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Vol. 78 Friday,

No. 139 July 19, 2013

Part IV

Department of Housing and UrbanDevelopment

24 CFR Parts 5, 91, 92, et al.

Affirmatively Furthering Fair Housing; Proposed Rule

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43710 Federal Register / Vol. 78, No. 139 / Friday, July 19, 2013/ Proposed Rules

DEPARTMENT OF HOUSING ANDURBAN DEVELOPMENT

24 CFR Parts 5, 91, 92, 570, 574, 576,and 903

[Docket No. FR–5173–P–01]

RIN No. 2501–AD33

Affirmatively Furthering Fair HousingAGENCY: Office of the Secretary, HUD.

ACTION: Proposed rule.

SUMMARY: Through this rule, HUDproposes to provide HUD programparticipants with more effective meansto affirmatively further the purposes andpolicies of the Fair Housing Act, whichis Title VIII of the Civil Rights Act of1968. The Fair Housing Act not onlyprohibits discrimination but, inconjunction with other statutes, directsHUD’s program participants to takesteps proactively to overcome historic

patterns of segregation, promote fairhousing choice, and foster inclusivecommunities for all. As acknowledged

by the U.S. Government AccountabilityOffice (GAO) and many stakeholders,advocates, and program participants, thecurrent practice of affirmativelyfurthering fair housing carried out byHUD grantees, which involves ananalysis of impediments to fair housingchoice and a certification that thegrantee will affirmatively further fairhousing, has not been as effective as had

been envisioned. This rule accordinglyproposes to refine existing requirements

with a fair housing assessment andplanning process that will better aidHUD program participants fulfill thisstatutory obligation and address specificcomments the GAO raised. To facilitatethis new approach, HUD will providestates, local governments, insular areas,and public housing agencies (PHAs), aswell as the communities they serve,with data on patterns of integration andsegregation; racially and ethnicallyconcentrated areas of poverty; access toeducation, employment, low-poverty,transportation, and environmentalhealth, among other critical assets;

disproportionate housing needs basedon the classes protected under the FairHousing Act; data on individuals withdisabilities and families with children;and discrimination. From these data,program participants will evaluate theirpresent environment to assess fairhousing issues, identify the primarydeterminants that account for thoseissues, and set forth fair housingpriorities and goals. The benefit of thisapproach is that these priorities andgoals will then better inform programparticipant’s strategies and actions by

improving the integration of theassessment of fair housing throughenhanced coordination with currentplanning exercises. This proposed rulefurther commits HUD to greaterengagement and better guidance forprogram participants in fulfilling theirobligation to affirmatively further fairhousing. With this new clarity through

guidance, a template for the assessment,and a HUD-review process, programparticipants should achieve moremeaningful outcomes that affirmativelyfurther fair housing.DATES: Comment Due Date: September17, 2013.ADDRESSES: Interested persons areinvited to submit comments regardingthis proposed rule to the RegulationsDivision, Office of General Counsel,Department of Housing and UrbanDevelopment, 451 7th Street SW., Room10276, Washington, DC 20410–0500:Communications must refer to the above

docket number and title. There are twomethods for submitting publiccomments. All submissions must referto the above docket number and title.

1. Submission of Comments by Mail.Comments may be submitted by mail tothe Regulations Division, Office ofGeneral Counsel, Department ofHousing and Urban Development, 4517th Street SW., Room 10276,Washington, DC 20410–0001.

2. Electronic Submission ofComments. Interested persons maysubmit comments electronically throughthe Federal eRulemaking Portal at

www.regulations.gov . HUD stronglyencourages commenters to submitcomments electronically. Electronicsubmission of comments allows thecommenter maximum time to prepareand submit a comment, ensures timelyreceipt by HUD, and enables HUD tomake them immediately available to thepublic. Comments submittedelectronically through thewww.regulations.gov Web site can beviewed by other commenters andinterested members of the public.Commenters should follow theinstructions provided on that site tosubmit comments electronically.

Note: To receive consideration as publiccomments, comments must be submittedthrough one of the two methods specifiedabove. Again, all submissions must refer tothe docket number and title of the rule.

No Facsimile Comments. Facsimile(FAX) comments are not acceptable.

Public Inspection of PublicComments. All properly submittedcomments and communicationssubmitted to HUD will be available forpublic inspection and copying between8 a.m. and 5 p.m. weekdays at the above

address. Due to security measures at theHUD Headquarters building, an advanceappointment to review the publiccomments must be scheduled by callingthe Regulations Division at 202–708–3055 (this is not a toll-free number).Individuals with speech or hearingimpairments may access this numbervia TTY by calling the toll-free Federal

Relay Service during working hours at800–877–8339. Copies of all commentssubmitted are available for inspectionand downloading atwww.regulations.gov .

FOR FURTHER INFORMATION CONTACT:Camille Acevedo, Associate GeneralCounsel for Legislation and Regulations,Office of General Counsel, Departmentof Housing and Urban Development,451 7th Street SW., Room 10282,Washington, DC 20410; telephonenumber 202–708–1793 (this is not a toll-free number). Hearing- or speech-impaired individuals may access this

number via TTY by calling the toll-freeFederal Relay Service during workinghours at 1–800–877–8339.SUPPLEMENTARY INFORMATION:

I. Executive Summary

Purpose of the Regulatory Action

From its inception, the Fair HousingAct (and subsequent laws reaffirming itsprinciples) outlawed discrimination andset out steps that needed to be takenproactively to overcome the legacy ofsegregation through the obligation ofaffirmatively furthering fair housing(AFFH).

Informed by lessons learned inlocalities across the country, HUDissues this proposed rule, whichprovides new tools now available tohelp guide communities in fulfilling theoriginal promise of the Fair HousingAct. The proposed rule involves refiningthe fair housing elements of the existingplanning process that states, localgovernments, insular areas, and publichousing agencies (program participants)now undertake. The process proposed

by this rule assists these programparticipants to assess fair housingdeterminants, prioritize fair housing

issues for response, and take meaningfulactions to affirmatively further fairhousing.

As recognized by HUD staff, programparticipants, civil rights advocates, theGAO, and others, the fair housingelements of current housing andcommunity development planning arenot as effective as they could be, do notincorporate leading innovations insound planning practice, and do notsufficiently promote the effective use oflimited public resources to affirmativelyfurther fair housing. The approach


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43711Federal Register / Vol. 78, No. 139 / Friday, July 19, 2013/ Proposed Rules

1Although the term ‘‘disability’’ is used today torefer to an individual’s physical or mentalimpairment, the term ‘‘handicap’’ is the term usedin the Fair Housing Act, as enacted in 1968.

proposed by the rule addresses theseissues and strengthens AFFHimplementation. It does so by providingdata to program participants related tofair housing planning, clarifying thegoals of the AFFH process, andinstituting a more effective mechanismfor HUD’s review and oversight of fairhousing planning. The proposed rule

does not mandate specific outcomes forthe planning process. Instead,recognizing the importance of localdecision-making, it establishes basicparameters and helps guide publicsector housing and communitydevelopment planning and investmentdecisions to fulfill their obligation toaffirmatively further fair housing. Inaddition, it helps educate other publicsector agencies in their planning andinvestment decisions, and providesrelevant civil rights information to thecommunity and other private and publicsector stakeholders.

Summary of Legal AuthorityThe Fair Housing Act (Title VIII of the

Civil Rights Act of 1968, 42 U.S.C.3601–3619) declares that it is ‘‘thepolicy of the United States to provide,within constitutional limitations, for fairhousing throughout the United States.’’See 42 U.S.C. 3601. Accordingly, theFair Housing Act prohibitsdiscrimination in the sale, rental, andfinancing of dwellings, and in otherhousing-related transactions because ofrace, color, religion, sex, familial status,national origin, or handicap.1 See 42U.S.C. 3601 et seq. Section 808(e)(5) of

the Fair Housing Act (42 U.S.C.3608(e)(5)) requires that HUD programsand activities be administered in amanner affirmatively to further thepolicies of the Fair Housing Act. TheAct leaves it to the Secretary to definethe precise scope of the AFFHobligation for HUD’s programparticipants.

Summary of the Major Provisions of theRule

The proposed rule—in concert withother HUD policies—is structured toprovide direction, guidance, andprocedures for program participants topromote fair housing choice. The rulepromotes these objectives and respondsto the GAO’s observations by:

a. Refining the current requirementthat program participants complete anAnalysis of Impediments (AI) with amore effective and standardizedAssessment of Fair Housing (AFH),through which program participants

would evaluate fair housing challengesand goals using regional and national

benchmarks and data tools to facilitatethe measurements of trends and changesover time;

b. Improving fair housing assessment,planning, and decision-making byproviding data that program participantsmust consider in their AFHs, thereby

aiding program participants establishfair housing goals to address theseissues and concerns;

c. Incorporating, explicitly, fairhousing planning into existing planningprocesses, the consolidated plan andPHA Annual Plan, which in turnincorporates fair housing priorities andconcerns more effectively into housing,community development, land-use, andother decision-making that influenceshow communities and regions grow anddevelop;

d. Encouraging and facilitatingregional approaches to addressing fair

housing issues, including effectiveincentives for collaboration acrossjurisdictions and PHAs, andincorporation of fair housing planninginto regionally significant undertakings,such as major public infrastructureinvestments;

e. Bringing people historicallyexcluded because of characteristicsprotected by the Fair Housing Act intofull and fair participation in decisionsabout the appropriate uses of HUDfunds and other investments, through arequirement to conduct communityparticipation as an integral part of

program participants’ AFHs; andf. Establishing an approach toaffirmatively further fair housing thatcalls for coordinated efforts to combatillegal housing discrimination, so thatindividuals and families can makedecisions about where to live, free fromdiscrimination, with necessaryinformation regarding housing options,and with adequate support to make theirchoices viable.

