President Biden Issues Wide-Ranging Executive Order Relating to Fair Housing

If there was any doubt about how the new Administration’s approach to fair housing will differ from that of the prior administration, the Executive Order signed by President Biden on January 26, 2021, should resolve the issue.

The Order, titled “Memorandum on Redressing our Nation’s and the Federal Government’s History of Discriminatory Housing Practices and Policies,”  outlines the 20th Century history of housing discrimination by Federal, State, and local governments.  According to the Order, these policies contributed to segregated neighborhoods and inhibited equal opportunity and the chance to build wealth for minorities. Among the results of these practices is a racial gap in homeownership; a persistent undervaluation of properties owned by families of color; a disproportionate burden of pollution and exposure to the impacts of climate change in communities of color; and systemic barriers to safe, accessible, and affordable housing for people of color, immigrants, individuals with disabilities, and the LGBTQ community.

Since Congress enacted the Fair Housing Act (FHA) in 1968, access to housing and the creation of wealth through homeownership has remained persistently unequal, and many neighborhoods are as racially segregated today as they were in the middle of the 20th century. In fact, the racial wealth gap today is wider than it was in 1968.

As stated in the Order, the FHA imposes on Federal departments and agencies the duty to “administer their programs and activities relating to housing and urban development … in a manner affirmatively to further” fair housing. This created a mandate to take actions to undo historic patterns of segregation.

Accordingly, the Order states, “it is the policy of my Administration that the Federal government shall work with communities to end housing discrimination, to provide redress to those who have experienced housing discrimination, to eliminate racial bias and other forms of discrimination in all stages of home buying and renting, to lift barriers that restrict housing and neighborhood choice, to promote diverse and inclusive communities, to ensure sufficient physically accessible housing, and to secure equal access to housing opportunity for all.”

The primary component of the Order directs that the Department of Housing & Urban Development (HUD) shall examine the impact of two rules promulgated by the Trump administration: (1) “Preserving Community and Neighborhood Choice,” which repealed the July 16, 2015 rule entitled “Affirmatively Furthering Fair Housing. This 2020 rule significantly weakened the requirement that localities identify obstacles to fair housing or face a loss of federal funding for failure to do so; and (2) “HUD’s Implementation of the Fair Housing Act’s Disparate Impact Standard,” which became a rule on September 24, 2020. This made it much harder for plaintiffs to make a case under the disparate impact theory of fair housing.

It is almost certain that HUD will reverse the two rules issued by the Trump administration and put in place an aggressive requirement for affirmatively furthering fair housing as well as return the test for proving a disparate impact case to pre-2020 standards (the three-part “burden-shifting test.”)

Based on the tenor of this Order, it is likely that the next four years will see much more aggressive enforcement of fair housing law that has been seen recently.