Affirmatively Furthering Fair Housing

Affirmatively Furthering Fair Housing

WASHINGTON, D.C. – October 9, 2013 – (RealEstateRama) — In July 2013, the Department of Housing and Urban Development (HUD) issued a draft rule called Affirmatively Further Fair Housing (AFFH), which was designed to clarify the Fair Housing Act’s 1968 mandate to address segregated housing issues and promote diverse, inclusive communities. The rule is specifically geared towards entities that receive HUD funding and helping them develop fair housing plans. Manna, Inc. submitted the below comment on the draft rule (you can also find Manna’s comment on HUD’s website):

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Manna, Inc. has been an DC-based nonprofit affordable homeownership developer, educator and mortgage/downpayment assistance lender for over 30 years; we also develop other types of affordable housing. Our over 1,000 first-time, lower income buyers have a less than 2% foreclosure rate. In addition, Manna, Inc. is also a member of the National Community Reinvestment Coalition and NeighborWorks America.

Manna, Inc. commends HUD for its efforts to carry out the goals of the Fair Housing Act.  As the demographics of the United States continue to shift, the need to eliminate barriers to housing choice and opportunity in our communities is critical.  The proposed rule to strengthen the affirmatively furthering fair housing mandate is an important step toward ensuring that barriers to fair housing are eliminated.

Manna, Inc. supports many components of the proposed rule, but believes there is still room for improvement.  Specifically, we have concerns that HUD’s ability to enforce the rule will be limited considering the agency’s resources, that the rule does not go far enough in engaging the public to identify barriers to fair housing, that the rule does not address grantee practices (especially in homeownership programs) which constrain housing opportunities for non-economic reasons, and that the rule is unclear on how grantees may use independent consultants.

To address these concerns, Manna, Inc. encourages HUD to incorporate the following recommendations:

Recommendation 1:  HUD should actively review grantees’ assessments over a 120-day window and, by the end of that window, make a formal decision about an assessment’s compliance with AFFH requirements.

Recommendation 2:  HUD should require grantees to consider information resources beyond the data sets that will be provided by HUD in the analysis section of the AFH.  HUD should make clear to grantees that the data it provides represents a floor, and not a ceiling.

Recommendation 3: HUD should review the impact of grantee homeownership  program guidelines for homeownership programs, specifically mortgage qualifying ratios that are much more restrictive than FHA and GSE underwriting standards. Particularly in high-priced markets, HUD needs to be clear with grantees that AFFH requires balancing providing homeownership opportunities to prepared, lower income buyers with attempts to control housing prices for lower incomer buyers by limiting downpayment support.

Recommendation 4: HUD should review the impact of grantee homeownership  program guidelines for homeownership programs, to evaluate reasonable return on investment impacts of long-term resale restrictions. With an ever-growing wealth gap between whites and minorities, HUD needs to be clear with grantees that AFFH requires balancing homeownership wealth benefits with the goal of future affordable homeownership opportunities (both affordable unit creation and downpayment assistance). 

Recommendation 5: HUD should require that grantees maximize citizen participation in every stage of the assessment process by: 1) creating an affirmative marketing plan for every event open to the public; 2) publishing all materials and reports in plain language, and in multiple languages; and 3) making all comments on the process available to the public.

Recommendation 6:  HUD should require grantees to identify quantifiable and reasonable fair housing performance benchmarks as part of their assessments.

Recommendation 7: HUD must consider the resources that will be required to enforce each proposed requirement of the Affirmatively Fair Housing Rule, and ensure that it has those necessary resources in place.

Recommendation 8: HUD must make clear that grantees may, and should, use independent outside consultants when preparing documents required by the AFFH rule. 

Recommendation 9: HUD should continue to develop more robust and innovative tools that will be available to help communities better identify fair housing issues.

Manna, Inc. believes that the affirmatively furthering fair housing rule can only be strengthened by incorporating the above recommendations.    We would like to thank HUD for this opportunity to share our views on the proposed rule.

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