5304(b)(2),
5306(d)(7)(B), 12705(b)(15), 1437C-1(d)(16). As described below,
Congress enacted these requirements against the background of judicial
and administrative construction of the Fair Housing Act's AFFH
requirement, which is presumed to have been incorporated in those
later-enacted Congressional mandates.
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\1\ The term ``familial status'' is defined in the Fair Housing
Act at 42 U.S.C. 3602(k). It includes one or more children who are
under the age of 18 years being domiciled with a parent or guardian.
\2\ Although the Fair Housing Act was amended in 1988 to extend
civil rights protections to persons with ``handicaps,'' the term
``disability'' is more commonly used and accepted today to refer to
an individual's physical or mental impairment that is protected
under federal civil rights laws, the record of such an impairment,
and being regarded as having such an impairment. For this reason,
except where quoting from the Fair Housing Act, HUD uses the term
``disability.''
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For decades, courts have held that the AFFH obligation imposes a
duty on HUD and its grantees to affirmatively further the purposes of
the Fair Housing Act. These courts have held that funding recipients,
to meet their AFFH obligations, must, at a minimum, ensure that they
make decisions informed by preexisting racial and socioeconomic
residential segregation. The courts have further held that, informed by
such information, funding recipients must strive to dismantle historic
patterns of racial segregation; preserve integrated housing that
already exists; and otherwise take meaningful steps to further the Fair
Housing Act's purposes beyond merely refraining from taking
discriminatory actions and banning others from such discrimination.
Soon after the enactment of the Fair Housing Act, the U.S. Court of
Appeals for the Third Circuit, in Shannon v. HUD, 436 F.2d 809 (3d Cir.
1970), held that HUD is obligated to ``utilize some institutionalized
method whereby, in considering site selection or type selection, it has
before it the relevant racial and socio-economic information necessary
for compliance with its duties'' under the Fair Housing Act. Id. at
821. The Third Circuit further held that any HUD discretion must be
exercised to not just prevent discrimination in housing, but to align
the federal government ``in favor of fair housing.'' Id. at 819-20. It
follows that, where HUD delegates decision-making responsibility to its
grantees, HUD grantees must likewise gather and consider relevant
information such as racial and socioeconomic segregation in housing to
inform decisions that will foster integration and not further
perpetuate segregation.
Only a few years later, the U.S. Court of Appeals for the Second
Circuit, in Otero v. New York City Housing Auth., et al., 484 F.2d 1122
(2d Cir. 1973), similarly held that the obligation to AFFH requires
that ``[a]ction must be taken to fulfill, as much as possible, the goal
of open, integrated residential housing patterns and to prevent the
increase of segregation, in ghettos,\3\ of
[[Page 30781]]
racial groups whose lack of opportunity the Act was designed to
combat.'' Id. at 1134. Otero further held that, to accomplish this
goal, HUD and funding recipients must take into account the
socioeconomic and demographic makeup of the neighborhoods they govern,
reasoning that ``the affirmative duty placed on the Secretary of HUD by
Sec. 3608(e)(5) and through him on other agencies administering
federally-assisted housing programs also requires that consideration be
given to the impact of proposed public housing programs on the racial
concentration in the area in which the proposed housing is to be
built.'' Id. at 1133-34.
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\3\ Reflecting the era in which it was enacted, the Fair Housing
Act's legislative history and early court decisions, including those
referenced throughout this preamble, refer to ``ghettos'' when
discussing racially concentrated areas of poverty.
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In NAACP, Boston Chapter v. HUD, 817 F.2d 149 (1st Cir. 1987), the
U.S. Court of Appeals for the First Circuit likewise found that the
AFFH mandate in 42 U.S.C. 3608(e)(5) requires, ``as a matter of
language and of logic,'' that HUD and its funding recipients do more
than refrain from discrimination. Id. at 154. NAACP involved a claim
that HUD and Boston officials knew the city's neighborhoods and housing
were racially segregated, yet they failed to utilize the ``immense
leverage'' of federal funds to ``provide desegregated housing so that
the housing stock is sufficiently large to give minority families a
true choice of location.'' Id. at 152. The court held that HUD's
obligation to AFFH requires that ``HUD do more than simply not
discriminate itself''; rather, HUD must ``use its grant programs to
assist in ending discrimination and segregation, to the point where the
supply of genuinely open housing increases.'' Id. at 155. Like Shannon,
NAACP explained that, to carry out this AFFH obligation effectively,
HUD and its grantees must ``consider the effect of a HUD grant on the
racial and socio-economic composition of the surrounding area,''
including historical patterns of segregation. Id. at 156.
Thus, each federal court of appeals that has construed the Fair
Housing Act's AFFH requirement has recognized that the AFFH obligation
requires a funding recipient to consider existing segregation,
including racial segregation, and other barriers to fair housing, and
then take meaningful action to address them. These cases make plain
that the AFFH obligation requires HUD and recipients of its funding to
take proactive steps towards fair housing in this manner, beyond merely
refraining from discrimination. These judicially recognized AFFH
principles cannot be reconciled with PCNC's far more limited definition
of affirmatively furthering fair housing, which a funding recipient
satisfies by taking any step rationally related to any of a large set
of objectives, some of which are not intrinsically about fair housing
at all. More recently, courts applying and construing the AFFH
requirement, and the precedents described above, have recognized that
discretion and flexibility that HUD and its funding recipients have are
inherent to the statutory obligation, because the precise actions
needed depend on the local context. At the same time, they have
continued to recognize that this discretion is cabined by the
obligations to meaningfully assess racial and other forms of
segregation and other impediments to fair housing and then take
meaningful actions to address them. For example, in Thompson v. HUD,
348 F. Supp. 2d 398, 409 (D. Md. 2005), the court found that HUD
violated its duty to AFFH by limiting its efforts to desegregate public
housing in Baltimore to the city limits, as opposed to widening its
focus to the Baltimore region as a whole. Id. at 459, 461. In ordering
HUD to take a regional approach, the court found that the AFFH mandate
requires HUD to adopt policies ``whereby the effects of past
segregation in Baltimore City public housing may be ameliorated by the
provision of public housing opportunities beyond the boundaries of
Baltimore City.'' Id. at 462. See also U.S. ex rel. Anti-Discrimination
Ctr. v. Westchester Cnty., 2009 WL 455269 (S.D.N.Y. Feb. 24, 2009)
(finding program participant's certification that it would AFFH
deficient where it failed to adequately consider the impact of race on
housing opportunities in the county).
While the Supreme Court has never had occasion to consider the
scope of the AFFH provision, it has consistently recognized and noted
the Fair Housing Act's broad and remedial goals and has repeatedly
observed that the Act is meant not just to bar discrete discriminatory
acts, but to affirmatively counteract the nation's long history of
racial segregation and discriminatory housing practices and policies.
In Trafficante v. Metro. Life Ins. Co., 409 U.S. 205, 211 (1972),
while analyzing the scope and purpose of the Act soon after the law was
enacted and finding that it conferred very broad standing on private
litigants to challenge discrimination, the Court relied on the
statements of the Act's co-sponsor Senator Walter F. Mondale that:
``the reach of the proposed law was to replace the ghettos `by truly
integrated and balanced living patterns.' '' Decades later, in
confirming the unanimous view of the courts of appeals that the Act
permits disparate-impact claims, the Court further explained that
``[m]uch progress remains to be made in our Nation's continuing
struggle against racial isolation. . . . The Court acknowledges the
Fair Housing Act's continuing role in moving the Nation toward a more
integrated society.'' Tex. Dep't of Hous. & Cmty. Affairs v. Inclusive
Cmtys. Project, Inc., 576 U.S. 519, 546-47 (2015). As the Supreme Court
held in Inclusive Communities Project, the Act's broad remedial
purposes cannot be accomplished simply by banning intentional
discrimination. The AFFH requirement plays a key role in the
accomplishment of those purposes, requiring HUD and recipients of
federal financial assistance to take affirmative steps to create an
open, integrated society and to eliminate the barriers that stand in
the way of truly equal housing opportunities for underserved
populations.
Moreover, Congress has repeatedly confirmed its view that the AFFH
mandate imposes affirmative obligations on HUD funding recipients. In
three separate statutes post-dating the Fair Housing Act--the Housing
and Community Development Act of 1974, the Cranston-Gonzalez National
Affordable Housing Act, and the Quality Housing and Work Responsibility
Act of 1998--Congress has required covered HUD program participants to
certify, as a condition of receiving Federal funds, that they will
AFFH. See Public Law 93-383, the Housing and Community Development Act
of 1974, 88 Stat. 633, (Aug. 22, 1974), as amended by Public Law 98-
181, Supplemental Appropriations Act of 1984, 97 Stat. 1153, (Nov. 30,
1984) (codified at 42 U.S.C. 5304(b)(2), Pub. L. 101-625, Cranston-
Gonzalez National Affordable Housing Act, 104 Stat. 4079 (Nov. 28,
1990) (codified at 42 U.S.C. 5306(d)(7)(B), 12705(b)(15); Pub. L. 105-
276, Quality Housing and Work Responsibility Act of 1998, 112 Stat.
2461, (Oct. 21, 1998) (codified at 42 U.S.C. 42 1437C-1(d)(16). The
certifications these laws require are designed to ensure compliance
with a term that Congress necessarily understood to have the content
given it by the courts and the agency tasked with overseeing
compliance. See e.g., 42 U.S.C. 5304(b)(2) (requiring certification
``that the grantee will affirmatively further fair housing'');
5306(d)(7)(B) (``No amount may be distributed by any State or the
Secretary under this
[[Page 30782]]
subsection . . . unless such unit of general local government certifies
that . . . it will affirmatively further fair housing''), 12705(b)(15)
(requiring certification ``that the jurisdiction will affirmatively
further fair housing''), 1437C-1(d)(16) (requiring the public housing
agency's certification that it ``will affirmatively further fair
housing''). It is well-settled that Congress is presumed to be aware of
an administrative or judicial interpretation of a statutory provision
and to adopt that interpretation when it re-enacts that statute or uses
the same statutory language elsewhere without change. Lamar, Archer &
Cofrin, LLP v. Appling, 138 S. Ct. 1752 (2018) (citing Lorillard v.
