"Promoting housing affordability by combating exclusionary housing policies"
CFC # 41863 (Combined Federal Campaign)
“Housing is a necessary of life.”
United States Supreme Court
Block v. Hirsch, 256 U.S. 135, 156 (1921)
(per Justice Oliver Wendell Holmes, Jr.)
Despite the general recognition of the crucial importance of a good home to human development, tens of millions of low- and moderate-income Americans do not have the opportunity to buy or rent decent housing in wholesome neighborhoods.
Among the biggest barriers to those opportunities are exclusionary governmental housing policies (“regulatory barriers to housing affordability”), such as exclusionary zoning. "State and local regulations are among the principal culprits behind the nation’s persistent affordability problems,” according to the Harvard University Joint Center for Housing Studies.
Examples of exclusionary zoning are the widespread requirements for large lots and home sizes in American suburbs—where most jobs now are located, and where almost all new urban jobs are being created. Other exclusionary housing policies include costly, high-end building, housing, and subdivision code requirements that are unnecessary for health and safety; and protracted, unduly expensive permitting procedures.
Such regulatory barriers often nullify reasonable efforts to increase the supply of moderately-priced housing. In other cases they increase the cost of that housing tremendously. Rigorous economic research has found that such barriers have caused prices for basic houses to be 40-50 percent above the costs of construction in most of the major metropolitan areas studied, across the United States. In certain high-opportunity metros (including Pacific Coast metros such as Los Angeles, San Francisco, and Seattle), prices exceed construction costs by several times that amount. For more, click on ECONOMIC EFFECTS OF EXCLUSIONARY HOUSING POLICIES.
Similar problems with unjustified regulatory barriers pose the biggest obstacles to housing affordability worldwide. For more, click on McKINSEY REPORT ON MEETING GLOBAL HOUSING AFFORDABILITY CHALLENGE.
The Equitable Housing Institute (EHI) is a charitable organization that focuses on eliminating exclusionary housing policies in the United States, in order to reduce homelessness and poverty. EHI is the only national organization focused primarily on removing those barriers for all low- and moderate-income Americans.
EHI’s primary tools are education and public policy advocacy. During its first five years (2008-2013), its advocacy was a catalyst in the addition to local housing plans in its home county of more than one additional affordable unit per day, and more than eight additional housing units per day overall (on average). (EHI’s headquarters is in Fairfax County, Virginia, in the Washington, DC, region).) For more, click on ABOUT EHI.
Nationally, EHI’s website provides information on many aspects of exclusionary housing policies and ways to remove them. EHI also has advised people in various regions of the United States regarding specific issues in their areas.
EHI “holds one of the keys [to] the goal of more integrated communities and schools,” and is an “obvious candidate for funding,” according to Inside Philanthropy magazine. “With its detailed research on housing law, and its ability to help municipalities take a hard look at their assumptions and priorities, EHI has an important role to play in the fight for fair housing.” For more, click on Inside Philanthropy urges funders to support EHI.
White House issues Housing Development Toolkit
focused on exclusionary zoning and other regulatory
barriers to housing development—and on solutions
In late September, the White House issued its Housing Development Toolkit. That document focuses on the devastating impacts of regulatory barriers (primarily in the form of local exclusionary housing policies), regarding the adequacy and affordability of housing in America. The Toolkit also discusses various action steps that states and local jurisdictions can take to reverse those impacts.
The Toolkit follows on President Obama’s recent statement that: “"We can work together to break down rules that stand in the way of building new housing and that keep families from moving to growing, dynamic cities." (President Barak Obama, remarks to the U.S. Conference of Mayors, January 21, 2016) The Toolkit explains in some detail that:
- Since at least 1980, local barriers to housing development (such as exclusionary zoning) have intensified, most noticeably in the high-growth, metropolitan areas that increasingly fuel the national economy.
- During the same period, average house prices nationwide have escalated, while average housing construction costs have remained about the same (adjusted for inflation).
- The consequences include over 5 million more very low-income households (those earning 50% or less of their area’s median income) having to pay more than half their income on rent—just in the last 10 years.
