Affirmatively Furthering Fair Housing, 8516-8590 [2023-00625]

Agencies

• DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Federal Register Volume 88, Number 27 (Thursday, February 9, 2023)]
[Proposed Rules]
[Pages 8516-8590]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-00625]



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Vol. 88

Thursday,

No. 27

February 9, 2023

Part II





Department of Housing and Urban Development





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24 CFR Parts 5, 91, 92, et al.





Affirmatively Furthering Fair Housing; Proposed Rule

Federal Register / Vol. 88 , No. 27 / Thursday, February 9, 2023 / 
Proposed Rules

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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Parts 5, 91, 92, 93, 570, 574, 576, 903 and 983

[Docket No. FR-6250-P-01]
RIN 2529-AB05


Affirmatively Furthering Fair Housing

AGENCY: Office of the Secretary, Department of Housing and Urban 
Development (HUD).

ACTION: Proposed rule.

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SUMMARY: Through this rulemaking, HUD proposes to implement the 
obligation to affirmatively further the purposes and policies of the 
Fair Housing Act, which is title VIII of the Civil Rights Act of 1968, 
with respect to certain recipients of HUD funds. The Fair Housing Act 
not only prohibits discrimination, but also directs HUD to ensure that 
the agency and its program participants will proactively take 
meaningful actions to overcome patterns of segregation, promote fair 
housing choice, eliminate disparities in housing-related opportunities, 
and foster inclusive communities that are free from discrimination. 
This proposed rule builds on the steps previously taken in HUD's 2015 
Affirmatively Furthering Fair Housing (AFFH) final rule to implement 
the AFFH obligation and ensure that Federal funding is used in a 
systematic way to further the policies and goals of the Fair Housing 
Act. This rule proposes to retain much of the 2015 AFFH Rule's core 
planning process, with certain improvements such as a more robust 
community engagement requirement, a streamlined required analysis, 
greater transparency, and an increased emphasis on goal setting and 
measuring progress. It also includes mechanisms to hold program 
participants accountable for achieving positive fair housing outcomes 
and complying with their obligation to affirmatively further fair 
housing, modeled after those processes under other Federal civil rights 
statutes that apply to recipients of Federal financial assistance.

DATES: Comment due date: April 10, 2023.

ADDRESSES: Interested persons are invited to submit comments regarding 
this proposed rule to the Regulations Division, Office of General 
Counsel, Department of Housing and Urban Development, 451 7th Street 
SW, Room 10276, Washington, DC 20410-0500. Communications must refer to 
the above docket number and title. There are two methods for submitting 
public comments. All submissions must refer to the above docket number 
and title.
    1. Submission of Comments by Mail. Comments may be submitted by 
mail to the Regulations Division, Office of General Counsel, Department 
of Housing and Urban Development, 451 7th Street SW, Room 10276, 
Washington, DC 20410-0500.
    2. Electronic Submission of Comments. Interested persons may submit 
comments electronically through the Federal eRulemaking Portal at 
www.regulations.gov. HUD strongly encourages commenters to submit 
comments electronically. Electronic submission of comments allows the 
commenter maximum time to prepare and submit a comment, ensures timely 
receipt by HUD, and enables HUD to make them immediately available to 
the public. Comments submitted electronically through the 
www.regulations.gov website can be viewed by other commenters and 
interested members of the public. Commenters should follow the 
instructions provided on that site to submit comments electronically.

    Note: To receive consideration as public comments, comments must 
be submitted through one of the two methods specified above. Again, 
all submissions must refer to the docket number and title of the 
rule.

    No Facsimile Comments: Facsimile (FAX) comments are not acceptable.
    Public Inspection of Comments. All properly submitted comments and 
communications submitted to HUD will be available for public inspection 
and copying between 8 a.m. and 5 p.m. weekdays at the above address. 
Due to security measures at the HUD Headquarters building, an advance 
appointment to review the public comments must be scheduled by calling 
the Regulations Division at 202-402-3055 (this is not a toll-free 
number). HUD welcomes and is prepared to receive calls from individuals 
who are deaf or hard of hearing, as well as individuals with 
communication disabilities. To learn more about how to make an 
accessible telephone call, please visit https://www.fcc.gov/consumers/guides/telecommunications-relay-service-trs. Copies of all comments 
submitted are available for inspection and downloading at 
www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Tiffany Johnson, Director, Policy and 
Legislative Initiatives Division, Office of Fair Housing and Equal 
Opportunity, Department of Housing and Urban Development, 451 7th 
Street SW, Room 5250, Washington, DC 20410-8000, telephone number 202-
402-2881 (this is not a toll-free number). Individuals who are deaf or 
hard of hearing and individuals with speech impairments may access this 
number via TTY by calling the toll-free Federal Relay Service during 
working hours at 1-800-877-8339.

SUPPLEMENTARY INFORMATION:

I. Executive Summary

Purpose of the Regulatory Action

    Housing plays a central role in American life. Where children live 
and grow up is inextricably linked to their level of educational 
attainment, their relationship with policing and the criminal justice 
system, what jobs they can obtain as adults, how much wealth their 
family can attain, whether they will someday purchase their own home, 
whether they will face chronic health conditions or other lifelong 
obstacles, and ultimately the opportunities they will be able to 
provide for their own children and grandchildren. As the United States 
Supreme Court noted recently, in enacting the Fair Housing Act more 
than fifty years ago, Congress recognized the critical role housing 
played and continues to play in creating and maintaining inequities 
based on race and color. See Tex. Dep't of Housing and Cmty Affairs v. 
Inclusive Cmtys Project, Inc., 576 U.S. 519, 546 (2015) (``The [Fair 
Housing Act] must play an important part in avoiding the Kerner 
Commission's grim prophecy that `our Nation is moving toward two 
societies, one [B]lack, one [W]hite--separate and unequal.' The Court 
acknowledges the Fair Housing Act's role in moving the Nation toward a 
more integrated society.'') (internal citations omitted).
    Notwithstanding progress in combatting some types of housing 
discrimination, the systemic and pervasive residential segregation that 
was historically sanctioned (and even worsened) by Federal, State, and 
local law, and that the Fair Housing Act was meant to remedy has 
persisted to this day. In countless communities throughout the United 
States, people of different races still reside separate and apart from 
each other in different neighborhoods, often due to past government 
policies and decisions. Those neighborhoods have very different and 
unequal access to basic infrastructure (streets, sidewalks, clean 
water, and sanitation systems) and other things that every thriving 
community needs, such as access to affordable and accessible housing, 
public transportation, grocery and retail establishments, health care, 
and educational and employment

[[Page 8517]]

opportunities--frequently because government itself has intentionally 
denied resources to the neighborhoods where communities of color live. 
And this segregation is perpetuated by policies that effectively 
preclude mobility to neighborhoods where opportunity is greater.
    Moreover, inequities in real housing choice do not exist solely on 
race or color lines, but across all the classes the Fair Housing Act 
protects. Individuals with disabilities too frequently are excluded not 
just from buildings but from whole communities because of lack of 
accessible and affordable housing. The widespread lack of quality 
affordable housing shuts out families with children and members of 
other protected class groups.
    This proposed rule implements the Fair Housing Act's Affirmatively 
Furthering Fair Housing (AFFH) mandate across the Nation to address 
these inequities and others that cause unequal and segregated access to 
housing and the platform it provides for a better life. The proposed 
rule is intended to foster local commitment to addressing local and 
regional fair housing issues, both requiring and enabling communities 
to leverage and align HUD funding with other Federal, State, or local 
resources to develop innovative solutions to inequities that have 
plagued our society for far too long. The proposed rule is meant to 
provide the tools that HUD--together with other Federal, State, and 
local agencies, as well as public housing agencies--can use to overcome 
centuries of separate and unequal access to housing opportunity. In 
line with the Nation's current reckoning with racial and other types of 
inequity, the proposed rule is designed to assist HUD and its program 
participants to take advantage of a unique opportunity to fulfill the 
promise made when the Fair Housing Act was enacted on April 11, 1968.
    This proposed rule takes as its starting point the fair housing 
planning process created by the 2015 AFFH Rule (80 FR 42272, July 16, 
2015), which was a significant step forward in AFFH implementation. It 
then proposes refinements, informed by lessons HUD learned from its 
implementation of the 2015 AFFH Rule, by feedback provided by States 
and localities across the country, and by stakeholder input. For 
example, the proposed rule is designed to reduce burden on program 
participants by streamlining the analysis of fair housing issues that 
they must perform, allowing them to focus more directly on the setting 
of effective fair housing goals and strategies to achieve them. It also 
would provide greater accountability mechanisms and increase 
transparency to and participation by the public.
    Ultimately, this proposed rule would provide a framework under 
which program participants will set and implement meaningful fair 
housing goals that will determine how they will leverage HUD funds and 
other resources to affirmatively further fair housing, promote equity 
in their communities, decrease segregation, and increase access to 
opportunity and community assets for people of color and other 
underserved communities.

Summary of Legal Authority

    The Fair Housing Act (title VIII of the Civil Rights Act of 1968, 
42 U.S.C. 3601-3619) declares that it is ``the policy of the United 
States to provide, within constitutional limitations, for fair housing 
throughout the United States.'' See 42 U.S.C. 3601. Accordingly, the 
Fair Housing Act prohibits, among other things, discrimination in the 
sale, rental, and financing of dwellings, and in other housing-related 
transactions because of ``race, color, religion, sex,\1\ familial 
status,\2\ national origin, or handicap.'' \3\ See 42 U.S.C. 3604 and 
3605. Section 808(d) of the Fair Housing Act requires all executive 
branch departments and agencies administering housing and urban 
development programs and activities to administer these programs in a 
manner that affirmatively furthers fair housing. See 42 U.S.C. 3608. 
Section 808(e)(5) of the Fair Housing Act (42 U.S.C. 3608(e)(5)) 
requires that HUD programs and activities be administered in a manner 
that affirmatively furthers the policies of the Fair Housing Act.
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    \1\ Consistent with established practice, HUD interprets the 
term ``sex'' to include gender identity, sexual orientation, and 
nonconformance with gender stereotypes. See Memorandum from Damon Y. 
Smith, Principal Deputy General Counsel to Jeanine M. Worden, Acting 
Assistant Secretary for Fair Housing and Equal Opportunity, 
``Application to the Fair Housing Act of the Supreme Court's 
decision in Bostock v. Clayton County, GA'' (Feb. 9, 2021), 
available at https://www.hud.gov/sites/dfiles/ENF/documents/Bostock%20Legal%20Memorandum%2002-09-2021.pdf.
    \2\ The term ``familial status'' is defined in the Fair Housing 
Act at 42 U.S.C. 3602(k). It includes one or more children who are 
under the age of 18 years being domiciled with a parent or guardian, 
the seeking of legal custody, or pregnancy.
    \3\ Although the Fair Housing Act was amended in 1988 to extend 
civil rights protections to persons with ``handicaps,'' the term 
``disability'' is more commonly used and accepted today to refer to 
an individual's physical or mental impairment that is protected 
under Federal civil rights laws, the record of such an impairment, 
and being regarded as having such an impairment. For this reason, 
except where quoting from the Fair Housing Act, this preamble and 
proposed rule use the term ``disability.''
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Summary of Major Provisions of the Rule

    The proposed rule retains much of the framework of the 2015 AFFH 
Rule. Under the proposed rule, as under the 2015 AFFH Rule, program 
participants will identify fair housing issues, prioritize the fair 
housing issues they will focus on overcoming in the next three to five 
years, and develop the goals they will implement to overcome those fair 
housing issues. The proposed rule contains refinements based on HUD's 
experience implementing the 2015 AFFH Rule and input from many 
stakeholders. It is structured to simplify and provide greater 
flexibility: regarding the analysis that program participants must 
perform as part of their Equity Plans (which are a modified version of 
the Assessments of Fair Housing performed under the 2015 AFFH Rule), to 
allow more time and energy to be spent on effective goal setting; to 
provide clarity, direction, and guidance for program participants to 
promote fair housing choice; to provide more transparency to the public 
and greater opportunity for public input; and to provide 
accountability, a mechanism for regular progress evaluation, and a 
greater set of enforcement options to ensure that program participants 
are meeting their planning commitments and to provide them the 
opportunity to revise commitments where circumstances change. The 
proposed rule will advance these objectives in a manner that is 
informed by the lessons HUD learned from the implementation of the 2015 
AFFH Rule by:
    a. Giving underserved communities a greater say in the actions 
program participants will take to address fair housing issues. When HUD 
implemented its 2015 AFFH Rule, program participants and community 
members alike consistently reported to HUD that community engagement 
(then called community participation) was an extremely effective and 
important part of identifying fair housing issues and figuring out how 
best to prioritize and address them. The proposed rule makes that 
process more inclusive and robust, for example by requiring program 
participants to consult with a broad range of community members, to 
hold meetings in diverse settings, ensure that individuals with 
disabilities and their advocates have equal access to those meetings, 
and partner with local community-based organizations and stakeholders 
to engage with protected class groups and underserved communities. The 
proposed rule

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empowers broader segments of the community by, for example, requiring 
program participants to engage with a broad cross-section of the 
community, which could include advocates, clergy, community 
organizations, local universities, resident advisory boards, healthcare 
professionals and other service providers, and fair housing groups. HUD 
will also make the data HUD provides to program participants publicly 
available, including maps and other information demonstrating the 
existence of fair housing issues such as segregated areas, to 
facilitate public engagement throughout the process. HUD specifically 
seeks comment below regarding how it can best ensure that community 
engagement is effective in informing the Equity Plan. The proposed rule 
also requires program participants to submit, along with their Equity 
Plans, more information regarding their community engagement efforts 
than was required by the 2015 AFFH Rule. Additionally, as described 
further below, the proposed rule allows the public to submit 
information directly to HUD regarding submitted Equity Plans, providing 
HUD greater ability to ensure that community engagement requirements 
are satisfied. HUD also intends to supply more technical assistance for 
program participants on effective ways to conduct community engagement.
    b. Streamlining the Equity Plan's required fair housing analysis, 
while providing easy-to-use data to support that analysis. HUD will 
help program participants and their communities understand the data HUD 
provides them. Aided by that data and more comprehensive community 
engagement, program participants will be empowered to identify key fair 
housing issues more effectively and efficiently without unnecessary 
burden. Under HUD's 2015 AFFH Rule, HUD provided program participants 
with considerable data and then required program participants to 
conduct extensive data analysis in response to a large number of 
questions. This data-driven analysis was very useful for identifying 
fair housing issues such as patterns of segregation, but some program 
participants, particularly smaller ones that lacked relevant expertise, 
found it more difficult to complete than HUD had intended. The 2015 
AFFH Rule used an Assessment Tool that contained approximately 100 
questions program participants were required to answer in a prescribed 
format, as well as about forty contributing factors that program 
participants were required to consider for each fair housing issue they 
identified. Some program participants, working on their own or with 
technical assistance from HUD, conducted successful fair housing 
analyses using the Assessment Tool. Other program participants, 
however, struggled to properly interpret the data provided by HUD, and 
several program participants retained consultants to perform the bulk 
of the fair housing analysis for them. In HUD's experience reviewing 
the fair housing plans submitted pursuant to the 2015 AFFH Rule, the 
fair housing analyses conducted by program participants themselves or 
with technical assistance from fair housing groups, universities, or 
HUD were typically of much better quality than the fair housing 
analyses prepared for program participants solely by consultants. Put 
differently, the fair housing plans prepared by program participants 
themselves typically reflected better analysis that gave greater 
consideration to local fair housing issues and history rather than more 
generic approaches taken by consultants that prepared analyses for 
multiple program participants in different geographic areas of the 
country. The proposed rule, therefore, reflects improvements on the 
2015 AFFH Rule framework and is designed to reduce burden for program 
participants in conducting the fair housing analysis portion of their 
Equity Plan and identifying fair housing issues, leaving program 
participants more time to establish meaningful fair housing goals and 
making them more likely to conduct their own analyses. Under the 
proposed rule, program participants will conduct their fair housing 
analyses to identify fair housing issues by responding to questions in 
a few broad areas (seven for consolidated plan recipients, five for 
public housing agencies) that HUD is proposing to constitute the core 
areas of analysis. While HUD anticipates providing program participants 
with flexibility on the format of their Equity Plans, HUD will expect 
program participants to answer all required questions, including those 
that assess the reasons fair housing issues exist, as in the 2015 AFFH 
Rule. Under this proposed rule, HUD is considering ways to reduce 
burden for program participants by, for example, providing the program 
participant with not only raw data and maps, but is also considering 
providing technical assistance that helps highlight key takeaways and 
fair housing issues. HUD will also provide technical assistance on 
common fair housing issues, potential fair housing goals that could 
overcome fair housing issues, and additional training on how to 
identify and prioritize fair housing issues. Finally, HUD will make all 
program participants' Equity Plans available on a HUD-maintained web 
page, allowing program participants to review other program 
participants' Equity Plans that have been accepted by HUD and learn 
from the experiences of those who already have been through the 
process. While HUD believes these changes will make it easier for many 
program participants and their communities to effectively use HUD-
provided data, it also understands that the raw data and the AFFH Data 
& Mapping Tool (AFFH-T) made available under the 2015 AFFH Rule have 
proven invaluable for researchers and high-capacity program 
participants, and HUD will continue to make such data available.
    c. Placing greater focus on fair housing goals. A key difference 
between the proposed rule and the 2015 AFFH Rule is a much greater 
focus on HUD's review of program participants' goals that will 
contribute to positive fair housing outcomes. While the proposed rule 
sets out questions for program participants to answer, it does not 
specify the content or length of responses. In some cases, the answer 
to the question will be relatively clear based on the HUD-provided data 
and technical assistance, and the program participant will only then 
need to assess the causes and circumstances that result in fair housing 
issues. In other instances, program participant may need to do more 
analysis, including assessing local data, local knowledge, and 
information obtained through community engagement, in order to 
sufficiently respond to the question. HUD is making clear here, and 
will continue to do so with technical assistance and guidance, that the 
purpose of the questions is not to generate an extensive written 
analysis of local conditions for its own sake, but to require program 
participants to give serious consideration to the specific local 
conditions (such as the existence of segregation, or the lack of 
housing choice throughout a jurisdiction) that are likely to implicate 
fair housing issues faced by different protected class groups. 
Accordingly, HUD's review of program participants' answers to those 
questions will entail confirming that the program participant did an 
adequate job of identifying the fair housing issues revealed by the 
HUD-provided data and by information provided during community 
engagement. HUD's review of fair housing goals, meanwhile, will entail 
determining whether the program participant's goals have been designed