Pons, 434 U.S. 575, 580 (1978); Bragdon v. Abbott, 524 U.S. 624, 645
(1998) (explaining that ``[w]hen administrative and judicial
interpretations have settled the meaning of an existing statutory
provision, repetition of the same language in a new statute indicates,
as a general matter, the intent to incorporate its administrative and
judicial interpretations as well.''). See also Tex. Dep't of Hous. &
Cmty. Affairs, 576 U.S. at 536-38 (applying the concept of ``implicit
ratification'' to the Fair Housing Act).
HUD's Implementation of the Affirmatively Furthering Fair Housing
Mandate
For decades, consistent with this judicial precedent, HUD
interpreted the AFFH mandate as requiring the agency to use its
programs to do more than simply not discriminate and bar others from
discriminating. HUD instead interpreted this obligation to mean that it
was required to use its programs to take affirmative steps to
proactively overcome historic patterns of segregation, promote fair
housing choice, and foster inclusive communities for all.\4\ Since
1996, HUD required its grantees to support their certifications that
they were affirmatively furthering fair housing by undertaking an
Analysis of Impediments to Fair Housing Choice (AI), a form of fair
housing planning. For example, HUD regulations for program participants
that submit Consolidated Plans require an AFFH compliance
certification. For many years, these regulations provided that, in
making such certification, a grantee would commit to conducting an
``analysis of 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.'' 24 CFR
91.225(a)(1), 91.325(a)(1) and 91.425(a)(1) (1996). The AI is meant to
be an assessment of conditions, both public and private, that affect
fair housing choice within a grantee's jurisdiction. HUD's Fair Housing
Planning Guide (FHPG) provided extensive guidance on how to AFFH by
supplying a framework for fair housing planning.
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\4\ The requirement of recipients of Federal housing and urban
development funds and other Federal funds to affirmatively further
fair housing has also been reiterated through executive order
predating the PCNC rule. Executive Order 12892, entitled
``Leadership and Coordination of Fair Housing in Federal Programs:
Affirmatively Furthering Fair Housing,'' issued January 17, 1994,
vests primary authority in the Secretary of HUD for all federal
executive departments and agencies to administer their programs and
activities relating to housing and urban development in a manner
that furthers the purposes of the Fair Housing Act.
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The 2015 AFFH Rule
In July 2013, HUD proposed regulations that codified and
implemented the agency's longstanding interpretation of the AFFH
requirement. After undertaking an extensive review of comments, HUD
issued its 2015 final AFFH rule to implement the statutory requirement
with respect to consolidated plan and public housing agency program
participants, published on July 16, 2015 at 80 FR 42272.
Consistent with decades of understanding of the obligation to AFFH
as discussed throughout this preamble, the rule defined a funding
recipient's AFFH duty as ``taking meaningful actions that, taken
together, address significant disparities in housing needs and in
access to opportunity, replacing segregated living patterns with
racially balanced living patterns, transforming racially or ethnically
concentrated areas of poverty into areas of opportunity, and fostering
and maintaining compliance with civil rights and fair housing laws.''
The rule further defined ``meaningful actions'' as ``significant
actions that are designed and can be reasonably expected to achieve a
material positive change that affirmatively furthers fair housing by,
for example, increasing fair housing choice or decreasing disparities
in access to opportunity.'' The AFFH rule defined ``fair housing
choice,'' in turn, to mean that ``individuals and families have the
information, opportunity, and options to live where they choose without
unlawful discrimination and other barriers related to race, color,
religion, sex, familiar status, national origin, or disability.'' In
sum, HUD restated and memorialized the substantive content of the
statutory obligation to AFFH, based on longstanding precedent in
caselaw, administrative practice, and congressional intent and
ratification, in various definitions in the 2015 AFFH rule.
In addition, the 2015 AFFH rule established a process whereby
program participants \5\ would conduct a more standardized Assessment
of Fair Housing (AFH) instead of an AI. The rule further required the
program participant to certify that it would take meaningful actions to
further the goals identified in its AFH. Program participants were not
required to conduct and submit an AFH until after HUD had made
available its Assessment Tool available for their use.\6\ and instead
were instructed to continue conducting AIs (i.e., a variant of the same
process they had followed for many years) to meet their AFFH
obligations. 24 CFR 5.160(a)(3) (2015).
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\5\ Program participants subject to the requirements of the 2015
rulemaking included jurisdictions and insular areas required to
submit consolidated plans for the Community Development Block Grant
(CDBG) program (see 24 CFR part 570, subparts D and I); the
Emergency Solutions Grants (ESG) program (see 24 CFR part 576); the
HOME Investment Partnerships (HOME) program (see 24 CFR part 92);
and the Housing Opportunities for Persons With AIDS (HOPWA) program
(see 24 CFR part 574); as well as Public housing agencies (PHAs)
receiving assistance under sections 8 or 9 of the United States
Housing Act of 1937 (42 U.S.C. 1437f or 42 U.S.C.1437g).
\6\ Along with a HUD-provided assessment tool, HUD-provided data
also needed to be available to program participants to trigger the
obligation to conduct an AFH under the 2015 AFFH rule.
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Following promulgation of the 2015 AFFH rule, HUD began to
implement the process contemplated by its 2015 AFFH rule, including
producing assessment tools for program participants to use to conduct
AFHs. HUD reviewed forty-nine submitted AFHs. In 2018, however, HUD
paused implementation. HUD published three Federal Register Notices on
May 23, 2018, one of which withdrew the Assessment Tool for Local
Governments, the only available HUD-provided Assessment Tool for
program participants to use when conducting an AFH. 83 FR 23927 (May
23, 2018). As explained in a second Federal Register Notice published
that same day, HUD directed all program participants who had not yet
completed an AFH that they would continue to be required to conduct an
AI. 83 FR 23927-23928.\7\ This well-established AI obligation and
planning process continued to be in place until the PCNC regulation
took effect on September 8, 2020.
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\7\ The third Federal Register Notice withdrew an earlier Notice
that had extended the deadline for submitting an AFH for certain
program participants. 83 FR 23928.
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[[Page 30783]]
The 2020 Proposed Rule and PCNC
HUD published a proposed rule in January 2020, 85 FR 2014 (January
14, 2020), to repeal and replace the 2015 AFFH rule. However, on August
7, 2020, at 85 FR 47899, HUD abandoned that proposed rulemaking and
instead promulgated the PCNC final rule, which not only repealed the
2015 AFFH rule, but eliminated the regulatory framework that preexisted
that rule. It thus left program participants without any obligation to
undertake any type of fair housing planning (whether an AFH, an AI, or
any other) and leaving HUD without any mechanism to assist
jurisdictions that wished to continue such activity. As described
below, and of particular relevance to this rulemaking, the PCNC rule
also redefined the AFFH obligation to which funding recipients must
certify, without reconciling the new definition with the statutory
requirement and judicial precedent.
HUD promulgated PCNC without following notice-and-comment
rulemaking procedures deciding that the PCNC rule was exempt from the
Administrative Procedure Act (APA)'s notice and comment requirement
because the regulation ``applies only to the AFFH obligation of
grantees.'' The APA exempts from notice-and-comment rulemaking any
``matter relating to agency management or personnel or to public
property, loans, grants, benefits, or contracts.'' 5 U.S.C. 553(a)(2).
However, as PCNC acknowledged, HUD's ``rule on rules'' at 24 CFR part
10 requires HUD generally to follow the APA notice-and-comment
rulemaking procedures notwithstanding any statutory exception that
might otherwise apply, such as the grantmaking exception. HUD instead
relied upon the Secretary's general regulatory waiver authority at 24
CFR 5.110 and codified at 42 U.S.C. 3535(q) to waive any regulatory
requirement ``[u]pon determination of good cause.'' As justification,
the preamble to the PCNC rule stated that ``AFFH has been the subject
of significant debate and public comment over the course of many years
and this rule will ensure that program participants have the timely
clarity they need concerning their legal obligations as grantees.'' 85
FR 47901. In the waiver notice accompanying the PCNC regulation, HUD
asserted that ``[i]n light of this public engagement, continued notice
and comment concerning AFFH is unnecessary and would simply be a legal
formality without adding substance to the debate.'' \8\ The waiver did
not acknowledge that, while other issues related to the AFFH
requirement had been the subject of notice and public comment, the
definition of AFFH that appears in the PCNC rule had never been
published for public comment. Notwithstanding this lack of prior notice
and comment, the PCNC rule withdrew the 2015 rule's definition of the
AFFH obligation and replaced it with a novel definition that HUD now
finds was not a reasonable interpretation of the statutory mandate. The
PCNC rule acknowledged that, under any reasonable reading of the AFFH
requirement, compliance ``requires more than simply not
discriminating,'' and grantees are required to ``actually promote fair
housing.'' 85 FR 47902. Nevertheless, the rule went on to define ``fair
housing'' as ``housing that, among other attributes, is affordable,
safe, decent, free of unlawful discrimination, and accessible as
required under civil rights laws.'' 85 FR 47905. The rule thus
redefined ``fair housing'' to include attributes such as ``safe'' and
``decent'' that, while laudable and consistent with HUD's mission, are
legally distinct from the requirements of the Fair Housing Act's AFFH
obligation. It then revised the regulatory definition of
``affirmatively further'' to mean ``to take any action rationally
related to promoting any attribute or attributes of fair housing . .
.'' Id. (emphasis added). Finally, the PCNC rule provided that a
program participant's certification of compliance with this statutory
duty would be deemed sufficient if the participant took, during the
relevant period, ``any action that is rationally related to promoting
one or more attributes of fair housing. . . ,'' using the definition of
``fair housing'' described above. 85 FR 47906.
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\8\ Partial Waiver of 24 CFR 10.1 Notice-and-Comment Requirement
(July 23, 2020), <a href="https://www.hud.gov/sites/dfiles/ENF/documents/6228-F-01%20PCNC%20-%20SIGNED%20Waiver%20-%207.23.20.11.42.pdf">https://www.hud.gov/sites/dfiles/ENF/documents/6228-F-01%20PCNC%20-%20SIGNED%20Waiver%20-%207.23.20.11.42.pdf</a>.
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Thus, under the PCNC rule, a program participant's certification of
compliance with the AFFH obligation amounted to a certification that
the program participant would take any action rationally related to
promoting one or more of the following ``attributes'': Housing that is
affordable, safe, decent, free of unlawful discrimination, or
accessible as required under civil rights laws. This certification
requirement can be satisfied with minimal or no action not already
required by other non-civil rights statutes and HUD rules, and without
doing anything to remedy fair housing issues. For example, a
jurisdiction taking any steps to meet HUD's programmatic requirements
for maintaining the physical condition of federally supported housing,
such as ensuring that fire exits are not blocked, smoke detectors are
in good working order, or lighting is adequate, could certify
compliance under the PCNC rule, despite taking no steps to stop
discrimination that violates the Fair Housing Act, let alone any
proactive steps of the kind the AFFH statutory mandate requires. Put
simply, the PCNC rule made a participant's certification insufficient
to ensure compliance with the AFFH obligation.