- There is compelling evidence that such regulatory barriers are aggravating economic inequality and interfering with the nation’s economic growth, by preventing workers from moving to high-growth regions for better jobs and careers.
- The problem of unjustified local barriers to housing development is now being felt in smaller cities and non-coastal locations—not just the major metropolitan areas on the East and West coasts that have garnered most of the attention to date.
- Such barriers help perpetuate discrimination against low-income renters, increase homelessness, and undercut the effectiveness of HUD’s housing assistance programs.
Among the many remedial steps the Toolkit discusses, that already have been taken by some state and/or local jurisdictions, are: (a) relaxing zoning restrictions on building densities and heights, unit sizes, and parking minimums; (b) making better use of vacant urban land for housing; (c) streamlining housing permit processes and time frames; (d) requiring the inclusion of some lower-priced units in large, new multi-family developments, in return for increased density, which allows the construction of extra market-rate units and prevents economic loss to the developer due to the lower-priced units; and (e) tax incentives to developers to build more lower-cost units.
The White House Toolkit is the latest of numerous direct, Presidential initiatives—by Presidents of different political parties—to address the growing problems. EHI has been sending the same, consistent message as those Presidential initiatives since its founding in 2008—and has had some notable successes.
For more, click on 2016 WHITE HOUSE TOOLKIT. To access the White House document, click on: https://www.whitehouse.gov/sites/whitehouse.gov/files/images/Housing_Development_Toolkit%20f.2.pdf.
Presidential Candidates’ Websites on Housing Policy
EHI takes no position on candidates in partisan elections, because it is a non-partisan, charitable organization. For information on the major party candidates for President of the United States in 2016, and their positions on housing issues, their campaign websites are listed below (alphabetically, by candidate’s last name):
Hillary Clinton (Democratic Party): https://www.hillaryclinton.com/issues/housing/
Gary Johnson (Libertarian Party): http://www.lp.org/2016-libertarian-party-candidates
Donald J. Trump (Republican Party): https://www.donaldjtrump.com/
EHI helps its Local Emphasis Area--the Washington, DC,
region--achieve much-improved rental cost record
Recent data confirms the trend of the last several years in the Washington, DC, area, of substantially lower rent increases than in most comparable housing markets nationwide. That trend is especially helpful to low- and moderate-income people because, for example, most of them are renters rather than homeowners, and their housing costs tend to consume much more of their incomes.
Major increases in the area’s supply of newly completed, and planned, multifamily housing units seem to be an important factor in the trend. A recent dip in the area’s economy is another factor, but it no longer seems to be a major one. Other important factors include the area’s sizeable nonprofit, housing development sector; its rich array of large national and local nonprofit organizations concerned about low-income housing; the presence of many federal housing-related agencies, and the research resources of several major universities in the area.
We believe EHI is an important factor too. The DC area is EHI’s home base and its local emphasis area. Although still relatively new and small, EHI has engaged in vigorous education and advocacy there, since its founding in 2008, to loosen unwarranted restrictive zoning and other exclusionary housing policies of local governments. Those restrictions have seriously limited the supply of housing affordable to low- and moderate-income people.
For example, EHI changed the dynamics of Fairfax County’s planning for major redevelopment around several new Metrorail (commuter rail) stations in Reston and the western edge of the County, which plan for upwards of 45,000 new workers by 2040. More than 15,000 additional housing units were put in those plans after EHI became involved, following the initially proposed residential development levels.
Those additional units amount to more than half the total number of new housing units planned in the four transit station areas involved. The plans ultimately adopted by Fairfax County for the three Reston stations call for enough new housing to accommodate as many workers as are expected to join Reston’s workforce. At least 1,900 of those units—and perhaps upwards of 2,700—will be affordable to low- and moderate-income people, under Fairfax County’s inclusionary housing requirements for large, new residential buildings.
In addition to its active involvement in local planning and zoning, EHI has explained the local problems and solutions in letters printed on the editorial page of the Washington Post, and in articles such as this one on EHI’s website.
