HOTMA Changes to Deductions and Expenses for HUD Properties

person A.J. Johnson today 11/11/2023

Introduction

The U.S. Department of Housing and Urban Development (HUD) has released Notice H 2013-10, which expands upon the Final Rule for implementing the Housing Opportunity Through Modernization Act (HOTMA). The publication of this guidance in September 2023 outlined a number of changes to the rules relating to HUD-permitted deductions and expenses.

Owners of HUD-assisted projects that determine rent based on adjusted income must consider mandatory deductions when determining a family’s annual adjusted income. Public Housing Agencies (PHAs) may also consider additional deductions to a family’s annual income if established by a written policy in the PHA’s Admissions or Continued Occupancy Policy (ACOP) or Administrative Plan.

Dependent Deduction

Effective January 1, 2024, the dependent deduction amount is - as it has been - $480. This amount will be adjusted annually, beginning in 2025, and applies to a family’s next annual or interim reexamination after the annual adjustment, whichever is sooner. Not later than September 1 of each year, HUD will publish an adjusted dependent deduction on its website. PHAs and owners will be required to implement the adjusted dependent deduction for all income reexaminations that are effective January 1 or later.

Elderly/Disabled Family Deduction

Effective January 1, 2024, the elderly/disabled family deduction increases from $400 to $525 and applies to a family’s next annual or interim reexamination, whichever is sooner. This deduction will also be adjusted annually based on an inflation factor.

Health & Medical/Disability Related Expenses

In one of the most controversial changes to the current rules, the HOTMA final rule establishes that the sum of unreimbursed health and medical care and reasonable attendant care and auxiliary expenses that exceed 10 percent of the family’s annual income can be deducted from annual income. The current threshold is 3 percent of annual income. This rule applies only to elderly or disabled families.

In order to claim the deduction for disability-related costs, the family must include a person with a disability, and the expenses must enable any member of the family (including the disabled member) to be employed.

Hardship Exemptions for Medical and Disability-Related Expenses

HUD received many comments on the proposed rule relating to hardship exemptions for unreimbursed health and medical care, attendant care, auxiliary apparatus expenses, and childcare expenses. The final rule has been revised to provide clarity to these exemptions and ease burdens on families experiencing financial hardship.

Medical/Disability Expenses

Current regulations permit the deduction of medical expenses from annual income for elderly households if the expenses (1) will not be reimbursed by insurance or another source; and (2) when combined with any disability assistance expenses are in excess of three percent of annual income.

  • The new regulation does not permit the deduction until the medical expenses exceed 10 percent of gross income.
  • This will clearly have a negative impact on many elderly/disabled households. To help ease this burden, the final rule provides two types of hardship exemptions to the ten percent threshold for health and medical care expenses (for elderly and disabled families) and reasonable attendant care and auxiliary apparatus expenses (for families that include a person with disabilities).
  • The first category ("phased in relief") is for families eligible for and taking the unreimbursed health and medical care expenses and reasonable attendant care and auxiliary apparatus expenses deduction in effect prior to this rule (i.e., the 3% rule).
  • The second category ("general relief") is for families that can demonstrate that the family’s health and medical care expenses or reasonable attendant care and auxiliary apparatus expenses increased, or the family’s financial hardship is a result of a change in circumstances that would not otherwise trigger an interim reexamination.
    • HUD is adding this second category in the final rule in recognition that the change from the three percent threshold to the new ten percent threshold for unreimbursed health and medical care expenses or reasonable attendant care and auxiliary apparatus expenses may result in financial hardship for families, including those families who were not receiving the deduction or may not even have been receiving housing assistance at the time the final rule goes into effect.
    • These families may receive temporary hardship relief if their health and medical care expenses or reasonable attendant care and auxiliary apparatus expenses exceed five percent of the family’s income.
  • Under the first category (families taking the deduction based on the three percent rule), owners must deduct eligible expenses exceeding five percent of the family’s income for the first year, 7.5% for the second year, and 10% for the third year. It should be noted that the term "year" refers to the certification year - not the calendar year.
  • Under the second category, a family may qualify for hardship exemptions for health and medical care expenses or reasonable attendant care and auxiliary apparatus expenses if the family can demonstrate that the expenses increased, or the family’s financial hardship is a result of a change in circumstances (as determined by the project owner).
    • For these families, the deduction will be for expenses in excess of five percent of family income for up to 90 days.
  • This may be extended for additional 90-day periods at the discretion of the owner, based on family circumstances.
    • Owners may also terminate the hardship exemption if it is determined that the family no longer needs the exemption.
  • Examples of circumstances constituting a financial hardship may include the following situations:
    •  The family is awaiting an eligibility determination for a federal, state, or local assistance program, such as a determination for unemployment compensation or disability benefits; The family’s income decreased because of a loss of employment, the
    death of a family member, or due to a natural or federal/state-declared
    • disaster; or
    •  Other circumstances as determined by the PHA/MFH Owner.