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and can be reasonably expected to overcome the fair housing issues that 
the program participant has identified and prioritized for action in 
the next three to five years. Stated plainly, HUD's review will focus 
primarily on whether the Equity Plan appropriately identifies the 
relevant fair housing issues and establishes fair housing goals that 
can realistically be expected to address them and produce meaningful 
fair housing outcomes for various protected class groups in the program 
participant's underserved communities; HUD's review will not focus on 
the volume of written analysis underlying the identification of the 
fair housing issues.
    d. Providing HUD more flexibility to work with program participants 
to improve a submitted Equity Plan and ensure it meets regulatory 
requirements. HUD's experience implementing the 2015 AFFH Rule 
demonstrated that a robust back and forth between HUD and program 
participants regarding the content of submitted plans was important to 
the rule's success; in many instances, a submitted plan improved 
substantially as a result of HUD engagement. However, the structure of 
the 2015 AFFH Rule limited HUD's practical ability to do this work. HUD 
was required to either accept or not accept a plan within 60 days of 
submission. If an Assessment of Fair Housing (AFH) was not accepted by 
HUD after the initial submission, HUD provided the program participant 
an opportunity to revise and resubmit the plan for HUD review; however, 
HUD then had a limited amount of time to review the revised plan, work 
with the program participant to address remaining issues, and then 
accept that plan before a decision on a submitted consolidated plan or 
public housing agency (PHA) plan needed to be rendered. If the program 
participant could not achieve an accepted AFH by the time the program 
participant's consolidated plan or PHA Plan was due, the automatic 
consequence was a cut-off of Federal funding. Faced with that 
consequence, HUD ultimately accepted every plan, although many of the 
plans that HUD accepted could still have benefited from improvements if 
there had been additional time for HUD to work with the program 
participant. This proposed rule provides HUD more time--100 days, with 
the ability to extend that time for good cause--to review a submitted 
Equity Plan and work with a program participant to ensure the plan 
meets the requirements of this proposed rule. In addition, the proposed 
rule provides that, if a program participant does not have an accepted 
Equity Plan by the time a consolidated plan or PHA Plan must be 
approved, to have that plan approved it must provide HUD with special 
assurances that it will achieve an Equity Plan that meets regulatory 
requirements within 180 days of the end of HUD's review period for its 
consolidated plan or PHA Plan. At the end of the 180-day period, if the 
program participant still does not have an Equity Plan that has been 
accepted by HUD, HUD will seek the most serious of remedies by 
initiating the termination of funding and will not grant or continue 
granting applicable funds. HUD believes this structure will provide it 
with the necessary enforcement authority and the flexibility to work 
with program participants to achieve an Equity Plan that meets this 
proposed rule's requirements. By obtaining special assurances, HUD will 
continue to have the ability to enforce this proposed rule by 
initiating the termination of funding for program participants that do 
not provide the required special assurances or that do not achieve an 
Equity Plan that is accepted by HUD in the time allotted. HUD believes 
the addition of the procedures relating to special assurances provide a 
stronger yet more flexible mechanism for HUD to compel compliance with 
the requirements of this proposed rule beyond what it could require 
under the 2015 AFFH Rule.
    e. Creating a more direct linkage between the Equity Plan's fair 
housing goals and the planning processes in the consolidated plan, 
annual action plan, or PHA Plan. The proposed rule requires the program 
participant to establish concrete fair housing goals that are designed 
and can be reasonably expected to achieve meaningful fair housing 
outcomes. In the process, program participants will identify the 
funding and any contingencies that must be met for the program 
participant to achieve the goal. The proposed rule then requires 
program participants to incorporate the fair housing goals from their 
Equity Plans into their consolidated plan, annual action plan, or PHA 
Plan. The direct linkage between the Equity Plan and subsequent program 
planning documents will enable program participants to make more 
informed decisions about how to overcome circumstances that cause, 
increase, contribute to, maintain, or perpetuate fair housing issues. 
By incorporating their fair housing goals, strategies, and actions into 
their planning documents, program participants will be better 
positioned to build equity and fairness into their decision-making 
processes for the use of resources and other investments, live up to 
the commitments they have made in Equity Plans, and ultimately fulfill 
their obligations to affirmatively further fair housing.
    f. Implementing a more transparent process for program 
participants' development and HUD's review of Equity Plans. The 
proposed rule will enable members of the public to have online access 
to all submitted Equity Plans; to provide HUD with additional 
information regarding Equity Plans that are under HUD review; and to 
know HUD decisions on Equity Plan acceptance and on program 
participants' annual progress evaluations. HUD will use information 
submitted by the public in its review of the Equity Plan. This 
transparency is intended, in part, to assist program participants with 
understanding how other similarly situated program participants 
conducted their analyses. HUD believes that this transparency will 
allow the public to be more engaged in the local fair housing planning 
process, the implementation of fair housing goals, and ultimately in 
assisting their local leaders in determining how to allocate resources 
to address fair housing issues.
    g. Tracking progress on fair housing goals. The proposed rule 
requires program participants to conduct annual progress evaluations 
regarding the progress made on each goal. These progress evaluations 
will be submitted to HUD, and HUD will make them publicly available on 
a HUD-maintained website. This annual progress evaluation ensures that 
goal implementation stays on track and that progress (or lack thereof) 
is disclosed to the public. In conducting this evaluation, a program 
participant must assess whether to establish a new fair housing goal or 
whether to modify an existing fair housing goal because it cannot be 
achieved in the amount of time previously anticipated. The proposed 
rule allows program participants, with HUD's permission, to submit a 
revised Equity Plan that modifies goals or set new goals if 
circumstances changed or if the established goals have been 
accomplished. HUD believes this ability to account for changed 
circumstances will make program participants more willing to set 
ambitious, creative goals that may be dependent on certain 
contingencies, since the goals can be updated if the contingencies are 
not met. However, HUD will not grant permission to alter goals if the 
program participant is simply choosing not to take necessary steps. The 
annual progress evaluation will allow for public

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awareness that a goal is not being met before it is too late to change 
course to meet it.
    h. Increasing accountability by creating a mechanism for members of 
the public to file complaints and for HUD to further engage in 
oversight and enforcement. Under the proposed rule, HUD will have the 
ability to open compliance reviews, and members of the public will be 
able to file complaints directly with HUD regarding a program 
participant's AFFH-related activities. While these processes are new to 
AFFH compliance, the proposed regulatory provisions relating to the 
filing and investigation of complaints and HUD's procedures for 
obtaining compliance are consistent with the oversight and enforcement 
mechanisms that exist for other Federal civil rights statutes that HUD 
implements. Accordingly, HUD anticipates that the agency, program 
participants, and the public should be able to readily acclimate 
themselves to these processes and that the associated burden will be 
manageable.
    These improvements are intended to result in tangible fair housing 
outcomes that advance equity and increase opportunity for people of 
color and other underserved communities while minimizing burden and 
constraints on program participants in how those outcomes are 
determined and achieved. Ultimately, those tangible fair housing 
outcomes will be locally driven based on the fair housing issues that 
are presented by local circumstances. This proposed rule does not 
dictate the particular steps a program participant must take to resolve 
a fair housing issue. Rather, the proposed rule is intended to empower 
and require program participants to meaningfully engage with their 
communities and confront difficult issues in order to achieve 
integrated living patterns, overcome historic and existing patterns of 
segregation, reduce racial and ethnic concentrations of poverty, 
increase access to homeownership, and ensure realistic and truly equal 
access to opportunity and community assets for members of protected 
class groups, including those in historically underserved communities.
    As previously noted, this proposed rule is intended to ensure that 
program participants set and achieve meaningful fair housing goals 
while reducing program participant burden in performing the required 
analysis in the planning stage. The proposed rule reduces burden 
compared with the 2015 AFFH Rule for program participants through the 
provision of HUD data and assistance in interpreting the data and other 
modifications such as not prescribing a particular format for the 
written analysis. It is HUD's intention to allow program participants 
to spend less time on data analysis and more time on setting meaningful 
fair housing goals that are based on that data and other information, 
including conversations with their local community regarding the most 
effective means of advancing fair housing and equity. This does not 
diminish the key role that interpretation of maps and other objective 
data will continue to play in the required analysis, but rather enables 
program participants to focus more of their time and energy on the fair 
housing goals and strategies and actions they will employ to overcome 
the fair housing issues identified using the data. HUD will continue to 
provide program participants datasets, including maps, and tools that 
contain at least as much data as is currently provided in the AFFH-T 
Data & Mapping Tool. HUD will continue to make these data publicly 
available, including for use by program participants in conducting 
their Equity Plans, at https://www.hud.gov/program_offices/fair_housing_equal_opp/affh. HUD will explore ways to build on and 
improve the current AFFH-T Data & Mapping Tool and will continue to 
evaluate whether these data or other data may be helpful to program 
participants and the public in undertaking an analysis of how to 
advance fair housing outcomes within local communities.
    HUD is contemplating making its provision of these data more user 
friendly in ways that will reduce burden for smaller program 
participants and those with fewer resources while increasing their 
understanding--and their communities' understanding--of what those data 
signify. Along with updating and improving the current AFFH-T Data & 
Mapping Tool, HUD is contemplating providing technical assistance that 
would highlight key points to help program participants understand what 
those maps and tables show. For example, technical assistance may 
include identification of racially or ethnically concentrated areas of 
poverty (R/ECAPs) in the jurisdiction and demographic information about 
the R/ECAPs' residents, making it simpler for the program participant 
to answer the relevant question in the required analysis. HUD 
anticipates that these efforts will reduce the burden for program 
participants to answer the required analysis questions and identify 
fair housing issues, while providing information critical to the fair 
housing analysis in a format that also can be understood by the 
community.
    The proposed rule is less burdensome compared to the 2015 AFFH 
Rule. While this proposed rule continues to require program 
participants to review and understand the data and their fair housing 
implications, including for purposes of setting fair housing goals, 
program participants will not be required to submit responses in the 
form of data analysis. Except as specifically instructed in the 
proposed analysis questions (in instances where HUD expects its own 
provision of data to make it simple to do so), program participants 
would not need to reference specific percentages or calculations, for 
example, regarding demographics or segregation, but would be required 
to show the connection between their data analysis, their 
identification of fair housing issues, and the establishment fair 
housing goals. Instead, the data provided by HUD, along with local data 
and local knowledge, should be sufficient to drive the program 
participant's analysis and ultimate identification of goals and 
strategies. The program participant's answers should be informed by 
data but need not be written in that form. These improvements will make 
it easier for smaller program participants and those with fewer 
resources to complete the written analysis, and also make it easier for 
the community to engage in the process, understand the analysis of fair 
housing issues in a submitted Equity Plan, and provide additional 
relevant information to facilitate HUD's review. Program participants 
will have the opportunity to engage with HUD staff to help ensure that 
consultants, contractors, or complex data analysis are not required to 
produce an Equity Plan that can be accepted.\4\
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    \4\ HUD is aware that during implementation of the 2015 AFFH 
Rule, many university-based researchers (along with fair housing 
groups and other non-profit organizations) assisted program 
participants in analyzing and understanding HUD-provided data for 
purposes of identifying fair housing issues and establishing fair 
housing goals in their AFHs.
---------------------------------------------------------------------------

    This proposed rule features much greater transparency for the 
public to see and participate in the decisions program participants 
make and HUD's responses to them. HUD expects to publish all Equity 
Plan submissions and decisions as to whether HUD has accepted the 
Equity Plan on its AFFH web page to further increase transparency and 
reduce burden for program participants. This transparency is intended, 
in part, to assist program participants with understanding how other 
similarly situated program participants conducted their analyses. HUD 
believes that by publishing this

[[Page 8521]]

information, not only will local officials be able to learn from other 
jurisdictions' Equity Plans, but also the public will be more engaged 
in the local fair housing planning process and implementation of local 
fair housing goals. HUD anticipates that this approach may also lead to 
collaboration with other government entities as well as the private 
sector with respect to housing and community development activities and 
investments in a program participant's jurisdiction. In addition, this 
more robust community engagement process to discuss fair housing issues 
and potential fair housing goals will lead to more transparent fair 
housing planning and greater ability to influence equitable outcomes 
for members of protected class groups, including people of color, 
individuals with disabilities, and other underserved communities.
    HUD expects that the refinements made to this proposed rule 
compared with the 2015 AFFH Rule will help program participants more 
easily identify where equity in their communities is lacking and how 
they can affirmatively further fair housing by advancing equity for 
protected class groups through the use of HUD funds, other investments, 
and policy decisions. HUD's commitment to be a partner in the planning 
process for program participants and the public alike should result in 
a reduction of burden and greater transparency and public 
participation, and result in program participants undertaking 
meaningful actions to fulfill the promise of the AFFH mandate 
established in 1968. HUD is soliciting comment on this proposed rule 
and also seeks comment on specific topics in Section IV of this 
preamble.

Summary of Benefits and Costs

    As detailed in the Regulatory Impact Analysis, HUD does not expect 
a large aggregate change in compliance costs for program participants 
as a result of the proposed rule. As a result of increased emphasis on 
affirmatively furthering fair housing within the planning process, 
there may be increased compliance costs for some program participants, 
while for others the improved process and goal setting, combined with 
HUD's provision of foundational data, is likely to decrease compliance 
costs. Program participants are currently required to engage in 
outreach and collect data in order to support their certifications that 
they are affirmatively furthering fair housing. As more fully addressed 
in the Regulatory Impact Analysis that accompanies this rule, HUD 
estimates that compliance with these additional planning requirements 
would collectively cost program participants a total of $5.2 million to 
$27 million per year, once the Equity Plan cycle is fully implemented, 
a sum that is offset by the societal benefits accruing to fair housing 
goals that decrease segregation and the lack of equal access to housing 
and related opportunities throughout society.
    Further, HUD believes that the proposed rule has the potential for 
substantial benefit for program participants and the communities they 
serve. The proposed rule would improve the fair housing planning 
process by providing greater clarity regarding the steps program 
participants must undertake to meaningfully affirmatively further fair 
housing, and at the same time provide better resources for program 
participants to use in taking such steps, thus increasing AFFH 
compliance more broadly. Through this rule, HUD commits to provide 
States, local governments, PHAs, the communities they serve, and the 
general public with local and regional data, as well as assistance in 
understanding that data, as discussed further below. From these data, 
program participants should be better able to evaluate their present 
environment to assess fair housing issues, identify the primary 
determinants that account for those issues, set forth fair housing 
priorities and goals, and document these activities.
    The rule covers program participants that are subject to a great 
diversity of local preferences and economic and social contexts across 
American communities and regions. For these reasons, HUD recognizes 
there is significant uncertainty associated with quantifying outcomes 
of the process, as proposed by this rule, to identify barriers to fair 
housing, the priorities of program participants in deciding which 
barriers to address, the types of policies designed to address those 
barriers, and the effects of those policies on protected classes. In 
brief, because of the diversity of communities and regions across the 
Nation and the resulting uncertainty of precise outcomes of the 
proposed AFFH planning process, HUD cannot estimate the specific 
benefits and costs of policies influenced by the rule. HUD does 
recognize that segregation, combined with the legacy of discrimination 
against protected class groups and longstanding disinvestment in 
certain neighborhoods, has imposed and continues to impose substantial 
costs on members of protected classes and society in general by 
reducing employment, education, and homeownership opportunities as well 
as the costs associated with reduced health and safety in neighborhoods 
that have long faced disinvestment and other adverse environmental 
impacts.\5\ HUD is confident, as discussed more fully below, that the 
rule will create a process that allows for each jurisdiction to not 
only undertake meaningful fair housing planning, but also build 
capacity and develop a thoughtful strategy to affirmatively further 
fair housing and make progress towards a more integrated society with 
more equitable access to opportunity. The benefits of undertaking 
meaningful actions to produce an integrated, just, and prosperous 
society and otherwise further fair housing objectives far outweigh the 
costs.
---------------------------------------------------------------------------

    \5\ See Acs, Pendall, Trekson, et al., ``The Cost of 
Segregation: National Trends and the Case of Chicago 1990-2010,'' 
Urban Institute and The Metropolitan Housing and Communities Policy 
Center (2017), available at https://www.urban.org/sites/default/files/publication/89201/the_cost_of_segregation.pdf (finding that 
higher levels of racial segregation were associated with lower 
incomes for Black residents, lower educational attainment levels for 
White and Black residents, and lower levels of public safety for all 
residents).
---------------------------------------------------------------------------

II. Background

A. Legal Authority

    The Fair Housing Act (title VIII of the Civil Rights Act of 1968, 
42 U.S.C. 3601-3619), enacted into law on April 11, 1968, declares that 
it is ``the policy of the United States to provide, within 
constitutional limitations, for fair housing throughout the United 
States.'' See 42 U.S.C. 3601. Accordingly, the Fair Housing Act 
prohibits discrimination in the sale, rental, and financing of 
dwellings, and in other housing-related transactions because of race, 
color, religion, sex, familial status, national origin, or disability. 
See 42 U.S.C. 3601 et seq. In addition to prohibiting discrimination, 
the Fair Housing Act (42 U.S.C. 3608(e)(5)) requires that HUD programs 
and activities be administered in a manner to affirmatively further the 
policies of the Fair Housing Act. Section 808(d) of the Fair Housing 
Act (42 U.S.C. 3608(d)) directs other Federal agencies ``to administer 
their programs . . . relating to housing and urban development . . . in 
a manner affirmatively to further'' the policies of the Fair Housing 
Act, and to ``cooperate with the Secretary'' in this effort.
    The Fair Housing Act's provisions related to ``affirmatively . . . 
further[ing]'' fair housing, contained in sections 3608(d) and (e), 
require more than compliance with the Act's anti-discrimination 
mandates. NAACP, Boston Chapter v. HUD, 817 F.2d 149

[[Page 8522]]

(1st Cir. 1987); see, e.g., Otero v. N.Y. City Hous. Auth., 484 F.2d 
1122 (2d Cir. 1973); Shannon v. HUD, 436 F.2d 809 (3d Cir. 1970). When 
the Fair Housing Act was originally enacted in 1968 and amended in 
1988, major portions of the statute involved the prohibition of 
discriminatory activities (whether undertaken with a discriminatory 
purpose or with a discriminatory effect) and how private litigants and 
the government could enforce these provisions.
    In sections 3608(d) and (e) of the Fair Housing Act, however, 
Congress went further by mandating that ``programs and activities 
relating to housing and urban development'' be administered ``in a 
manner affirmatively to further the purposes of this subchapter.'' This 
is not only a mandate to refrain from discrimination but a mandate to 
take the type of actions that undo historic patterns of segregation and 
other types of discrimination and afford access to opportunity that has 
long been denied. Congress has repeatedly reinforced and ratified this 
uncontradicted interpretation of the AFFH mandate, requiring in the 
Housing and Community Development Act of 1974, the Cranston-Gonzalez 
National Affordable Housing Act, and the Quality Housing and Work 
Responsibility Act of 1998, that covered HUD program participants 
certify, as a condition of receiving Federal funds, that they will 
affirmatively further fair housing. See 42 U.S.C. 5304(b)(2), 
5306(d)(7)(B), 12705(b)(15), 1437C-1(d)(16).\6\
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    \6\ Section 104(b)(2) of the Housing and Community Development 
Act (HCD Act) (42 U.S.C. 5304(b)(2)) requires that, to receive a 
grant, the state or local government must certify that it will 
affirmatively further fair housing. Section 106(d)(7)(B) of the HCD 
Act (42 U.S.C. 5306(d)(7)(B)) requires a local government that 
receives a grant from a state to certify that it will affirmatively 
further fair housing. The Cranston-Gonzalez National Affordable 
Housing Act (NAHA) (42 U.S.C. 12704 et seq.) provides in section 105 
(42 U.S.C. 12705) that states and local governments that receive 
certain grants from HUD must develop a comprehensive housing 
affordability strategy to identify their overall needs for 
affordable and supportive housing for the ensuing 5 years, including 
housing for persons experiencing homelessness, and outline their 
strategy to address those needs. As part of this comprehensive 
planning process, section 105(b)(15) of NAHA (42 U.S.C. 
12705(b)(15)) requires that these program participants certify that 
they will affirmatively further fair housing. The Quality Housing 
and Work Responsibility Act of 1998 (QHWRA), enacted into law on 
October 21, 1998, substantially modified the United States Housing 
Act of 1937 (42 U.S.C. 1437 et seq.) (1937 Act), and the 1937 Act 
was more recently amended by the Housing and Economic Recovery Act 
of 2008, Public Law 110-289 (HERA). QHWRA introduced formal planning 
processes for PHAs--a 5-Year Plan and an Annual Plan. The required 
contents of the Annual Plan included a certification by the PHA that 
the PHA will, among other things, affirmatively further fair 
housing.
---------------------------------------------------------------------------

