WASHINGTON — The Biden administration is moving to reinstate two key fair housing rules that were rolled back under President Trump, according to notices published this week by the Office of Management and Budget.
The Department of Housing and Urban Development is looking to restore a 2013 rule outlining its use of the “disparate impact” legal standard in fair-lending cases and the 2015 “affirmatively furthering fair housing” rule meant to guide local jurisdictions on compliance with the Fair Housing Act.
Former President Donald Trump rescinded the “affirmatively furthering fair housing rule”
Trump’s rhetoric around the Obama-era rule also stunned advocates. At one point he tweeted that the rule was having “a devastating impact on these once thriving Suburban areas.” Although the rule was part of the 1968 Fair Housing Act, it was difficult to interpret or enforce until the Obama administration created the 2015 regulation.
Also last year, then-HUD Secretary Ben Carson
Disparate impact is a legal doctrine that opens up lenders to fair-lending enforcement even if their lending policies were unintentionally discriminatory. It has long been unpopular with financial institutions. However, big banks urged the Trump administration
Current HUD Secretary Marcia Fudge’s efforts to undo the Trump administration’s revamp of the two rules follow
“We need to make the dream of homeownership — and the security and wealth creation that comes with it — a reality for more Americans,” Fudge said at a January Senate Banking Committee hearing to examine her nomination. “That will require us to end discriminatory practices in the housing market, and ensure that our fair housing rules are doing what they are supposed to do.”
Biden's order had called on the department to examine the effects of the previous administration’s rules and “take any necessary steps … to implement the Fair Housing Act’s requirements that HUD administer its programs in a manner that affirmatively furthers fair housing … including by preventing practices with an unjustified discriminatory act.”
Although the budet office notices posted Tuesday reveal little information about how HUD might go about reinstating the two rules, the restoration of the affirmatively furthering fair housing rule is classified as an “interim final rule,” while the rollback of the Trump administration’s disparate impact amendments is classified as a “proposed rule.”
HUD officials are unable to comment on the proposals until they are published in the Federal Register.
Still, groups that had decried the Trump administration’s efforts to redo the two rules were cheered by signs that HUD will restore the provisions.
“We applaud Secretary Fudge and HUD for taking this critical first step to fully enforcing the Fair Housing Act and preventing discriminatory practices,” Jesse Van Tol, CEO of the National Community Reinvestment Coalition, said in a statement. “Restoring portions of the 2015 AFFH rule could not have come soon enough, as billions of dollars continue to flow into communities across the country from the last stimulus.”
The Center for Responsible Lending called the reinstatement of both rules “central to building back better.”
“President Biden and Secretary Fudge are keeping their promise to restore these crucial fair housing rules,” Nikitra Bailey, executive vice president of the center, said in a statement. “Reinstating the original Disparate Impact and AFFH rules will move us closer to achieving a more just society where everyone has access to opportunity.”