Through these improvements, the ruleseeks to make program participantsmore empowered to foster the diversityand strength of communities and

regions by improving integrated livingpatterns and overcoming historicpatterns of segregation, reducing racialand ethnic concentrations of poverty,and responding to identifieddisproportionate housing needs ofpersons protected by the Fair HousingAct. The rule also seeks to assistprogram participants in reducingdisparities in access to key communityassets based on race, color, religion, sex,familial status, national origin, ordisability, thereby improving economiccompetitiveness and quality of life.

HUD intends the guidance, data,tools, and procedural improvementsprovided under this proposed rule toreduce the current data collection

burden on program participants. HUDwill provide technical assistance andguidance that will allow programparticipants to spend less time gatheringinformation and more time engaged in

conversation with the communityregarding the most effective means ofadvancing their fair housing goals. Inaddition, HUD is facilitating theintegration of previously separateplanning processes into a singleplanning process, to the extent feasible,

both to streamline the work thatprogram participants undertake and tosupport the weaving of fair housingvalues throughout housing andcommunity development decision-making. Under this new process,program participants will submitassessments on a regular schedule and

HUD will review them. In addition toachieving more meaningful fair housingoutcomes through direct alignment withrelated planning and investmentprocesses, HUD expects that the clarityand explicit direction provided by theproposed rule should help programparticipants comply with theiraffirmatively furthering fair housingresponsibilities. One of HUD’saspirations for the proposed rule is thatit will reduce the risk of litigation forprogram participants. Moreover, HUD’scommitment to be an ongoing partner inthe process should result submissionsthat meet the standards for analysis that

the proposed rule seeks to establish.

Summary of Costs and Benefits

As detailed in the Regulatory ImpactAnalysis (found at www.regulations.gov under the docket number 5173–P–01–RIA), HUD does not expect a largeaggregate change in compliance costs forprogram participants as a result of theproposed rule. As a result of increasedemphasis on affirmatively furthering fairhousing within the planning process,there may be increased compliancecosts for some program participants,while for others the improved process

and goal-setting, combined with HUD’sprovision of foundational data, is likelyto decrease compliance costs. Programparticipants are currently required toengage in outreach and collect data inorder to meet the obligation toaffirmatively further fair housing. Asmore fully addressed in the RegulatoryImpact Analysis that accompanies thisrule, HUD estimates net annualcompliance costs in the range of $3 to$9 million.

Further, HUD believes that the rulehas the potential for substantial benefit


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2Section 104(b)(2) of the Housing andCommunity Development Act (HCD Act) (42 U.S.C.5304(b)(2)) requires that, to receive a grant, the stateor local government must certify that it willaffirmatively further fair housing. Section106(d)(7)(B) of the HCD Act (42 U.S.C.5306(d)(7)(B)) requires a local government thatreceives a grant from a state to certify that it willaffirmatively further fair housing. The Cranston-Gonzalez National Affordable Housing Act (NAHA)(42 U.S.C. 12704 et seq.) provides in section 105 (42U.S.C. 12705) that states and local governments that

receive certain grants from HUD must develop acomprehensive housing affordability strategy toidentify their overall needs for affordable andsupportive housing for the ensuing 5 years,including housing for homeless persons, andoutline their strategy to address those needs. Aspart of this comprehensive planning process,section 105(b)(15) of NAHA (42 U.S.C.12705(b)(15)) requires that these program

participants certify that they will affirmativelyfurther fair housing. The Quality Housing and WorkResponsibility Act of 1998 (QHWRA), enacted intolaw on October 21, 1998, substantially modified theUnited States Housing Act of 1937 (42 U.S.C. 1437et seq.) (1937 Act), and the 1937 Act was morerecently amended by the Housing and EconomicRecovery Act of 2008, Public Law 110–289 (HERA).QHWRA introduced formal planning processes forPHAs—a 5-Year Plan and an Annual Plan. Therequired contents of the Annual Plan included acertification by the PHA that the PHA will, amongother things, affirmatively further fair housing.

3Reflecting the era in which it was enacted, theFair Housing Act’s legislative history and earlycourt decisions refer to ‘‘ghettos’’ when discussingracially concentrated areas of poverty.

for program participants and thecommunities they serve. The rule wouldimprove the fair housing planningprocess by providing greater clarity tothe steps that program participantsundertake to meaningfully affirmativelyfurther fair housing, and at the sametime provide better resources forprogram participants to use in taking

such steps, hopefully resulting inincreased compliance and fewerinstances of litigation. Through thisrule, HUD commits to provide states,local governments, PHAs, thecommunities they serve, and the generalpublic with local and regional data onpatterns of integration, racially andethnically concentrated areas of poverty,access to key community assets, anddisproportionate housing needs basedon classes protected by the Fair HousingAct. From these data, programparticipants should be better able toevaluate their present environment to

assess fair housing issues, identify theprimary determinants that account forthose issues, set forth fair housingpriorities and goals, and document theseactivities.

The rule covers program participantsthat are subject to a great diversity oflocal preferences and economic andsocial contexts across Americancommunities and regions. For thesereasons, HUD recognizes there issignificant uncertainty associated withquantifying outcomes of the process,proposed by this rule, to identify

barriers to fair housing, the priorities of

program participants in deciding which barriers to address, the types of policiesdesigned to address those barriers, andthe effects of those policies on protectedclasses. In brief, because of the diversityof communities and regions across theNation and the resulting uncertainty ofprecise outcomes of the proposed AFFHplanning process, HUD cannot quantifythe benefits and costs of policesinfluenced by the rule. HUD isconfident, however, that the rule willcreate a process that allows for eachjurisdiction to not only undertakemeaningful fair housing planning, but tohave capacity and a well-considered

strategy to implement actions toaffirmatively further fair housing.

II. Background

A. Legal Authority

The Fair Housing Act (Title VIII of theCivil Rights Act of 1968, 42 U.S.C.3601–3619), enacted into law on April11, 1968, declares that it is ‘‘the policyof the United States to provide, withinconstitutional limitations, for fairhousing throughout the United States.’’See 42 U.S.C. 3601. Accordingly, the

Fair Housing Act prohibitsdiscrimination in the sale, rental, andfinancing of dwellings, and in otherhousing-related transactions because ofrace, color, religion, sex, familial status,national origin, or handicap. See 42U.S.C. 3601 et seq. Section 808(e)(5) ofthe Fair Housing Act (42 U.S.C.3608(e)(5)), requires that HUD programs

and activities be administered in amanner affirmatively to further thepolicies of the Fair Housing Act. Section808(d) of the Fair Housing Act (42U.S.C. 3608(d)) directs other federalagencies to administer their programsrelating to housing and urbandevelopment in a manner affirmativelyto further the policies of the FairHousing Act, and to cooperate with theSecretary in this effort.

The Fair Housing Act’s provisionsrelated to ‘‘affirmatively . . .further[ing]’’ fair housing, contained insections 3608(d) and (e), extend beyond

the Act’s anti-discrimination mandates.See, e.g., Otero v. N.Y. City Hous. Auth.,484 F.2d 1122 (2d Cir. 1973); Shannonv. HUD, 436 F.2d 809 (3d Cir. 1970).When the Fair Housing Act wasoriginally enacted in 1968 and amendedin 1988, major portions of the statuteinvolved the prohibition ofdiscriminatory activities (whetherundertaken with a discriminatorypurpose or with a discriminatoryimpact) and how private litigants andthe government could enforce theseprovisions.

In section 3608 of the Fair HousingAct, however, Congress went further by

mandating that ‘‘programs and activitiesrelating to housing and urbandevelopment’’ be administered ‘‘in amanner affirmatively to further thepurposes of this subchapter.’’ Congresshas repeatedly reinforced this mandate,requiring in the Housing andCommunity Development Act of 1974,the Cranston-Gonzalez NationalAffordable Housing Act, and in theQuality Housing and WorkResponsibility Act of 1998, that coveredHUD program participants certify as acondition of receiving federal funds thatthey will affirmatively furthering fair

housing. See 42 U.S.C. 5304(b)(2),5306(d)(7)(B), 12705(b)(15), 1437C–1(d)(16).2

In examining the legislative history ofthe Fair Housing Act and relatedstatutes, courts have found that thepurpose of the AFFH mandate is toensure that recipients of federal housingand urban development funds do morethan simply not discriminate: itobligates them to take proactive steps toaddress segregation and related barriers

for those protected by the Act,particularly as reflected in racially andethnically concentrated areas of poverty.The United States Supreme Court, inone of the first Fair Housing Act casesit decided, referenced the Act’s co-sponsor, Senator Walter F. Mondale, innoting that ‘‘the reach of the proposedlaw was to replace the ghettos ‘by trulyintegrated and balanced livingpatterns.’’’ Trafficante v. Metro. Life Ins.Co., 409 U.S. 205, 211 (1972).3 The Actrecognized that ‘‘where a family lives,where it is allowed to live, isinextricably bound up with better

education, better jobs, economicmotivation, and good livingconditions.’’ 114 Cong. Rec. 2276–2707(1968). As the Second Circuit has stated,section 3608(d) requires that ‘‘[a]ctionmust be taken to fulfill, as much aspossible, the goal of open, integratedresidential housing patterns and toprevent the increase of segregation, inghettos, of racial groups whose lack ofopportunity the Act was designed tocombat.’’ Otero, 484 F.2d at 1134.