    Courts have found that the purpose of the affirmatively furthering 
fair housing mandate is to ensure that recipients of Federal funds used 
for housing or urban development and certain other Federal funds do 
more than simply not discriminate: recipients also must take actions to 
address segregation and related barriers for members of protected class 
groups, as often reflected in racially or ethnically concentrated areas 
of poverty. The U.S. Supreme Court, in one of the first Fair Housing 
Act cases it decided, acknowledged that the Act was intended to make 
significant change in addition to outlawing discrimination in housing, 
noting that ``the reach of the proposed law was to replace the ghettos 
`by truly integrated and balanced living patterns.' '' Trafficante v. 
Metro. Life Ins. Co., 409 U.S. 205, 211 (1972); see also Client's 
Council v. Pierce, 711 F.2d 1406, 1425 (8th Cir. 1983) (``Congress 
enacted section 3608(e)(5) to cure the widespread problem of 
segregation in public housing''); see also Crow v. Brown, 332 F. Supp. 
382, 391 (N.D. Ga. 1971), affirmed in part without op. and reversed in 
part without op. by Banks v. Perk, 473 F.2d 910 (6th Cir. 1973) (``It 
is also clear that the policy of HUD requires that public housing be 
dispersed outside racially compacted areas . . . and [is] part of the 
national housing policy.\7\ Indeed, relief has been granted to 
plaintiffs and against HUD for failing to comply with this affirmative 
duty to disperse public housing which is implicit in the Housing Act of 
1949, the Civil Rights Act of 1964, and the Civil Rights Act of 
1968.''). The Act recognized that ``where a family lives, where it is 
allowed to live, is inextricably bound up with better education, better 
jobs, economic motivation, and good living conditions.'' 114 Cong. Rec. 
2276-2707 (1968). As the First Circuit has explained, section 
3608(e)(5) and the legislative history of the Act show that Congress 
intended that ``HUD do more than simply not discriminate itself; it 
reflects the desire to have HUD use its grant programs to assist in 
ending discrimination and segregation, to the point where the supply of 
genuinely open housing increases.'' NAACP, Boston Chapter v. HUD, 817 
F.2d at 154; see also Otero, 484 F.2d at 1134 (section 3608(d) requires 
that ``[a]ction must be taken to fulfill, as much as possible, the goal 
of open, integrated residential housing patterns and to prevent the 
increase of segregation, in ghettos, of racial groups whose lack of 
opportunity the Act was designed to combat'').
---------------------------------------------------------------------------

    \7\ Reflecting the era in which it was enacted, the Fair Housing 
Act's legislative history and early court decisions refer to 
``ghettos'' when discussing racially concentrated areas of poverty. 
In addition, much of the litigation during this period related to 
the siting of public housing; however, HUD notes that the holdings 
of these courts apply to all programs and activities administered by 
HUD and are not limited to the public housing program.
---------------------------------------------------------------------------

    The Act itself does not define the precise scope of the 
affirmatively furthering fair housing obligation for HUD or HUD's 
program participants. Over the years, courts have provided some 
guidance for this task. In the first appellate decision interpreting 
section 3608, for example, the U.S. Court of Appeals for the Third 
Circuit emphasized the importance of racial and socioeconomic data to 
ensure that ``the agency's judgment was an informed one'' based on an 
institutionalized method to assess site selection and related issues. 
Shannon, 436 F.2d at 821-22. In multiple other decisions, courts have 
set forth that section 3608 applies to specific policies and practices 
of HUD program participants. See e.g., Otero, 484 F.2d at 1132-37; 
NAACP, Boston Chapter, 817 F.2d at 156 (``. . . a failure to `consider 
the effect of a HUD grant on the racial and socio-economic composition 
of the surrounding area' '' would be inconsistent with the Fair Housing 
Act's mandate); Langlois v. Abington Hous. Auth., 207 F.3d 43 (1st Cir. 
2000); U.S. ex rel. Anti-Discrimination Ctr. v. Westchester Cnty., 2009 
WL 455269 (S.D.N.Y. Feb. 24, 2009). The U.S. Court of Appeals for the 
First Circuit, in evaluating how the AFFH mandate applies to HUD and 
its program participants, including the decisions made in the 
administration of their programs and activities, further provided that 
``the need for such consideration itself implies, at a minimum, an 
obligation to assess negatively those aspects of a proposed course of 
action that would further limit the supply of genuinely open housing 
and to assess those aspects of a proposed course of action that would 
increase that supply. If HUD is doing so in any meaningful way, one 
would expect to see, over time, if not in any individual case, HUD 
activity that tends to increase, or at least, that does not 
significantly diminish the supply of open housing.'' NAACP, Boston 
Chapter, 817 F.2d at 156.
    More recently, in examining why regional solutions to segregation 
may be necessary, a United States District Court declared that ``[i]t 
is high time that HUD live up to its statutory mandate to consider the 
effect of its policies on the racial and socioeconomic composition of 
the surrounding area . . . The Court finds it no longer appropriate for 
HUD,

[[Page 8523]]

as an institution with national jurisdiction, essentially to limit its 
consideration of desegregative programs . . .'' Thompson v. HUD, 348 F. 
Supp. 2d 398, 409 (D. Md. 2005). The court emphasized the importance of 
using the AFFH mandate to afford choice to individuals and families 
about where they live by stating that, ``[i]n this regard, it is 
appropriate to note that there is a distinction between telling a 
person that he or she may not live in [a] place because of race and 
giving the person a choice so long as the place in question is, in 
fact, available to anyone without regard to race.'' Thompson, 398 F. 
Supp. 2d at 450. As recently as 2015, the U.S. Supreme Court explained 
that ``[m]uch progress remains to be made in our Nation's continuing 
struggle against racial isolation . . . The Court acknowledges the Fair 
Housing Act's continuing role in moving the Nation toward a more 
integrated society.'' Tex. Dep't of Hous. Cmty. Affairs v. Inclusive 
Cmtys. Project, Inc., 576 U.S. 519, 546-47 (2015). As the Supreme Court 
held in lnclusive Communities, the Fair Housing Act's broad remedial 
purposes cannot be accomplished simply by banning intentional 
discrimination today. Id.
    In addition to the statutes and court cases emphasizing the 
requirement of recipients of Federal housing and urban development 
funds and other Federal funds to affirmatively further fair housing, 
executive orders have also addressed the importance of complying with 
this requirement.\8\
---------------------------------------------------------------------------

    \8\ Executive Order 12892, entitled ``Leadership and 
Coordination of Fair Housing in Federal Programs: Affirmatively 
Furthering Fair Housing,'' issued January 17, 1994, vests primary 
authority in the Secretary of HUD for all Federal executive 
departments and agencies to administer their programs and activities 
relating to housing and urban development in a manner that furthers 
the purposes of the Fair Housing Act. Executive Order 12898, 
entitled ``Executive Actions to Address Environmental Justice in 
Minority Populations and Low-Income Populations,'' issued on 
February 11, 1994, declares that Federal agencies shall make it part 
of their mission to achieve environmental justice ``by identifying 
and addressing, as appropriate, disproportionately high and adverse 
human health or environmental effects of its programs, policies, and 
activities on minority populations and low-income populations.'' 
Executive Order 13985, ``Advancing Racial Equity for Underserved 
Communities Through the Federal Government'' issued on January 25, 
2021, establishes that it is the policy of the Federal Government to 
pursue a comprehensive approach to advancing equity for all, 
including people of color and others who have been historically 
underserved, marginalized, and adversely affected by persistent 
poverty and inequality. Executive Order 13985 makes clear that 
affirmatively advancing equity, civil rights, racial justice, and 
equal opportunity is the responsibility of the whole of our 
Government, and that doing so requires a systematic approach to 
embedding fairness in decision making processes, and as such, 
executive departments and agency must recognize and work to redress 
inequities in their policies and programs that serve as barriers to 
equal opportunity. Furthermore, President Biden's Memorandum to the 
Secretary of HUD dated January 26, 2021, titled ``Memorandum on 
Redressing our Nation's and the Federal Government's History of 
Discriminatory Housing Practices,'' obligates HUD to examine its 
programs and activities and empowers the Secretary to take any 
necessary steps, as appropriate and consistent with applicable law, 
to implement the Fair Housing Act's requirements that HUD administer 
its programs and activities in a manner that affirmatively furthers 
fair housing.
---------------------------------------------------------------------------

B. HUD's July 16, 2015 Final Rule, HUD's 2020 Preserving Communities 
and Neighborhood Choice Rule, and HUD's June 10, 2021 Interim Final 
Rule

    On July 16, 2015, the Department published a final AFFH regulation 
(2015 AFFH Rule) at 24 CFR 5.150 through 5.180, which required program 
participants to conduct and submit to HUD an Assessment of Fair Housing 
(AFH).\9\ The 2015 AFFH Rule reflected HUD's efforts to more fully and 
meaningfully effectuate the AFFH mandate of the Fair Housing Act. The 
promulgation of the 2015 AFFH Rule was a significant and important step 
toward realizing the promise of the AFFH mandate.
---------------------------------------------------------------------------

    \9\ Prior to HUD's 2015 AFFH Rule, beginning in 1996, HUD 
required program participants to undertake an ``Analysis of 
Impediments to Fair Housing Choice,'' (AI) which was the mechanism 
for supporting their AFFH-related certifications. HUD issued 
guidance in the form of the Fair Housing Planning Guide for how to 
conduct an AI. HUD did not require the AI to be submitted, though 
HUD would review AIs in connection with compliance reviews. The 2015 
AFFH Rule replaced the AI process with the AFH process.
---------------------------------------------------------------------------

    To implement the 2015 AFFH Rule, the Department developed and 
required the use of Assessment Tools for different types of program 
participants (which were subject to public comment through the process 
required under the Paperwork Reduction Act), created fact sheets and 
guidance to assist program participants in conducting their AFHs, and 
provided a data and mapping tool (AFFH-T) that remains publicly 
available. While the promulgation of the 2015 AFFH Rule marked a 
substantial improvement to HUD's implementation of the AFFH mandate 
with respect to certain recipients of Federal financial assistance from 
the Department, it was not perfect, and HUD learned important lessons 
about how the 2015 AFFH Rule could be improved.
    The required use of Assessment Tools delayed implementation of the 
2015 AFFH Rule because of the need to adhere to the Paperwork Reduction 
Act process, which includes publication of two Federal Register notices 
and two rounds of public comment solicitation.\10\ When implementation 
began, between October 2016 and December 2017, HUD received, reviewed, 
and issued initial decisions on forty-nine AFHs. HUD's experience with 
the implementation of the 2015 AFFH Rule highlighted some areas for 
improvement, including ways in which the identification of fair housing 
issues could be streamlined. Furthermore, due to the complexity of the 
assessment required and the need to adhere to the specific format 
required, many program participants utilized outside contractors to 
complete their AFHs, others misunderstood the questions asked, and some 
failed to identify fair housing issues or set meaningful goals to 
affirmatively further fair housing. Many submissions merely recounted 
what the HUD-provided data showed, rather than providing an analysis of 
the actual fair housing issues program participants' communities were 
and are facing. In some instances, this resulted in goals that 
consisted of a program participant merely continuing with actions that 
would maintain existing conditions rather than advancing equity for 
members of protected class groups and underserved communities. 
Similarly, the 2015 AFFH Rule's requirement that program participants 
identify and prioritize factors that contribute to fair housing issues 
(from a list of over forty potential factors) proved confusing and, in 
some instances, program participants were not able to translate 
identified factors into meaningful goals that could be reasonably 
expected to result in material progress.
---------------------------------------------------------------------------

    \10\ See, PRA approval process at https://pra.digital.gov/clearance-process/.
---------------------------------------------------------------------------

    At the same time, the 2015 AFFH Rule demonstrated that its basic 
planning structure had considerable promise for assisting local 
communities to achieve meaningful fair housing ends that are responsive 
to local needs. Program participants and members of the community 
reported that, because program participants were required to answer 
specific questions regarding longstanding segregation and other fair 
housing issues, they had productive conversations about important 
issues they otherwise would not have confronted. Moreover, some AFH 
submissions contained creative fair housing goals, including by 
collaborating across different sectors (e.g., public housing agencies 
and school districts working together), to find ways to overcome 
disparities for protected class groups in specific geographic areas. 
HUD believes this demonstrates that the required focus on core fair 
housing topics and goal setting required by the 2015 AFFH Rule remain 
appropriate, even as it also heard from many stakeholders of the need 
for a

[[Page 8524]]

greater emphasis on goals and outcomes tied to a streamlined analysis. 
As more fully explained below, this proposed rule seeks to build on 
these lessons learned. HUD specifically invites comment on this 
proposal in Section IV of this preamble.
    In 2018, HUD suspended implementation of the 2015 AFFH Rule by 
withdrawing the operative assessment tool that program participants 
were required to use for conducting an AFH. See 83 FR 23927 (Jan. 5, 
2018). Then, on August 7, 2020, at 85 FR 47899, HUD promulgated a final 
rule--Preserving Community and Neighborhood Choice (PCNC Rule)--which 
repealed the 2015 AFFH Rule. The PCNC Rule redefined the AFFH mandate 
in a manner that was a substantial and substantive departure from 
decades of judicial and administrative precedent interpreting the AFFH 
mandate in the Fair Housing Act.
    On June 10, 2021, HUD promulgated an interim final rule, 
``Restoring Affirmatively Furthering Fair Housing Definitions and 
Certifications'' (AFFH IFR), in order to repeal the PCNC Rule and 
restore legally supportable definitions and certifications for program 
participants. See 86 FR 30779 (June 10, 2021). The AFFH IFR restored 
relevant definitions from the 2015 AFFH Rule and created a process for 
program participants to certify to HUD that they will affirmatively 
further fair housing. At that time, HUD did not reinstate other 
provisions from the 2015 AFFH Rule, but committed to further 
implementation of the AFFH mandate at a future date, which is the 
purpose of this proposed rule.
    HUD invited and considered public comments on the AFFH IFR. HUD 
also undertook multiple listening sessions to inform this proposed 
rule. These listening sessions included a variety of stakeholders 
including HUD program participants, fair housing and civil rights 
advocates, community organizations, and other interested members of the 
public. These stakeholders provided their views about what worked and 
what did not with respect to the implementation of the 2015 AFFH Rule, 
recommended additional features and refinements that they believed a 
new rule should include, and identified certain fair housing- and 
equity-related issues prevalent in their communities that they hoped a 
proposed rule would address. HUD thanks these stakeholders for this 
valuable input and has taken it into account in formulating this 
proposed rule.
    This proposed rule, as more fully described below, restores much of 
the structure of the 2015 AFFH Rule, but with modifications and 
improvements to increase transparency and accountability, and to reduce 
burden, while retaining flexibility for program participants to 
establish fair housing goals based on their local circumstances. The 
proposed rule generally tracks the structure of the 2015 AFFH Rule 
because HUD believes program participants are familiar with that 
structure; however, HUD is open to considering changes to this proposed 
regulatory scheme to effectively and meaningfully implement the Fair 
Housing Act's AFFH mandate. HUD specifically seeks comment on this 
topic in Section IV of this preamble.

C. HUD Proposes To Restore Much of the Structure of the 2015 AFFH Rule, 
While Streamlining the Required Analysis for Program Participants, and 
Adding Features That Will Bolster the Effective Implementation of the 
AFFH Rule

    HUD now proposes to restore much of the structure of the 2015 AFFH 
Rule, while proposing modifications that HUD believes will lead to a 
more effective fair housing planning process while reducing burden for 
program participants and providing the public more transparency and 
opportunities to influence both planning and implementation. HUD is 
responsible for ensuring that the Fair Housing Act's AFFH mandate is 
implemented and that it drives the change that Congress intended in 
1968--the undoing of vestiges of segregation, unequal treatment, and 
inequitable access to opportunity that the Federal Government itself 
helped create--and helps combat the unequal access to housing and 
related opportunities because of race, color, national origin, 
religion, sex, familial status, and disability that persists in our 
society today.
    For change to occur throughout the Nation, HUD must help the states 
and localities it serves to bring it about, arming them with the 
relevant information and establishing a process that assists in 
identifying fair housing issues and then implementing meaningful 
actions to remedy them. To that end, the 2015 AFFH Rule created a 
robust and data-driven analytical scheme for program participants to 
use when engaging in fair housing planning and determining what actions 
were necessary in their local communities to affirmatively further fair 
housing. Under the 2015 AFFH Rule, HUD provided program participants 
with considerable raw data, in part through an interface known as AFFH-
T that the program participants were expected to use to access data 
relevant to their geographic areas of analysis, and then required 
program participants to analyze this data in answering questions 
contained in the AFH Assessment Tool designed to drive the 
identification of fair housing issues. It was HUD's intention that the 
AFH Assessment Tool's User Interface would import the data from the 
AFFH-T. HUD now recognizes that this approach, while achieving a major 
step forward in fair housing planning and providing an invaluable 
source of publicly available data, particularly for researchers and 
better-resourced program participants, created some unnecessary burden 
and confusion particularly for smaller program participants and those 
with fewer resources. For instance, HUD is aware that program 
participants struggled to use the AFH Assessment Tool's User Interface 
and perform the required data-driven analysis. Accordingly, while HUD 
is using the 2015 AFFH Rule as a model for this proposed rule, this 
proposed rule streamlines the questions in the required analysis and 
HUD proposes to make it more user-friendly. This would enable program 
participants to more readily use HUD-provided data, including during 
community engagement, to identify fair housing issues and set goals 
that will result in meaningful change. HUD continues to consider 
whether other changes to the structure set out in the proposed rule 
would further reduce burden and maximize material positive change and 
seeks comment to that effect in Section IV, below.
    HUD notes that the proposed rule is not intended to conflict with 
or interfere with program participants carrying out existing 
programmatic responsibilities including maintenance of affordable 
housing. It remains a top priority for HUD to preserve and maintain the 
existing stock of long-term affordable rental housing, including the 
federally assisted stock. HUD recognizes the overwhelming need for 
affordable and accessible housing and the inadequate supply of HUD-
assisted housing to meet that need. The most recent HUD report on Worst 
Case Needs for Affordable Housing (issued July 2021) found there were 
over 7.77 million unassisted very low-income renter households facing 
either severe rent burden (paying more than half their incomes for 
rent) or severely inadequate housing conditions, or both. This does not 
include persons facing homelessness, nor does it include lower income 
(but not very low-income)