HUD thus finds that the PCNC rule did not interpret the AFFH
mandate in a manner consistent with statutory requirements, HUD's prior
interpretations, or judicial precedent. Nor did it provide sufficient
justification for this substantial departure. Rather than attempting to
reconcile its definition with these precedents, the PCNC rule dismissed
them as mistaken in conclusory fashion. 85 FR 47902.
Through this rule, HUD is repealing the PCNC rule and publishing
this interim final rule to reinstate the relevant definitions that were
promulgated pursuant to the APA's notice and comment requirements in
HUD's 2015 AFFH rule, as well as appropriate certifications that
incorporate these definitions, effective on July 31, 2021. This interim
final rule thus reinstates the regulatory requirement, consistent with
the statutory mandate, agency interpretations, and judicial precedent,
that program participants certify that they take 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 or
ethnically concentrated areas of poverty into areas of opportunity, and
fostering and maintaining compliance with civil rights and fair housing
laws. Program participants have long been accustomed to certifying
compliance with this substantive standard and comparable procedural
requirements (such as completion of the AI process). Additionally,
while this interim final rule does not require program participants to
undertake any specific type of fair housing planning to support their
certifications, it provides notice that HUD will once again offer
technical support and other assistance for jurisdictions that wish to
undertake AFHs, AIs, or other forms of fair housing planning.
[[Page 30784]]
II. Justification for Interim Rule
Good Cause Under the Administrative Procedure Act
In general, HUD publishes a rule for public comment in accordance
with both the APA, 5 U.S.C. 553, and the agency's regulation on
rulemaking at 24 CFR part 10. Both the APA and Part 10, however,
provide for exceptions from that general rule where HUD finds good
cause to omit advance notice of the opportunity for public comment. The
good cause requirement is satisfied when prior public procedure is
``impracticable, unnecessary, or contrary to the public interest.'' 5
U.S.C. 553(b)(B). In order to publish a rule for effect prior to
receiving and responding to public comments (i.e., an interim final
rule), the agency must make a finding that ``good cause'' exists.
HUD has determined that good cause exists to promulgate this
interim final rule because it is in the public interest to publish this
rule without advance notice and public comment in light of the present
circumstances, and that subjecting the rule to notice and comment prior
to publication would be impracticable and unnecessary. HUD's
determination is based on, among other things, a combination of the
following considerations. This interim final rule rescinds the PCNC
regulation, currently codified at 24 CFR parts 5, 91, 92, 570, 574, and
903. HUD finds that the PCNC rule was promulgated improperly without
notice and comment, and without sufficient explanation for its
substantial departure from prior agency interpretations and judicial
precedent concerning the AFFH obligation. As a result, the PCNC Rule
creates substantial risks that reliance on the rule's certifications by
HUD funding recipients, many of which are in jurisdictions where
caselaw is irreconcilable with the PCNC rule, may place them in
jeopardy of violation of their statutory AFFH obligations, and, were
HUD to accept these certifications, may place the agency at risk of
violating its own statutory duty to affirmatively further fair housing.
While the PCNC rule fundamentally altered the regulatory landscape,
this interim final rule is limited in scope and imposes no new
requirements that have not already been the subject of prior notice and
comment. It reinstates provisions that were in effect prior to the PCNC
rule's promulgation. Under the unique circumstances here, HUD has good
cause to omit advance notice and public comment prior to this rule
taking effect.
Notwithstanding these good cause determinations for this IFR
interim final rule to take effect without advance notice and comment,
HUD still requests and encourages public comments on all matters
addressed in this rule. Moreover, HUD recognizes that program
participants may need some time to adjust to this restoration and may
choose to seek assistance from HUD in doing so, and therefore delays
the effective date until July 31, 2021. HUD has determined this is the
longest delay it can provide consistent with the need to reinstate AFFH
certifications that help ensure program participants' compliance with
their statutory AFFH obligations in their expenditure of billions of
federal dollars prior to the date on which many program participants
make their annual certifications of compliance. HUD thus requests
comments within 30 days of publication so that it may consider public
views prior to the effective date.
This Limited Rulemaking Is Consistent With Notice-and-Comment
Principles, Because It Restores Provisions That Have Gone Through
Notice and Comment While Rescinding Provisions That Have Not
This limited rulemaking reinstates definitions and corresponding
certifications from the 2015 AFFH rule and provides notice of the
reinstatement of a voluntary process by which HUD will assist program
participants in complying with their AFFH obligations. HUD previously
promulgated these provisions after extensive notice-and-comment
process, so they are familiar to HUD program participants. HUD
published a Notice of Proposed Rulemaking (NPRM) for its AFFH rule in
2013 and received over one thousand public comments. 78 FR 43709. HUD
reviewed and considered those comments and then promulgated the AFFH
rule in 2015.\9\ In this interim final rule, HUD is reinstating
definitions already promulgated in the 2015 rule, with a few technical
changes to conform provisions that previously assumed the existence of
mandatory fair housing planning process and other procedures, such as
completing an AFH or AI, to the more limited structure of this interim
final rule.
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\9\ HUD's full response to public comment on the restored
definitions is contained in the preamble to the original publication
of the 2015 AFFH rule at 80 FR 42272. Cf. Citronelle-Mobile
Gathering, Inc. v. Gulf Oil Corp., 420 F. Supp. 162, 170-71 (S.D.
Ala. 1975), remanded on other grounds, 578 F.2d 1149 (5th Cir. 1978)
(noting that the agency could have invoked ``good cause'' if it had
been required to repromulgate its existing regulations because the
regulations had previously been promulgated pursuant to notice and
comment, stating, ``No real purpose would have been served by
requiring the redundant solicitation of public comment. This had
already been previously accorded for exactly the same regulation in
question . . . Repromulgation would have required the administrative
procedures be once more employed, necessitating delay and a lapse in
regulatory enforcement. This would have served no useful
purpose.'').
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Reinstating these definitions and corresponding certifications
prior to public notice and comment is also necessary because the PCNC
rule provided no opportunity for the public to comment before
comprehensively redefining the AFFH mandate and the content of
corresponding certifications that funding recipients make on a regular
basis. Where, as here, a familiar regulatory definition that has passed
through extensive notice and comment scrutiny is available, HUD
believes the public interest is disserved by requiring funding
recipients to certify compliance to a definition that has not benefited
from public comment.
As an initial matter, HUD now believes it is doubtful that PCNC's
invocation of notice and comment waiver authority was appropriate. PCNC
invoked HUD's general regulatory waiver authority under 24 CFR 5.110 to
waive its Part 10 regulations, which otherwise would have required
notice-and-comment procedures, but in doing so it downplayed the
statutory requirement that HUD maintain its Part 10 regulation, as well
as the general principle that notice-and-comment rulemaking for major
legal change best serves the public interest. A longstanding statutory
provision requires HUD to maintain its Part 10 requirements, i.e., to
comply with notice-and-comment requirements.\10\ In the PCNC rule, HUD
minimized the significance of this provision, stating that Congress did
``not abrogate the Secretary's independent statutory authority under 42
U.S.C. 3535(q) to waive regulations in specific circumstances.'' 85 FR
47904 (FN 78). HUD now believes that this was an overly restrictive
reading of this provision that ignored Congress's clear intent to limit
HUD's authority to eschew notice-and-comment requirements.
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\10\ See Departments of Veterans Affairs and Housing and Urban
Development, and Independent Agencies Appropriations Act, 1998,
Public Law 105-65, 111 Stat. 1344, 1365, Sec. 208 (Oct. 27, 1997).
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In any event, regardless of whether PCNC's reliance on the
regulatory waiver to bypass notice-and-comment requirements was lawful,
HUD believes it disserved the public interest such that there is a
strong interest in immediately restoring a regulatory definition that
has gone through notice-and-comment scrutiny and more sustained agency
and public consideration. PCNC abandoned the agency's longstanding
[[Page 30785]]
understanding of the AFFH obligation, declined to follow judicial
precedent, and suddenly altered the duties and obligations of funding
recipients around the country. No judicial authority or HUD guidance
exists that would help program participants, communities, and fair
housing stakeholders reconcile this newly minted definition with
better-established understandings of the AFFH requirement. PCNC
acknowledged this lack of judicial or agency precedent supporting its
redefinition of the AFFH requirement. See 85 FR 47902, 47903 FN 54,
62.\11\ It relied solely on dictionaries, id. at 47901-902, but without
explaining how this approach justified the redefinition of the term
``fair housing'' to include actions that do not constitute fair housing
as this term is ordinarily used. HUD relied heavily on a policy-driven
conclusion that it is too burdensome for program participants to
conduct any fair housing analysis, not just of the sort that was
required by the 2015 rule, but of the sort that was required for
decades before. Id. at 47902-903. These fundamental changes in how the
agency understands and implements a statutory obligation are of the
magnitude that should warrant notice and comment.
---------------------------------------------------------------------------
\11\ PCNC's preamble pointed to the Cranston Gonzales National
Affordable Housing Act, of 1990, Public Law 101-625 102, 105, for
the proposition that ``Congress also broadened national housing
policy grants administered by HUD, requiring AFFH certifications, to
include goals such as a `decent, safe, and sanitary housing for
every American' and increasing the supply of `affordable housing.'''
See 85 FR 47901. But this statute has several purposes. While one of
its purposes was to promote decent, safe, and sanitary housing, and
it incorporated a requirement that covered entities certify that
they would affirmatively further fair housing, the statute does not
include a nexus between that purpose and fair housing. As a result,
HUD's prior reliance on Cranston Gonzalez to justify this novel
definition of fair housing was misplaced.
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In this context, this interim final rule is not an attempt to avoid
notice and comment obligations; instead, it suspends a rule that is
inconsistent with the AFFH statutory mandate, HUD's prior
interpretations, and judicial precedent and was improperly promulgated
without notice and opportunity for comment in favor of provisions drawn
from a rule that assiduously followed that process. HUD believes that
leaving the PCNC rule in place--thus causing grant recipients to rely
upon a confusing rule that was promulgated in disregard of notice and
comment obligations--while seeking comment prior to publication on a
proposal to reinstate provisions from the 2015 rule would subvert
rather than honor the purposes of the notice and comment process. Cf.