The recent improvement in the trajectory of rents in the DC-area housing market has coincided with the emergence of EHI as a force locally. Much more remains to be done to make the pricey DC area affordable to low- and moderate-income renters, however. To see a detailed discussion of DC-area rental housing cost issues, click on EHI HELPS ITS HOME REGION TO MUCH-IMPROVED RENTAL HOUSING COST RECORD.
Loudoun County (Virginia) needs major housing growth to meet challenge of Metrorail
The Washington, DC, area’s Metrorail (commuter rail) system is coming to Loudoun County, Virginia. Metrorail brings opportunities for needed housing growth, along with the additional commercial growth that Loudoun seeks. The County is planning for new development near the two stations, which currently are scheduled to open in late 2019.
EHI has studied Loudoun’s housing needs related to Metrorail and completed an extensive report on November 4, 2015. To read it, please click on Loudoun County’s Metrorail-Related Housing Needs.
Loudoun County’s Dept. of Planning and Zoning’s (DPZ) presented its draft land use plan for the Metrorail areas (“Silver Line Small Area Plan”) at a public workshop on June 29. DPZ forecasts enough housing units by 2040 to balance the tremendous number of new and existing jobs in those areas. DPZ’s approach is consistent with the public’s input on the Metrorail planning, with good planning principles, and with the facts on the ground—as documented in EHI’s report mentioned above, which EHI submitted to DPZ in November 2015. For specifics on DPZ's draft plan and on many other recent developments in Loudoun's Metrorail-area planning, please click on Loudoun Metrorail-area planning update--June 2016.
U.S. Supreme Court rules that housing practices with
disproportionate, adverse impact on minorities may violate
federal Fair Housing Act, regardless of intent
On June 25, 2015, the U.S. Supreme Court ruled that the federal Fair Housing Act (“FHA,” 42 U.S.C. § 3601 et seq.,) prohibits housing practices that have a disproportionately adverse effect on members of minority groups—unless those practices have a justifiable purpose and properly limited scope. Texas Dept. of Housing and Community Affairs v. Inclusive Communities Project (ICP), No. 13–1371 (June 25, 2015).
In a 5-4 decision, the Court held that discriminatory intent is irrelevant to whether such a “disparate impact” violation exists. The Court also explained what a litigant must show in order to prove, or, conversely defend against, an alleged violation. The Court’s decision applies both to government officials and private persons.
The FHA’s prohibition on practices that have such a “disparate impact” is an important basis for challenging exclusionary housing policies, because those policies often have much greater adverse impacts on minority group members than on the overall population. The Court stated:
These unlawful practices include zoning laws and other housing restrictions that function unfairly to exclude minorities from certain neighborhoods without any sufficient justification. Suits targeting such practices reside at the heartland of disparate-impact liability.
(Slip op. at 17) The Court’s opinion, authored by Justice Kennedy, clarified the elements of a disparate impact housing violation, which had been stated somewhat differently by certain lower courts. The Supreme Court essentially adopted the statement of those elements in the recent rule issued by the U. S. Department of Housing and Urban Development (HUD), regarding such cases.Implementation of the Fair Housing Act’s Discriminatory Effects Standard: Final Rule, 78 Fed. Reg. 11460 (2013) (codified at 24 CFR §100.500).
HUD’s formulation involves the same kind of burden-shifting approach the Court has formulated for other anti-discrimination laws, such as Title VII of the Civil Rights Act of 1964 (equal employment opportunity). Thus, a person complaining of alleged housing discrimination (“plaintiff”) has the initial burden of proving “that a challenged practice caused or predictably will cause a discriminatory effect.” 24 CFR §100.500(c)(1) (2014).
If a plaintiff makes that showing, the burden shifts to the defendant to prove “that the challenged practice is necessary to achieve one or more substantial, legitimate, nondiscriminatory interests.”Id., §100.500(c)(2). If the defendant makes its showing, the plaintiff still can “prevail upon proving that the substantial, legitimate, nondiscriminatory interests supporting the challenged practice could be served by another practice that has a less discriminatory effect.” Id., §100.500(c)(3).