[[Page 8525]]

cost burdened households. HUD believes and expects that program 
participants can act in recognition of this urgent need to maintain and 
add to existing affordable and accessible housing stock consistent with 
the fair housing principles and requirements set forth in this proposed 
rule.
    HUD recognizes that, notwithstanding its efforts to make 
refinements in this proposed rule to reduce burden and simplify the 
Equity Plan analysis for all program participants, some smaller program 
participants may benefit from additional flexibility and technical 
assistance. In particular, HUD is aware that small PHAs and 
consolidated plan participants may have significantly fewer personnel 
and financial resources available to complete the analysis contemplated 
in this proposed rule when compared to larger entities, especially if 
they are unable to identify another entity they can work with to submit 
a joint Equity Plan.
    As compared to the 2015 AFFH Rule, HUD has significantly 
streamlined the analysis that would be required for a program 
participant's Equity Plan from what was required in the Assessment of 
Fair Housing and has eliminated the analysis of contributing factors 
required by the 2015 AFFH Rule. This streamlined analysis would still 
require program participants to assess the underlying causes of the 
identified fair housing issues as a basis for designing effective fair 
housing goals. In addition, by providing simpler, standard questions 
for all program participants in the regulatory text itself, HUD would 
not be continually revisiting those questions through revised 
assessment tools, which would be subject to changes under the Paperwork 
Reduction Act (PRA) (a Federal law discussed later in this preamble) at 
least every three years, thereby giving program participants long-term 
certainty about the analysis they would be required to undertake and 
reducing the burden involved in preparing subsequent Equity Plans.
    Importantly, HUD has sought to design the questions, and its 
anticipated review of answers, such that the complexity and burden of 
satisfactory answers will scale based on the size of a program 
participant. For example, the largest PHAs (under the proposed rule, a 
PHA that administers 10,000 or more combined public housing and voucher 
units) and the largest consolidated plan participants (under the 
proposed rule, a program participant that receives a total of $100 
million or more in formula grant funds) are likely to operate in large 
metropolitan areas with multiple local government entities, various 
categories of publicly supported housing and other affordable housing, 
many different types of community assets across the geographic area of 
analysis, and millions of community residents with significantly more 
complex demographic patterns. Conversely, the smallest PHAs and 
smallest consolidated plan participants are likely to operate in rural 
areas, newly suburban areas, or other localities with far fewer 
community assets, more limited public infrastructure, and more 
homogenous demographic patterns among significantly smaller populations 
(e.g., 50,000 residents). As a result, smaller program participants, 
though responding to the same questions, would be expected to have less 
to analyze and HUD anticipates that it would be acceptable for them to 
provide briefer answers. As described below, in rare instances and 
typically with smaller program participants, program participants may 
respond that much or all of the question is not applicable to them, as 
long as this response is supported by realities on the ground, 
including through HUD-provided data and insights drawn from local 
knowledge and community engagement.
    During the implementation of the 2015 AFFH Rule, HUD's efforts to 
address the issue of burden on small program participants by requiring 
simplified analyses were largely unsuccessful. HUD created inserts 
within the Assessment Tools for small PHAs and consolidated plan 
program participants but found that this process still resulted in 
confusion. Moreover, the smaller program participants that submitted 
AFHs to HUD generally either did not use the inserts or submitted 
essentially the same analysis as would have been required by the 
standard questions. Nonetheless, HUD is committed to exploring ways to 
further reduce the burden of preparing an Equity Plan for small PHAs 
and small consolidated plan program participants while ensuring that 
they engage in fair housing planning that is sufficient to meet their 
AFFH obligations. HUD solicits comment in this proposed rule on whether 
it should take an alternative approach for smaller program 
participants, including whether it should require such participants to 
analyze fair housing issues in a different manner.
    Additionally, HUD is aware that some small PHAs (such as those that 
operate only Public Housing but do not participate in the Housing 
Choice Voucher (HCV) program, including many of those in rural areas) 
and some small consolidated plan participants (such as those that only 
receive Community Development Block Grant (CDBG) funds) may have 
limited ability to impact housing choice or mobility, making it harder 
for them to establish mobility-related goals as discussed in the 
definition of ``balanced approach'' in Sec.  5.152. In those 
circumstances, a collaborative approach with other entities to address 
issues outside their control may be warranted and may allow them to set 
goals that would enable them to pursue a balanced approach. For 
example, HUD expects such small, public housing-only PHAs could 
undertake collaboration and outreach efforts with local governments, 
the private sector, non-profits, and other applicable governmental 
entities to address fair housing issues and formulate appropriate fair 
housing goals. Specific examples include working with a local 
government to address exclusionary zoning, coordinating with local or 
State agencies to increase public transportation options, addressing 
lead contamination or other environmental hazards, ensuring appropriate 
emergency response coverage, or partnering with an adjacent PHA or 
other larger PHAs that have HCV programs to increase mobility, 
including through portability programs. Similarly, small PHAs (and all 
PHAs as well) could review and make revisions to their PHA Admissions 
and Continued Occupancy Policy and other policies to positively impact 
underserved communities beyond fulfilling existing requirements, e.g., 
modifying preferences or doing specific outreach to organizations that 
support underserved communities. Through such actions, HUD believes 
that even the smallest PHAs can meaningfully impact fair housing 
outcomes within their sphere of influence, even as it recognizes that 
their options and resources may be limited compared to those of larger 
PHAs. HUD does not propose to exempt smaller, public housing-only PHAs 
from efforts to use a balanced approach or their obligation to 
affirmatively further fair housing, but it is committed to providing 
guidance regarding how the AFFH obligation and the balanced approach 
apply when a public housing-only PHA has limited ability to directly 
control issues that involve mobility-related goals as discussed in the 
definition of balanced approach.
    Nonetheless, HUD seeks comment on the extent to which smaller PHAs 
and consolidated plan participants can set goals that constitute a 
balanced approach as defined in this proposed rule, including examples 
of goals that such PHAs and consolidated plan

[[Page 8526]]

participants can appropriately and reasonably set. To the extent that 
commenters believe some smaller PHAs and consolidated plan participants 
may not be able to set goals consistent with a balanced approach, HUD 
seeks comment on what are appropriate expectations for smaller PHAs and 
consolidated plan participants that ensure that meeting their 
regulatory planning requirements will put them on the path to comply 
with their affirmatively furthering fair housing obligation.
    Please see specific requests for comment in Section IV of this 
proposed rule related to reducing burden on small program participants.
    HUD is also proposing other changes to the 2015 AFFH Rule that are 
designed to make the fair housing planning processes more transparent 
to the public and responsive to local fair housing issues. For example, 
HUD is considering how it can better support its program participants 
during the community engagement process in order to ensure that 
representatives from the entire community have the chance to provide 
their important perspectives, including members of protected class 
groups and underserved communities. HUD continues to consider and 
evaluate ways to eliminate unnecessary burden for program participants 
to incorporate public feedback they receive so they can develop 
effective goals to address local fair housing issues. HUD anticipates 
that the more transparent process articulated in this proposed rule for 
publication of Equity Plans will help reduce burden by allowing program 
participants to learn from and build upon the experiences of others.
    HUD acknowledges that implementation of the AFFH mandate will not 
and cannot occur without burden for program participants, though HUD is 
committed to ensuring that program participants experience less burden 
than the 2015 AFFH Rule imposed. Under the proposed rule, program 
participants would continue to be required to submit certifications 
that they will affirmatively further fair housing in connection with 
documents such as their consolidated plan, annual action plan, or PHA 
Plan (or any plan incorporated therein), and it will continue to be 
HUD's responsibility to ensure that these certifications are accurate. 
Furthermore, HUD is committed to advancing equity for protected class 
groups and underserved communities, as well as assisting its program 
participants in doing the same. To truly honor Congress' intent, any 
regulation to implement the Fair Housing Act's AFFH mandate must help 
program participants move away from the status quo with respect to 
planning approaches and facilitate the development of innovative 
solutions to overcome decades, if not centuries, of housing-related 
inequality throughout American communities.
    The need for change remains urgent; many of the problems the Kerner 
Commission Report \11\ identified are still with us today, even as 
other barriers to equal access to housing opportunities have taken on 
increased attention. In particular, the Nation remains highly 
segregated by race, communities continue to have vastly different 
access to critical resources because of historic disinvestment in 
communities of color, there is still a large wealth gap between people 
of color and White persons, and the lack of choice for many about where 
to live persists notwithstanding that the Fair Housing Act barred 
discrimination based on race and other protected characteristics as a 
formal matter more than 50 years ago. Both anecdotal evidence and 
empirical research continue to demonstrate that many low-income 
families in all protected class groups face barriers to obtaining or 
keeping housing in well-resourced, low-poverty areas that provide 
access to opportunity and community assets, such as desirable schools, 
parks, grocery stores, and reputable financial institutions, among 
others. Ample research demonstrates that ongoing discrimination and 
exclusionary practices, not preferences among low-income families and 
members of protected class groups, drives residential and income 
segregation today.\12\ In addition, continued disinvestment not only in 
housing, but in community assets in areas that are not well-resourced 
perpetuates this residential and income segregation.
---------------------------------------------------------------------------

    \11\ Report of the National Advisory Committee on Civil 
Disorders, Mar. 1, 1968, available at https://www.hud.gov/sites/dfiles/FHEO/documents/kerner_commission_full_report.pdf.
    \12\ See for example, Bergman, Chetty, DeLuca, Hendren, Katz, 
and Palmer, ``Creating Moves to Opportunity: Experimental Evidence 
on Barriers to Neighborhood Choice,'' August 2019, available at 
https://opportunityinsights.org/wp-content/uploads/2019/08/cmto_paper.pdf.
---------------------------------------------------------------------------

    Research also shows that this lack of choice as to where families 
can live has serious consequences. Children who move to low-poverty 
neighborhoods have increased academic achievement, greater long-term 
chances of success, and less intergenerational poverty.\13\ Children 
who move to low-poverty neighborhoods have also been shown to 
experience lower rates of hospitalization and lower hospital 
spending.\14\ Meanwhile, adults given the chance to move to low-poverty 
neighborhoods experience reductions in extreme obesity and 
diabetes.\15\ For example, the Opportunity Atlas examines a change in 
the way the literature has studied and measured poverty and 
neighborhood conditions by looking at longitudinal information rather 
than snapshots in time, which allows an evaluation of the root causes 
of long-term outcomes by looking back at where children grew up.\16\ 
One finding from the Opportunity Atlas suggests that if a child moves 
from a ``below-average to an above-average neighborhood at birth,'' it 
could increase the child's lifetime earnings by $200,000.\17\ Another 
study concluded with respect to income disparities that ``initiatives 
whose impacts cross neighborhood and class lines and increase upward 
mobility specifically for Black men hold the greatest promise of 
narrowing the [B]lack-[W]hite gap. There are many promising examples of 
such efforts: mentoring programs for [B]lack boys, efforts to reduce 
racial bias among [W]hites, interventions to reduce discrimination in 
criminal justice, and efforts to facilitate greater interaction across 
racial groups.'' \18\ Furthermore, researchers have found that even 
low-income individuals can have an increased life expectancy if they 
reside in more affluent and educated cities.\19\
---------------------------------------------------------------------------

    \13\ Chetty, Hendren, and Katz, ``The Effects of Exposure to 
Better Neighborhoods on Children: New Evidence from the Moving to 
Opportunity Experiment,'' American Economic Review, April 2016. 
Chetty and Hendren, ``The Effects of Neighborhoods on 
Intergenerational Mobility I: Childhood Exposure and II: County-
Level Estimates,'' Quarterly Journal of Economics, 2018.
    \14\ Pollack, Blackford, Du, et al. ``Association of Receipt of 
a Housing Voucher With Subsequent Hospital Utilization and 
Spending,'' JAMA, 322(21):2115-2124. doi:10.1001/jama.2019.17432, 
2019.
    \15\ Ludwig, Sanbonmatsu, Gennetian, et al. ``Neighborhoods, 
obesity, and diabetes--a randomized social experiment,'' New England 
Journal of Medicine; 365(16):1509-1519. doi:10.1056/NEJMsa1103216, 
2011.
    \16\ Chetty, Friedman, Hendren, Jones, Porter, ``The Opportunity 
Atlas: Mapping the Childhood Roots of Social Mobility,'' NBER 
Working Paper No. 25147 (Jan. 2020), available at https://opportunityinsights.org/paper/the-opportunity-atlas/.
    \17\ Id.
    \18\ Chetty, Hendren, Jones, and Porter, ``Race and Economic 
Opportunity in the United States: An Intergenerational 
Perspective,'' Quarterly Journal of Economics, Vol. 135, Issue 2, 
711-783 (May 2020), available at https://opportunityinsights.org/paper/race/.
    \19\ Chetty, Stepner, Lin, Scuderi, Turner, Bergeron, and 
Cutler, ``The Association Between Income and Life Expectancy in the 
United States, 2001-2014,'' The Journal of the American Medical 
Association, 315(16): 1750-1766 (2016).
---------------------------------------------------------------------------

    For these reasons, the proposed rule requires program participants 
to not only identify areas that are segregated based on race and other 
protected characteristics, but also areas (many of

[[Page 8527]]

them the same ones) that lack critical community assets. Such an 
inquiry is vital to understanding how the neighborhood where someone 
grows up in many ways determines their life outcomes, including for 
example by perpetuating significant wealth gaps and health and 
educational disparities and limiting the overall opportunities that 
person may have. This is not intended to be a burdensome inquiry. In 
many cases, it will be clear from local knowledge (including what is 
gathered through community engagement) that disparities in community 
assets exist.
    This proposed rule also recognizes that there is a need to take a 
balanced approach when devising ways to overcome fair housing issues. 
The affirmatively furthering fair housing mandate is intended to 
increase fair housing choice for persons of all protected class groups, 
including those with limited income and economic resources. HUD also 
recognizes that there are often economic factors affecting fair housing 
choice, which include rising rents and displacement from existing 
housing due to gentrification. Program participants, in undertaking a 
balanced approach to overcome fair housing issues should consider the 
impact of these economic factors. Affirmatively furthering fair housing 
can involve both bringing investments to improve the housing, 
infrastructure, and community assets in underserved communities as well 
as enabling families to seek greater opportunity by moving to areas of 
the community that already enjoy better community infrastructure and 
community assets. Therefore, HUD's proposed rule supports program 
participants' choice to engage in place-based activities, such as 
preserving affordable housing in particular neighborhoods while making 
complementary investments in other infrastructure and assets in those 
neighborhoods, as well as those choices that promote mobility, 
including housing mobility programs, in order to increase access to 
well-resourced areas and opportunity for protected class groups that 
have historically been housed in underserved neighborhoods.
    The proposed rule calls on program participants to identify, and 
over time remedy, unequal access to homeownership opportunities--which 
is a more direct focus than was required under the 2015 AFFH Rule--
because of race, color, national origin, disability, or other protected 
characteristics. Inequality in access to homeownership has created a 
ballooning wealth gap among racial and ethnic groups. Homeownership is 
generally the most traditional and stable way for a family to 
accumulate wealth; however, this advantage has primarily been made 
available only to White families, even today.\20\ As one researcher 
described the results of a 2019 study, the median White family had 
eight times the wealth of the median Black family and five times the 
wealth of the median Latino or Hispanic family.\21\ It is clear that 
eliminating discrimination from housing-related transactions today will 
be insufficient to reduce the wealth gap created over many years.\22\ 
While some efforts are underway to remedy this wealth gap, research 
also shows that current programs that incentivize homeownership may not 
be designed in a manner that would result in a closing of the wealth 
gap and an increase in access to homeownership opportunities for 
persons of color, other protected class groups, and underserved 
communities.\23\ There are myriad ways to reimagine how homeownership 
incentives can be created and utilized to promote these opportunities 
more fairly. Evaluating how homeownership can be incentivized, 
including through public-private partnerships, and made a reality for 
members of protected class groups and underserved communities may be 
one way that program participants can affirmatively further fair 
housing, and this proposed rule explicitly creates space for them to do 
so.
---------------------------------------------------------------------------

    \20\ See McCargo and Choi, ``Closing the Gaps: Building Black 
Wealth through Homeownership,'' Urban Institute (2020), available at 
https://www.urban.org/research/publication/closing-gaps-building-black-wealth-through-homeownership/view/full_report.
    \21\ Schuetz, ``Rethinking Homeownership Incentives to Improve 
Household Financial Security and Shrink the Racial Wealth Gap,'' 
Brookings Blueprints for American Renewal & Prosperity (2020), 
available at https://www.brookings.edu/research/rethinking-homeownership-incentives-to-improve-household-financial-security-and-shrink-the-racial-wealth-gap/.
    \22\ Id.
    \23\ Id.
---------------------------------------------------------------------------

    In addition to the wealth gap, other barriers to homeownership 
exist for other protected class groups. For example, program 
participants may identify--and then set goals to remedy--a lack of 
accessible housing that prevents individuals with disabilities from 
experiencing housing choice. A 2015 analysis of 2011 American Housing 
Survey data found that this was a widespread challenge.\24\
---------------------------------------------------------------------------

    \24\ Accessibility of America's Housing Stock: Analysis of the 
2011 American Housing Survey (AHS), https://www.huduser.gov/portal/publications/mdrt/accessibility-america-housingStock.html.
---------------------------------------------------------------------------

D. Summary of Proposed Changes to HUD's July 16, 2015 Final Rule

a. Streamlined Analysis Will Reduce Burden
    Under the 2015 AFFH Rule, program participants were required to use 
an Assessment Tool to conduct their Assessments of Fair Housing (AFHs). 
The Assessment Tool required them to address more than ninety questions 
and rely on HUD-provided data, local data, and local knowledge to 
answer all questions. The Assessment Tool also contained a list of over 
forty contributing factors.\25\ The factors had to be identified and 
prioritized for each fair housing issue based on the responses to the 
questions and data analysis conducted.
---------------------------------------------------------------------------

    \25\ Under the 2015 AFFH Rule, a contributing factor or fair 
housing contributing factor was defined as ``a factor that creates, 
contributes to, perpetuates, or increases the severity of one or 
more fair housing issues. Goals in an AFH are designed to overcome 
one or more contributing factors and related fair housing issues. . 
.'' 24 CFR 5.152 (2015).
---------------------------------------------------------------------------

    While the Assessment Tool had the worthwhile goal of ensuring that 
program participants conducted a thorough analysis in accordance with a 
standardized process, HUD now proposes a modified approach that is 
intended to make it simpler for program participants to identify fair 
housing issues and thus allow them to focus more of the planning 
process on setting meaningful fair housing goals. While HUD continues 
to believe that an analysis and evaluation of current and historic 
circumstances in a program participant's community is necessary to 
determine appropriate fair housing goals, and that such analysis must 
be informed by data as well as local knowledge and community input, 
such objectives can be achieved without requiring program participants 
to undertake as much independent burden.
    Accordingly, this proposed rule eliminates the required use of an 
Assessment Tool and instead, in Sec.  5.154, sets out a streamlined 
analysis that program participants must follow to develop their Equity 
Plans. The required content, which is different for consolidated plan 
participants and PHAs, consists of fewer questions than the Assessment 
Tool, and HUD proposes to allow program participants to determine the 
format for responding to the questions. HUD believes these questions 
constitute the core of the fair housing inquiry that is required to 
identify fair housing issues, including what may be causing those 
issues, and set meaningful fair housing goals. HUD specifically 
solicits comment below on