The Act leaves it to the Secretary todefine the precise scope of the AFFHobligation for HUD’s programparticipants. Over the years, courts have

provided some guidance for this task. Inthe first appellate decision interpretingsection 3608, for example, the ThirdCircuit emphasized the importance ofracial and socioeconomic data to ensurethat ‘‘the agency’s judgment was aninformed one’’ based on an



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4Executive Order 12892, entitled ‘‘Leadershipand Coordination of Fair Housing in FederalPrograms: Affirmatively Furthering Fair Housing,’’issued January 17, 1994, vests primary authority inthe Secretary of HUD for all federal executivedepartments and agencies to administer theirprograms and activities relating to housing andurban development in a manner that furthers thepurposes of the Fair Housing Act. Executive Order12898, entitled Executive Actions to AddressEnvironmental Justice in Minority Populations andLow-Income Populations, issued on February 11,1994, declares that Federal agencies shall make itpart of their mission to achieve environmentaljustice ‘‘by identifying and addressing, asappropriate, disproportionately high and adversehuman health or environmental effects of itsprograms, policies, and activities on minoritypopulations and low-income populations.’’

5These include requirements involving theevaluation of site and neighborhood conditionsunder which HUD-funded housing developmentoccurs and the affirmative marketing of units topromote integrated residences. See, e.g., 24 CFR891.125, 941.202, 983.57.

6For these programs, the Consolidated Plan isintended as the program participant’scomprehensive mechanism to gather relevant

housing data, detail housing, homelessness, andcommunity development strategies, and commit tospecific actions. These are then updated annuallythrough annual action plans.

7The GAO noted that close to 30 percent of thegrantees from whom it sought documentation hadoutdated AIs and that almost 5 percent of thegrantees were unable to provide AIs whenrequested.

8See, e.g., Department of Housing & CommunityDevelopment Massachusetts, Affirmative FairHousing and Civil Rights Policy (Apr. 2009), http:// www.mass.gov/hed/docs/dhcd/hd/fair/ affirmativefairhousingp.pdf .

9See U.S. Department of Commerce, U.S. CensusBureau, The White Population: 2010, (Sept. 2011),http://www.census.gov/prod/cen2010/briefs/ c2010br-05.pdf .

10See U.S. Department of Commerce, U.S. CensusBureau, An Older and More Diverse Nation byMidcentury Releases: CB08–123 (Aug. 14, 2008),http://www.census.gov/newsroom/releases/ archives/population/cb08-123.html .

institutionalized method to assess siteselection and related issues. Shannon,436 F.2d at 821–22. In multiple otherdecisions, courts have set forth how thesection applies to specific policies andpractices of HUD program participants.See, e.g., Otero, 484 F.2d at 1132–37;Langlois v. Abington Hous. Auth., 207F.3d 43 (1st Cir. 2000); U.S. ex rel. Anti-

Discrimination Ctr. v. Westchester Cnty.,2009 WL 455269 (S.D.N.Y. Feb. 24,2009).

In addition to the statutes and courtcases emphasizing the requirement ofrecipients of federal housing and urbandevelopment funds to affirmativelyfurther fair housing, Executive Ordershave also addressed the importance ofcomplying with this requirement.4

B. The Need To Refine the CurrentAFFH Planning Framework

HUD has approached the AFFHobligation in various ways,5 and thisproposed rule is intended in particularto improve fair housing planning bymore directly linking it to housing andcommunity development planningprocesses currently undertaken byprogram participants as a condition oftheir receipt of HUD funds. At thejurisdictional planning level, HUDrequires program participants receivingCommunity Development Block Grant(CDBG), HOME Investment Partnerships(HOME), Emergency Solutions Grants(ESG), and Housing Opportunities forPersons With AIDS (HOPWA) formulafunding to undertake an analysis toidentify impediments to fair housing

choice within the jurisdiction takeappropriate actions to overcome theeffects of any impediments, and keeprecords on such efforts. See 24 CFR91.225(a)(1), 91.325(a)(1).6 Likewise,

PHAs must commit, as part of theirplanning process for PHA Plans andCapital Fund Plans, to examine theirprograms or proposed programs,identify any impediments to fairhousing choice within those programs,address those impediments in areasonable fashion in view of theresources available, work with

jurisdictions to implement any of thejurisdiction’s initiatives to affirmativelyfurther fair housing that require PHAinvolvement, maintain recordsreflecting those analyses and actions,and operate programs in a manner thatis consistent with the applicablejurisdiction’s consolidated plan. See 24CFR 903.7(o), 903.15.

Over the past several years, HUD hasreviewed the efficacy of thesemechanisms to fulfill the AFFHmandate and has concluded that the AIprocess can be a more meaningful toolto integrate fair housing into program

participants’ planning efforts. HUD’sFair Housing Planning Guide (PlanningGuide), a document issued in 1996,provides extensive suggestions but doesnot fully articulate the goals that AFFHmust advance. In addition, HUD hasnever provided data to grantees to helpframe their analysis, and AIs are notregularly submitted to HUD for review.

These observations are reinforced bya recent report by the GAO entitled‘‘HUD Needs to Enhance ItsRequirements and Oversight of

Jurisdictions’ Fair Housing Plans,’’GAO–10–905, Sept. 14, 2010. See http:// www.gao.gov/new.items/d10905.pdf (GAO Report). In this report, the GAOfound that there has been unevenattention paid to the AI by localcommunities in part because sufficientguidance and clarity was viewed aslacking. Specifically, GAO noted theuneven quality of existing AIs andfound that ‘‘HUD’s limited regulatoryrequirements and oversight’’ contributeto many grantees placing a ‘‘low priorityon ensuring that their AIs serve aseffective planning tools.’’ Id. at 1.7 In itsrecommendations, GAO emphasizedthat HUD could assist programparticipants by providing more effective

guidance and technical assistance andthe data necessary to prepare fairhousing plans.

Stemming from substantial interactionwith program participants and

advocates, and the GAO Report, HUD’sanalysis is that the current AI process isinsufficiently integrated into thegrantees’ planning efforts. Manyprogram participants are activelygrappling with how issues involvingrace, ethnicity, disability and other fairhousing concerns do and shouldinfluence housing and community

development planning and actions.HUD has found, however, that programparticipants must turn to outsideconsultants to collect data and conductthe analysis, and have little incentive touse this work as part of the consolidatedplan or PHA Plan. Moreover, HUD

believes that the current process doesnot fully incorporate refinements thathave developed since the PlanningGuide was promulgated in the way thatinnovators in the field address equity inthe context of housing and urbandevelopment.8 Especially in a time oflimited resources, HUD also believes

that it can do more to support programparticipants in the process, especiallythrough the provision of data,meaningful technical assistance, andguidance.

The need to rethink HUD’s approachto how program participantsaffirmatively further fair housing isreinforced by the fact that programparticipants are working in an Americathat is more diverse, with an increasingnumber of communities becoming moreintegrated. America has always been ademographically dynamic and diversenation and its diversity is increasing,

with over a third of the Americanpopulation now nonwhite, Hispanic/Latino, or a combination of races.9 Within little more than a generation,America is poised to become a nationwhere traditional minorities are in themajority.10 The ramifications of thisincreased diversity encompass a broadarray of dimensions, from the growingrecognition of the correlation betweennegative health indicators and patternsof segregation and poverty to theincreasing understanding regarding theimportance of diversity in business,higher education, and elsewhere to

prepare workers for the 21st century


http://www.mass.gov/hed/docs/dhcd/hd/fair/affirmativefairhousingp.pdfhttp://www.mass.gov/hed/docs/dhcd/hd/fair/affirmativefairhousingp.pdfhttp://www.mass.gov/hed/docs/dhcd/hd/fair/affirmativefairhousingp.pdfhttp://www.mass.gov/hed/docs/dhcd/hd/fair/affirmativefairhousingp.pdfhttp://www.census.gov/prod/cen2010/briefs/c2010br-05.pdfhttp://www.census.gov/prod/cen2010/briefs/c2010br-05.pdfhttp://www.census.gov/prod/cen2010/briefs/c2010br-05.pdfhttp://www.census.gov/newsroom/releases/archives/population/cb08-123.htmlhttp://www.census.gov/newsroom/releases/archives/population/cb08-123.htmlhttp://www.census.gov/newsroom/releases/archives/population/cb08-123.htmlhttp://www.gao.gov/new.items/d10905.pdfhttp://www.gao.gov/new.items/d10905.pdfhttp://www.gao.gov/new.items/d10905.pdfhttp://www.gao.gov/new.items/d10905.pdfhttp://www.census.gov/prod/cen2010/briefs/c2010br-05.pdfhttp://www.census.gov/prod/cen2010/briefs/c2010br-05.pdfhttp://www.mass.gov/hed/docs/dhcd/hd/fair/affirmativefairhousingp.pdfhttp://www.mass.gov/hed/docs/dhcd/hd/fair/affirmativefairhousingp.pdfhttp://www.mass.gov/hed/docs/dhcd/hd/fair/affirmativefairhousingp.pdfhttp://www.census.gov/newsroom/releases/archives/population/cb08-123.htmlhttp://www.census.gov/newsroom/releases/archives/population/cb08-123.html


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11See Dolores Acevedo-Garcia et. al., FutureDirections in Residential Segregation and HealthResearch: A Multilevel Approach Am. J. PublicHealth Vol. 93(2) p. 215–221 (Feb. 2003) availableat http://www.ncbi.nlm.nih.gov/pmc/articles/ PMC1447719/?tool=pubmed ; David R. Williams &Chiquita Collins, Racial Residential Segregation: AFundamental Cause of Racial Disparities in HealthPublic Health Report Vol. 119 p. 404–416 (Sept.–Oct. 2001) available at http:// www.ncbi.nlm.nih.gov/pmc/articles/PMC1497358/ pdf/12042604.pdf.