Friends of Animals v. Bernhardt, 961 F.3d 1197, 1206 (D.C. Cir. 2020)
(``But we do not see how a government action that illegally never went
through notice and comment gains the same status as a properly
promulgated rule such that notice and comment is required to withdraw
it. . . we are faced only with the repeal of a ``rule'' that illegally
never went through notice and comment--in other words, a `non-rule
rule.'''). The notice-and-comment requirement is intended to ``serve
the public interest by providing a forum for the robust debate of
competing and frequently complicated policy considerations.'' Nat. Res.
Def. Council v. Nat'l Highway Traffic Safety Admin., 894 F.3d 95, 115
(2d Cir. 2018); see also Consumer Energy, Etc. v. F.E.R.C., 673 F.2d
425, 446 (D.C. Cir. 1982) (``The value of notice and comment prior to
repeal of a final rule is that it ensures that an agency will not undo
all that it accomplished through its rulemaking without giving all
parties an opportunity to comment on the wisdom of repeal.''). HUD has
determined that these salutary purposes are best served by reinstating
provisions that have been subject to this ``robust debate'' but were
undone without notice and comment, particularly as there has been
little reliance on the PCNC rule's definitions and certifications,
which have been in place for only a short period of time.
Consistent with its commitment to principles of notice-and-comment
rulemaking, HUD now solicits comments on the provisions it now
promulgates on an interim basis and will consider all comments prior to
the effective date of this interim final rule. HUD anticipates
separately issuing an NPRM, which (unlike this interim final rule) will
propose provisions that have not previously gone through notice and
comment rulemaking. That notice will set forth and seek comment on more
detailed proposed implementation of a program participant's AFFH
obligations and will seek to build on and improve the processes set
forth in the 2015 AFFH rule to further help funding recipients comply
with their statutory obligation while reducing the regulatory burden on
them. HUD welcomes public participation in these efforts to continue to
strengthen fair housing outcomes while reducing burden on program
participants.
HUD Believes the PCNC Rule Is Not Based on a Reasonable Construction of
the AFFH Requirement as Construed by the Courts and Ratified by
Congress
While HUD has ample discretion to construe and apply the AFFH
requirement, the PCNC regulation is fundamentally inconsistent with the
agency's longstanding interpretation of its and funding recipients'
statutory obligation to AFFH, as well as the decades of authority
described above interpreting the scope of this obligation. The current
regulation does not require that program participants take any steps to
further any fair housing outcomes as the term ``fair housing'' is
generally understood, whereas the Housing and Community Development Act
of 1974, the Cranston-Gonzalez National Affordable Housing Act, and the
Quality Housing and Work Responsibility Act of 1998 all require program
participants to certify that they will affirmatively further fair
housing as Congress understood and ratified the term. This conflict
puts program participants at risk of confusion and violation of a
statutory duty. It is in the public interest not to expose program
participants to that risk.
As explained above, under the current regulation, a program
participant's certification of compliance with the AFFH obligation
amounts only to a certification that the program participant will take
any single action rationally related to promoting one or more of the
following ``attributes:'' Housing that is affordable, safe, decent,
free of unlawful discrimination, or accessible as required under civil
rights laws. Put simply, under PCNC, HUD is not requiring program
participants to certify that they are taking actions that meet their
actual statutory obligation to AFFH, and HUD risks not fulfilling its
own understanding of its statutory obligations.
The PCNC rule thus does not represent a selection among reasonable
options within HUD's discretion. Had HUD given notice and taken comment
before promulgating it, this substantive infirmity would almost
certainly have been pointed out and HUD would have had to address it.
The failure to abide by notice-and-comment requirements before
promulgating the PCNC rule therefore is closely connected with the
failure to put in place regulatory definitions that are consistent with
precedent and that foster compliance with the law. HUD believes the
public interest is best served by the timely reinstatement, prior to
the deadline by which a great number of program participants must
certify compliance, of definitions that not only went through notice-
and-comment procedures but are familiar to program participants; are
consistent with well-established judicial and agency precedent
construing the AFFH obligation and certifications incorporating these
definitions; and are further elaborated by years of regulatory
[[Page 30786]]
guidance that HUD has issued to assist grantees in compliance.
Compliance with AFFH is included as a condition in a myriad of funding
notices that HUD publishes on a regular basis and that it cannot delay
past the effective date of this interim final rule. Similarly, HUD
cannot delay past the effective date of this interim final rule because
participants in the Community Development Block Grant (CDBG) program
must submit their Annual Action Plans, which include AFFH
certifications, by August 16 each year.
Each year, HUD provides States, local governments, and public
housing agencies with billions of dollars in federal financial
assistance, appropriated and authorized by Congress. As part of HUD's
obligations as a grantor agency, consistent with longstanding statutory
requirements, HUD oversees the use of such funds to ensure that
taxpayer dollars are used in a responsible manner that is consistent
with the law. For example, HUD is obligated to ensure that all federal
grants are made consistently and in accordance with federal grant
making requirements set forth at 2 CFR part 200. These requirements
obligate HUD to engage in active oversight of its recipients, including
ensuring compliance with civil rights requirements. See, e.g., 2 CFR
200.300 (``The Federal awarding agency must manage and administer the
Federal award in a manner so as to ensure that Federal funding is
expended and associated programs are implemented in full accordance
with the U.S. Constitution, Federal Law, and public policy
requirements: Including, but not limited to, those protecting free
speech, religious liberty, public welfare, the environment, and
prohibiting discrimination.'').
As a vital part of this oversight role, HUD requires program
participants to annually certify that they will comply with various
federal requirements, including the obligation to affirmatively further
fair housing. Under the PCNC Rule, these certifications are to a
standard that is inconsistent with the underlying legal obligation,
preventing HUD from relying on them to carry out its oversight
obligations. For these reasons, and with impending deadlines including
the August 16 CDBG annual action plan deadline, it is imperative that
HUD immediately provide its recipients with legally supportable
definitions and certifications for HUD to meet its own obligations as a
grantor agency and put its grantees on notice that PCNC represents a
standard that HUD now believes is not consistent with the statutory
obligation to affirmatively further fair housing. Moreover, because
certifications made under the PCNC rule do not require compliance with
the Fair Housing Act, allowing that rule to remain in place risks
further entrenching segregation and inequity in access to housing and
opportunity, challenges that have been exacerbated by presently
converging health, economic, and climate crises.
HUD Is Delaying the Effective Date of This Interim Final Rule Until
July 31, 2021
While HUD is providing notice immediately that it does not regard
the PCNC definitions as compliant with the statutory AFFH obligation,
HUD's prior interpretations, and judicial precedent, HUD is delaying
the effective date of this interim final rule until July 31, 2021 to
give program participants time to adjust. HUD has determined that this
is the longest delay of the effective date it can provide while
ensuring that municipalities and other participants in the Community
Development Block Grant program can submit annual action plans,
including AFFH certifications, that are consistent with the AFFH
statutory obligation as described above. CDBG annual action plans must
be submitted by August 16 each year, and so HUD has determined that it
is necessary for this rule to go into effect before then and to provide
program participants with sufficient notice.\12\
---------------------------------------------------------------------------
\12\ See 42 U.S.C. 5316(b); 24 CFR 91.15(a); 24 CFR
570.304(c)(1).
---------------------------------------------------------------------------
Between the date of publication and the effective date, HUD will
provide additional clarity to affected program participants. HUD will
provide guidance and technical support to program participants
regarding the interim final rule, including with respect to the
reinstated definitions and certifications and with respect to fair
housing planning and actions that program participants may voluntarily
undertake in support of their certifications. Additionally, although
the definitions have already been the subject of notice-and-comment
rulemaking, HUD will seek comment for a period of 30 days from
publication to solicit additional views. HUD will carefully consider
all such comments and in response to those comments, as it deems
appropriate, may amend the interim final rule accordingly.
Conclusion
Under the totality of the circumstances described above, HUD
believes this limited-in-scope interim final rule is justified by good
cause.\13\ HUD finds that the PCNC rule is contrary to the AFFH
statutory mandate and constitutes a substantial departure from HUD's
prior interpretations and judicial precedent. Moreover, the PCNC rule
is contrary to multiple Congressional mandates with which HUD must act
promptly to comply by removing the PCNC regulation and restoring
definitions upon which program participants can reasonably rely in
certifying compliance with their statutory duty to AFFH. HUD further
finds that the PCNC rule was improperly promulgated without a
sufficient reason for forgoing notice and comment rulemaking. This
interim final rule reinstates provisions that have already undergone
sufficient notice and comment processes, and HUD is now inviting
additional comment and delaying the effective date of this interim
final rule until July 31, 2021. HUD may further revise this interim
final rule before its effective date in response to these comments.
Additionally, HUD is reestablishing voluntary processes and technical
assistance to assist program participants in complying with their
statutory AFFH obligations and engage in fair housing planning.
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\13\ See Petry v. Block, 737 F.2d 1193, 1200 (D.C. Cir. 1984)
(``For here the combination of several extraordinary factors
validates the Department's adoption of the interim rule under the
mantle of `good cause.' ''); see also Nat'l Women, Infants, &
Children Grocers Ass'n v. Food & Nutrition Serv., 416 F. Supp. 2d
92, 105-107 (D.D.C. 2006) (finding that, under the totality of
circumstances, a combination of the four reasons advanced by the
agency established good cause to promulgate an interim final rule).
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III. This Interim Final Rule
Against this backdrop, this interim rulemaking is narrowly focused
to meet the urgent need to withdraw the PCNC rule definition, which
promotes confusion and noncompliance with the statutory obligation to
AFFH, and to reinstate a definition that properly states that duty and
is the result of notice and comment rulemaking. This interim final rule
restores the understanding of the AFFH obligation for certain
recipients of federal financial assistance from HUD to the previously
established understanding by reinstating legally supportable
definitions that are consistent with a meaningful AFFH requirement and
certifications that incorporate these definitions. HUD has also amended
the certifications in the program regulations at 24 CFR 91.225, 91.325,
91.425, 570.487, 903.7, and related record keeping requirements to
restore meaningful AFFH certifications that incorporate appropriate
definitions.