[[Page 8528]]

whether the questions in Sec.  5.154 are easily understood to require 
this type of response and whether different or additional questions are 
needed. HUD believes that a more flexible format will allow program 
participants to tailor responses to local needs and priorities. The 
proposed rule still requires program participants to ground their 
analysis in HUD-provided data, local data, and local knowledge 
(including information obtained during the community engagement 
process), but does not require a program participant to provide a 
complete description of the data analyzed in response to each question. 
Instead, the written responses to the questions should describe the 
fair housing issues and their causes present in the program 
participant's geographic areas of analysis, and describe the key 
sources of information relied upon in fair housing issues and their 
causes sufficiently to ensure that responses are grounded in data and 
local knowledge.
    By streamlining the written analysis, HUD believes the proposed 
rule will reduce burden for program participants in conducting their 
Equity Plans, will result in clearer and more direct identification of 
fair housing issues, and will allow program participants and their 
communities to place greater focus on the real task at hand--setting 
and implementing fair housing goals that are tailored to overcome the 
fair housing issues they collectively face. HUD also believes that the 
streamlined written analysis that focuses more on identifying fair 
housing issues and related causes will enable more program participants 
to establish meaningful fair housing goals that are concrete and 
measurable without the need for consultants and contractors.
    For similar reasons, HUD is also eliminating the need to identify 
and prioritize factors contributing to fair housing issues as part of 
the required analysis within each section of the Assessment Tool 
provided under the 2015 AFFH Rule. While the lists of contributing 
factors included in the 2015 AFFH Rule's Assessment Tool were intended 
to help program participants set meaningful goals to remedy fair 
housing issues by first requiring them to identify the causes of those 
issues, HUD's experience in implementing the 2015 AFFH Rule showed that 
this step led to confusion without leading to the development or 
implementation of meaningful fair housing goals. Program participants 
are still required to assess the underlying reasons for the fair 
housing issues they face as part of determining the best and most 
effective approaches for overcoming them, though HUD believes the 
approach taken under the 2015 AFFH Rule did not function as initially 
envisioned.
    Ultimately, because of this proposed rule's emphasis on outcomes, 
HUD believes it will be unnecessary for program participants to rely on 
contractors, consultants, or other experts that may be needed for a 
heavily data-driven written analysis. At the same time, HUD believes 
the simplified analysis still requires the core fair housing analysis--
including engagement with the data provided by HUD--to drive meaningful 
goal setting.
b. Revised Fair Housing Planning Procedures Will Simplify 
Implementation, Reduce Burden, and Increase Transparency
    This proposed rule modifies many of the procedures for how fair 
housing planning is implemented by program participants and their 
submissions reviewed by HUD compared to the 2015 AFFH Rule based on 
HUD's own experiences and the feedback of stakeholders regarding their 
experience with the 2015 AFFH Rule worked in practice.
    First, while HUD's 2015 AFFH Rule was designed to provide program 
participants with maximum flexibility for how to collaborate on an AFH, 
the two different types of collaboration (joint program participants 
and regionally collaborating program participants) proved unnecessarily 
confusing. HUD is proposing to maintain the flexibilities for program 
participants to collaborate on their Equity Plans, while simplifying 
the actual procedures for those collaborations.
    Second, the 2015 AFFH Rule provided for only 60 days for HUD's 
initial review of a submitted AFH and required program participants to 
have an accepted AFH for their consolidated plan, annual action plan, 
or PHA Plan to be approved, which in turn meant that the failure to 
have an accepted AFH could result in the loss of funding for program 
participants and their communities. In practice, this created 
unnecessary pressure on HUD and program participants to ensure that an 
AFH was accepted in a relatively short period of time to avoid risking 
funding that is designed to help low-income families and underserved 
communities. This timing also limited the extent to which HUD could 
work with program participants to revise a submitted plan to ensure 
full compliance with the rule and put program participants on a path to 
meaningful fair housing achievements. HUD has revised these procedures 
in several ways to allow a fuller review and revision process that 
ultimately results in compliant Equity Plans and meaningful actions by 
program participants that implement fair housing goals. HUD proposes to 
increase the review period for submitted plans from 60 to 100 days, 
providing HUD with more time to work with all program participants to 
improve their Equity Plans after submission to ensure the Equity Plan 
meets the regulatory requirements set forth in this proposed rule. The 
proposed rule provides that HUD can extend that review period for good 
cause. The proposed rule provides that if a program participant does 
not have an accepted Equity Plan, HUD may approve a consolidated plan 
or PHA Plan but only if the program participant furnishes special 
assurances that require the program participant to achieve an Equity 
Plan that meets the requirements of this proposed rule within 180 days 
of the end of HUD's review period for the consolidated plan or PHA 
Plan, as applicable, and that require the program participant to then 
amend the consolidated plan, annual action plan, or PHA Plan upon HUD's 
acceptance of the Equity Plan. As a result, HUD will have a clear 
mechanism to remedy noncompliance with the requirement to have an 
accepted Equity Plan, including the ability to take a range of actions 
(up to and including the cut-off of Federal funding where appropriate) 
against program participants who fail to provide or comply with such 
special assurances. HUD's expectation is that review of most Equity 
Plans will conclude with an acceptance, but the additional available 
procedures contained in this proposed rule provide mechanisms for HUD 
to take a progressive series of steps to obtain compliance in cases 
where this expectation is not met.
    Third, while the 2015 AFFH Rule endeavored to align the AFH with 
program participants' other planning cycles, HUD recognizes that this 
approach led to difficulty for program participants in determining the 
date by which their AFHs were required to be submitted. This proposed 
rule, while still generally aligning Equity Plan cycles with other 
program cycles, contains clearer submission deadlines to allow program 
participants and the public to know with certainty when an Equity Plan 
will be due to HUD. Furthermore, program participants will have more 
time to prepare and refine their Equity Plans. HUD also expects to 
provide more robust technical assistance throughout the planning 
process. Based on this, and the changes to the required analysis 
explained throughout this preamble, HUD believes

[[Page 8529]]

it will be unnecessary for program participants to rely on contractors, 
consultants, or other experts that they may have chosen to use under 
the 2015 AFFH Rule. HUD is committed to building stronger partnerships 
with its program participants in order to fully implement the AFFH 
mandate.
    Fourth, the 2015 AFFH Rule required program participants to report 
on their progress in subsequent AFHs--essentially, once every five 
years. HUD believes both that program participants should provide more 
regular progress updates and that they may need greater flexibility to 
adjust, revise, or reposition their fair housing goals on a more 
regular basis, particularly if program participants achieve their goals 
and need to establish new ones. HUD also believes that transparency 
around this progress evaluation is necessary to ensure that the 
community and members of the public are aware of the progress being 
made, including whether there are obstacles preventing progress from 
occurring. For this reason, HUD has included the requirement that, as 
part of their Equity Plans, program participants submit to HUD annual 
progress evaluations that summarize the status of the implementation of 
the fair housing goals. HUD does not anticipate that these progress 
evaluations will be long documents and expects many program 
participants could meet this requirement in a one- or two-page summary. 
HUD will also post these annual progress evaluations on its public AFFH 
web page to maximize the transparency of the progress being made. At 
the same time, the proposed rule provides a mechanism for program 
participants to seek revision of their established goals at these 
annual checkpoints.
    Finally, the 2015 AFFH Rule's review process was not transparent 
enough to allow the public to know why HUD accepted or did not accept 
an AFH. This proposed rule creates a more transparent review process, 
pursuant to which submitted Equity Plans will be posted on HUD's AFFH 
web page, the public will have the opportunity to comment on submitted 
plans (as described further below), and HUD will publish its decisions 
on Equity Plan submissions. HUD believes that increasing the 
transparency around its review of Equity Plans will promote engagement 
by members of the public in the fair housing planning process and will 
serve to keep HUD and its program participants accountable for meeting 
their obligation to affirmatively further fair housing. Ultimately, HUD 
believes that, by having a transparent process, program participants 
will be better positioned to implement the fair housing goals 
established in their Equity Plans because their communities will be 
better equipped to contribute and hold program participants 
accountable.
c. Modified Community Engagement, Consultation, and Publication 
Requirements Will Increase Transparency
    HUD recognizes that transparency and inclusion are necessary 
components of implementing the AFFH rule in a manner that ensures that 
the people the rule is meant to help have a significant voice in 
shaping outcomes. In this proposed rule, HUD offers modifications to 
what the 2015 AFFH Rule termed ``community participation''--in the now 
revised ``community engagement'' section at Sec.  5.158--to include 
requirements that HUD believes are more likely to lead to broader 
engagement, particularly by members of protected class groups and other 
underserved communities who have historically been excluded from these 
types of discussions. The proposed rule would also require consultation 
with various types of organizations, such as Fair Housing Assistance 
Program agencies and Fair Housing Initiative Program grantees, and 
other groups representing underserved communities, which include 
organizations that advocate on behalf of individuals with disabilities 
such as Centers for Independent Living, Protection & Advocacy Agencies, 
Aging and Disability Resource Centers, and Councils on Developmental 
Disabilities, among others. In addition, HUD will require program 
participants to hold multiple community meetings, at different times of 
day, and in different locations throughout the jurisdiction to account 
for the needs of shift workers, families requiring childcare, and 
individuals with disabilities, among others. Ensuring that all members 
of a community have a say in the identification of fair housing issues 
and deciding how available resources are allocated is the first step 
toward advancing equity for everyone.
    HUD intends to maintain an AFFH web page where all submitted Equity 
Plans will be posted for public view. The AFFH web page will include 
public posting of whether HUD has accepted or has not accepted a plan, 
as well as the annual progress evaluation that program participants 
submit. HUD believes that creating a central public site where all of 
this information can be easily viewed will improve public engagement in 
the planning and implementation process by enabling community members 
to provide HUD with additional information that may be pertinent to its 
review, and to hold program participants accountable for implementing 
the fair housing goals established in their accepted Equity Plans. HUD 
may publish submitted Equity Plans or portions of such plans on other 
HUD-maintained web pages for the purposes of disseminating best 
practices and in a searchable information clearinghouse to benefit 
program participants and the general public.
d. New Complaint and Enforcement Mechanisms Will Enhance HUD's Ability 
To Ensure AFFH Compliance
    While the proposed rule continues to focus on planning and goal 
setting, HUD is proposing to add a complaint and enforcement mechanism 
to help ensure that program participants comply with their duty to 
affirmatively further fair housing. This proposed rule, at Sec. Sec.  
5.170 through 5.174, would permit the filing of complaints, and for HUD 
to open a compliance review in response to a complaint or on its own 
initiative, about: a program participant's failure to comply with the 
requirements of the proposed rule; failure to comply with an Equity 
Plan commitment; or any action that is materially inconsistent with the 
obligation to affirmatively further fair housing as defined in this 
proposed rule. This proposed rule would set out how HUD will 
investigate complaints and conduct compliance reviews and the available 
mechanisms for HUD to enforce compliance when a program participant is 
found in noncompliance and voluntary resolution cannot be obtained. HUD 
has modeled these procedures after existing regulations that implement 
Federal civil rights laws, particularly those that apply to recipients 
of Federal financial assistance such as title VI of the Civil Rights 
Act of 1964 and section 504 of the Rehabilitation Act of 1973, and 
therefore are familiar to program participants, all of whom are 
recipients of Federal financial assistance from HUD. See 24 CFR parts 1 
(Title VI) and 8 (Section 504).
    The 2015 AFFH Rule did not include any explicit mechanism for 
members of the public to file complaints with HUD regarding a program 
participant's failure to comply with the requirements of the regulation 
or for HUD to undertake a review of a program participant's compliance. 
Instead, the primary enforcement tools were HUD's ability to reject a 
submitted Assessment of Fair Housing or challenge a program 
participant's certification that it would affirmatively further fair 
housing. These tools alone proved to be insufficient

[[Page 8530]]

because they triggered drastic remedies (such as the suspension or 
termination of funding) that limited their practical use for ensuring 
compliance. HUD uses complaint and compliance review processes as one 
of the standard ways it ensures that program participants satisfy other 
civil rights obligations that attach to Federal funding and has used 
complaint processes in other HUD programs as a means to increase 
compliance. HUD proposes to establish a complaint and compliance 
process for AFFH, based on its experience implementing the 2015 AFFH 
Rule, feedback it received from stakeholders in listening sessions, the 
urgent need to address the systemic inequities in housing, and HUD's 
belief that community members are well positioned to provide important 
information regarding whether program participants are meeting their 
commitments made in the planning process and their duty to 
affirmatively further fair housing more generally. While HUD proposes 
to implement an enforcement mechanism for program participants who fail 
to fulfill the AFFH obligation, HUD understands that certain 
enforcement mechanisms such as withholding funds could have substantial 
impacts on consolidated plan program participants and PHAs and the 
people that they serve. The proposed rule would provide HUD with the 
ability to tailor remedies appropriately for particular circumstances. 
In particular, HUD does not intend to take actions that would adversely 
impact families participating in HUD's assisted housing programs, and 
is cognizant of the potential for such adverse effects from 
conditioning the disbursement of funds for public housing programs 
under section 8 or section 9. HUD would maintain a range of enforcement 
options that can ensure compliance, including finding a PHA in default 
of the Annual Contributions Contract if the circumstances require.
    HUD does not intend this complaint and compliance review process to 
supplant the planning process as the principal means by which HUD and 
its program participants will implement the AFFH obligation and by 
which the community will have input into how AFFH compliance takes 
place. The proposed rule provides for public input at multiple points 
in the planning process, including while the program participant is 
developing its Equity Plan and while HUD is reviewing a submitted 
Equity Plan. HUD expects that interested members of the public will 
actively participate in the community engagement process and raise 
concerns in that forum about a program participant's identification of 
fair housing issues or establishment of fair housing goals. It also 
expects that any concerns the public has regarding a submitted Equity 
Plan will be provided during HUD's review of the Equity Plan, since the 
proposed rule permits members of the public to submit such information 
at that time. HUD will not treat information submitted regarding an 
Equity Plan HUD is reviewing as a complaint to be investigated; rather 
it will consider it as additional information that may be relevant to 
HUD's review of whether the Equity Plan conforms to this rule's 
requirements. HUD anticipates that these opportunities for the public 
to participate in the Equity Plan process will reduce the need to 
resort to the complaint process.
    HUD also does not intend the complaint process to be a forum to 
challenge program participants' day-to-day activities that have little 
nexus to the AFFH obligation. Program participants are on notice of the 
types of actions that would be materially inconsistent with their 
obligation to affirmatively further fair housing because of prior 
guidance provided by HUD (e.g., the 2015 AFFH Rule, the Fair Housing 
Planning Guide, the 2015 AFFH Rule Guidebook, and caselaw, including 
that cited above, interpreting the AFFH mandate).\26\ HUD, nonetheless, 
also commits to providing further guidance as to the alleged conduct 
that HUD will accept as meriting an investigation. HUD's experience in 
administering other civil rights statutes with similar complaint and 
compliance review processes indicates that program participants will 
not be subject to investigations or sanctions arising from frivolous 
complaints regarding actions that do not actually implicate AFFH 
compliance. Additionally, HUD observes that the lack of an explicit 
administrative process that both permits the public to file complaints 
and authorizes HUD to investigate and take necessary corrective action 
has not always permitted program participants to avoid such claims. 
Rather, such allegations have been channeled into False Claims Act 
suits and other lawsuits or complaints of violations of other laws 
against program participants that sometimes required enforcement of 
AFFH in unpredictable ways. HUD has also used its authority to ensure 
program participant compliance with the Fair Housing Act to investigate 
and conciliate complaints of AFFH obligations even in the absence of an 
explicit process. HUD believes it will benefit program participants and 
the Department to have a regular and defined administrative process for 
its consideration of such complaints. As described below, HUD is 
specifically soliciting comment on how it can most effectively 
institute a complaint and compliance review process to provide as much 
notice as possible regarding the proper subjects of complaints and 
compliance reviews and ensure that program participants will not be 
subjected to frivolous complaints that are not directly tied to the 
program participant's obligation to affirmatively further fair housing.
---------------------------------------------------------------------------

    \26\ The Fair Housing Planning Guide and 2015 AFFH Rule 
Guidebook are available at the Office of Fair Housing and Equal 
Opportunity's (FHEO) AFFH web page https://www.hud.gov/AFFH.
---------------------------------------------------------------------------

e. Changes in Definitions Related to the Fair Housing Analysis Will Add 
Clarity to and Focus on Core Fair Housing Concepts
    As described above, the proposed rule eliminates the need for a 
separate Assessment Tool and instead sets out the simplified fair 
housing analysis required of program participants. Many of the 
definitions in this proposed rule therefore reflect some aspects of 
that analysis. HUD has eliminated or modified certain definitions from 
the 2015 AFFH Rule in this proposed rule to provide program 
participants and the public greater clarity regarding what the 
obligation to affirmatively further fair housing encompasses and what 
HUD's expectations are for its funding recipients. Additionally, HUD 
believes that by creating these new definitions that they will provide 
additional information and clarity regarding this proposed rule and the 
topics that program participants are expected analyze. The new 
definitions include:
     ``Affordable housing opportunities,'' which refers to 
whether members of protected class groups and underserved communities 
have equitable access to housing that is affordable to them, including 
with respect to where such housing is located, whether it meets the 
needs of families of different sizes, whether it meets the 
accessibility needs of individuals with disabilities, whether it 
affords access to opportunity, including community assets, and whether 
there are factors that adversely affect access to affordable housing, 
specifically, but not limited to, rising rents, evictions, source of 
income discrimination, loss of existing affordable housing;
     ``Balanced approach,'' which refers to HUD's 
acknowledgement of the balancing of various approaches

[[Page 8531]]

program participants can employ when undertaking community planning and 
investments, which results in the balancing of a variety of actions to 
eliminate the housing-related disparities that result from persistent 
segregation or lack of integration, the lack of affordable housing in 
well-resourced areas of opportunity, the lack of investment in 
community assets in R/ECAPs and other high-poverty areas, and the loss 
of affordable housing to meet the needs of underserved communities. The 
proposed definition would make clear that both place-based and mobility 
strategies are part of a balanced approach necessary to achieve 
positive fair housing outcomes. A program participant that has the 
ability to create greater fair housing choice outside segregated, low-
income areas should not rely on solely place-based strategies;
     ``Community assets,'' which refers to the types of assets 
that are often not equitably distributed and available within 
communities, such as high quality schools, equitable employment 
opportunities, reliable transportation services, parks and recreation 
facilities, community centers, community-based supportive services, law 
enforcement and emergency services, healthcare services, grocery 
stores, retail establishments, infrastructure and municipal services, 
libraries, and banking and financial institutions;
     ``Equity or equitable,'' which refers to the consistent 
and systematically fair, just, and impartial treatment of all 
individuals, including individuals who are members of protected class 
groups or parts of underserved communities that have been denied such 
treatment, as well as persons otherwise adversely affected by 
persistent poverty or inequality;
     ``Publication,'' which refers to how HUD will maintain web 
pages to publicly post Equity Plan materials to enhance transparency 
and provide opportunities for communities to learn from one another and 
benefit from the innovative thinking of others;
     ``Underserved communities,'' which refers to the remedial 
nature of the AFFH mandate so that groups or classes of individuals, as 
well as geographic communities who have historically had inequitable 
access to housing, education, transportation, economic, and other 
important opportunities, including community assets, within the program 
participant's jurisdiction, and HUD would require program participants 
to take them into account to ensure communities overcome the systemic 
perpetuation of inequity.
    HUD believes that building these definitions and others into the 
proposed rule itself more directly articulates HUD's expectations for 
how program participants can comply with this proposed rule and the 
AFFH mandate than leaving such matters to a separate assessment tool as 
the 2015 AFFH Rule did.
f. Conforming Amendments to Program Regulations Are Necessary for 
Consistency With This Proposed Rule
    This proposed rule contains conforming amendments to program 
regulations at 24 CFR parts 91, 92, 93, 570, 574, 576, 903, and 983 in 
order to ensure consistency between this proposed rule and the 
implementation of programmatic requirements for States, local 
governments, insular areas, and PHAs. Because HUD and its program 
participants are required to administer all programs and activities in 
a manner that affirmatively furthers fair housing, establishing 
consistent mechanisms in these regulatory provisions is necessary to 
ensure that program participants are positioned to fulfill this 
obligation.

E. Conclusion

    The opportunity to choose where one lives free from barriers or 
inequities related to race, color, religion, sex, national origin, 
familial status, or disability is at the very heart of the Fair Housing 
Act's AFFH mandate. That obligation is meant to ensure that Federal 
money, which for too long was used to perpetuate segregation and impose 
discriminatory policies, is instead used to dismantle the enduring 
legacy of that history. This proposed rule's implementation of the Fair 
Housing Act's AFFH mandate requires that communities confront and 
commit to changing historic and ongoing discriminatory practices and 
policies, engage in proactive planning for the use of Federal funds to 
ensure funds are used equitably, and implement meaningful actions that 
affirmatively further fair housing. The new regulation carries forward 
the core planning process of the 2015 AFFH Rule, and HUD anticipates 
that the plans generated by this proposed rule will drive how HUD funds 
will be used to advance equity and affirmatively further fair housing. 
The proposed rule also modifies some aspects in order to make the 
process more user-friendly and less burdensome for program 
participants, and more accessible and transparent to the public. HUD's 
objective in this proposed rule is to provide greater support for 
program participants in performing the necessary analysis and otherwise 
meeting their obligations, while requiring more inclusion in the 
planning process for communities that historically have had too little 
say in it; more transparency for the public as to the decisions that 
have been made; and more regular progress reporting and opportunity to 
change course to reflect changed circumstances.
    HUD is committed to taking active measures to work with its program 
participants to develop innovative and consequential ways to 
affirmatively further fair housing. For those program participants that 
take the AFFH obligation seriously, HUD anticipates that this rule will 
be simpler and less burdensome to follow, and that program participants 
will find HUD to be a helpful partner as they engage their communities 
and seek creative ways to remedy fair housing issues that have too long 
been ignored. For those that do not, HUD proposes changes that are 
intended to make its review process more robust and to otherwise 
provide for vigorous enforcement to ensure that the AFFH mandate is 
implemented. Based on the lessons learned from the implementation of 
the 2015 AFFH Rule, this proposed rule builds on that rule's successes 
and offers a more streamlined, effective approach to empower program 
participants and their communities to make informed decisions based on 
local circumstances to advance equity and affirmatively further fair 
housing.

