President Obama’s Plan to Diversify the Suburbs-Mostly Truth!
Summary of eRumor:
President Obama plans to diversify the suburbs through a combination of federal regulations and new funding formulas for housing vouchers.
The Truth:
The Obama administration’s plan to “further fair housing” has been inching forward for some time, and it would likely result in more diverse suburbs.
There are two main parts to claims about Obama’s plans diversify the suburbs. The first part, which was set into motion in 2015, established new requirements for cities that receive federal housing grants to document and report on racially biased housing practices on a regular basis (we’ll cover that later). The second part was set into motion in June 2016. We’ll start there.
In June 2016, HUD proposed a rule that would change the formula for how Fair Market Rents (FMR) are calculated. The FMR determines how much Section 8 housing assistance renters in a particular area can receive. The goal, HUD explains, is to promote more housing choices:
In metropolitan areas where there is a wide variance in the rents being charged to tenants and where voucher holders are concentrated in a few high-poverty neighborhoods, HUD is proposing to calculate FMRs based upon the rents being charged by the zip codes within that area. This permits FMRs and the resulting payment standards to be higher in low-poverty/high-rent areas, and lower in high-poverty/low-rent areas.
The idea, known as the Small Area Fair Market Rent approach, HUD explains, is to “increase voucher holders’ access to a greater number of units in low poverty areas while reducing excess subsidy from some high poverty neighborhoods.”
Right or wrong, some have interpreted that as Obama trying to diversify the suburbs. HUD is accepting public comment on the rule, and some expected that it would be finalized in fall of 2016.
And, when it comes the first HUD rule from 2015, its origins actually date back to a Government Accountability Office (GAO) report on housing and community grants published in 2010.
The report, titled “HUD Needs to Enhance Its Requirements and Oversight of Jurisdiction’s Fair Housing Plans,” looked at how cities that receive federal grant funding are furthering fair housing opportunities, a requirement of the Civil Rights Act of 1968:
Pursuant to the Fair Housing Act, Department of Housing and Urban Development (HUD) regulations require grantees, such as cities, that receive federal funds through the Community Development Block Grant (CDBG) and HOME Investment Partnerships Program (HOME) to further fair housing opportunities. In particular, grantees are required to prepare planning documents known as Analyses of Impediments (AI), which are to identify impediments to fair housing (such as restrictive zoning or segregated housing) and actions to overcome them. HUD has oversight responsibility for AIs. This report (1) assesses both the conformance of CDBG and HOME grantees AIs’ with HUD guidance pertaining to their timeliness and content and their potential usefulness as planning tools and (2) identifies factors in HUD’s requirements and oversight that may help explain any AI weaknesses.
The GAO reviewed the AIs of 441 cities across the country. The watchdog found that 29 percent of cities that had received CDBG and HOME grants had Analysis of Impediments (AI) documents in place that predated 2004, 11 percent of the AI documents hadn’t been updated since the 1990s although they’re supposed to be updated every five years. About half of the cities with AIs that were drafted after 2005 didn’t meet minimum requirements, and 25 cities didn’t submit any AI documents at all.
Following the study, the GAO recommended that HUD step up regulations to ensure that cities that receive federal CDBG and HOME grants comply with statutory requirements of the Civil Rights Act of 1968:
GAO recommends that, through regulation, HUD require grantees to update their AIs periodically, follow a specific format, and submit them for review. HUD neither agreed nor disagreed with the recommendations but noted recent efforts to improve compliance and oversight.
HUD published a final rule on “Affirmatively Furthering Fair Housing” (AFFH) in the Federal Register on July 16, 2015. The rule established new reporting requirements for cities that receive HUD grants to look for and report on racial population disparities every five years to help identify trends and promote long-term integration.
HUD explained the new regulation with this statement:
HUD’s rule clarifies and simplifies existing fair housing obligations for HUD grantees to analyze their fair housing landscape and set locally-determined fair housing priorities and goals through an Assessment of Fair Housing (AFH). To aid communities in this work, HUD will provide open data to grantees and the public on patterns of integration and segregation, racially and ethnically concentrated areas of poverty, disproportionate housing needs, and disparities in access to opportunity. This improved approach provides a better mechanism for HUD grantees to build fair housing goals into their existing community development and housing planning processes. In addition to providing data and maps, HUD will also provide technical assistance to aid grantees as they adopt this approach.
HUD’s rule took steps to ensure that communities comply with a nearly 40-year-old requirement that communities receiving HUD funding continuously take steps to remove barriers to fair housing practices.
Taken together, HUD’s actions could result in the diversification of the suburbs — even if it’s not the stated purpose. That’s why we’re calling this one mostly truth.