[[Page 30787]]
Amendments to 24 CFR parts 92, 570, 574, and 576 include updated cross-
references and clarification of program participants in the HOME, CDBG,
Housing Opportunities for Persons With AIDS (HOPWA), and Emergency
Solutions Grants programs regarding recordkeeping requirements. In a
similar manner, this interim final rule amends 24 CFR 903.7(o), 903.15,
and 24 CFR 903.23(f) to update cross-references to the amended
definitions and certification provisions in 24 CFR 5.151 and 5.152 and
to explain the relationship of the public housing agency plans to the
consolidated plan and a PHA's fair housing requirements. The
regulations also explain how HUD will assist program participants in
carrying out their obligation and provides attendant definitions in 24
CFR 5.152. With this interim final rule, HUD does not, however,
reinstate the obligation to conduct an AFH or AI, or mandate any
specific fair housing planning mechanism.
The effect of the reinstatement of the 2015 AFFH rule definitions
and certifications incorporating those definitions is that recipients
once again can rely on HUD's regulatory definition to accurately
articulate the purpose and meaning of their AFFH obligation. The
critical importance of requiring funding recipients to certify to a
regulatory definition that is consistent with longtime understandings
of the AFFH obligation was recognized by the court in National Fair
Housing Alliance v. Carson, 330 F. Supp. 3d 14 (D.D.C. 2018). In that
case, plaintiffs challenged HUD's withdrawal of the Local Government
Assessment Tools (and effective suspension of the AFH process),
contending that eliminating these procedural requirements put HUD in
violation of its own obligation to ensure that funding recipients
comply with the AFFH requirement. The court determined that HUD's
actions were not contrary to the Fair Housing Act because the AI
requirement and the 2015 rule's definitions and certifications
incorporating those definitions remained in place. See 330 F. Supp. 3d
at 45. Accordingly, when HUD published PCNC and replaced the 2015
rule's definitions with ones unmoored from the Fair Housing Act, it
withdrew the underpinnings of National Fair Housing Alliance v.
Carson's reasoning that HUD was continuing to require compliance with
the Act's substantive obligation.
Since some of the 2015 Rule's definitions may not be applicable
absent the obligation to conduct an AFH or AI, HUD is not reinstating
all definitions from the 2015 AFFH rule at 24 CFR 5.152 (2015).
Instead, HUD is promulgating only those that are applicable and in
force under this limited-in-scope interim final rule.\14\ HUD is
providing the definitions at 24 CFR 5.151 in order to inform program
participants of how these terms are applied. The definitions include:
``Affirmatively Furthering Fair Housing,'' ``Disability,'' ``Fair
Housing Choice,'' ``Housing Programs Serving Specified Populations,''
``Integration,'' ``Meaningful Actions,'' ``Racially or Ethnically
Concentrated Areas of Poverty,'' ``Segregation,'' and ``Significant
Disparities in Opportunity.'' These definitions correspond with the
AFFH statutory mandates, HUD's long-standing interpretations, and
judicial precedent.
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\14\ While some definitions from the 2015 AFFH rule referred to
the Assessment Tool to provide more information, HUD does not
restore these references. HUD has removed references to the AFH and
other provisions of the 2015 AFFH rule that are no longer
applicable. HUD restores 24 CFR 5.150 to similarly align with this
approach, explaining that the purpose of the regulations, pursuant
to the statutory obligation to affirmatively further fair housing,
is to provide program participants with a substantive definition of
the AFFH requirement, as well as to provide access to an effective
planning approach to aid those program participants that wish to
avail themselves of it in taking meaningful actions to overcome
historic patterns of segregation, promote fair housing choice, and
foster inclusive communities that are free from discrimination.
These conforming edits to the definitions and purpose do not change
the meaning of the terms; they merely align them to the previously
published regulations that are restored here. HUD believes that the
restoration of these definitions will be helpful to recipients as
they certify that they are affirmatively furthering fair housing
consistent with prior judicial interpretations of the statutory
mandate to affirmatively further fair housing.
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HUD provides the definition of ``Affirmatively Furthering Fair
Housing'' based on numerous judicial interpretations of the Fair
Housing Act. For example, in Otero v. New York City Housing Auth., the
Second Circuit held that the AFFH mandate requires that ``[a]ction must
be taken to fulfill, as much as possible, the goal of open, integrated
residential housing patterns and to prevent the increase of
segregation, in ghettos, of racial groups whose lack of opportunities
the Act was designed to combat.'' Otero, 484 F.2d at 1134. It found
that this requirement flows from the evident legislative purpose, as
Senator Mondale ``pointed out that the proposed law was designed to
replace the ghettos `by truly integrated and balanced living patterns.'
'' Otero, 484 F.2d at 1134 (citing 114 Cong. Reg. 3422).
Similarly, in NAACP, Boston Chapter v. HUD, 817 F.2d at 154, the
First Circuit held that ``as a matter of language and logic, a statute
that instructs an agency `affirmatively to further' a national policy
of nondiscrimination would seem to impose an obligation to do more than
simply not discriminate itself.'' NAACP, Boston Chapter, 817 F.2d at
154. It found that ``. . . a failure to `consider the effect of a HUD
grant on the racial and socio-economic composition of the surrounding
area' '' would be inconsistent with the Fair Housing Act's mandate. Id.
at 156. Further, the court found that ``the need for such consideration
itself implies, at a minimum, an obligation to assess negatively those
aspects of a proposed course of action that would further limit the
supply of genuinely open housing and to assess positively those aspects
of a proposed course of action that would increase that supply.'' Id.
If HUD is ``doing so in any meaningful way, one would expect to see,
over time, if not in any individual case, HUD activity that tends to
increase, or at least, that does not significantly diminish, the supply
of open housing.'' Id.
Similarly, in Thompson v. HUD, the court found that the AFFH
mandate requires consideration of the effect of its policies on the
racial and socioeconomic composition of the surrounding area. Thompson,
348. F. Supp. 2d at 409; see also Garrett v. Hamtramck, 335 F. Supp.
16, 27 (E.D. Mich. 1971), aff'd 503 F.2d 1236 (6th Cir. 1974). HUD
believes the 2015 rule's definition of AFFH is consistent with these
rulings and others and can ensure that HUD and its program participants
comply with the AFFH requirement.
Relatedly, in this interim final rule, HUD is including a
definition of ``Fair Housing Choice'' that is consistent with these
cases and others. For example, in Thompson, the court found that, ``it
is appropriate to note that there is a distinction between telling a
person that he or she may not live in [a] place because of race and
giving the person a choice so long as the place in question is, in
fact, available to anyone without regard to race.'' 348 F. Supp. 2d at
450.
The other definitions provided in this interim final rule, which
help to detail the meaning of the AFFH obligation, are similarly rooted
in judicial precedent and statutory purpose. In Otero, the Second
Circuit held that the AFFH mandate extends beyond HUD and to its
recipients (in that case, the housing authority) and required funding
recipients to take affirmative steps to promote integration. 484 F.2d
at 1124. The obligation of program participants to take ``Meaningful
Actions,'' as defined in the 2015 rule and in this interim final rule,
is a reasonable interpretation of this holding. See also NAACP, Boston
Chapter, 817 F.2d at
[[Page 30788]]
154 (requiring the assessment of actions in a ``meaningful way'').
In addition, because the AFFH obligation as intended by Congress
and construed by the courts requires efforts to decrease segregation
and promote integration, HUD finds it appropriate to once again include
those concepts in the definition of AFFH and, in turn, reinstate the
definitions for both ``Segregation'' and the converse, ``Integration,''
from the 2015 rule. See Client's Council v. Pierce, 711 F.2d 1406, 1425
(8th Cir. 1983) (``Congress enacted section 3608(e)(5) to cure the
widespread problem of segregation in public housing''); see also
Resident Advisory Bd. v. Rizzo, 425 F. Supp. 987, 1013-1019 (E.D. Pa.
1976) aff'd in part, rev'd in part on other grounds, 564 F.2d 126 (3d
Cir.), cert. denied, 435 U.S. 908 (1977) (``Each case brought under
[3608(e)(5)] requires a close analysis of the facts peculiar to that
case and the city in which the facts have occurred . . . in view of the
pattern of racial segregation which prevailed in both private and
public housing in Philadelphia, the City of Philadelphia has not, under
the facts of this case, met its duty of affirmatively implementing the
national policy of fair housing and has violated Title VIII of the
Civil Rights Act of 1968.); Otero, 484 F.2d at 1133-34 (explaining that
``. . . the affirmative duty placed on the Secretary of HUD by Sec.
3608(e)(5) and through him on other agencies administering federally-
assisted housing programs also requires that consideration be given to
the impact of proposed public housing programs on the racial
concentration in the area in which the proposed housing is to be
built.'').
HUD is also reinstating the definition of ``Housing Programs
Serving Specified Populations'' in this rule. Such programs include HUD
and Federal Housing programs, such as HUD's Supportive Housing for the
Elderly, Supportive Housing for Persons with Disabilities, and homeless
assistance programs under McKinney-Vento Homeless Assistance Act (42
U.S.C.11301, et seq.), and housing designated under section 7 of the
United States Housing Act of 1937 (42 U.S.C. 1437e) that serve specific
identified populations and comply with Federal civil rights statutes
and regulations. The inclusion of this definition is necessary to
assure current and prospective program participants that participation
in these specified Federal housing programs does not present a fair
housing issue of segregation, provided that such programs are
administered to comply with program regulations and applicable civil
rights requirements.
Judicial precedents similarly held that, as a necessary precursor
to fulfilling the ultimate obligation of pursuing actions that foster
desegregation and avoid perpetuating segregation, the AFFH mandate
requires program participants to assess the demographics of discrete
geographic areas when conducting an analysis. For example, the Third
Circuit found that the AFFH mandate requires obtaining the information
necessary to make informed decisions on the effects of site selection
or type selection of housing with regard to racial concentration,
determining that even within the discretion afforded by the AFFH
mandate, judgment must be ``informed.'' See Shannon, 436 F.2d at 820-
22.