III. Summary of Proposed Rule

    This rule proposes to amend the regulations in 24 CFR parts 5, 91, 
92, 93, 570, 574, 576, 903, and 983 as discussed in this section.

Affirmatively Furthering Fair Housing Regulation

    This proposed rule would amend HUD regulations in 24 CFR part 5, 
subpart A, which contains generally applicable definitions and 
requirements that are applicable to all or almost all HUD programs. 
This rule proposes to amend existing subpart A by adding new Sec. Sec.  
5.150 through 5.180 under the undesignated heading of ``Affirmatively 
Furthering Fair Housing.'' These revised or new sections will provide 
the regulations that will govern how States, local governments, insular 
areas, and PHAs comply with their statutory obligation to affirmatively 
further fair housing, but reserves additional sections in subpart A for 
HUD to continue to provide regulations that will assist all HUD program 
participants in more effectively affirmatively furthering fair housing.

[[Page 8532]]

Affirmatively Furthering Fair Housing: Purpose (Sec.  5.150)

    Revised Sec.  5.150 states that the purpose of the AFFH mandate in 
the Fair Housing Act is to ensure that Federal funds are used in a 
manner to overcome the legacy of public and private policies and 
practices that intentionally or unintentionally have created segregated 
communities and inequities for people of color and other groups because 
of the characteristics the Act protects. The purpose of HUD's AFFH 
regulation is to provide program participants with an effective 
approach to aid program participants in identifying and taking 
meaningful actions to overcome historic patterns of segregation, 
promote fair housing choice, eliminate inequities in access to housing 
and related opportunities caused by policies or actions that 
discriminated on the basis of protected class, and foster inclusive 
communities that are free from discrimination. The new AFFH regulation 
is intended to provide a straightforward approach for program 
participants to advance equity in their communities using Federal 
financial assistance from HUD, while ensuring that HUD has a mechanism 
to enforce the mandate.

Affirmatively Furthering Fair Housing: Application (Sec.  5.151)

    New Sec.  5.151 provides the general applicability of AFFH 
requirements as it applies to all of HUD's programs and activities and 
makes clear that Sec. Sec.  5.150 through 5.180 in subpart A also 
imposes a planning requirement on certain program participants.

Definitions (Sec.  5.152)

    New Sec.  5.152 provides the definitions that are used for purposes 
of the AFFH regulation and conforming amendments to existing program 
regulations. HUD has preserved and modified some of the following 
definitions that were included in the 2015 AFFH Rule (and in certain 
instances the AFFH IFR), which include ``Affirmatively furthering fair 
housing,'' ``Community engagement'' (formerly ``Community 
Participation''), ``Data,'' ``Disability,'' ``Fair housing choice,'' 
``Fair housing issue,'' ``Geographic area,'' ``Integration,'' ``Local 
knowledge,'' ``Meaningful actions,'' ``Protected characteristics,'' 
``Protected class,'' ``Racially or ethnically concentrated areas of 
poverty,'' ``Region,'' ``Segregation,'' and ``Significant disparities 
in access to opportunity.'' New terms defined in this section include 
``Affordable housing opportunities,'' ``Analysis of Impediments to Fair 
Housing Choice,'' ``Balanced approach,'' ``Community asset,'' ``Equity 
or equitable,'' ``Equity Plan,'' ``Fair housing gals,'' ``Fair housing 
goal categories,'' ``Fair housing strategies and actions,'' ``Funding 
decisions,'' ``Publication,'' ``Publicly supported housing,'' 
``Responsible Civil Rights Official,'' ``Reviewing Civil Rights 
Official,'' ``Siting decisions,'' ``Underserved communities,'' and 
``Well-resourced areas.''
    The definition of ``affirmatively furthering fair housing'' 
explains program participants' obligations under the Fair Housing Act 
as described throughout this preamble. This definition provides greater 
clarity than the definition contained in the 2015 AFFH Rule and the 
AFFH IFR by expressly stating that the duty to affirmatively further 
fair housing extends to all of a program participant's activities, 
services, and programs relating to housing and community development; 
it extends beyond a program participant's duty to comply with Federal 
civil rights laws and requires a program participant to take actions, 
make investments, and achieve outcomes that remedy the pervasive 
segregation and disparities the Fair Housing Act was designed to 
redress.
    The definition of ``affordable housing opportunities'' is included 
in this proposed rule to assist program participants in identifying 
whether and in which areas of their communities members of protected 
class groups lack access to affordable housing opportunities. The 
definition also includes that the housing must comply with 
affordability and habitability requirements. This definition also 
includes the broader concept of whether members of protected class 
groups and underserved communities have equitable access to housing 
that is affordable to them, including with respect to where such 
housing is located and whether it affords access to opportunity, 
including community assets. HUD anticipates that this definition, as 
incorporated into the analysis required by Sec.  5.154, will provide a 
connection between housing affordability, protected characteristic, and 
access to other opportunities, such as community assets. This 
definition accounts for whether housing stability for protected class 
groups is adversely affected by various factors, including rising 
rents, loss of existing affordable housing, displacement due to 
economic pressures, evictions, source of income discrimination, or code 
enforcement. This definition also contemplates that individuals with 
disabilities who need accessible housing have affordable housing 
opportunities that meet their needs in areas of their community that 
also afford access to opportunity. HUD notes that HUD is not changing 
the standard for HUD-assisted housing in program regulations with the 
inclusion of this definition for purposes of the Equity Plan analysis. 
By assessing where affordable housing is located in a community, as 
well as who has been successful in accessing that housing, program 
participants can better understand how the location of such housing, in 
relation to community assets, promotes integration, provides access to 
opportunity or is a barrier to such access, and whether there are laws, 
policies, or practices in their jurisdictions that may impede the 
provision of affordable housing in certain areas, such as well-
resourced areas. With this understanding, program participants will be 
better positioned to set fair housing goals that can be designed and 
reasonably expected to result material positive change. This definition 
is not intended to align with HUD's programmatic requirements, and so 
whether housing meets this definition does not speak to whether it 
complies with programmatic rules.
    The definition of ``Analysis of Impediments to Fair Housing 
Choice'' provides context for the manner in which program participants 
will meet their obligations to affirmatively further fair housing until 
such time as they are required to submit an Equity Plan to HUD.
    The definition of ``balanced approach'' is added to articulate 
HUD's acknowledgement that different strategies for remedying fair 
housing issues can be employed based on the facts and circumstances 
specific to a program participant's community. Where a community has 
been starved of investment, some may want to leave for other 
communities, while others will want to bring those resources to bear to 
improve the circumstances of where they live. Accordingly, HUD has 
added this definition to ensure that program participants can adopt 
different types of strategies that will meaningfully increase fair 
housing choice in their communities, including by choosing from an 
array of place-based strategies (e.g., the preservation of existing 
affordable housing or increased investments in community assets) and 
mobility strategies (e.g., improved housing counseling, assessing how 
school assignments are made, or building affordable housing in well-
resourced areas). A combination of actions will likely be necessary in 
most communities, which would include both place-based and mobility 
strategies. The proposed rule requires

[[Page 8533]]

that a program participant's goals, taken together, meet the definition 
of a balanced approach. HUD provides that place-based and mobility 
strategies must be designed to achieve positive fair housing outcomes 
(including accessibility for individuals with disabilities) and that a 
program participant that has the ability to create greater fair housing 
choice outside segregated, low-income areas should not rely solely on 
place-based strategies. HUD believes that the vast majority of, if not 
all, program participants will be able to set goals that rely on both 
place-based and mobility-based strategies. HUD seeks specific comment 
on whether this is a reasonable requirement for every program 
participant and, if not, the specific circumstances under which it 
would not be.
    The definition of ``community assets'' is added to describe the 
sorts of high-quality assets that are characteristic of communities 
that have not suffered from disinvestment and that affect the quality 
of housing opportunities. It is meant to be a non-exhaustive but 
illustrative list of assets. Consideration of the location of and 
access to community assets, by protected class, is an integral part of 
the analysis of the Equity Plan, which HUD anticipates will allow 
program participants to be better positioned to understand the specific 
fair housing issues within their local communities. HUD does not intend 
to require analysis of community assets to be particularly burdensome 
and will provide data and technical assistance to support this 
analysis.
    The definition of ``community engagement'' is included to provide 
program participants with a baseline understanding of what the 
obligation, more specifically delineated at Sec.  5.158, entails.
    The definition of ``disability'' in this proposed rule, as in the 
2015 AFFH Rule, is intended to be consistent with other Federal civil 
rights laws with which program participants must comply, such as 
section 504 of the Rehabilitation Act of 1973 and the Americans with 
Disabilities Act of 1990 (ADA), as amended by the ADA Amendments Act of 
2008. HUD incorporates by reference the definition of disability under 
section 504 and the ADA, consistent with the Attorney General's 
interpretations of that definition, see 28 CFR 35.108, for purposes of 
the affirmatively furthering fair housing obligation under section 
808(e)(5) so as to provide consistency and clarity to HUD program 
participants, which are all already bound by the same definition under 
those statutes.
    The definition of ``equity or equitable,'' which is consistent with 
Executive Order 13985, is intended to provide program participants with 
a framework for how to assess their communities in a manner that is 
fair, just, and impartial.
    The definition of ``Equity Plan'' provides a less burdensome and 
more straightforward approach to fair housing planning and replaces the 
Assessment of Fair Housing that was required by the 2015 AFFH Rule. The 
Equity Plan consists of the content included in Sec.  5.154, is 
submitted to HUD for review, and includes an annual progress 
evaluation. Program participants may submit an individual Equity Plan 
or may partner with other program participants to submit a joint Equity 
Plan, as provided for in Sec.  5.160.
    The definition of ``fair housing goals'' sets forth how program 
participants will overcome the fair housing issues identified in their 
Equity Plans. ``Fair housing goals'' are designed to go beyond the 
status quo in the program participant's community and result in 
tangible, positive, and measurable fair housing outcomes. Each fair 
housing goal will include a description of the fair housing issue it is 
designed to overcome.
    The definition of ``fair housing goal categories'' details the 
seven categories for which program participants must establish fair 
housing goals to overcome fair housing issues. The purpose of this 
definition, and related provisions, is to help focus program 
participants' prioritization of which identified fair housing issues 
they will set goals to remedy. HUD understands that, in many cases, it 
will be beyond the capacity of program participants to set goals to 
remedy every identified issue in a single 5-year cycle. The fair 
housing goal categories are intended to provide program participants 
with a reasonable number of specific areas in which to focus their 
goals. Program participants may address multiple fair housing issues 
through a single goal, and doing so need not be difficult. Accordingly, 
the proposed rule does not require a goal to be set for every 
identified fair housing issue, but does require that a goal be set that 
addresses issues in each of the seven fair housing goal categories, 
which are outlined in Sec.  5.154(f). HUD believes these to be at the 
core of the AFFH obligation.
    The definition of ``fair housing issues'' is modified from the 
definition in the 2015 AFFH Rule and provides the substantive areas of 
analysis that program participants will assess in their Equity Plans 
before setting fair housing goals. ``Fair housing issues'' now also 
include such conditions as ongoing local or regional segregation or 
lack of integration, racially or ethnically concentrated areas of 
poverty, significant disparities in access to opportunity, inequitable 
access to affordable housing opportunities and homeownership 
opportunities, laws or ordinances that impede the provision of 
affordable housing in well-resourced areas, evidence of discrimination 
or violations of civil rights law or regulations related to housing, 
and inequitable distribution of local resources, which may include 
municipal services, emergency services, community-based supportive 
services, and investments in infrastructure.
    The definition of ``fair housing strategies and actions'' helps 
clarify how program participants will implement the fair housing goals 
established in their Equity Plans, including with respect to the 
allocation of funding that may be necessary for purposes of achieving 
the fair housing goals.
    The definitions of ``funding decisions'' and ``siting decisions'' 
refer to a set of decisions that program participants make about the 
allocation of HUD funds and other investments in their communities, 
decisions that have contributed to inequity and segregation in the past 
and that this proposed rule seeks to reorient in order to advance 
equity and undo patterns of segregation going forward.
    The definition of ``geographic area'' delineates the specific 
levels of geographic areas of analysis that certain types of program 
participants must undertake when conducting the analysis required in 
the Equity Plan by Sec.  5.154. These largely restate the geographic 
areas of analysis that were established by the 2015 AFFH Rule and the 
various Assessment Tools that implemented it. HUD flags that while the 
expected geographic area of analysis for State and insular areas 
includes the whole State or insular area, including entitlement and 
non-entitlement areas, this does not change existing requirements that 
restrict States to using CDBG and other Community Planning and 
Development funds only in non-entitlement areas.
    The definitions of ``integration,'' ``segregation,'' ``racially or 
ethnically concentrated areas of poverty,'' and ``significant 
disparities in access to opportunity,'' are included because they are 
necessary components of the required analysis in order to set and 
implement meaningful fair housing goals. When appropriate, they 
identify cross-references to other legal standards that are also 
relevant to how these terms apply to specific classes protected under

[[Page 8534]]

the Fair Housing Act (e.g., integration and individuals with 
disabilities).\27\
---------------------------------------------------------------------------

    \27\ In 1999, the United States Supreme Court issued the 
landmark decision in Olmstead v. L.C., 527 U.S. 581 (1999), 
affirming that the unjustified segregation of individuals with 
disabilities is a form of discrimination prohibited by title II of 
the ADA. Following the Olmstead decision, there have been increased 
efforts across the country to assist individuals who are 
institutionalized or housed in other segregated settings to move to 
integrated, community-based settings. As a result of the Olmstead 
decision and the integration mandate of section 504 of the 
Rehabilitation Act included in HUD's section 504 regulation at 24 
CFR part 8, HUD has consistently recognized the great need for 
affordable, integrated housing opportunities where individuals with 
disabilities are able to live and interact with individuals without 
disabilities, while receiving the health care and long-term services 
and supports they need.
---------------------------------------------------------------------------

    The definition of ``homeownership opportunities'' is included in 
this proposed rule so that program participants, in conducting their 
analyses, consider whether members of protected class groups have 
equitable access to homeownership in their jurisdictions, and if not, 
to determine what barriers exist to attaining homeownership so that 
fair housing goals can be established.
    The definition of ``publication'' encompasses the posting of the 
Equity Plan materials for review on a HUD-maintained web page, which 
will facilitate transparency of the local decisions made and the HUD 
review process. The public will be able to track the status of HUD's 
review and provide feedback to HUD directly, and communities will be 
able to learn and benefit from the innovative ideas of others.
    The definition of ``publicly supported housing'' sets forth the 
types of assisted affordable housing that program participants will 
analyze. HUD is providing data regarding the location and demographics 
of certain types of such housing, and program participants will also 
rely on local data and local knowledge for other types of assisted 
housing operated in the jurisdiction.
    The definitions of ``Responsible Civil Rights Official'' and 
``Reviewing Civil Rights Official'' clarify the Departmental official 
with the authority to make determinations regarding a program 
participant's Equity Plan and its compliance with its obligation to 
affirmatively further fair housing under the Fair Housing Act.
    The definition of ``underserved communities,'' which is consistent 
with Executive Order 13985, includes groups or classes of individuals, 
as well as geographic communities that disproportionately include 
members of particular protected class groups, who have historically had 
inequitable access to housing and other community assets.
    The definition of ``well-resourced areas'' is included to emphasize 
that program participants must assess which areas and whether the 
residents who reside in such areas have high-quality and well-
maintained community assets (in view of local economic circumstances), 
as defined in Sec.  5.152, which afford residents genuine access to 
opportunity (e.g., infrastructure, high performing schools, economic 
opportunity, etc.) as a result of public and private investments.

Equity Plan (Sec.  5.154)

    New Sec.  5.154 sets forth the substantive requirement for program 
participants to evaluate their communities in order to more effectively 
affirmatively further fair housing and advance equity. This section 
sets forth the seven areas of analysis, which will also serve as fair 
housing goal categories for which program participants must establish 
fair housing goals. HUD seeks comment on whether it is appropriate to 
require every program participant to establish goals in each of the 
seven categories.
    The process described in this section consists of fewer questions 
than previously required by the 2015 AFFH Rule to which program 
participants must respond. The specific required questions are codified 
in this section, but program participants have the flexibility to 
conduct their Equity Plan in a manner and format that best suits their 
local needs, so long as the required content is submitted to HUD. HUD 
will provide program participants with data that include maps, tables, 
and may include technical assistance that aids program participants in 
conducting their analysis. HUD will also continue to provide the 
existing mapping tools, first provided under the 2015 AFFH Rule, and is 
exploring ways to improve those offerings and provide additional 
relevant data. In addition, for purposes of the analysis related to 
access to affordable housing opportunities, HUD will continue to 
provide data to assist program participants in assessing disparities 
among protected class groups based on factors of cost burden, severe 
cost burden, overcrowding (particularly for large families), and 
substandard housing conditions. HUD believes this approach will better 
facilitate the discussions in communities around how to develop and 
implement meaningful fair housing goals. While HUD's approach under the 
2015 AFFH Rule often yielded meaningful fair housing goals, HUD now 
understands that requiring all program participants to perform 
extensive data analysis themselves and show their work in a written 
submission (i.e., requiring program participants to recite back to HUD 
what the HUD-provided data showed) may have impeded some program 
participants' ability to focus on outcomes. HUD is now proposing to 
simplify the required analysis and assist program participants in 
understanding how to use the relevant data to identify fair housing 
issues. This will allow program participants to place a greater 
emphasis on developing fair housing goals, making investment and 
funding decisions in furtherance of those fair housing goals, and 
listening to members of the community who have historically lacked 
equitable participation in such decisions. When establishing fair 
housing goals, program participants may adopt a small number of goals 
if such goals could ultimately result in outcomes that have a 
significant impact toward advancing equity for protected class groups 
by reducing the adverse effects of fair housing issues. HUD recognizes 
that fair housing goals may be short-term, in that they can be achieved 
relatively quickly, or long-term, in that they may take more than one 
funding cycle, and that program participants may set both short- and 
long-term goals in order to ensure that they ultimately affirmatively 
further fair housing.
    Paragraphs (a) and (b) of Sec.  5.154 provide the general 
requirement to conduct and submit an Equity Plan, including the 
obligation to engage the community in the development of the Equity 
Plan. Paragraph (b) makes clear that certain portions of the analysis 
may rely on local data, local knowledge, and information obtained 
through community engagement, particularly if HUD is unable to provide 
data for a specific topic required to be included as part of the 
analysis. Paragraph (c) provides the general content that must be 
included in a program participant's Equity Plan and the requirement to 
incorporate the Equity Plan into subsequent planning documents such as 
the consolidated plan, annual action plan, and PHA Plan (or any plan 
incorporated therein) so that program participants can appropriately 
allocate necessary funding for the implementation of fair housing 
goals. Paragraph (d) provides the specific content the Equity Plan must 
contain for local governments, States, and insular areas, including the 
questions to which these program participants must respond. The 
questions consist of: (1) demographics; (2) segregation and 
integration; (3) R/ECAPs; (4) access to community assets; (5) access to 
affordable housing opportunities; (6) access to homeownership and 
economic