12See U.S. Department of Health & HumanServices, Administration on Aging, Aging Statistics(Sept. 1, 2011, 1:17:40 p.m.), http://www.aoa.gov/ aoaroot/aging _statistics/index.aspx .

13See Megan A. Turner & Karina Fortuny,Residential Segregation and Low-Income WorkingFamilies, The Urban Institute (Feb. 2009), http:// www.urban.org/uploadedpdf/411845 _residential _segregation _liwf.pdf .

14See Wodtke GT et al., (2011), NeighborhoodEffects in Temporal Perspective: The Impact ofLong-Term Exposure to Concentrated Disadvantageon High School Graduation. American SociologicalReview. Vol. 76, No. 5, 713–736.

15See Heather L. Schwartz, Housing Policy isSchool Policy: Economically Integrative HousingPromotes Academic Success in MontgomeryCounty, Maryland A Century Foundation Report p.57 (2010), http://www.rand.org/pubs/ external _ publications/EP201000161.html .

16 In setting forth these two goals, the proposedrule reinforces the proposition that a criticalcomponent of addressing segregation is providingsupport for those communities that are integratedor are integrating. Strategies and actions to promotethe effective and long-term viability of thesecommunities is an important component of thesefair housing goals.

17See http://www.economicmobility.org/assets/ pdfs/PEW _NEIGHBORHOODS.pdf .

18See, e.g., David Card & Jesse Rothstein, RacialSegregation and the Black-White Test Score Gap, 91 Journal of Public Economics 2158–218 (2007);Edward L. Glaeser & David Cutler, Are GhettosGood or Bad, 112 The Quarterly Journal ofEconomics 827–872 (1997); David Weiner, ByronLutz & Jens Ludwig, The Effects of SchoolDesegregation on Crime National Bureau ofEconomic Research, Working Paper No. 15380(2009).

19 It has been HUD’s policy to encouragecommunity-based rather than institutionalresidences for persons with disabilities. Infurtherance of the Supreme Court’s decision inOlmstead v. L.C., 527 U.S. 581(1999), and pursuantto regulations at 24 CFR 8.4(d), HUD promoteshousing in the most integrated setting appropriateto the needs of persons with disabilities.

20See William Julius Wilson, When WorkDisappears: The World of the New Urban Poor1996.

economy.11 HUD’s proposed rule alsorecognizes other significant shifts, suchas those related to persons withdisabilities. Demographically, the agingof the population makes physicallyaccessible housing and the preservationof housing choice for people withdisabilities increasingly significant.12

Research indicates that disparities in

access to community assets negativelyimpact educational and economicoutcomes.13 Sustained exposure tohighly distressed neighborhoods isassociated with a reduction inchildren’s odds of high schoolgraduation by at least 60 percent,14 while low-income students who haveaccess to asset-rich neighborhoods withgood schools may realize math andreading gains that help close theachievement gap.15 Given this research,HUD hopes this proposed rule and otherefforts would reduce disparities inaccess to community assets based on

race, color, religion, sex, familial status,national origin, or disability.

C. The Proposed AFFH PlanningFramework

To promote more effective fairhousing planning and assist everyprogram participant to meetrequirements related to affirmativelyfurthering fair housing, HUD proposesin this rule to address directly concernsabout the current fair housing planningprocess by making a number of keychanges. These include: (1) A new fairhousing assessment and planning tool,the AFH, which replaces the AI, (2) the

provision of nationally uniform datathat will be the predicate for and help

frame program participants’ assessmentactivities, (3) meaningful and focuseddirection regarding the purpose of theAFH and the standards by which it will

be evaluated, (4) a more direct link between the AFH and subsequentprogram participant planningproducts—the consolidated plan andthe PHA Plan—that ties fair housing

planning into the priority setting,commitment of resources, andspecification of activities to beundertaken, and (5) a new HUD reviewprocedure based on clear standards thatfacilitates the provision of technicalassistance and reinforces the value andimportance of fair housing planningactivities.

In terms of the provision of greaterclarity regarding the purpose of the fairhousing assessment and planningprocess, the proposed rule will moreclearly define the core goals involved infulfilling program participants’

affirmatively furthering fair housingmandate. In doing so, HUD begins withgoals long associated with this mandate:addressing patterns of segregation whilesupporting integrated and integratingcommunities, as well as seeking toreduce disproportionate housing needsamong protected class members.16 Theproposed rule recognizes thatsegregation is due in part to a historicallegacy of discrimination and continuesto have adverse impacts, with the dualconcentration of poverty and racial andethnic populations still far tooprevalent.17 Segregation carries a heavysocial cost. Numerous studies indicatethat segregation negatively impactsminorities’ educational attainment,labor market outcomes, physical andmental health, and crimevictimization.18 These negativeoutcomes translate to lower economicproductivity for the Nation as a whole,and increased cost to society in amultitude of ways, from the justicesystem to the public healthinfrastructure. The importance of

overcoming patterns of segregation andsupporting means to advanceintegration are equally important asapplied to persons with disabilities.Programmatically, HUD recognizes andis implementing means to overcome alegacy related to persons withdisabilities that reflects a history ofinappropriate segregation,

institutionalization, and otherwiselimited equal access to housingchoices.19

In refining the current AFFHframework, racially or ethnicallyconcentrated areas of poverty are ofparticular concern because they couplefair housing issues with othersignificant local and regional policychallenges. These areas clearly fall inthe domain of fair housing, as they oftenreflect legacies of segregated housingpatterns. Of the nearly 3,800 censustracts in this country where more than40 percent of the population is below

the poverty line, about 3,000 (78percent) are also predominantlyminority. Racially or ethnicallyconcentrated areas of poverty meritspecial attention because the costs theyimpose extend far beyond theirresidents, who suffer due to theirlimited access to high-qualityeducational opportunities, stableemployment, and other prospects foreconomic success. Because of their highlevels of unemployment, capitaldisinvestment, and other stressors, theseneighborhoods often experience a rangeof negative outcomes such as exposureto poverty, heightened levels of crime,

negative environmental health hazards,low educational attainment, and otherchallenges that require extra attentionand resources from the largercommunities of which they are a part.Consequently, interventions that resultin reducing racially and ethnicallyconcentrated areas of poverty hold thepromise of providing benefits that assist

both residents and their communities.20 The proposed rule acknowledges that

the prospects for individual or familialsuccess are influenced by a variety ofneighborhood features far moreextensive than just housing. These other

neighborhood features must beimportant considerations in seeking toadvance fair housing. HUD hasconsistently recognized that features