In light of these judicial precedents, this rule reinstates the
definitions of ``Data'' and ``Significant Disparities in Access to
Opportunity.'' In doing so, it restores a reasonable interpretation of
precedents holding that the AFFH obligation requires the consideration
of data such as the racial demographics of neighborhoods, other
geographic areas, and housing developments, as a necessary precursor to
taking meaningful action to promote integration, decrease segregation,
undo racially or ethnically concentrated areas of poverty, and overcome
significant disparities in access to opportunity. See, e.g., Blackshear
Res. Org. v. Housing Auth. of City of Austin, 347 F. Supp. 1138, 1148
(W.D. Tex. 1971) (holding that both the PHA and HUD were charged with
the obligation to AFFH and their decision ``failed to consider that
policy'' and must be set aside because HUD had not considered ``hard,
reliable data showing the racial demography of any of these areas''
despite the readily available data that could have been consulted.).
Finally, HUD is including definitions of ``Protected
Characteristic,'' ``Protected Class,'' and ``Disability.'' The
definition of ``Disability'' in this interim final rule, as in the 2015
AFFH Rule, is intended to be consistent with other federal civil rights
laws with which program participants must comply, such as Section 504
of the Rehabilitation Act of 1973 and the Americans with Disabilities
Act of 1990, as amended by the ADA Amendments Act of 2008. HUD
incorporates by reference the definition of disability under Section
504 and the ADA as interpreted by the Attorney General, see 28 CFR
35.108, for purposes of the affirmatively furthering fair housing
obligation under Section 808(e)(5) so as to provide consistency and
clarity to HUD program participants, which are all already bound by the
same definition under those statutes.
In addition to reinstating these definitions, HUD restores the
certifications that incorporate these definitions. HUD has sometimes
required funding recipients to certify to compliance with certain
procedures (such as creating an AI) that implement the caselaw above
and has sometimes required certification to a substantive standard. HUD
is not mandating any particular procedure by which program participants
must engage in fair housing planning in this interim final rule, but
rather is reinstating a meaningful substantive definition of AFFH.
Additionally, HUD interprets its own statutory obligation as
requiring it to assist program participants with compliance, and in any
event HUD's experience teaches it that such assistance leads to better
fair housing outcomes. Through this interim final rule, HUD resumes a
process for providing technical assistance to program participants that
engage in fair housing planning, including, in particular, the familiar
AI and AFH processes.
HUD anticipates that many program participants may wish to engage
in voluntary fair housing planning processes that support their AFFH
certifications. Most program participants have already prepared an AI
or AFH, which were required by the regulations that preceded the PCNC
rule, and so HUD anticipates that many program participants may wish to
continue to implement or update their AI or AFH to support their AFFH
certifications. Accordingly, HUD will provide technical assistance and
other support to program participants that voluntarily engage in the AI
or AFH planning processes. This interim final rule does not require
program participants to comply with these processes, but HUD
anticipates the continued use of the AI or AFH process are ways program
participants may choose to support AFFH certifications while
maintaining continuity.
Program participants may also choose to support their
certifications and maintain records in other meaningful ways, provided
they can appropriately certify that they will AFFH, consistent with the
definitions that are restored in this rule. Program participants are
encouraged to seek technical assistance from HUD's Office of Fair
Housing and Equal Opportunity (FHEO) regarding any fair housing
planning process.
Under its authority regarding a grantee's certifications, HUD may
review recipients' records and documents to confirm the validity of
[[Page 30789]]
certifications submitted to HUD in connection with the receipt of
Federal funds. HUD only intends to undertake such a review when it has
reason to believe the certifications submitted are not supported by the
recipients' actions. HUD expects these instances to be rare and will
provide all required notice to recipients of any review to be
undertaken.
Consistent with this interim final rule, HUD will separately
restore the guidance and resources available for recipients' use in
conducting fair housing planning until such time as HUD finalizes a new
regulation to implement the statutory mandate to AFFH at 42 U.S.C.
3608(e)(5). While the AFFH Rule Guidebook was published to further the
implementation of the 2015 AFFH rule, its content may assist recipients
in identifying areas of analysis and strategies and actions that would
overcome historic patterns of segregation, promote integration,
increase access to opportunity, and ensure fair housing choice. As
such, HUD will republish both the FHPG and the AFFH Rule Guidebook. It
also will keep the AFFH Data and Mapping Tool (the AFFH-T) publicly
available,\15\ so that program participants have racial, socioeconomic,
and other data to engage in fair housing planning.
---------------------------------------------------------------------------
\15\ HUD has continued to update the data used in this tool on a
yearly basis. The data was last updated in summer 2020.
---------------------------------------------------------------------------
HUD will also make available the Assessment Tool for Local
Governments and the Assessment Tool for Public Housing Agencies, which
previously were made available as an optional format to follow to
conduct an AI, and which some program participants have chosen to use
to guide their fair housing planning processes.
HUD's provision on a voluntary basis of a variety of familiar tools
is intended to reduce the burden on recipients while ensuring that they
have tools for fair housing planning in order to AFFH as HUD works
toward an implementation scheme that will further reduce burden for
recipients while bolstering fair housing outcomes.
As noted, HUD will solicit comments through a separate NPRM on how
to amend the 2015 AFFH rule to achieve both burden reduction and
material, positive change that affirmatively furthers fair housing.
For the reasons described in this preamble, this rule is necessary
to comply with the Congressional mandate to AFFH and the statutory
certifications, consistent with the directive in the FY1998
appropriations. While HUD will solicit public comments on the NPRM
through separate Federal Register notice, HUD here requests and
encourages public comments on all matters addressed in this interim
final rule.
IV. Findings and Certifications
Executive Orders 12866 and 13563, Regulatory Planning and Review
Pursuant to Executive Order 12866 (Regulatory Planning and Review),
a determination must be made whether a regulatory action is significant
and therefore, subject to review by the Office of Management and Budget
(OMB) in accordance with the requirements of the Executive Order. This
interim final rule has been determined to be a ``significant regulatory
action,'' as defined in section 3(f) of Executive Order 12866, but not
economically significant. Because nothing in this rule imposes any
specific regulatory requirements and because the substantive standard
that this rule reinstates is one that program participants have long
followed, HUD anticipates that this rule will have no economic effects.
Executive Order 13563 (Improving Regulations and Regulatory Review)
directs executive agencies to analyze regulations that are ``outmoded,
ineffective, insufficient, or excessively burdensome, and to modify,
streamline, expand, or repeal them in accordance with what has been
learned.'' Executive Order 13563 also directs that, where relevant,
feasible, and consistent with regulatory objectives, and to the extent
permitted by law, agencies are to identify and consider regulatory
approaches that reduce burdens and maintain flexibility and freedom of
choice for the public. This interim final rule clarifies the obligation
with which HUD grantees are already required to comply by statute. HUD,
therefore, believes that this final rule would provide flexibility and
freedom for HUD grantees to AFFH, consistent with the statutory
mandate, and is consistent with Executive Order 13563.
Executive Order 13132, Federalism
Executive Order 13132 (entitled ``Federalism'') prohibits an agency
from publishing any rule that has federalism implications if the rule
either imposes substantial direct compliance costs on state and local
governments and is not required by statute, or the rule preempts state
law, unless the agency meets the consultation and funding requirements
of Section 6 of the Executive Order. This rule would not have
federalism implications and would not impose substantial direct
compliance costs on state and local governments or preempt state law
within the meaning of the Executive Order.
Environmental Impact
This final rule is a policy document that sets out fair housing and
nondiscrimination standards. Accordingly, under 24 CFR 50.19(c)(3),
this final rule is categorically excluded from environmental review
under the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et
seq.).
Regulatory Flexibility Act
The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) generally
requires an agency to conduct a regulatory flexibility analysis of any
rule subject to notice and comment rulemaking requirements, unless the
agency certifies that the rule will not have a significant economic
impact on a substantial number of small entities. Because HUD
determined that good cause exists to issue this rule without prior
public comment, this rule is not subject to the requirement to publish
an initial or final regulatory flexibility analysis under the RFA as
part of such action.
Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
3501-3520), an agency may not conduct or sponsor, and a person is not
required to respond to, a collection of information, unless the
collection displays a currently valid Office of Management and Budget
(OMB) control number. The information collection requirements for
Affirmatively Furthering Fair Housing collected have previously been
approved by OMB under the Paperwork Reduction Act and assigned OMB
control number 2506-0117 (Consolidated Plan, Annual Action Plan &
Annual Performance Report).
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-
4; approved March 22, 1995) (UMRA) establishes requirements for Federal
agencies to assess the effects of their regulatory actions on state,
local, and tribal governments, and on the private sector. This rule
does not impose any Federal mandates on any state, local, or tribal
government, or on the private sector, within the meaning of the UMRA.
List of Subjects
24 CFR Part 5
Administrative practice and procedure, Aged, Claims, Crime,
Government contracts, Grant programs--housing and community
development, Individuals with
[[Page 30790]]
disabilities, Intergovernmental relations, Loan programs--housing and
community development, Low and moderate income housing, Mortgage
insurance, Penalties, Pets, Public housing, Rent subsidies, Reporting
and recordkeeping requirements, Social security, Unemployment
compensation, Wages.
24 CFR Part 91
Aged; Grant programs--housing and community development; Homeless;
Individuals with disabilities; Low and moderate income housing;
Reporting and recordkeeping requirements.
24 CFR Part 92
Administrative practice and procedure; Low and moderate income
housing; Manufactured homes; Rent subsidies; Reporting and
recordkeeping requirements.
24 CFR Part 570
Administrative practice and procedure; American Samoa; Community
development block grants; Grant programs--education; Grant programs-
housing and community development; Guam; Indians; Loan programs--
housing and community development; Low and moderate income housing;
Northern Mariana Islands; Pacific Islands Trust Territory; Puerto Rico;
Reporting and recordkeeping requirements; Student aid; Virgin Islands.
24 CFR Part 574
Community facilities; Grant programs--housing and community
development; Grant programs--social programs; HIV/AIDS; Low- and
moderate-income housing; Reporting and recordkeeping requirements.
24 CFR Part 576
Community facilities; Grant programs--housing and community
development; Grant programs--social programs; Homeless; Reporting and
recordkeeping requirements.
24 CFR Part 903
Administrative practice and procedure; Public housing; Reporting
and recordkeeping requirements.
Accordingly, for the reasons described in the preamble, HUD amends
24 CFR parts 5, 91, 92, 570, 574, 576, and 903 as follows:
PART 5--GENERAL HUD PROGRAM REQUIREMENTS; WAIVERS
0
1. The authority citation for part 5, subpart A, continues to read as
follows:
Authority: 29 U.S.C. 794, 42 U.S.C. 1437a, 1437c, 1437c-1(d),
1437d, 1437f, 1437n, 3535(d), and Sec. 327, Pub. L. 109-115, 119
Stat. 2936; 42 U.S.C. 3600-3620; 42 U.S.C. 5304(b); 42 U.S.C. 12101
et seq.; 42 U.S.C. 12704-12708; Executive Order 11063, 27 FR 11527,
3 CFR, 1958-1963 Comp., p. 652; Executive Order 12892, 59 FR 2939, 3
CFR, 1994 Comp., p. 849.
