Dive Brief:
- Fair housing advocacy groups sued the U.S. Department of Housing and Urban Development last week, claiming the agency’s funding restructuring drastically reduces their ability to receive funds from the Fair Housing Initiatives Program.
- The complaint, filed in U.S. District Court in Massachusetts, argues that HUD’s July 2 notices of funding opportunities unlawfully introduced criteria that “will disqualify nearly all existing fair housing organizations” from FHIP funding. It calls the alterations an "assault" on the grant program.
- It is the third lawsuit concerning the Trump administration’s distribution and management of FHIP funds filed against HUD in the past two years.
Dive Insight:
The Trump administration has pledged to scale back fair housing enforcement efforts that it views as “beyond the scope of the Fair Housing Act,” according to HUD.
“We will continue to enforce the law as written, and nothing else,” HUD Secretary Scott Turner told a Senate Appropriations Subcommittee in May. “Fair housing is about equal rights, not extra rights.”
If the funding changes introduced by HUD this month move forward, more than 100 fair housing law enforcement and education nonprofits stand to lose funding, according to the National Fair Housing Alliance, one of the plaintiffs in the July 23 lawsuit, along with the Massachusetts Fair Housing Center. The lawsuit was filed on the organizations’ behalf by civil rights law firm Relman Colfax.
The Fair Housing Initiatives Program was created in 1987 to provide competitive grants to nonprofits dedicated to improving the effectiveness of the Fair Housing Act, the complaint states.
“NFHA’s member organizations handle three in four housing discrimination complaints every year,” with HUD handling others, NFHA Executive Vice President Nikitra Bailey said in a news release. “Virtually all these community-based organizations depend on FHIP’s critical funding to operate, and many will not survive without it. Those that do survive will have to reduce services considerably.”
A HUD spokesperson told The New York Times that the agency would “enforce the law as written, protect the civil rights of Americans, and responsibly steward taxpayer resources” and that “Activist opposition will not deter the Department.”
HUD’s notice of funding opportunity plans to allocate $46 million of $56 million approved for fiscal year 2025 in just five grants, as opposed to the 100-plus grants typically awarded for the program, according to the complaint. One of those grants includes $25 million “for a single favored law school,” according to NFHA.
The fiscal year 2026 notice of funding opportunity “effectively excludes” local, nonprofit fair housing organizations from FHIP funding altogether, NFHA said.
Whistleblowers last year accused the administration of undermining fair housing laws through a verbal gag order and large workforce reductions at the agency’s Office of Fair Housing.