http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1447719/?tool=pubmedhttp://www.ncbi.nlm.nih.gov/pmc/articles/PMC1447719/?tool=pubmedhttp://www.ncbi.nlm.nih.gov/pmc/articles/PMC1447719/?tool=pubmedhttp://www.ncbi.nlm.nih.gov/pmc/articles/PMC1497358/pdf/12042604.pdfhttp://www.ncbi.nlm.nih.gov/pmc/articles/PMC1497358/pdf/12042604.pdfhttp://www.ncbi.nlm.nih.gov/pmc/articles/PMC1497358/pdf/12042604.pdfhttp://www.aoa.gov/aoaroot/aging_statistics/index.aspxhttp://www.aoa.gov/aoaroot/aging_statistics/index.aspxhttp://www.aoa.gov/aoaroot/aging_statistics/index.aspxhttp://www.aoa.gov/aoaroot/aging_statistics/index.aspxhttp://www.aoa.gov/aoaroot/aging_statistics/index.aspxhttp://www.urban.org/uploadedpdf/411845_residential_segregation_liwf.pdfhttp://www.urban.org/uploadedpdf/411845_residential_segregation_liwf.pdfhttp://www.urban.org/uploadedpdf/411845_residential_segregation_liwf.pdfhttp://www.urban.org/uploadedpdf/411845_residential_segregation_liwf.pdfhttp://www.urban.org/uploadedpdf/411845_residential_segregation_liwf.pdfhttp://www.urban.org/uploadedpdf/411845_residential_segregation_liwf.pdfhttp://www.urban.org/uploadedpdf/411845_residential_segregation_liwf.pdfhttp://www.urban.org/uploadedpdf/411845_residential_segregation_liwf.pdfhttp://www.urban.org/uploadedpdf/411845_residential_segregation_liwf.pdfhttp://www.urban.org/uploadedpdf/411845_residential_segregation_liwf.pdfhttp://www.rand.org/pubs/external_publications/EP201000161.htmlhttp://www.rand.org/pubs/external_publications/EP201000161.htmlhttp://www.rand.org/pubs/external_publications/EP201000161.htmlhttp://www.rand.org/pubs/external_publications/EP201000161.htmlhttp://www.rand.org/pubs/external_publications/EP201000161.htmlhttp://www.economicmobility.org/assets/pdfs/PEW_NEIGHBORHOODS.pdfhttp://www.economicmobility.org/assets/pdfs/PEW_NEIGHBORHOODS.pdfhttp://www.economicmobility.org/assets/pdfs/PEW_NEIGHBORHOODS.pdfhttp://www.economicmobility.org/assets/pdfs/PEW_NEIGHBORHOODS.pdfhttp://www.economicmobility.org/assets/pdfs/PEW_NEIGHBORHOODS.pdfhttp://www.aoa.gov/aoaroot/aging_statistics/index.aspxhttp://www.aoa.gov/aoaroot/aging_statistics/index.aspxhttp://www.rand.org/pubs/external_publications/EP201000161.htmlhttp://www.rand.org/pubs/external_publications/EP201000161.htmlhttp://www.ncbi.nlm.nih.gov/pmc/articles/PMC1447719/?tool=pubmedhttp://www.ncbi.nlm.nih.gov/pmc/articles/PMC1447719/?tool=pubmedhttp://www.economicmobility.org/assets/pdfs/PEW_NEIGHBORHOODS.pdfhttp://www.economicmobility.org/assets/pdfs/PEW_NEIGHBORHOODS.pdfhttp://www.ncbi.nlm.nih.gov/pmc/articles/PMC1497358/pdf/12042604.pdfhttp://www.ncbi.nlm.nih.gov/pmc/articles/PMC1497358/pdf/12042604.pdfhttp://www.ncbi.nlm.nih.gov/pmc/articles/PMC1497358/pdf/12042604.pdfhttp://www.urban.org/uploadedpdf/411845_residential_segregation_liwf.pdfhttp://www.urban.org/uploadedpdf/411845_residential_segregation_liwf.pdfhttp://www.urban.org/uploadedpdf/411845_residential_segregation_liwf.pdf


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21See, e.g., HUD Fair Housing Planning Guide 5–

9 (emphasizing that jurisdictions should strive toequalize services, including schools, recreationalfacilities and programs, social service programs,parks, roads, transportation, street lighting, trashcollection, street cleaning, crime prevention, andpolice protection activities, in their fair housingplan); see also, e.g., 24 CFR 941.202 (requiring that,inter alia, environmental conditions, access toemployment opportunities, and access to ‘‘social,recreational, educational, commercial, and healthfacilities and services, and other municipalfacilities and services’’ be considered whenchoosing neighborhoods in which to locate publichousing); 24 CFR 891.125.

22See Xavier de Souza Briggs, The Geography ofOpportunity: Race and Housing Choice inMetropolitan America (2005).

23The consolidated plan is a 5-year planninginstrument. The annual action plan is the plansubmitted by consolidated plan programparticipants that describes the consolidated planactions that participants intend to carry out in acalendar year.

other than housing stock are importantcomponents assessing the quality ofhousing opportunities and land use andplanning activities.21 Drawing uponpertinent research,’’ 22 the proposed ruleincorporates a set of measures designedto assess the extent to which a particulararea possesses or is linked to assets thatcorrelate with an increased chance to

improve an individual or family’s lifetrajectory. It also proposes to provideprogram participants with the tools toassess the assets and stressors within acommunity that impact the quality oflife of residents. In addition, theproposed rule notes that shiftingresidential and development patternshave significant implications forfamilies with children, particularlyimpacting children’s ability to receive aquality education. In setting forth thisprimary objective and commitment toproviding relevant data tools andassessment techniques, the proposed

rule attempts to follow the adviceprovided by the GAO report to giveprogram participants more guidance andtools to prepare more effective fairhousing plans.

A second core innovation in theproposed rule involves HUD’s provisionof data to program participants as astarting point in the fair housingassessment process. This data will bedrawn from nationally uniformsources(including data related toeducation, poverty, transit access,employment, exposure to environmentalhealth hazards, and other criticalcommunity assets, as well as nationally

uniform local and regional data onpatterns of integration and segregation;racial and ethnic concentrations ofpoverty; disproportionate housing needs

based on protected class; andoutstanding discrimination findings.The provision of this data will bothenable program participants to moreknowledgably undertake their AFH andreduce the burden that currently existsfor undertaking the AI. The HUD datamay be supplemented by available localor regional information. HUD believes

that these broader data will greatlyassist housing and communitydevelopment strategies, investments,and other actions to affirmativelyfurther fair housing at the jurisdictionaland regional level.

By directly providing nationallyuniform information about the fairhousing dynamics of regions and

communities to 1,200 localgovernments, all states, the insularareas, and more than 4,000 PHAs, HUDexpects that officials, communitymembers, and other stakeholdersthroughout the Nation will be able tohave a more informed and transparentconversation about the fair housingpotential of public and privateinvestments, strategies, and initiatives.This offers significant opportunities forinnovation and progress, especiallygiven the ways in which this data isexpected to enable communities toassess changes over time. Further,

having a common, national baseline offair housing indicators will facilitatecoordination and connection withplanning and assessment of civil rightsimplications in other domains closelyrelated to housing and communitydevelopment, such as transportation,education, employment, and health.

Under the proposed rule, programparticipants will use HUD data toevaluate patterns of integration andsegregation, racial and ethnicconcentration of poverty, and disparitiesin access to valuable community assetsand disproportionate housing needs

based on protected class and evaluate

the primary determinants of theseconditions. Program participants willalso assess whether laws, policies, orpractices limit fair housing choice, aswell as the role of public investments increating, perpetuating, or alleviating thesegregation patterns revealed by theassessment. Examples of such laws,policies, or practices include, but arenot limited to, zoning, land use,financing, infrastructure planning, andtransportation.

A third critical innovation in theproposed rule that also respondsdirectly to the GAO report is the AFH,

which replaces the AI, and is completed by program participants with HUD dataand guidance. The AFH will helpprogram participants more effectivelyintegrate fair housing concerns into theconsolidated plan and PHA planningprocess. The proposed rule requiresprogram participants to submit theirAFH to HUD in advance of theconsolidated plan and PHA Plansubmission so that the AFH may theninform strategies and actions in thoseplans. HUD’s review of an AFH will be

based on standards for acceptance

contained in the proposed rule, and anaccepted AFH and completion ofcorresponding requirements related toaffirmatively furthering fair housing inthe consolidated plan and PHA Planwill be required for HUD to approvethose respective plans. HUD will eitheraccept the AFH or provide the programparticipant with specific reasons for

non-acceptance, the actions the programparticipant needs to take to meet thecriteria for acceptance, and, asappropriate, technical assistance to meetAFH requirements.

Once accepted, the AFH will theninform consolidated plan and PHA Planstrategies, more directly and effectivelyincorporating fair housing planning intothe comprehensive housing andplanning processes that programparticipants now use.23 Consolidatedplan program participants willdemonstrate how their affordablehousing and community development

priorities and objectives willaffirmatively further fair housing. Theseprogram participants will also identifyany additional strategies and actions notdirectly tied to the priorities they aresetting forth to further goals of the AFH.Similarly, these program participantswill describe actions to affirmativelyfurther fair housing in their annualaction plans.

The proposed rule similarly creates astructure for PHAs to cooperate fully inthe creation of the AFH and then to usethe resulting AFH to inform the PHAplanning process, all as a predicate tothe PHA certification that it will

affirmatively further fair housing. Aswith consolidated plan programparticipants, PHAs will incorporate theAFH into the PHA planning process inorder to inform strategies and actions intheir 5-Year PHA Plans and/or AnnualPlans to affirmatively further fairhousing. PHAs will have the choice toparticipate with their local governmentin preparing the AFH, prepare the AFHindependently, or follow the state’sAFH. PHAs may adjust their planningcycle over time to assure that the AFHis completed before their PHA Planwork begins. For PHAs that participate

in the new collaborative AFH, theresulting analysis is designed to besufficient to support a 5-year planninghorizon, and PHAs will not have toundertake the same exercise every year.This will free up PHA resources to focuson implementation and long-termstrategies.



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Many fair housing issues transcendlocal jurisdictional boundaries.Solutions to such issues often involvecoordinated actions by multiplejurisdictions, and require creativecollaboration across traditionallydisconnected policy domains.Coordination between jurisdictions thatundertake consolidated planning andPHAs can allow for more effectivedeployment of limited resources, whichis important because PHA programs,including notably the Housing ChoiceVoucher Program, can frequently besignificant mechanisms to enablefamilies to access communities offeringassets that are often difficult for voucherfamilies to obtain. In this context,regional assessments can be animportant means for effectivelyaddressing these issues, as well as thosethat are local to independentjurisdictions. Regional assessments aretherefore encouraged in this rule.