0
2. Revise Sec. 5.150 to read as follows:
Sec. 5.150 Affirmatively Furthering Fair Housing: Purpose.
Pursuant to the affirmatively furthering fair housing mandate in
section 808(e)(5) of the Fair Housing Act, and in subsequent
legislative enactments, the purpose of the Affirmatively Furthering
Fair Housing (AFFH) regulations is to provide program participants with
a substantive definition of the AFFH requirement, as well as to provide
access to an effective planning approach to aid those program
participants that wish to avail themselves of it in taking meaningful
actions to overcome historic patterns of segregation, promote fair
housing choice, and foster inclusive communities that are free from
discrimination.
0
3. Revise Sec. 5.151 to read as follows:
Sec. 5.151 Affirmatively Further Fair Housing: Definitions.
For purposes of Sec. Sec. 5.150 through 5.152, the terms
``consolidated plan,'' ``consortium,'' ``unit of general local
government,'' ``jurisdiction,'' and ``State'' are defined in 24 CFR
part 91. For PHAs, ``jurisdiction'' is defined in 24 CFR 982.4. The
following additional definitions are provided solely for purposes of
Sec. Sec. 5.150 through 5.152 and related amendments in 24 CFR parts
91, 92, 570, 574, 576, and 903:
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 or 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.
Disability. (1) The term ``disability'' means, with respect to an
individual:
(i) A physical or mental impairment that substantially limits one
or more major life activities of such individual;
(ii) A record of such an impairment; or
(iii) Being regarded as having such an impairment.
(2) The term ``disability'' as used herein shall be interpreted
consistent with the definition of such term under section 504 of the
Rehabilitation Act of 1973, as amended by the Americans with
Disabilities Act Amendments Act of 2008. This definition does not
change the definition of ``disability'' or ``disabled person'' adopted
pursuant to a HUD program statute for purposes of determining an
individual's eligibility to participate in a housing program that
serves a specified population.
Fair housing choice means that individuals and families have the
information, opportunity, and options to live where they choose without
unlawful discrimination and other barriers related to race, color,
religion, sex, familial status, national origin, or disability. Fair
housing choice encompasses:
(1) Actual choice, which means the existence of realistic housing
options;
(2) Protected choice, which means housing that can be accessed
without discrimination; and
(3) Enabled choice, which means realistic access to sufficient
information regarding options so that any choice is informed. For
persons with disabilities, fair housing choice and access to
opportunity include access to accessible housing and housing in the
most integrated setting appropriate to an individual's needs as
required under Federal civil rights law, including disability-related
services that an individual needs to live in such housing.
Housing programs serving specified populations. Housing programs
serving specified populations are HUD and Federal housing programs,
including designations in the programs, as applicable, such as HUD's
Supportive Housing for the Elderly, Supportive Housing for Persons with
Disabilities, homeless assistance programs under the McKinney-Vento
Homeless Assistance Act (42 U.S.C. 11301 et seq.), and housing
designated under section 7 of the United States Housing Act of 1937 (42
U.S.C. 1437e), that:
(1) Serve specific identified populations; and
(2) Comply with title VI of the Civil Rights Act of 1964 (42 U.S.C.
2000d-2000d-4) (Nondiscrimination in Federally Assisted Programs); the
Fair Housing Act (42 U.S.C. 3601-19), including the duty to
affirmatively
[[Page 30791]]
further fair housing; section 504 of the Rehabilitation Act of 1973 (29
U.S.C. 794); the Americans with Disabilities Act (42 U.S.C. 12101, et
seq.); and other Federal civil rights statutes and regulations.
Integration means a condition, within the program participant's
geographic area of analysis, in which there is not a high concentration
of persons of a particular race, color, religion, sex, familial status,
national origin, or having a disability or a particular type of
disability when compared to a broader geographic area. For individuals
with disabilities, integration also means that such individuals are
able to access housing and services in the most integrated setting
appropriate to the individual's needs. The most integrated setting is
one that enables individuals with disabilities to interact with persons
without disabilities to the fullest extent possible, consistent with
the requirements of the Americans with Disabilities Act (42 U.S.C.
12101 et seq.) and section 504 of the Rehabilitation Act of 1973 (29
U.S.C. 794). See 28 CFR part 35, appendix B (2010) (addressing 28 CFR
35.130 and providing guidance on the Americans with Disabilities Act
regulation on nondiscrimination on the basis of disability in State and
local government services).
Meaningful actions means significant actions that are designed and
can be reasonably expected to achieve a material positive change that
affirmatively furthers fair housing by, for example, increasing fair
housing choice or decreasing disparities in access to opportunity.
Racially or ethnically concentrated area of poverty means a
geographic area with significant concentrations of poverty and minority
populations.
Segregation means a condition, within the program participant's
geographic area of analysis, in which there is a high concentration of
persons of a particular race, color, religion, sex, familial status,
national origin, or having a disability or a type of disability in a
particular geographic area when compared to a broader geographic area.
For persons with disabilities, segregation includes a condition in
which the housing or services are not in the most integrated setting
appropriate to an individual's needs in accordance with the
requirements of the Americans with Disabilities Act (42 U.S.C. 12101,
et seq.), and section 504 of the Rehabilitation Act of 1973 (29 U.S.C.
794). (See 28 CFR part 35, appendix B (2010), addressing 25 CFR
35.130.) Participation in ``housing programs serving specified
populations'' as defined in this section does not present a fair
housing issue of segregation, provided that such programs are
administered to comply with title VI of the Civil Rights Act of 1964
(42 U.S.C. 2000d-2000d-4) (Nondiscrimination in Federally Assisted
Programs): The Fair Housing Act (42 U.S.C. 3601-19), including the duty
to affirmatively further fair housing: Section 504 of the
Rehabilitation Act of 1973 (29 U.S.C. 794); the Americans with
Disabilities Act (42 U.S.C. 12101, et seq.); and other Federal civil
rights statutes and regulations.
Significant disparities in access to opportunity means substantial
and measurable differences in access to educational, transportation,
economic, and other important opportunities in a community, based on
protected class related to housing.
0
4. Add Sec. 5.152 to read as follows:
Sec. 5.152 AFFH Certification and Administration.
(a) Certifications. Program participants must certify that they
will comply with their obligation of affirmatively furthering fair
housing when required by statutes or regulations governing HUD
programs. Such certifications are made in accordance with applicable
regulations. Consolidated plan program participants are subject to the
certification requirements in 24 CFR part 91, and PHA Plan program
participants are subject to the certification requirements in 24 CFR
part 903.
(b) Administration. To assist program participants in carrying out
their obligation of affirmatively furthering fair housing, and
supporting their certifications pursuant to paragraph (a) of this
section, HUD will provide technical assistance to program participants
in various ways, including by:
(1) Making HUD-provided data and informational resources available,
including about how to voluntarily engage in fair housing planning,
such as:
(i) Analyzing fair housing data, assessing fair housing issues and
contributing factors, assessing fair housing priorities and goals;
taking meaningful actions to support identified goals; and taking no
action that is materially inconsistent with the obligation to
affirmatively further fair housing; or
(ii) Conducting an analysis to identify impediments to fair housing
choice within the jurisdiction, taking appropriate actions to overcome
the effects of any impediments identified through that analysis, and
maintaining records reflecting the analysis and actions in this regard;
or
(iii) Engaging in other means of fair housing planning that
meaningfully supports this certification;
(2) Permitting a program participant to voluntarily submit its fair
housing planning for HUD feedback from the responsible office; and
(3) Engaging in other forms of technical assistance.
(c) Procedure for challenging the validity of an AFFH
certification. The procedures for challenging the validity of an AFFH
certification are as follows:
(1) For consolidated plan program participants, HUD's challenge to
the validity of an AFFH certification will be as specified in 24 CFR
part 91.
(2) For PHA Plan program participants, HUD's challenge to the
validity of an AFFH certification will be as specified in 24 CFR part
903.
(d) Definitions. For purposes of this section, the following
definitions apply:
(1) Data refers collectively to the sources of data provided in
paragraphs (d)(1)(i) and (d)(1)(ii) of this definition. When
identification of the specific source of data in paragraphs (d)(1)(i)
and (d)(1)(ii) is necessary, the specific source (HUD-provided data or
local data) will be stated.
(i) HUD-provided data. The term ``HUD-provided data'' refers to
HUD-provided metrics, statistics, and other quantified information that
may be used when conducting fair housing planning. HUD-provided data
will not only be provided to program participants but will be posted on
HUD's website for availability to all of the public;
(ii) Local data. The term ``local data'' refers to metrics,
statistics, and other quantified information, relevant to the program
participant's geographic areas of analysis, that can be found through a
reasonable amount of search, are readily available at little or no
cost, and may be used to conduct fair housing planning.
(2) Program participants means:
(i) Jurisdictions and Insular Areas, as described in 570.405 and
defined in 570.3, that are required to submit consolidated plans for
the following programs:
(A) The Community Development Block Grant (CDBG) program (see 24
CFR part 570, subparts D and I);
(B) The Emergency Solutions Grants (ESG) program (see 24 CFR part
576);
(C) The HOME Investment Partnerships (HOME) program (see 24 CFR
part 92); and
(D) The Housing Opportunities for Persons With AIDS (HOPWA) program
(see 24 CFR part 574).
(ii) Public housing agencies (PHAs) receiving assistance under
sections 8 or
[[Page 30792]]
9 of the United States Housing Act of 1937 (42 U.S.C. 1437f or 42
U.S.C. 1437g).
(3) Protected characteristics are race, color, religion, sex,
familial status, national origin, having a disability, and having a
type of disability.
(4) Protected class means a group of persons who have the same
protected characteristic; e.g., a group of persons who are of the same
race are a protected class. Similarly, a person who has a mobility
disability is a member of the protected class of persons with
disabilities and a member of the protected class of persons with
mobility disabilities.