[[Page 8535]]

opportunity; and (7) local policies and practices impacting fair 
housing. Paragraph (e) provides the specific content the Equity Plan 
must contain for PHAs, including the questions to which PHAs must 
respond. The questions consist of: (1) demographics; (2) segregation 
and integration; (3) R/ECAPs; (4) access to community assets and 
affordable housing opportunities; and (5) local policies and practices 
impacting fair housing. As noted above, HUD welcomes comment on whether 
these questions should be modified for the purposes of small PHAs or if 
HUD should consider increased flexibilities PHAs can use to comply with 
the Equity Plan requirement or alternative approaches HUD can use to 
ensure that small PHAs comply with their obligations to affirmatively 
further fair housing.
    To assist program participants in conducting their Equity Plans' 
analysis, HUD intends to continue providing data that program 
participants can rely on to answer most of the questions that guide the 
proposed rule's required analysis. Many program participants and 
others, including researchers, found the raw data HUD provided under 
the 2015 AFFH Rule to be invaluable. HUD is committed to continuing to 
provide such data, to improving its current data and mapping tools 
(e.g., the AFFH-T Data & Mapping Tool), and to building additional 
tools and data products to further facilitate the fair housing 
analysis. For example, HUD is contemplating developing a flexible data 
tool for comparing the locations and demographics of publicly supported 
housing with patterns of segregation and R/ECAPs. A version of this 
tool is currently available in the AFFH-T Data & Mapping Tool, in the 
``Query Tool'' option, and HUD would welcome feedback on potential 
improvements to this functionality. Additionally, as previously 
described, HUD is contemplating various ways to present this data to 
program participants outside the AFFH-T interface and to provide 
technical assistance, which may include explanations that assist 
program participants in understanding how to use the data to identify 
fair housing issues.
    In addition, HUD intends to issue guidance and technical assistance 
on how to conduct an Equity Plan analysis and set appropriate goals. 
HUD intends to tailor this guidance to the various types of program 
participants, including State agencies and smaller and rural PHAs and 
consolidated planning agencies. HUD recognizes the wide range of 
different types of housing and community and economic development 
agencies that administer these vital programs at the State and local 
level, and that many of them have unique geographies and jurisdictional 
boundaries as well as unique data-related needs.
    Program participants will already be familiar with several of the 
key Equity Plan questions. For example, HUD notes that almost all 
program participants will already be familiar with the analysis of 
disparities in access to community assets and affordable housing 
opportunities, including for protected class groups. To the extent the 
proposed rule's analysis of ``affordable housing opportunities'' 
overlaps with analysis already conducted for the consolidated plan, and 
often adopted also by PHAs, there is little additional burden on 
program participants in conducting this part of the analysis in the new 
Equity Plan. Similarly, new analysis conducted for the Equity Plan can 
also inform similar parts of the consolidated plan and PHA Plans. HUD 
recognizes that some program participants may not have direct expertise 
to be able to fully answer some questions in the Equity Plan analysis 
section, for example those asking about access to schools, 
transportation, or employment opportunities. HUD expects that in 
addition to HUD-provided data, program participants' use of local data 
and local knowledge, including that gathered though the community 
engagement process, will assist program participants with conducting 
these analyses.
    Many of the questions are intended to be an opportunity to solicit 
informed feedback from the community, including local organizations 
that already work in these spaces, to assist the program participant in 
assessing disparities in access to community assets by protected class 
groups. HUD expects the community engagement process may be 
particularly helpful in consideration of certain aspects of the 
analysis. HUD does not anticipate that questions relying primarily on 
input from local data and local knowledge, which may be obtained 
through the community engagement process, should pose any major 
additional burden. As provided for in the proposed rule's definition of 
``local data'' in Sec.  5.152, the proposed rule requires consideration 
only of such data that ``can be found through a reasonable amount of 
search [and] are readily available at little or no cost.'' To provide 
one example, questions asking about ``underserved communities'' may not 
require a granular, data-driven analysis in order to identify fair 
housing issues. Rather, program participants are encouraged to actively 
engage with these communities in order to obtain the information 
necessary to conduct the analysis and to identify fair housing issues. 
This includes opening dialogues and engaging with individuals 
experiencing homelessness, survivors of domestic violence, people with 
criminal records, persons identifying as Lesbian, Gay, Bisexual, 
Transgender, Queer + (LGBTQ+), individuals with disabilities, and 
others who often have no established forum to inform local policymakers 
of their issues and needs.
    Some of the proposed rule's questions, in asking about changes in 
demographics or economic trends, ask about a concept known to many 
stakeholders as ``gentrification.'' The term is used here because of 
its common colloquial use to facilitate the program participant's and 
community's ease of understanding the concepts at issue in order to 
have required discussion about community trends. HUD notes the robust 
debate around the term ``gentrification'' and its impact on communities 
in both social science research and among communities themselves, and 
program participants can also consider such discussions in their 
review. This proposed rule does not establish a HUD definition of 
``gentrification,'' nor will program participants be required to 
precisely define the term.
    For questions that ask about ``livable wage jobs,'' while HUD 
provides several data points that relate to employment, labor 
participation, and proximity to jobs, it acknowledges that the data may 
not capture the full picture. Program participants may have local data 
and local knowledge that addresses this, including information obtained 
from local organizations that participate in the community engagement 
process.
    As noted above, HUD does not intend for program participants to 
document the performance of an extensive data-driven analysis for most 
questions, and instead intends for program participants to focus on 
effective goal setting to address identified issues. The analysis in 
the proposed rule is intended to facilitate a balanced approach by 
permitting the identification of fair housing issues susceptible to 
being remedied through a variety of policies. For example, if 
disparities by protected class group are identified in the questions 
regarding homeownership opportunities, responsive goals could include 
specific policies to assist first-time homebuyers and expand 
availability of affordable homeownership opportunities, such as new 
construction of affordable single-family homes, downpayment assistance

[[Page 8536]]

using the HOME Investment Partnerships (HOME) program, or zoning code 
reform. Similarly, an identified issue regarding lack of affordable 
housing opportunities in certain areas could be remedied through goals 
such as expanding rental availability through new placements of HOME, 
Housing Trust Fund (HTF), and Low-Income Housing Tax Credits (LIHTC) 
units, geographically targeted project-based vouchers, improved Housing 
Choice Voucher mobility, or addressing unnecessary regulatory barriers 
to affordable housing production, strengthening tenant protections, and 
preservation efforts.
    Paragraph (f) describes how program participants must identify and 
prioritize the fair housing issues for each fair housing goal category. 
In determining how to prioritize fair housing issues within each fair 
housing goal category, program participants shall give highest priority 
to fair housing issues that will result in the most effective fair 
housing goals for achieving material positive change for underserved 
communities, taking into account that different protected class groups 
may be impacted by different fair housing issues. Paragraph (g) sets 
the requirements for fair housing goals and for including fair housing 
goals in the Equity Plan. This paragraph is intended to provide program 
participants with greater clarity on what HUD will look for when an 
Equity Plan is submitted for review, including whether the fair housing 
goals, when taken together, are designed to overcome the effects of 
each prioritized fair housing issue.
    Broadly, the proposed rule requires program participants to set and 
implement fair housing goals that are designed and can be reasonably 
expected to result in a material positive change relating to the fair 
housing issues that they are intended to address. HUD expects that, in 
subsequent progress reports and planning cycles, program participants 
will be able to point to the changes that have resulted from 
implementation of the goals established in their Equity Plan. For 
example, if a program participant has identified as an issue 
segregation in certain areas of its jurisdiction and has set fair 
housing goals to reduce that segregation, it should be able to point to 
ways in which implementation of the fair housing goals have resulted in 
or are in the process of resulting in a decrease in such segregation. 
This does not mean that program participants must be able to report 
changes that are occurring with statistically significant data.
    HUD recognizes that fully remedying a fair housing issue will often 
take substantial time and occur in incremental steps, spanning multiple 
funding and Equity Plan cycles. Thus, HUD expects the fair housing 
goals will result in material positive change even if that change will 
be incremental, and it will take multiple funding cycles to fully 
remedy the fair housing issue. For example, a program participant might 
set a goal in its Equity Plan to supply 100 units of affordable housing 
in a well-resourced area. Completing this fair housing goal might not 
completely remedy the underlying fair housing issues (e.g., 
segregation) due to the size of the total population and existing 
segregated residential patterns in the jurisdiction and region. In such 
circumstances, if HUD accepts the program participant's Equity Plan and 
the program participant accomplishes its fair housing goal of building 
the 100 units, the program participant will have complied with its 
Equity Plan obligation, but it will still be required to set additional 
fair housing goals in future Equity Plan submissions to continue 
tackling the fair housing issue of segregation.
    HUD also understands that, with respect to many fair housing 
issues, forces other than the program participant's actions may 
influence the course of change. A program participant's fair housing 
goal can be successful on its own terms even as it fails to accomplish 
material positive change in terms of the underlying issue it was 
designed to address. For example, a program participant might identify 
the lack of affordable housing in well-resourced areas as an issue and 
set a fair housing goal to eliminate barriers to the siting of 
affordable housing in well-resourced areas. It might achieve that goal 
by eliminating the identified barriers, and yet affordable housing is 
not built in the areas in question for other reasons. In such 
circumstances, the program participant will have satisfied its 
obligation with respect to that fair housing goal and will not be 
deemed to be out of compliance with its Equity Plan obligations. The 
program participant will be expected to continue to set goals in 
subsequent planning cycles to address the still existing fair housing 
issue in ways that will accomplish the required material positive 
change.
    Paragraph (h) consists of additional content that is required for 
the Equity Plan, including the community engagement process and the 
submission of certifications and assurances. Paragraph (i) provides for 
program participants and their communities to engage in an evaluation 
of progress toward advancing equity following the acceptance of the 
Equity Plan. For each Equity Plan submitted following the first Equity 
Plan, program participants are permitted to provide their annual 
progress evaluations in the aggregate as part of the overarching 
progress evaluation required for each new Equity Plan. Paragraph (j) 
provides for the publication requirement of the Equity Plan, which HUD 
will facilitate, in order to increase transparency and allow for 
program participants and the public to view all Equity Plan submissions 
and view the Department's decisions regarding such plans. This will 
allow communities to discover and consider the innovative ideas and 
strategies other communities may be employing to advance equity in 
meaningful ways. This paragraph also provides for a mechanism for the 
public to submit information to HUD regarding the content of a 
published Equity Plan.

Affirmatively Furthering Fair Housing Through Equity Plan Incorporation 
Into Subsequent Planning Documents (Sec.  5.156)

    New Sec.  5.156 more closely and directly ties the fair housing 
goals established in the Equity Plan to the subsequent planning 
processes program participants are required to undertake to ensure that 
program participants adequately and appropriately undertake and fund 
programs, services, and activities in a manner that advances equity and 
affirmatively furthers fair housing. This will provide a more holistic 
approach to the implementation of the AFFH mandate by requiring program 
participants to embed fairness and equity into their decision-making 
processes.

Community Engagement (Sec.  5.158)

    New Sec.  5.158 sets forth the requirements for community 
engagement as a key component of the development of the Equity Plan. 
This section, along with conforming amendments to applicable program 
regulations, provides program participants the flexibility to conduct 
this process differently from how they conduct citizen participation 
for the consolidated plan or annual action plan or the policies and 
procedures PHAs use for the PHA Plan if they so choose. Program 
participants' engagement with their communities in the development of 
the Equity Plan requires the confrontation of difficult issues, and so 
HUD is providing program participants with flexibility to determine how 
best to facilitate those important conversations. HUD expects the 
community engagement process to focus on the fair housing issues facing 
communities, and

[[Page 8537]]

HUD further anticipates that by providing data, guidance, and technical 
assistance to program participants regarding the fair housing issues 
demonstrated by HUD-provided data, this focus on community engagement 
as a source of critical information can be more easily maintained. The 
community engagement process is intended to be a robust discussion 
across all sectors of the community so that program participants can 
make informed choices about how to overcome existing fair housing 
issues, such as barriers to fair housing choice, and make equitable 
funding decisions. This section also provides the Federal civil rights 
requirements with which program participants must comply when 
conducting in community engagement and permits program participants to 
utilize the processes in their respective program regulations to 
undertake these activities.

Submission Requirements (Sec.  5.160)

    New Sec.  5.160 provides the requirements for the submission of the 
Equity Plan to HUD, including how program participants may collaborate 
to submit a joint Equity Plan to HUD, and provides the timeframes for 
when a program participant's first Equity Plan will be due. The 
timeframes for the first Equity Plan in this section are intended to be 
straightforward and easily discernable so that program participants 
have certainty as to when their obligation to conduct and submit an 
Equity Plan is triggered. This section also provides for how and when 
annual progress evaluations will be submitted as well as subsequent 
Equity Plans. Further, until such time as an Equity Plan is due to HUD, 
program participants must ensure they are engaging in fair housing 
planning in a publicly transparent way and this section sets forth how 
to meet that obligation.
    Paragraph (a) allows program participants to collaborate and 
conduct an Equity Plan (joint Equity Plan) with other program 
participants (joint program participants), which may allow program 
participants to pool resources in order to overcome fair housing issues 
that cross jurisdictional lines. This paragraph sets out the 
requirements for how program participants collaborate and the 
obligations of each collaborating participant, as well as notification 
to HUD of the intent to collaborate on an Equity Plan.
    Paragraph (b) sets out the submission deadlines for consolidated 
plan program participants. These deadlines are tied to the aggregate 
amount of formula funding the program participant receives from HUD and 
then is further keyed to the program year that begins on or after a 
particular date. This paragraph thereby creates a tiered submission 
schedule, in which the first group of consolidated plan program 
participants that have an Equity Plan due will be all among the largest 
such participants. HUD anticipates that this group is better positioned 
to begin implementation, and the experiences of this first cohort will 
allow for program participants of different sizes to benefit from 
technical assistance from HUD during the course of implementation of 
this proposed rule. Likewise, paragraph (c) sets out the submission 
deadlines for PHAs based on the aggregate number of units and vouchers 
the PHA administers, which are then keyed to the program year that 
begins on or after a particular date. The first cohort of PHAs with an 
Equity Plan due will also be among the largest PHAs, and their 
experience will allow PHAs of different sizes to benefit from technical 
assistance from HUD in advance of an Equity Plan submission.
    Paragraph (d) requires, until such time as a program participant 
must submit an Equity Plan to HUD, that the program participant engage 
in fair housing planning and sets forth how to meet this obligation, 
including what must be submitted to HUD and when such submissions are 
required.
    Paragraph (e) provides for the procedures that HUD will utilize in 
order to determine when an Equity Plan is due for new program 
participants. Paragraph (f) sets out the requirements for submitting 
annual progress evaluations as part of the Equity Plan. Paragraph (g) 
specifies the deadlines for subsequent Equity Plan submissions. 
Paragraph (h) provides that program participants must submit an Equity 
Plan to HUD no less frequently than every five years.
    Paragraph (i) requires program participants to include 
certifications and assurances as part of the Equity Plan submission to 
HUD. These certifications and assurances are distinct from those 
submitted in connection with an application for Federal financial 
assistance.

Review of Equity Plan (Sec.  5.162)

    New Sec.  5.162 provides the procedures and standard HUD will use 
to review submitted Equity Plans. This provision sets forth the timing 
for HUD's review and what may occur as a result of HUD's review--HUD 
may accept the Equity Plan, extend the time for review for good cause, 
or provide notice to the program participant that HUD does not accept 
the Equity Plan and the reasons why. Specifically, HUD will have 100 
calendar days from the date the Equity Plan is submitted to review the 
plan. HUD's acceptance of an Equity Plan is not a determination of 
whether the program participant has met its obligation to affirmatively 
further fair housing under the Fair Housing Act and means only that the 
program participant's submission appears to meet the requirements of 
this proposed regulation.
    Paragraph (a) sets out the process for review and what HUD's 
acceptance of an Equity Plan means. Paragraph (b) sets out the standard 
HUD will apply when determining to accept or not to accept an Equity 
Plan--HUD will not accept the Equity Plan if any portion of it is 
inconsistent with fair housing or civil rights requirements, which 
includes but is not limited to any material noncompliance with the 
requirements of Sec. Sec.  5.150 through 5.180. This paragraph provides 
examples of reasons why HUD will not accept an Equity Plan. In the 
event an Equity Plan is not accepted, paragraph (c) sets out the 
procedures for program participants to revise and resubmit their Equity 
Plan to HUD. Paragraph (d) provides ways HUD, at its discretion, can 
incentivize and support program participants that establish ambitious 
fair housing goals in their Equity Plans including for example 
assisting program participants in securing additional resources for 
implementing their fair housing goals and achieving positive fair 
housing outcomes in their communities.
    Paragraph (e) explains the procedures for when a program 
participant does not have an accepted Equity Plan at the time their 
consolidated plan or PHA Plan, as applicable, must be submitted to HUD. 
As explained above, the proposed rule provides that a consolidated plan 
or PHA Plan (or any plan incorporated therein) may be accepted under 
such circumstances, but only if a program participant provides special 
assurances that it will submit an Equity Plan that meets the regulatory 
requirements within 180 days of the end of HUD's review period for the 
consolidated plan or PHA Plan. HUD notes that failure to provide such 
special assurances will lead to the disapproval of the applicable 
programmatic plan. If the Secretary determines that there has been a 
failure to fulfill the terms set out in the special assurances, the 
Secretary will initiate the termination of funding, refuse to grant or 
to continue to grant Federal financial assistance, or seek other 
appropriate remedies. In addition, paragraph (e) explains that a 
program participant's failure to provide or comply with special 
assurances can provide the Secretary a basis to

[[Page 8538]]

challenge the validity of the program participant's AFFH certification 
pursuant to Sec.  5.166. Finally, paragraph (e) specifies that the 
procedures HUD will follow if there is a failure to comply are at Sec.  
5.172 and that the special assurances are subject to the publication 
requirement and will be made available on HUD's AFFH web page.

Revising an Accepted Equity Plan (Sec.  5.164)

    New Sec.  5.164 sets out the minimum criteria for when an Equity 
Plan must be revised--that is, when a material change occurs, upon 
written notification from the Responsible Civil Rights Official 
(Assistant Secretary for Fair Housing and Equal Opportunity or his or 
her designee) specifying a material change that requires the Equity 
Plan to be revised, or a program participant chooses to revise its 
Equity Plan. Paragraph (a)(1)(i) provides examples of what a material 
change would include, such as Presidentially declared disasters under 
title IV of the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act. A material change may occur because the program 
participant's jurisdiction receives additional Federal financial 
assistance, new fair housing issues emerge in the program participant's 
jurisdiction, significant demographic changes occur in the program 
participant's jurisdiction, or civil rights findings, determinations, 
settlements (including Voluntary Compliance Agreements), or court 
orders occur. Paragraph (a)(1)(ii) specifies that the Responsible Civil 
Rights Official may notify program participants in writing that a 
material change has occurred that requires revision. Paragraph (a)(2) 
sets out the circumstances under which a program participant may choose 
to voluntarily revise its previously accepted Equity Plan, with 
permission from HUD. HUD intends that this provision be used by program 
participants who face changed circumstances that make it difficult or 
impossible to meet established fair housing goals or otherwise require 
revisions to their Equity Plans. HUD does not intend this provision to 
be used by program participants that simply fail to accomplish the fair 
housing goals they established. Paragraph (a)(3) sets out the 
requirements for a revised Equity Plan. Paragraph (b) establishes the 
timeframes that will apply when revising an Equity Plan, paragraph (c) 
requires the revised Equity Plan to be submitted to HUD for review, and 
paragraph (d) requires that, once a revised Equity Plan has been 
accepted by HUD, the program participant incorporate any revised fair 
housing goals into their consolidated plan, annual action plan, PHA 
Plan or any plan incorporated therein within 12 months of the date of 
HUD's acceptance of the revised Equity Plan.