It is a statutory condition of HUDfunding that program participantscertify that they will affirmativelyfurther fair housing, which, under theproposed rule, means that that they willtake meaningful actions to further thegoals identified in an AFH conducted inaccordance with the requirements ofthis rule, and that the programparticipant will take no action that ismaterially inconsistent with itsobligation to affirmatively further fairhousing. It is important to note,however, that neither the proposed rulenor the improved process that it willestablish defines the strategies oractions program participants will take.In fact, the proposed rule emphasizesthat there are diverse approaches thatcan be taken. A program participant’sstrategies and actions may includestrategically enhancing neighborhoodassets (for example, through targetedinvestment in neighborhoodrevitalization or stabilization) orpromoting greater mobility and access tocommunities offering vital assets suchas quality schools, employment, andtransportation consistent with fairhousing goals. Consistent with long-standing judicial guidance regardingAFFH, the proposed rule is designed sothat program participants undertake aprocess that informs and engages thepublic and allows program participantsto make educated judgments regardingthe appropriate strategies and actionsthat are consistent with their obligationsto affirmatively further fair housing. Indoing so, it directs them to examinerelevant factors, such as zoning andother land-use practices that are likelycontributors to fair housing concerns,

and take appropriate actions inresponse.

D. Conclusion

The opportunity to choose where onelives free from obstacles related to race,color, religion, sex, familial status,national origin, or disability is essentialto the ability to engage as a full member

of one’s community. This promise offair housing choice requires vigorousenforcement of laws barringdiscrimination, and proactive planning,strategies, and actions.

In administering its programs andactivities in a manner to affirmativelyfurther fair housing, HUD is committedto taking active measures to build onprogress made by communities acrossthe country to affirmatively further fairhousing, while confronting the realitythat more must be done. This proposedrule, informed by local experience andthe GAO report, offers such active

measures.III. Summary of Proposed Rule

This rule proposes to amend theregulations in 24 CFR parts 5, 91, 92,570, 574, 576, and 903, as discussed inthis section.

Affirmatively Furthering Fair HousingRegulations

This proposed rule would amendHUD regulations in 24 CFR part 5 thatcontain general HUD programrequirements, and specifically 24 CFRpart 5, subpart A, which containsgenerally applicable definitions and

federal requirements that are applicableto all or almost all HUD programs. Thisrule proposes to add new §§5.150–5.180 under the undesignated headingof ‘‘Affirmatively Furthering FairHousing.’’ These new sections willprimarily provide the regulations thatwill govern the affirmatively furtheringfair housing planning process by states,local governments, and PHAs, butreserves additional sections in subpartA for HUD to continue to provideregulations that will assist all HUDprogram participants in more effectivelyaffirmatively furthering fair housing.

Purpose of Affirmatively FurtheringFair Housing Regulations (§ 5.150). New§ 5.150 states that the purpose of HUD’snew regulations (AFFH regulations) is toprovide more effective means of meetingthe statutory obligation imposed onHUD program participants toaffirmatively further fair housing. Thenew AFFH regulations are intended toadd clarity to the goals that are at theheart of affirmatively furthering fairhousing, to provide for guidance andinteraction between HUD and programparticipants and, to the extent

appropriate, inform other housing andurban development programs that aresubject to AFFH requirements. The newregulations envision a process that isstructurally incorporated into theconsolidated plan and the PHAplanning process, building upon what isalready familiar to HUD programparticipants and thus reducing burden

and connecting disparate planningprocesses.

Definitions (§ 5.152). New §5.152provides the definitions that are used inthe AFFH regulations. Several termsdefined in this section are defined inother HUD regulations, and this sectioncontains cross-references to theregulations that define such terms. Newterms defined in this section include‘‘affirmatively furthering fair housing,’’‘‘assessment of fair housing, community

participation,’’ ‘‘disproportionatehousing needs,’’ ‘‘ fair housing choice,’’‘‘ fair housing determinant,’’ ‘‘ fair

housing issue,’’ ‘‘ fair housingenforcement and fair housing outreachcapacity,’’ ‘‘integration,’’ ‘‘racially orethnically concentrated area of

poverty,’’ ‘‘segregation,’’ and‘‘significant disparities in access tocommunity assets.’’ Fordisproportionate housing needs,integration, racially or ethnicallyconcentrated area of poverty,segregation, and significant disparitiesin access to community assets, HUDwill provide specific data sources andthresholds with the final rule and willupdate this information periodicallythrough Federal Register notices, as

data sources and methodologiesimprove.

The definition of ‘‘affirmatively furthering fair housing’’ clarifies thatAFFH, while includingantidiscrimination measures, requiresproactive steps to foster more inclusivecommunities and access to communityassets for all those protected by the FairHousing Act. The definitionincorporates the goals animating theproposed rule, as reflected in thecategories of the AFH (see § 5.154) anddescribed in the preamble, seeIntroduction, Parts I and II. It makes

clear that the pursuit of these endsrequires appropriate assessment andanalysis, and actions based on thisassessment and analysis. Whencompared to the definition of AFFHcontained in the Planning Guide, thisdefinition provides greater clarity aboutthe purposes of AFFH, while retainingthat AFFH will be accomplishedthrough analysis and assessment andactions (including the investment offederal and other resources andimplementation of strategies) basedupon that analysis and assessment. The



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proposed definition encompasses thekey aspects of the definitionincorporated in the Planning Guide, assatisfactory production of an AFH willrequire identifying what werepreviously called impediments, takingactions, and maintaining records.Certain terms that are in the PlanningGuide definition do not need to be

included in the proposed definition, asthey are incorporated elsewhere in therule.

The definition of ‘‘ fair housingchoice’’ sets forth elements required forindividuals and families to be able tolive where they choose without barriersrelated to the classes protected underthe Fair Housing Act: Actual choice,protected choice, and enabled choice.As explained in more detail in thepreamble (see Introduction, Part II (B)),these elements are necessary forindividuals and families to be able toachieve fair housing choice given the

legacy of segregation, ongoingdiscrimination, and residential patternsthat offer different levels of access tocommunity assets.

The definition of ‘‘ fair housing issue’’similarly builds on the core elements ofAFFH as contained in that definitionand fully explained in the preamble,and incorporates any other conditionthat impedes fair housing choice.

The definitions of ‘‘integration,’’‘‘segregation,’’ ‘‘racially or ethnicallyconcentrated areas of poverty,’’ and‘‘significant disparities in access tocommunity assets’’ are included

because they are key components of the

goals contained in the proposed ruleand central elements in the new AFH;see § 5.154. When appropriate, theyidentify cross-references to other legalstandards that are relevant to how theseterms apply to specific classes protectedunder the Act (e.g., integration andpersons with disabilities). Thedefinitions of ‘‘integration,’’‘‘segregation,’’ and ‘‘racially orethnically concentrated areas of

poverty’’ note that HUD will determinethe appropriate data sources in additionto the decennial status to be used toidentify such geographic areas.

Assessment of Fair Housing (AFH)(§ 5.154). New §5.154 sets forth the keyrequirement for more effectivelyfulfilling the duty to affirmativelyfurther fair housing—an assessment offair housing (AFH) by programparticipants. As discussed earlier, HUDhas determined that the current processfor affirmatively furthering fair housingis insufficient to ensure that programparticipants are meeting their obligationin a purposeful manner as contemplated

by law. The AFH, which will bedeveloped with data and guidance from

HUD, will replace the AI previouslyrequired of program participants, whichoften required significant staff and otherresources to complete withoutadequately informing subsequentplanning and action. The result will notonly be evidence that programparticipants have undertakenmeaningful fair housing planning, but

that they have a well-consideredstrategy to implement actions toaffirmatively further fair housing. HUD

believes that the process set forth in thisproposed rule involving the submissionand review of the AFH will thus lead toa more effective and collaborative fairhousing planning process, especiallysince HUD is clarifying the goals andrequirements of the process, providingdata and other prerequisites, andintegrating the AFH into other keyplanning documents for the use of HUDfunds.

Paragraph (b) of this section lists the

HUD program participants that mustperform such assessment, and theseentities are: (1) States, insular areas, andlocal governments participating in HUDprograms that are covered by theconsolidated plan submissionrequirements in HUD regulations in 24CFR part 91; and (2) PHAs receivingassistance under sections 8 and 9 of theU.S. Housing Act of 1937 . Currently, asnoted, in support of the affirmativelyfurthering fair housing certification ofthe Consolidated Plan statute, 42 U.S.C.10275(b)(15), HUD requires programparticipants that receive formula grantsunder the CDBG, ESG, HOME, and

HOPWA programs to prepare an AI. See24 CFR 91.2(a), 91.225(a), 91.325(a),91.425(a). Also, in support of the civilrights certification of the PHA Planstatute, 42 U.S.C. 1437c–1(d)(15), HUDrequires PHAs to examine theirprograms for impediments to fairhousing choice. See 24 CFR 903.7(o).

Paragraph (c) provides that HUD willmake available fair housing data toprogram participants to assist them intheir assessment of the availability offair housing choice in their jurisdictionsand in overcoming barriers to suchchoice. In addition to any available local

or regional information and informationgained through communityparticipation and consultation, HUDwill provide, as a resource for programparticipants, a set of nationally uniformlocal and regional data on patterns ofintegration and segregation; racially andethnically concentrated areas of poverty;access to neighborhood opportunitiessuch as education, employment, lowpoverty, transportation, andenvironmental health, among others;disproportionate housing needs; data onindividuals with disabilities and

families with children; anddiscrimination. HUD will also providePHA site locational data (including, tothe extent available, units accessible forpersons with disabilities), thedistribution of housing choice vouchers,and occupancy data.