PART 91--CONSOLIDATED SUBMISSIONS FOR COMMUNITY PLANNING AND
DEVELOPMENT PROGRAMS
0
5. The authority citation for part 91 continues to read as follows:
Authority: 42 U.S.C. 3535(d), 3601-19, 5301-5315, 11331-11388,
12701-12711, 12741-12756, and 12901-12912.
0
6. Revise Sec. 91.225(a)(1) to read as follows:
Sec. 91.225 Certifications.
(a) * * *
(1) Affirmatively furthering fair housing. Each jurisdiction is
required to submit a certification, consistent with Sec. Sec. 5.151
and 5.152 of this title, that it will affirmatively further fair
housing.
* * * * *
0
7. Revise Sec. 91.235(c)(4) to read as follows:
(c) * * *
(4) Submissions, certifications, amendments, and performance
reports. An Insular Area grantee that submits an abbreviated
consolidated plan under this section must comply with the submission,
certification, amendment, and performance report requirements of Sec.
570.440 of this title. This includes the certification that the grantee
will affirmatively further fair housing pursuant to Sec. Sec. 5.151
and 5.152 of this title.
* * * * *
0
8. Revise Sec. 91.325(a)(1) to read as follows:
Sec. 91.325 Certifications.
(a) * * *
(1) Affirmatively furthering fair housing. Each State is required
to submit a certification, consistent with Sec. Sec. 5.151 and 5.152
of this title, that it will affirmatively further fair housing.
* * * * *
0
9. Revise Sec. 91.425(a)(1)(i) to read as follows:
Sec. 91.425 Certifications.
(a) * * * (1) * * * (i) Affirmatively furthering fair housing. Each
Consortium is required to submit a certification, consistent with
Sec. Sec. 5.151 and 5.152 of this title, that it will affirmatively
further fair housing.
* * * * *
PART 92--HOME INVESTMENT PARTNERSHIPS PROGRAM
0
10. The authority citation for part 92 continues to read as follows:
Authority: 42 U.S.C. 3535(d), 12 U.S.C. 1701x and 4568.
0
11. Amend Sec. 92.508 by revising paragraph (a)(7)(i)(C) to read as
follows:
Sec. 92.508 Recordkeeping.
(a) * * *
(7) * * *
(i) * * *
(B) Documentation of the actions the participating jurisdiction has
taken to affirmatively further fair housing pursuant to Sec. Sec.
5.151, 5.152, 91.225, 91.325, and 91.425 of this title.
* * * * *
PART 570--COMMUNITY DEVELOPMENT BLOCK GRANTS
0
12. The authority citation for part 570 continues to read as follows:
Authority: 12 U.S.C. 1701x, 1701 x-1; 42 U.S.C. 3535(d) and
5301-5320.
0
13. Revise Sec. 570.487(b) to read as follows:
Sec. 570.487 Other applicable laws and related program requirements.
* * * * *
(b) Affirmatively furthering fair housing. The Act requires the
state to certify to HUD's satisfaction that it will affirmatively
further fair housing pursuant to Sec. Sec. 5.151 and 5.152 of this
title. The Act also requires each unit of general local government to
certify that it will affirmatively further fair housing.
* * * * *
0
14. In Sec. 570.506, revise paragraph (g)(1) to read as follows:
Sec. 570.506 Records to be maintained.
* * * * *
(g) * * *
(1) Documentation of the actions the participating jurisdiction has
taken to affirmatively further fair housing pursuant to Sec. Sec.
5.151, 5.152, 91.225, 91.325, and 91.425 of this title.
0
15. Revise Sec. 570.601(a)(2) to read as follows:
Sec. 570.601 Public Law 88-352 and Public Law 90-284; affirmatively
furthering fair housing; Executive Order 11063.
(a) * * *
(2) Public Law 90-284, which is the Fair Housing Act (42 U.S.C.
3601-3620). In accordance with the Fair Housing Act, the Secretary
requires that grantees administer all programs and activities related
to housing and community development in a manner to affirmatively
further the policies of the Fair Housing Act.
* * * * *
PART 574--HOUSING OPPORTUNITIES FOR PERSONS WITH AIDS
0
16. The authority citation for part 574 continues to read as follows:
Authority: 12 U.S.C. 1701x, 1701 x-1; 42 U.S.C. 3535(d) and
5301-5320.
0
17. Revise Sec. 574.530(b) to read as follows:
Sec. 574.530 Recordkeeping.
* * * * *
(b) Documentation of the actions the grantee has taken to
affirmatively further fair housing, pursuant to Sec. Sec. 5.151 and
5.152 of this title.
* * * * *
PART 576--EMERGENCY SOLUTIONS GRANTS PROGRAM
0
18. The authority citation for part 576 continues to read as follows:
Authority: 12 U.S.C. 1701x, 1701 x-1; 42 U.S.C. 11371 et seq.,
42 U.S.C. 3535(d).
0
19. Amend Sec. 576.500 by revising paragraph (s)(1)(ii) to read as
follows:
Sec. 576.500 Recordkeeping and reporting requirements.
* * * * *
(s) * * *
(1) * * *
(ii) Documentation of the actions that the recipient has taken to
affirmatively further fair housing, pursuant to Sec. Sec. 5.151 and
5.152 of this title.
* * * * *
PART 903--PUBLIC HOUSING AGENCY PLANS
0
20. The authority citation for part 903 continues to read as follows:
Authority: 42 U.S.C. 1437c; 42 U.S.C. 1437c-1; Pub. L. 110-289;
42 U.S.C. 3535d.
0
21. Amend Sec. 903.7 by revising paragraph (o) to read as follows:
Sec. 903.7 What information must a PHA provide in the Annual Plan?
* * * * *
[[Page 30793]]
(o) Civil rights certification. (1) The PHA must certify that it
will carry out its plan in conformity with title VI of the Civil Rights
Act of 1964 (42 U.S.C. 20000d-2000d-4), the Fair Housing Act (42 U.S.C.
3601-19), section 504 of the Rehabilitation Act of 1973 (29 U.S.C.
794), and title II of the Americans with Disabilities Act of 1990 (42
U.S.C. 12101 et seq.), and other applicable Federal civil rights laws.
The PHA must also certify that it will affirmatively further fair
housing pursuant to Sec. Sec. 5.151 and 5.152 of this title.
(2) The certification is applicable to the 5-Year Plan and the
Annual Plan.
* * * * *
0
22. Amend Sec. 903.15 by adding paragraph (c) to read as follows:
Sec. 903.15 What is the relationship of the public housing agency
plans to the Consolidated Plan and a PHA's Fair Housing Requirements?
* * * * *
(c) Fair housing requirements. A PHA is obligated to affirmatively
further fair housing in its operating policies, procedures, and capital
activities. All admission and occupancy policies for public housing and
Section 8 tenant-based housing programs must comply with Fair Housing
Act requirements and other civil rights laws and regulations and with a
PHA's plans to affirmatively further fair housing. The PHA may not
impose any specific income or racial quotas for any development or
developments.
(1) Nondiscrimination. A PHA must carry out its PHA Plan in
conformity with the nondiscrimination requirements in Federal civil
rights laws, including title VI of the Civil Rights Act of 1964,
section 504 of the Rehabilitation Act of 1973, the Americans with
Disabilities Act, and the Fair Housing Act. A PHA may not assign
housing to persons in a particular section of a community or to a
development or building based on race, color, religion, sex,
disability, familial status, or national origin for purposes of
segregating populations.
(2) Affirmatively furthering fair housing. A PHA's policies should
be designed to reduce the concentration of tenants and other assisted
persons by race, national origin, and disability. Any affirmative steps
or incentives a PHA plans to take must be stated in the admission
policy.
(i) HUD regulations provide that PHAs must take steps to
affirmatively further fair housing. PHA policies should include
affirmative steps to overcome the effects of discrimination and the
effects of conditions that resulted in limiting participation of
persons because of their race, national origin, disability, or other
protected class.
(ii) Such affirmative steps may include, but are not limited to,
marketing efforts, use of nondiscriminatory tenant selection and
assignment policies that lead to desegregation, additional applicant
consultation and information, provision of additional supportive
services and amenities to a development (such as supportive services
that enable an individual with a disability to transfer from an
institutional setting into the community), and engagement in ongoing
coordination with state and local disability agencies to provide
additional community-based housing opportunities for individuals with
disabilities and to connect such individuals with supportive services
to enable an individual with a disability to transfer from an
institutional setting into the community.
(3) Validity of certification. (i) A PHA's certification under
Sec. 903.7(o) will be subject to challenge by HUD where it appears
that a PHA:
(A) Fails to meet the affirmatively furthering fair housing
requirements at 24 CFR 5.150 through 5.152
(B) Takes action that is materially inconsistent with its
obligation to affirmatively further fair housing; or
(C) Fails to meet the fair housing, civil rights, and affirmatively
furthering fair housing requirements in 24 CFR 903.7(o).
(ii). If HUD challenges the validity of a PHA's certification, HUD
will do so in writing specifying the deficiencies, and will give the
PHA an opportunity to respond to the particular challenge in writing.
In responding to the specified deficiencies, a PHA must establish, as
applicable, that it has complied with fair housing and civil rights
laws and regulations, or has remedied violations of fair housing and
civil rights laws and regulations, and has adopted policies and
undertaken actions to affirmatively further fair housing, including,
but not limited to, providing a full range of housing opportunities to
applicants and tenants in a nondiscriminatory manner. In responding to
the PHA, HUD may accept the PHA's explanation and withdraw the
challenge, undertake further investigation, or pursue other remedies
available under law. HUD will seek to obtain voluntary corrective
action consistent with the specified deficiencies. In determining
whether a PHA has complied with its certification, HUD will review the
PHA's circumstances relevant to the specified deficiencies, including
characteristics of the population served by the PHA; characteristics of
the PHA's existing housing stock; and decisions, plans, goals,
priorities, strategies, and actions of the PHA, including those
designed to affirmatively further fair housing.
0
23. Amend Sec. 903.23 by revising paragraph (f) to read as follows:
Sec. 903.23 What is the process by which HUD reviews, approves, or
disapproves an Annual Plan?
* * * * *
(f) Recordkeeping. PHAs must maintain records reflecting actions to
affirmatively further fair housing pursuant to Sec. Sec. 5.151, 5.152,
and 903.7(o) of this title.
Dated: June 4, 2021.
Marcia L. Fudge,
Secretary.
[FR Doc. 2021-12114 Filed 6-9-21; 8:45 am]
BILLING CODE 4210-67-P
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</html>Indexed from Federal Register on June 10, 2021.
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