FEDERAL 'FAIR HOUSING' POLICY SET FOR A MAJOR OVERHAUL.

• Author: Britschgi, Christian

THE U.S. DEPARTMENT of Housing and Urban Development (HUD) sent a major rewrite of federal fair housing regulation to Congress in late December.

The proposed rule would ask localities receiving federal housing funding to report on their housing market outcomes and then to propose concrete steps for improving housing affordability. Localities that either have affordable housing or see housing become more affordable over a five-year period could be rewarded with additional grant money and other incentives. The department told Congress it would "focus remedial resources and potential regulatory enforcement actions" against the lowest-performing jurisdictions.

The rule is a marked change from the one issued by the Obama administration in 2015, which required HUD grantees to collect voluminous amounts of demographic data and then use that data to craft plans on combating racial segregation and concentrated poverty. The Trump administration argues that regulation was "overly burdensome" in their requirements and "too prescriptive" in its desired outcomes.

The new rule is light on details, and its early circulation has already provoked intense debate.

HUD's proposal "incentivizes a race to the top among localities based on housing affordability and availability and then offers a chance to put some teeth behind that," says Michael Hendrix, the director of state and local policy at the Manhattan Institute. But others argue it is much too narrow and actually weakens the federal government's enforcement powers. "The proposed rule entirely ignores the...