To see the Supreme Court decision and/or HUD rule in their entirety, click on the hyperlinks above.
EHI report shows how exclusionary housing policies are linked to deficiencies in low-income children's health, education, and general development
Many studies have found that housing problems—such as unsafe and unhealthful conditions, unaffordable housing costs, and neighborhoods isolated from high-performing schools and health facilities—are linked to increased developmental problems among low-income children. (Those children live in households that have incomes of 80 percent or less of their area’s median income.) Among the aspects of development involved are children’s health (physical, mental and emotional), safety, educational achievement, and general cognitive and behavioral development.
Because exclusionary housing policies raise major barriers to the production and preservation of adequate amounts of suitable housing, those policies:
- substantially increase the number of low-income children who must live in unsafe, unhealthful, and/or overcrowded housing conditions, and in decaying and/or unsafe neighborhoods;
- isolate many such children, and their neighborhoods, from most economic opportunities, and from high-performing schools and health facilities; and
- raise housing prices (by 20 to 50 percent in many major metropolitan areas), making those prices unaffordable to low- and moderate-income families with children—thus causing economic instability in those families, and many involuntary, disruptive moves (usually to poorer neighborhoods).
EHI has prepared a memorandum summarizing how exclusionary housing policies aggravate housing problems that have been linked to those adverse effects. (To access EHI’s memorandum in its entirety, please click CHILDREN'S DEVELOPMENT & XHPs.) EHI concludes that eliminating exclusionary housing policies is a crucial step toward improving low-income children’s development.
EHI’s analysis is based on an important new report by the U.S. Department of Housing and Urban Development (HUD) that summarizes in detail existing studies of housing and children’s development. (HUD PD&R, Evidence Matters: Housing’s and Neighborhoods’ Role in Shaping Children’s Future (Fall 2014) (“HUD 2014”), posted at: http://www.huduser.org/portal/periodicals/em/EM_Newsletter_fall_2014.pdf).
OTHER RECENT ARTICLES
- Major report by McKinsey Global Institute finds that overcoming exclusionary housing policies is the most critical step in providing affordable housing--in the United States and around the world. For more, click on McKINSEY REPORT ON MEETING GLOBAL HOUSING AFFORDABILITY CHALLENGE.
- HUD issues Affirmatively Furthering Fair Housing Rule (July 2015), requiring greater consideration of exclusionary and other discriminatory housing conditions by federal housing fund recipients. For more, click on HUD issues AFFH Rule. To read the Rule itself, click on HUD, Affirmatively Furthering Fair Housing (AFFH): Final Rule, 80 Fed. Reg. 42,272, 42,352 (July 16, 2015).
- Inside Philanthropy urges funders to support EHI’s efforts to break the grip of exclusionary zoning and other exclusionary housing policies on housing opportunities for low- and moderate-income people. For more, click on Inside Philanthropy urges funders to support EHI.
- Recent Washington Post articles highlight serious, adverse effects of local housing and land use policies: For more, click on ROGER LEWIS ON REGULATORY BARRIERS, and AFFORDABLE RENTS FADING AWAY IN D.C. EHI has expressed similar views in letters printed by the Post. For more, click on EHI LETTERS IN WASHINGTON POST.
- EHI analyzes whether Congress has Constitutional authority to prohibit unwarranted state and local regulatory restrictions on housing supply, if those restrictions affect interstate commerce—as a number of recent studies indicate they now do. For more, click on INTERSTATE EFFECTS OF RBHAs (2014).
- EHI responds to Wall Street Journal article on new exclusionary policies in certain suburbs of Phoenix and Denver. For more, click on WSJ on new exclusionary policies.
- One affordable housing unit per day is added to plans in EHI's home county, following EHI's advocacy, during its first five years. For more, click on EHI's FIRST FIVE YEARS.
- EHI issues analysis of role of governmental land use planning in housing shortages and excessive costs. For more, click on EHI ANALYSIS OF JOBS-HOUSING REPORT
Equitable Housing Institute
P.O. Box 1402