HUD proposes using the data and

thresholds specified in the datamethodology appendix, the full detailsof which can be found atwww.regulations.gov under docketnumber 5173–P–01–DM. To describesegregation dynamics, HUD will providecommon social science measures ofsegregation, including the dissimilarityindex and the isolation index. Thesemeasures will be accompanied byguidance to help program participantsand others understand whether valuessuggest relatively low, moderate, or highlevels of segregation. HUD will alsoprovide data on disproportionate

housing needs for protected classes,analogous to what is provided in HUD’sconsolidated planning process. Further,HUD will provide data to programparticipants that reports on theexistence of racially concentrated areasof poverty (RCAP) in their jurisdictions.These data will include a designationthat identifies whether a given censustract is an RCAP, based on HUD-established joint thresholds for minorityand poverty concentrations.

Finally, HUD has constructed keymeasures along an array of importantcategories. A simple poverty index

captures the depth and intensity ofpoverty in a given neighborhood. Theneighborhood school proficiency indexuses school-level data on theperformance of students on state examsto describe which neighborhoods havemore proficient elementary schools andwhich have less proficient elementaryschools. A labor market engagementindex provides a summary descriptionof the relative intensity of labor marketengagement and human capital in aneighborhood. A job access indexsummarizes the accessibility of a givenresidential neighborhood as a function

of its distance to all job locations, withdistance to larger employment centersweighted more heavily. A healthhazards exposure index summarizespotential exposure to harmful toxinsemitted from industrial facilities at aneighborhood level. A transit indexreflects a neighborhood’s proximity totransit stops. The input variables foreach index are listed below, with moredetail on the construction of eachmeasure available in the data appendixreferenced above.


http://www.regulations.gov/http://www.regulations.gov/


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Dimension Input variables

Poverty Index .................................. Percent of families living below the poverty line and percent of households receiving public assistance.School Proficiency Index ................ Percent of elementary students who are proficient in reading and percent who are proficient in math ac-

cording to state examinations.Labor Market Engagement/Human

Capital Index.Neighborhood unemployment rate; neighborhood labor force participation rate; and percent of the popu-

lation over the age of 25 with a bachelor’s degree or higher.Job Access Index ............................ Number of jobs in a neighborhood; distance from a neighborhood to employment centers; and number of

workers commuting to those employment centers.Health Hazards Exposure Index ..... Distance to facilities in EPA’s Toxic Release Inventory database; volume of releases; and toxicity of re-

leased chemicals.Transit Access ................................ Distance to nearest fixed-rail or bus rapid transit station.

As with all data metrics, the measuresin each category have strengths, as wellas limitations. Limitations arise inparticular in this instance because themetrics must rely on nationallyavailable data, which are often coarserthan data available for some localities.For example, measures for schools arereliant on broadly available test scoreinformation and not detailed measuresof instructional quality, while measures

of transit may not reflect the multitudeof transit options (bus, trolley, ferry) insome communities. Programparticipants will have the flexibility tosupplement or replace HUD measureswhen better local alternatives exist.Moreover, because research onmeasuring access to community assets iscontinually evolving, HUD is committedto reviewing the data on an ongoing

basis for potential improvements.Specific solicitation of comment.

Because these data are important andnovel, HUD is seeking input on thesedata metrics, both in the context of this

rule, as well as in a separate upcomingpublic comment process. Thissupplemental process will focus moredirectly on technical aspects of thestrengths and limitations of specificmetrics. Nonetheless, HUD seekscomment on the strengths andlimitations of the proposed data. HUD isalso interested in potential quantitativeor qualitative data that are not currentlyincluded in the indicators that mighteffectively complement or replace theHUD-provided data.

Paragraph (d) provides the content ofthe AFH that a program participant

must submit to HUD. Paragraph (d)provides that the AFH must addresssegregation, concentration of poverty,disparities in access to communityassets, and disproportionate housingneeds based on race, color, religion, sex,familial status, national origin, orhandicap. In addressing these subjectareas, paragraph (d) provides that theAFH must include a summary of fairhousing issues in the jurisdiction,including any findings or judgmentsrelated to fair housing or other civilrights laws and assessment of

compliance with existing fair housinglaws, regulations, and guidance.Additionally, the AFH must assess thejurisdiction’s fair housing enforcementand fair housing outreach capacity.

Paragraph (d) also provides for theAFH to include an analysis of the dataconcerning disparities in thejurisdiction’s area, based upon HUD-provided fair housing data, as well aslocal or regional data available to the

jurisdiction, and community input.Using this information, the programparticipant must identify, within thejurisdiction and region, integration andsegregation patterns and trends acrossprotected classes; racially or ethnicallyconcentrated areas of poverty; whethersignificant disparities in access tocommunity assets exist across protectedclasses within the jurisdiction andregion; and whether disproportionatehousing needs exist across protectedclasses.

Paragraph (d) further provides that,using an assessment tool provided by

HUD, each program participant must:(1) Identify the primary determinantsinfluencing conditions of segregation;concentrations of poverty; disparities inaccess to community assets; anddisproportionate housing needs basedon protected class; and the mostsignificant determinants of thesedisparities; (2) identify fair housingpriorities and general goals andarticulate a justification for the chosenprioritization; and (3) set one or moregoal(s) for mitigating or addressing thedeterminants. In recognition of theproposition that this assessment will bepart of existing statutory planningprocesses, paragraph (d) provides thatthe specific strategies or fundingdecisions subject to the consolidatedplan, PHA Plan, or other relevantplanning processes are not required to

be detailed in an AFH. It is HUD’sexpectation that the AFH will also serveas a valuable tool to inform otherplanning documents or processes inaddition to the consolidated plan andPHA Plan, such as PHA Capital FundPlans, and transportation or educationplans, in this way facilitating and

supporting civil rights planning acrosspolicy domains.

Paragraph (e) addresses AFHrequirements for specific types ofprogram participants. This paragraphaddresses the AFH required for: (1)PHAs that participate with the relevantconsolidated plan program participant;(2) HOME Program Consortia; (3) InsularAreas; and (4) the District of Columbia.With respect to PHAs, this paragraph

provides a process for submission andreview of a dissenting statement oralternative views on an AFH createdwith a consolidated plan programparticipant. With respect to preparationand submission of an AFH, a HOMEProgram consortium is considered to bea single unit of general localgovernment. An insular area jurisdictionmay choose to prepare an AFHfollowing either the abbreviated AFHprocedures in 24 CFR 91.235, or thecomplete AFH procedures applicable tolocal governments in 24 CFR part 91,subpart C. The District of Columbia

must follow the requirements applicableto local governments described in thissubpart.

Regional AFHs (§ 5.156). New §5.156addresses and encourages regionalassessments and fair housing planning,providing that that two or more programparticipants may join together to submita single AFH to evaluate fair housingchallenges, issues, and determinantsfrom a regional perspective (RegionalAFH). Regionally collaborating programparticipants need not be contiguous andmay cross state boundaries, and aRegional AFH, like a local AFH, will

examine regional data and account forregional dynamics. Regionallycollaborating program participants mustdesignate one member as the lead entityto oversee the development andsubmission of the assessment.

Program participants are encouragedto cooperate to develop regional AFHsto achieve the sharing of resources andthe development of regional strategies,goals, and outcomes to improve fairhousing choice for individuals withinregional areas. A consolidated planprogram participant choosing to



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participate in a Regional AFH shouldconsider the implications of thisapproach on its consolidated plan. Eachcooperating consolidated plan programparticipant remains responsible for itsown consolidated plan and itsobligation to affirmatively further fairhousing in accordance with theconsolidated plan and applicable

program requirements. This sectiondoes not preclude program participantsfrom entering into other cooperativearrangements to undertake regional fairhousing assessments and planning.

While new §5.156 encouragesregional assessments, a regionalassessment does not relieve eachregionally collaborating programparticipant from its obligation toanalyze and address local fair housingissues and determinates that affecthousing choice within its respectivejurisdiction.

Community participation,consultation, and coordination(§ 5.158). New §5.158 provides forcommunity participation andconsultation requirements for thepurpose of ensuring that the AFH isinformed by meaningful communityparticipation and is integrated fully intothe consolidated plan process, or otherplanning processes, as may beapplicable. Section 5.158 specifies theminimum AFH communityparticipation and consultation that must

be undertaken, whether preparing theAFH singly or in combination withother program participants. Forconsolidated plan program participants,

§ 5.158 provides that a jurisdiction mustfollow the policies and proceduresdescribed in its applicable citizenparticipation plan adopted pursuant tothe consolidated plan regulations in 24CFR part 91 (specifically, 24 CFR91.105, 91.115, 91.401). This sectionalso requires that the jurisdictionconsult with the agencies andorganizations identified in consultationrequirements at 24 CFR part 91(specifically, 24 CFR 91.100, 91.110,91.235, 91.401). For PHAs, §5.158provides that PHAs must follow thepolicies and procedures described in 24

CFR 903.7 and 903.19.Paragraph (b) of §5.158 addressescoordination and provides that PHAsmay participate directly withjurisdictions, prepare their own AFH, oradopt a state’s AFH.