In some circumstances, families receiving the deduction under the first category may request relief under the second category of hardship relief.

  • During the second year of transition, the owner deducts expenses exceeding 7.5 percent of family income if relief is being obtained under the first category.
  • If the family can demonstrate that the health and medical care expenses or reasonable attendant care and auxiliary apparatus expenses increased or the family’s financial hardship is a result of a change in circumstances, and not just due to the transition to the 7.5% threshold, the family may be granted relief under the second category.
  • In this case, expenses exceeding five percent of the family income will be deducted (instead of 7.5%). However, this relief will last only for 90 days (unless extended by the owner), and the family is no longer eligible for relief under the first category.
    • In other words, at the end of the relief period for the second category, the family will be subject to the regular health and medical care expenses or reasonable attendant care and auxiliary apparatus expenses deduction threshold of ten percent, regardless of whether they fully transitioned to the ten percent threshold under the first category.

Child Care Expense Deduction

HUD regulations permit the deduction from annual income of any reasonable child-care expenses necessary to enable a family member to work or further their education. The expenses must be unreimbursed and must be for the care of a child age 12 and younger.

Childcare Deduction Hardship Relief

Under the final rule, property owners may extend a deduction for unreimbursed childcare expenses for 90 days, with extensions for additional 90-day periods if the family can demonstrate that they are unable to pay their rent due to loss of the childcare expense deduction, and the childcare expense is still necessary even though the family member is no longer employed or furthering his or her education. The following example illustrates how this relief could work:

  • A family that was claiming the childcare deduction no longer qualifies because the care is no longer necessary to enable a family member to work or go to school.
  • The family member who was employed had to leave their job in order to provide uncompensated care to an elderly friend who is very ill and lives across town.
  • The family may continue to claim the childcare deduction for 90 days, with 90-day extensions as approved by the owner.

Hardship Policy Requirements

Owners must establish policies on how they define what constitutes a hardship. Some factors to consider when determining if a family is unable to pay rent may include a determination that the rent, utility payment, and applicable expenses (child care or health/disability expenses) are more than 45 percent (for example) of the family’s adjusted income, or verifying whether the family has experienced unexpected expenses, such as large medical bills, that have impacted their ability to pay rent.

Owners are required to notify families of either approval or denial of hardship exemptions. Notices of hardship exemption approval must inform the family of the dates that the exemption will begin and expire and the requirement for the family to report if the circumstances that made the family eligible for relief are no longer applicable. Owners of hardship exemption denial must state the reason for the denial.

The 90-Day Extensions

Owners may extend hardship relief for as many 90-day periods as the hardship continues to affect the family. Policies for extensions of relief must be included in PHA Administrative Plans and Owner Tenant Selection Plans.

Owners must obtain third-party verification of the family’s inability to pay rent or must document in the file the reason that third-party verification was not available. Owners must attempt to obtain third-party verification prior to the end of the 90-day period.

In conclusion, the adjustments to HUD regulations as delineated in Notice H 2013-10 reflect a concerted effort to modernize and improve the process of determining adjusted income for HUD-assisted families. While the increase in the threshold for medical and disability deductions may initially pose challenges for elderly and disabled households, the provision of phased and general hardship exemptions showcases HUD's commitment to a compassionate transition. The annual adjustments to dependent and elderly/disabled family deductions, along with the specific provisions for hardship exemptions, are designed to ensure that the most vulnerable populations continue to receive the support they need. By establishing clear guidelines and relief procedures, HUD aims to provide equitable opportunities for housing while addressing the complexities of financial hardship. As these changes roll out, it will be crucial for public housing agencies, owners, and families to stay informed and engaged with the evolving landscape of housing assistance to navigate these changes successfully.

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Historic Housing Expansion in Reconciliation Act

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

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

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

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

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

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