#140 Mar/Apr 2005

Back to Court

The big fair housing news of 2005 is a new federal court ruling in Thompson v. HUD, the Baltimore public housing desegregation class action filed by the Maryland ACLU in […]

The big fair housing news of 2005 is a new federal court ruling in Thompson v. HUD, the Baltimore public housing desegregation class action filed by the Maryland ACLU in 1994, partially settled in 1996 and finally brought to trial in December of 2003. Judge Garbis’s 322-page January 6 opinion places the full weight of responsibility on the Department of Housing and Urban Development (HUD) for its failure to actively promote regional housing opportunities for the Baltimore region’s low-income families living in federally assisted housing.

The Baltimore decision breaks no new legal ground; it relies heavily on a 1987 Court of Appeals decision in Boston, NAACP v. HUD, which itself was a restatement of principles that appeared in numerous other cases in the 20 years following the passage of the Fair Housing Act. Similarly, HUD’s complicity in Baltimore, as recited by the Court in Thompson, is little different than HUD’s role in any number of metropolitan areas.

The real question – and a clue to the importance of Thompson – is, if the pattern of HUD liability seems so familiar, why haven’t there been more cases like it? The answer lies partly in the continuing difficulty in funding large scale public interest litigation, but more importantly, it traces to a decision in the early 1990s by President Clinton’s first HUD Secretary, Henry Cisneros, to settle all of the then-pending public housing desegregation cases rather than continuing to litigate indefinitely.

In the early 1990s, HUD faced a seemingly bottomless well of liability, with public housing desegregation lawsuits pending in numerous cities, several more than a decade old. Each case alleged many years of HUD actions and inactions that support segregated public housing.

Secretary Cisneros used the pending lawsuits as an opportunity to advance the Administration’s agenda of deconcentrating racially and economically segregated neighborhoods. The resulting settlements included a combination of new Section 8 voucher allocations, mobility programs that would help families move to low-poverty neighborhoods, scattered-site replacement public housing (or project-based Section 8) developed outside of areas with minority concentration and in-place revitalization programs to improve the quality of existing public housing developments and neighborhoods. Only a few of these settlements were designed as comprehensive desegregation plans, but they each brought tangible benefits to plaintiff class members.

A major secondary benefit to HUD from these settlements was the avoidance of the kind of liability ruling issued by Judge Garbis in Thompson. Judge Garbis has essentially taken up the law where it left off in the late 1980s with the decisions in Walker v. HUD and NAACP v. Yonkers. The important message of the Thompson case is that, in spite of having dodged many bullets in the 1990s, HUD still has substantial unresolved liability in many metropolitan areas. As former Assistant Secretary for Fair Housing Roberta Achtenberg publicly stated in 1995:

That the federal government, including HUD, has a long history of having precipitated and perpetuated housing discrimination, there can be no question. At their inception, federal housing programs incorporated many of the prevailing practices of the private housing market and were explicitly discriminatory as a result. And as new housing programs have evolved, successive administrations, Democratic and Republican, have repeatedly missed opportunities to combat discrimination… Federal programs to assist low-income renters have helped concentrate poor, minority families in poor, minority neighborhoods, limiting housing choice and fostering social division.

The Federal Findings Against HUD
The Court’s liability finding against HUD is based on the duty to affirmatively further fair housing, set out in §3608 of the Fair Housing Act. Thus, the Court observes that “Title VIII imposes upon HUD an obligation to do something more than simply refrain from discriminating,” and that “through regionalization, HUD had the practical power and leverage to accomplish desegregation through a course of action that Local Defendants could not implement on their own, given their own jurisdictional limitations.”

The Court’s assessment of HUD’s failure to act regionally will seem familiar to fair housing advocates everywhere. Indeed, HUD’s actions in Baltimore are characteristic of an agency that has consistently avoided challenging the prerogatives of exclusionary suburban jurisdictions and has instead continued to funnel substantial low-income housing resources into central cities. The Court found that:

  • During the 1990s, 89 percent of public housing units developed with HUD’s support in the Baltimore Region were in Baltimore City.
  • …the relative expense and lack of affordability of housing outside of Baltimore City may present a significant barrier to Section 8 voucher holders who might wish to pursue private housing in the Baltimore Region but outside the city.
  • Fifty-six percent of the Region’s Section 8 voucher holders resided in Baltimore City.
  • …the majority – more than 67 percent – of the City’s Section 8 voucher holders live in census tracts that are 70 to 100 percent Black.
  • HUD itself recognized that one of the “lessons learned” from its HOPE VI program is that housing vouchers are “not viable replacement housing options” in tight housing markets like Baltimore’s.
  • The 4,869 units that were demolished [under HOPE VI] were, by-and-large, replaced by lower density housing in virtually the same sites.

The Court bolstered its ruling with 160 pages of “Supplemental Findings” that chart HUD’s role in decades of decisions that effectively restricted low-income minority families to segregated neighborhoods in the central city. In conclusion, the Court announced that:

It is high time that HUD lives up to its statutory mandate to consider the effect of its policies on the racial and socio-economic composition of the surrounding area and thus consider regional approaches to promoting fair housing opportunities for African-American public housing residents in the Baltimore Region.

Role of Local Defendants… and Non-Defendants
The only local parties sued in the Thompson case were the City of Baltimore and the Baltimore City Housing Authority. The Court was far more lenient in assessing these local defendants’ conduct, finding that city officials in the 1990s had few regional options and could not be faulted for using federal funds to improve conditions in poor inner-city neighborhoods – even though this activity was part of the pattern of increasing segregation in the region’s housing.

The Court stressed the powerlessness of the local defendants to effect any change on a regional level, since the court assumed (despite some evidence to the contrary) that their jurisdiction was limited to the city of Baltimore.

The Court finds Local Defendants’ reasons for focusing their efforts primarily within the City, as opposed to considering options throughout the Baltimore MSA [Metropolitan Statistical Areas], understandable and reasonable. On balance, these policies were based upon choices made (in recent years by officials answerable to an African-American majority within the City) to use limited resources for the maximum benefit for all of the citizens of Baltimore City. The City government had no realistic options whereby it might have devoted its public revenues on projects outside of its jurisdiction by virtue of financial and political realities. It is perfectly obvious that, as a practical matter, Local Defendants did not have the ability to affect regionalization that Federal Defendants had.

Where To Next?
Overall, the decision in Thompson should serve as a wake-up call to HUD. Even though it managed to avoid a major finding of liability in the 1990s, with the creative settlements in over a dozen major cases, the agency has a deep reservoir of future liability for the kinds of failures documented in Baltimore.

The challenge now for HUD and the other parties in Baltimore will be to develop a comprehensive remedy in a case where the city and its Housing Authority are no longer fully engaged in the case, and the other major regional players (the suburban counties, suburban public housing authorities and the state of Maryland) are not formal parties to the lawsuit. Such a remedy is attainable if HUD encourages state and county participation in its annual Consolidated Plan process, which requires that annual HUD funding be consistent with the local jurisdictions’ fair housing plan (known as the Analysis of Impediments to Fair Housing).

There are also remedial steps that can be taken that do not involve the participation of county government, such as targeting project-based subsidies (like the Low Income Housing Tax Credit) to non-segregated “opportunity” areas, expanding voucher-based housing mobility through a regional voucher program and using housing acquisition strategies that do not require rezoning. The parties may also learn from some of the desegregation settlements of the 1990s to develop a more effective set of remedies in the Baltimore region.



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