AFH Submission Requirements(§ 5.160). New §5.160 provides therequirements for submission of the AFHto HUD, and provides that the first timea program participant is undertaking theassessment, it must submit its AFH toHUD at least 270 calendar days beforethe start of the program year prior to the

start of the 3- or 5-year consolidatedplanning process. This section providesan exception for the date on whichnewly eligible jurisdictions under theHOME program must submit an AFH.Under 24 CFR 92.104, newly eligiblejurisdictions shall submit an initial AFHnot later than 90 calendar days afterproviding notification under §92.103

that the jurisdiction intends toparticipate in the HOME program as aparticipating jurisdiction.

New §5.160 provides that, afteracceptance of a program participant’sinitial AFH, each program participantshall submit subsequent AFHs to HUDat least 195 calendar days before thestart of the jurisdiction’s program yearin which they are submitting aconsolidated plan. The submissiondates set forth in this section, both foran initial AFH and subsequent AFHs,are established to allow the results of anaccepted AFH to inform the

consolidated plan and PHA planningprocess.Specific solicitation of comment. HUD

specifically invites comments as towhether these time frames will achievethat objective.

New §5.160 also addresses latesubmission of an AFH. Paragraph (b) ofthis section provides that an AFHaccepted by HUD is a precondition foracceptance of the AFFH certificationthat is required for the consolidatedplan and the PHA Plan. Paragraph (b)also provides that, if a jurisdiction failsto submit its AFH in a timely manner,HUD may require that the jurisdiction

submit its consolidated plan within acorresponding period of time after that.However, in no event will the deadline

be extended past August 16 of thefederal fiscal year in which grant fundsare appropriated, as provided in 24 CFR91.15. Thus, as provided under theconsolidated plan regulations, thefailure to submit the consolidated plan

by August 16 results in the loss ofcovered funds for the programparticipant for that funding year. See 24CFR 91.15 (a)(2).

Paragraph (c) of §5.160 addresses thefrequency of submission of an AFH, and

provides that each consolidated planprogram participant must submit anAFH at least once every 5 years, or atsuch time agreed upon by HUD and theprogram participants in order tocoordinate AFH submission with timeframes required of consolidated plans,cooperation agreements, or other plans.PHAs participating with theirconsolidated plan program participantsin the AFH process will incorporate theresulting AFH into its PHA Plan every5 years, and PHAs choosing toundertake their own AFH will further

have to update their AFH annually.Program participants will thus be in aposition to coordinate the AFH processwith existing planning processes.

Paragraph (d) of §5.160 provides thata consolidated plan program participantor a PHA may request to change aprogram year start date or fiscal year

beginning date to better coordinate the

submission of the AFH, consolidatedplan, and PHA Plan.

Review of AFH (§5.162). New §5.162addresses review of AFHs by HUD.HUD’s review of an AFH is to determinewhether the program participant hasmet the requirements for providing itsanalysis, assessment, and goal setting asset forth in §5.154(d). This sectionprovides that the AFH will be deemedaccepted 60 calendar days after the datethat HUD receives the AFH for review,unless before that date HUD has notifiedthe program participant that the AFH isnot accepted. This section provides thatHUD will notify program participants inwriting that the AFH has not beenaccepted, and the written notificationwill specify the reasons that the AFHwas not accepted and the actions thatprogram participants may take to meetthe criteria for acceptance. Section 5.162allows program participants to reviseand resubmit AFHs within 45 calendardays after the date of the firstnotification of non-acceptance. Therevised AFH will be deemed acceptedafter 30 calendar days of the date bywhich HUD receives the revised AFH,unless before that date HUD hasprovided notification that HUD does not

accept the revised AFH. These timeframes generally parallel the frameworkthrough which HUD currently reviewsconsolidated plan submissions.

HUD’s acceptance of an AFH meansonly that, for purposes of administeringHUD program funding, HUD hasdetermined that the program participanthas provided the required elements ofan AFH as set forth in §5.154(d). HUD’sacceptance does not mean that HUD hasdetermined that a jurisdiction hascomplied with its obligation toaffirmatively further fair housing underthe Fair Housing Act; has complied with

other provisions of the Act; or hascomplied with other civil rights laws,regulations or guidance.

Revising the AFH (§5.164). New§ 5.164 establishes the minimum criteriathat will require a program participantto revise its AFH.

Paragraph (a) of this section providesthat if a program participant experiencesa significant material change incircumstances that calls into questionthe continued validity of the AFH, thenthe program participant must revise itsAFH.



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Paragraph (a)(1) provides examples ofwhat a significant material change incircumstances may be, which wouldinclude: The jurisdiction is in an areafor which the President has declared adisaster under title IV of the Robert T.Stafford Disaster Relief and EmergencyAssistance Act that is significant; thejurisdiction has experienced significant

demographic changes; the jurisdictionhas made significant policy changes,such as significant changes related tozoning, housing plans or policies, ordevelopment plans or policies; or thejurisdiction is subject to significant civilrights findings, determinations,Voluntary Compliance Agreements, orother settlements. This section alsoprovides that a program participantmust revise its AFH upon writtennotification by HUD in which HUDspecifies the significant material changethat HUD has found to have taken place,thus requiring a revision to the AFH.

Required revisions will be practical andfocused on the relevant underlyingchange in circumstances, rather thannecessarily requiring revision to theentire AFH. This section recognizes thatpopulation, demographic, and otherdata may not be accurate when there aresudden shifts in circumstances, and it isimportant for program participants toexamine the information that isavailable to them at the time.

Paragraph (a)(2) of § 5.164 requiresconsolidated plan program participants,in their citizen participation plansadopted in accordance with theconsolidated plan regulations in 24 CFR

part 91, to specify the criteria that theprogram participant will follow indetermining which significant materialchanges will require revisions to AFH.Paragraph (a)(2) specifies that thecriteria must include, at a minimum, thecriteria described in paragraph (a)(1) of§ 5.164.

Paragraph (b) of §5.164 provides thatrevisions to the AFH are subject tocommunity participation. Thisrequirement underscores the importanceof the jurisdiction’s community beinginvolved in the development of theAFH, including significant changes to

the AFH. Paragraph (b) provides that thejurisdiction must follow the notice andcomment process applicable toconsolidated plan substantialamendments and the jurisdiction’scitizen participation plan adopted inaccordance with the consolidated planregulations at 24 CFR part 91;specifically, §§91.105, 91.115.Paragraph (b) requires that a consortiummust follow the participation processapplicable to consolidated plansubstantial amendments under theconsortium’s citizen participation plan

adopted pursuant to the consolidatedplan regulations 24 CFR 91.401.

Paragraph (c) of §5.164 provides thatrevisions to the AFH must be submittedto HUD and will be reviewed pursuantto the process set forth in §5.162.

Paragraph (d) of §5.164 provides thatwhen an AFH is revised under thissubpart, PHAs must revise their PHA

Plan within 18 months pursuant to 24CFR 903.15(e).

As this section reflects, HUD hasestablished requirements for revisions tothe AFH that closely follow therequirements for consolidated plansubstantial amendments, therebyproviding a process with whichconsolidated plan program participantsare thoroughly familiar and that canreadily be adopted by PHAs.

Recordkeeping (§ 5.166). This sectionestablishes AFFH-related recordkeepingrequirements for program participants.The maintenance of the information that

formed the development of the AFH,including information obtained throughconsultation and communityparticipation, is important for purposesof demonstrating why the AFH containsthe strategies and actions that it does,and by inspection by HUD if HUDdetermines the need to examine theunderlying information that resulted inthe AFH. This section lists the specificdocuments that program participants areto maintain and provides that theserecords must be maintained for theperiod specified in program regulations.

As this preceding discussion of thenew AFFH regulations reflect, these

new regulations, and specifically thenew AFH, are established not only toreflect the importance of undertakingfair housing planning well, but tounderscore that fair housing planning isan integral part of the consolidated andPHA planning processes.

Conforming Amendments ConsolidatedPlan Regulations (24 CFR Part 91)

Because the AFFH regulations in 24CFR part 5 build on existingconsolidated plan regulations withrespect to consultation, communityparticipation, submission, and

revisions, conforming amendments tothe consolidated plan regulations must be made to reflect the incorporation ofthe AFH into the consolidated planningprocess.

Definitions (§ 91.5)

Section 91.5, the definition section ofHUD’s consolidated plan regulations,would be revised to reflect that theterms ‘‘affirmatively furthering fairhousing,’’ ‘‘Assessment of Fair Housingor AFH and protected class’’ are definedin 24 CFR part 5.

Consultation; Local Governments(§ 91.100)

Section 91.100 of HUD’s consolidatedplan regulations would be amended inparagraph (a) to include the AFH in theconsultation that a local government isrequired to undertake. With respect tothe AFH, paragraph (a) requires thelocal government to consult with thesame public and private agencies thatthe local government consults with inpreparing the consolidated plan, butadds that such consultation shall alsoinclude any community- and regionally-

based organizations that representprotected class members or advance fairhousing laws.

Paragraph (c) of § 91.100, whichrequires the local government to consultwith the local PHA, would be amendedto provide that the jurisdiction mustconsult with the PHA regarding theAFH, affirmatively furthering fairhousing strategies, and proposed actions

to affirmatively further fair housing.The propos

affirmatively futhering fair housing

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