AFFH Certifications Required for the Receipt of Federal Financial 
Assistance (Sec.  5.166)

    New Sec.  5.166 requires program participants to provide 
certifications as part of the submission of their required consolidated 
plan, annual action plan, or PHA Plan, or any plan incorporated 
therein, pursuant to 24 CFR parts 91 and 903, as applicable, that they 
will affirmatively further fair housing in order to receive Federal 
financial assistance from HUD.
    Paragraph (a) of this section requires a certification that program 
participants will affirmatively further fair housing and take no action 
that is materially inconsistent with fair housing and civil rights 
requirements throughout the period for which Federal financial 
assistance is extended. These certifications are made in accordance 
with applicable program regulations, specifically 24 CFR part 91 for 
consolidated plan program participants and 24 CFR part 903 for PHAs.
    Paragraph (b) sets out the policies and procedures for when and how 
the Department will challenge the validity of an AFFH certification. 
HUD will endeavor to voluntarily resolve any potential inaccuracy or 
noncompliance with an AFFH certification that could result in the 
disapproval of a consolidated plan, annual action plan, or PHA Plan, 
and it expects recipients of Federal financial assistance to work 
cooperatively with the Department to reach voluntary resolution when 
there is a potential failure to comply with an AFFH certification or 
the obligation to affirmatively further fair housing. In the event this 
does not occur, this paragraph sets out the procedures HUD will use. 
This paragraph also sets forth how the process will work if there is 
evidence the program participant's certification is inaccurate. For 
example, if the noncompliance cannot be voluntarily resolved, HUD may 
set conditions on a grant for a consolidated planning program 
participant (see e.g., 2 CFR 200.208) or reject the AFFH certification. 
This paragraph also specifies how certifications may be challenged in 
the context of joint Equity Plans with respect to one program 
participant, but not necessarily all joint program participants.

Recordkeeping (Sec.  5.168)

    New Sec.  5.168 requires program participants to maintain 
sufficient records that would enable the Responsible Civil Rights 
Official to determine whether the program participant has complied with 
or is complying with their AFFH obligations. This provision permits 
access to records by the Responsible Civil Rights Official to make such 
a determination and sets out examples of the types of records program 
participants should maintain in order to demonstrate their compliance 
with this proposed rule. By providing examples of the types of records 
HUD would expect program participants to maintain, HUD is providing 
notice to program participants about how to best demonstrate their 
compliance to HUD.

Compliance Procedures (Sec.  5.170)

    New Sec.  5.170 creates a process that allows members of the public 
to submit information to HUD alleging that a program participant has 
failed to comply with this proposed rule or its Equity Plan, or that 
the program participant has taken action that is materially 
inconsistent with its obligation to affirmatively further fair housing, 
as defined in this proposed rule. It then provides that, in response to 
such a complaint or of its own accord, HUD may initiate an 
investigation to determine the program participant's compliance 
following procedures consistent with existing processes used for other 
Federal civil rights statutory and regulatory requirements accompanying 
the receipt of Federal financial assistance, such as title VI of the 
Civil Rights Act of 1964 and section 504 of the Rehabilitation Act of 
1973. See 24 CFR parts 1 (Title VI) and 8 (Section 504).
    As described above, HUD does not intend the complaint process to be 
used to relitigate decisions made by program participants in the 
planning process after opportunity for community input and HUD's 
acceptance of an Equity Plan. HUD specifically seeks comment on how it 
can effectively implement a complaint and compliance review process 
that works in tandem with the proposed planning process including 
specific regulatory text that would be in accord with these principles. 
HUD also seeks comment on whether and the extent to which setting out 
an AFFH complaint and compliance review process is likely to facilitate 
AFFH compliance. HUD recognizes that any investigation creates some 
burden on program participants and seeks comment on ways HUD can 
minimize the burden associated with an investigation while maintaining 
a mechanism for effectively enforcing the Fair Housing Act's AFFH 
mandate.

[[Page 8539]]

    Paragraph (a)(1) provides for submission of complaints and 
describes the permissible subject matter of such complaints. A 
complaint must allege the failure to comply with a specified 
requirement of this proposed rule; a failure to meet specific 
commitments a program participant has undertaken in the Equity Plan; or 
that the program participant has acted or is acting in a manner that is 
materially inconsistent with its obligation to affirmatively further 
fair housing, as defined in this regulation. This subject matter 
restriction is intended to make clear that HUD does not view the 
complaint process as a vehicle for general complaints about the 
activities of HUD program participants that lack nexus to the AFFH 
requirement.
    With respect to allegations that a program participant is failing 
to meet its Equity Plan commitments, HUD understands that accomplishing 
the goals set out in Equity Plans will not always happen immediately. 
Accordingly, the complaint process should not be used to attempt to 
micromanage the pace and manner in which they are accomplished, so long 
as program participants are continuing to make efforts to comply. 
Similarly, a program participant's inability to meet an Equity Plan 
commitment because of circumstances beyond its control will not be 
treated as a violation, though the program participant will be expected 
to disclose those circumstances in its annual progress evaluation and 
should seek to modify the relevant portion of its Equity Plan. With 
respect to claims that a program participant is acting in a manner that 
is materially inconsistent with its AFFH obligation, that standard is 
intended to mirror the certification that program participants make 
regularly that they will take no action materially inconsistent with 
that obligation. It is not intended to create any new substantive 
requirement for program participants, but rather to provide a 
manageable and predictable process to investigate and enforce 
compliance with the existing AFFH obligation in a manner that does not 
necessarily require HUD to challenge the validity of the certifications 
submitted in connection with the receipt of Federal financial 
assistance. There is no requirement that each individual action program 
participants take be in furtherance of the AFFH obligation, but rather 
program participants' actions must collectively affirmatively further 
fair housing and they may not take actions that are materially 
inconsistent with their obligation to affirmatively further fair 
housing. Therefore, it generally would be insufficient for a 
complainant to allege that a routine decision made or routine action 
taken by a program participant does not affirmatively further fair 
housing. HUD seeks comment on whether it should further clarify the 
scope of permissible complaints, including by reference to specific 
examples of subject matter that would or would not be the appropriate 
basis of a complaint.
    Paragraph (a)(2) further describes the procedures HUD will utilize 
when a complaint regarding a program participant's obligation to 
affirmatively further fair housing is received. Paragraph (a)(3) 
provides that complaints shall be filed within 365 days of the date of 
the last incident of the alleged violation, unless the Responsible 
Civil Rights Official extends the time limit for good cause, such as 
where the complaint concerns an alleged violation that took place more 
than a year previously but was not disclosed to the public until more 
recently.
    Paragraph (b) sets forth the procedures HUD will utilize when it 
initiates an investigation of either a complaint filed with the 
Department or a review initiated by the Department, in order to 
ascertain whether there has been a failure to comply with the program 
participant's obligation to affirmatively further fair housing. 
Paragraphs (b)(1) and (2) provide that the Responsible Civil Rights 
Official will provide notice to the program participant of the 
investigation, and may conduct interviews, request records, and obtain 
other information required to determine whether there has been a 
failure to comply. Paragraph (b)(3) provides that the Responsible Civil 
Rights Official shall attempt informal resolution where appropriate. In 
doing so, HUD will be mindful that program participants may have 
multiple ways available to them to remedy an alleged violation. While 
HUD believes it is helpful to provide a program participant with 
suggested remedies to facilitate discussions of appropriate 
resolutions, it does not intend to be prescriptive about the remedy a 
program participant ultimately agrees to so long as it is adequate to 
address the alleged violation. Paragraph (b)(3) also sets out the 
process that will occur if an informal resolution with the program 
participant cannot be achieved and a violation is found--the 
Responsible Civil Rights Official will issue a Letter of Findings. 
Paragraphs (b)(4) through (6) set out the required contents of a Letter 
of Findings, including findings of facts and conclusions of law, a 
description of a remedy for each violation found, and notice of the 
rights and procedures under Sec. Sec.  5.172 and 5.174, which include 
the right of the program participant or complainant (if any) to request 
review of the Letter of Findings within 30 calendar days from the date 
of issuance and the procedures for such a review.
    Paragraph (c) provides that the mechanism for informal resolution 
of matters is through either the execution of a Voluntary Compliance 
Agreement between the program participant and HUD, which may occur at 
any stage of processing of the matter, or, in appropriate 
circumstances, the Responsible Civil Rights Official may seek, in lieu 
of a Voluntary Compliance Agreement, assurances or special assurances 
of compliance.
    Paragraph (d) makes it a violation of this proposed rule for a 
program participant or other person to intimidate, threaten, coerce, or 
discriminate against any person for the purpose of interfering with any 
right or privilege secured by this proposed rule or the Fair Housing 
Act because of testimony, assistance, or participation in any manner in 
the filing of a complaint, an investigation, proceeding, or hearing 
under Sec. Sec.  5.150 through 5.180. HUD takes seriously allegations 
of retaliation and will investigate such claims.
    The provisions above are largely modeled on existing HUD 
regulations with respect to complaints regarding and enforcement of 
civil rights requirements that attach to the receipt of Federal 
financial assistance, such as Title VI and Section 504. HUD has used 
those regulations as a model because they are familiar to HUD and to 
program participants. HUD seeks comment on whether any modifications to 
these procedures are appropriate for purposes of considering alleged 
violations of the AFFH obligation.

Procedures for Effecting Compliance (Sec.  5.172)

    New Sec.  5.172 sets forth the procedures HUD will follow when 
informal or voluntary resolution through a Voluntary Compliance 
Agreement cannot be achieved. Paragraph (a) provides the non-exhaustive 
list of ways in which the Responsible Civil Rights Official may effect 
compliance, which include: a referral to the Department of Justice with 
a recommendation that appropriate proceedings be brought to enforce the 
rights of the United States under any law of the United States, or any 
assurance or contractual undertaking (which includes the assurances and 
certifications made in connection with grant agreements and

[[Page 8540]]

the requirements of this proposed rule); the initiation of an 
administrative proceeding by filing a Complaint and Notice of Proposed 
Adverse Action pursuant to 24 CFR 180.415, which may seek the 
suspension or termination of or refusal to grant or to continue to 
grant Federal financial assistance along with any other appropriate 
relief to remedy the noncompliance with this proposed rule; the 
initiation of debarment proceedings pursuant to 2 CFR part 2424; and 
any applicable proceeding under State or local law. This paragraph 
incorporates the familiar and longstanding mechanisms that HUD uses to 
effect compliance with fair housing and civil rights requirements by 
recipients of Federal financial assistance.
    Paragraph (b) provides for the remedies that will be available to 
the Department if a program participant fails or refuses to furnish an 
assurance required under Sec.  5.160(i), Sec.  5.162(e), or Sec.  
5.170(c), or if the program participant otherwise fails to comply with 
the requirements of this proposed rule. Specifically, in these 
circumstances, the Department may seek to terminate, refuse to grant, 
or not continue Federal financial assistance. Paragraph (c) further 
details the predicate steps that must occur prior to an order 
suspending, terminating, or refusing to grant or continue Federal 
financial assistance becomes effective. These procedures are intended 
to ensure that program participants', as recipients of entitlement 
grants from HUD, due process rights are satisfied prior to any 
termination, suspension, or refusal to grant or to continue to grant 
Federal funds. Like those in paragraph (c), the procedures in paragraph 
(d) are the same procedures that exist under the other Federal civil 
rights statutes requiring compliance by recipients in connection with 
the receipt of Federal funds. As drafted in this proposed rule, these 
procedures are written in a manner to give program participants greater 
clarity as to how this process will be operationalized. Furthermore, 
Paragraph (d) ensures that HUD will provide appropriate and proper 
notice to the State or local government official when the Secretary 
determines that a recipient of Federal financial assistance under title 
I of the Housing and Community Development Act of 1974, as amended (42 
U.S.C. 5301-5318) has failed to comply with this proposed rule. This 
notice is intended to safeguard the due process rights of recipients 
and is consistent with regulatory and statutory requirements of the 
Community Development Block Grant program.

Hearings (Sec.  5.174)

    New Sec.  5.174 describes the procedures for administrative 
hearings that HUD will follow should it need to effect compliance by 
filing a Complaint and Proposed Notice of Adverse Action pursuant to 24 
CFR 180.415 before HUD's administrative law judges. These procedures 
are consistent with the hearing procedures contained in other 
regulatory schemes implementing the Federal civil rights laws, such as 
title VI of the Civil Rights Act of 1964 and section 504 of the 
Rehabilitation Act of 1973. They should be familiar to both HUD and 
program participants and are generally governed by HUD's regulation on 
Consolidated HUD Hearing Procedures for Civil Rights Matters at 24 CFR 
part 180. However, this provision is included to ensure that program 
participants understand the procedures that would be applicable.

Conforming Amendments Consolidated Plan Regulations (24 CFR Part 91)

    Because the AFFH regulation in 24 CFR part 5 builds on existing 
consolidated plan regulations with respect to the community engagement 
process, the obligation to incorporate fair housing goals from the 
Equity Plan into subsequent planning documents, the submission of 
certifications, and procedures for effecting compliance with this 
proposed rule, conforming amendments to the consolidated plan 
regulations must be made to reflect the incorporation of the Equity 
Plan process into the consolidated planning process.
Applicability (Sec.  91.2)
    This section specifies that all programs covered by the 
consolidated plan must comply with the requirements to affirmatively 
further fair housing.
Definitions (Sec.  91.5)
    Section 91.5, the definition section of HUD's consolidated plan 
regulations, would be revised to reflect that the term ``Equity Plan'' 
is defined in 24 CFR part 5.
Consultation; Local Governments (Sec.  91.100)
    Section 91.100 of HUD's consolidated plan regulations would be 
amended to account for the community engagement process and procedures 
required for the development of the Equity Plan pursuant to Sec.  
5.158.
    Paragraph (c) of Sec.  91.100, which requires the local government 
to consult with the local PHA, would be amended to provide that the 
jurisdiction must also consult with the PHA regarding the Equity Plan, 
including affirmatively furthering fair housing strategies and 
meaningful actions that will implement the fair housing goals from the 
Equity Plan.
    The proposed rule adds a new paragraph (e) to Sec.  91.100 to 
address the requirement to affirmatively further fair housing. 
Paragraph (e) provides that the local government shall consult with 
community- and regionally-based organizations that represent protected 
class members or enforce fair housing laws, such as state or local fair 
housing enforcement agencies, including participants in the Fair 
Housing Assistance Program (FHAP), fair housing organizations and other 
non-profit organizations that receive funding under the Fair Housing 
Initiative Program (FHIP), and other public and private fair housing 
service agencies, to the extent such entities operate within its 
jurisdiction.
    As noted in paragraph (e), this consultation will help provide a 
better basis for the local government's Equity Plan, its certification 
to affirmatively further fair housing and other portions of the 
consolidated plan concerning affirmatively furthering fair housing. 
Paragraph (e) provides that the consultation required under this 
paragraph can occur with any organizations that have the capacity to 
engage with data informing the Equity Plan and are sufficiently 
independent and representative to provide meaningful feedback to a 
jurisdiction on the Equity Plan, the consolidated plan, and their 
implementation. A Fair Housing Advisory Council or similar group that 
includes community members and advocates, fair housing experts, housing 
and community development industry participants, and other key 
stakeholders can meet this critical consultation requirement.
    The proposed rule requires consultation to occur throughout the 
fair housing planning process, meaning that the jurisdiction will 
consult with the organizations described in this section in the 
development of both the Equity Plan and the consolidated plan. The 
AFFH-related consultation on the consolidated plan shall specifically 
seek input into how the fair housing goals identified in the accepted 
Equity Plan will be incorporated into the consolidated plan, including 
funding allocations. This community input and consultation is critical 
to ensure that the jurisdiction is meeting the fair housing needs of 
the community through the implementation of the fair housing goals

[[Page 8541]]

from the Equity Plan into the consolidated plan.
Citizen Participation Plan; Local Governments (Sec.  91.105)
    This section is amended to provide program participants with the 
option to incorporate and include the community engagement requirements 
from Sec.  5.158 for the development of the Equity Plan into the 
requirements governing the local government's citizen participation 
plan, should the program participant decide to do so. While reference 
to the Equity Plan is made throughout Sec.  91.105, the amendments to 
specifically note are as follows:
    Paragraph (a)(1) distinguishes the citizen participation plan 
required for purposes of the consolidated plan from the community 
engagement requirements of Sec.  5.158 for purposes of the Equity Plan. 
This paragraph provides jurisdictions with the flexibility to include 
the policies and procedures it will undertake for purposes of the 
Equity Plan in the citizen participation plan, so long as all 
requirements for community engagement contained in Sec. Sec.  5.150 
through 5.180 are included in the citizen participation plan; however, 
this paragraph does not require program participants to amend their 
citizen participation plans should they choose to undertake community 
engagement for purposes of the Equity Plan separate from citizen 
participation for purposes of the consolidated plan.
    Paragraph (a)(2)(i) of this section would be amended to add 
explicit reference to residents and other interested parties, including 
members of protected class groups that have historically been denied 
equal opportunity and underserved communities, that are encouraged to 
participate in the development of the Equity Plan and revisions to the 
Equity Plan, along with participation in the development of the 
consolidated plan and substantial amendments to the consolidated plan.
    Paragraph (a)(2)(ii), which encourages the participation of local 
and regional institutions, would be amended to reflect that such 
participation is not only important to the consolidated plan but to the 
Equity Plan as well.
    Paragraph (a)(2)(iii), which addresses consultation with PHAs, 
would be amended to include how the jurisdiction will consult with the 
PHA regarding the jurisdiction's Equity Plan and how the jurisdiction 
will affirmatively further fair housing through implementation of its 
fair housing goals from the Equity Plan.
    Paragraph (a)(2)(iv) of this section, which encourages the 
jurisdiction to explore alternative techniques to encourage public 
engagement in the development of the consolidated plan and Equity Plan 
would be amended to note that, to the extent the jurisdiction includes 
the community engagement requirements for the Equity Plan in its 
citizen participation plan, the techniques described must be consistent 
with the requirements at Sec.  5.158, including the nondiscrimination 
requirements detailed in that section.
    Paragraph (a)(3) would be amended to ensure jurisdictions meet 
their civil rights obligations when seeking comment on proposed plans, 
particularly with respect to individuals with disabilities and limited 
English proficient (LEP) residents of the community.
    Paragraph (a)(4) would be amended to set forth how the requirements 
of paragraph (a)(3) apply to the Equity Plan's development for purposes 
of providing language assistance to ensure meaningful access to 
participation by LEP residents.
    The proposed rule adds new paragraph (a)(5) to detail for 
jurisdictions how to meet their obligation to ensure effective 
communication with persons with disabilities during the development of 
the consolidated plan and Equity Plan. These requirements are 
consistent with those contained in the implementing regulations for 
section 504 of the Rehabilitation Act and title II of the Americans 
with Disabilities Act.
    Paragraph (b) of Sec.  91.105 would be amended to provide that to 
the extent the program participant includes the Equity Plan and the 
requirements of Sec.  5.158 in their citizen participation plan, those 
requirements would be in addition to the requirements for the 
consolidated plan, which are described in paragraph (b)(1).
    Paragraph (c) of Sec.  91.105 would be amended so that the local 
government must specify the criteria the local government will use for 
determining when revisions to the Equity Plan will be appropriate, and 
provides that, at a minimum, the local government's criteria must 
include the criteria specified in 24 CFR 5.164, if the Equity Plan is 
included in the citizen participation plan.
    Paragraph (e) of Sec.  91.105 would be amended to address the 
existing requirement for the number of public hearings to hold on the 
jurisdiction's consolidated plan and how those requirements differ from 
what is required for the development of the Equity Plan pursuant to 
Sec.  5.158.
    Paragraphs (f), (g), (i), and (j), would each be revised to 
reference the Equity Plan and the applicable fair housing and civil 
rights requirements for conducting meetings and making documents 
publicly available. In addition, paragraph (j) would be amended to 
explain that the complaint procedures the jurisdiction establishes in 
the citizen participation plan are applicable to the consolidated plan 
and are distinct from the processes that apply to the Equity Plan set 
forth at Sec. Sec.  5.158(i) and 5.170.
Consultation; States (Sec.  91.110)
    This section would be revised to provide for the Equity Plan to be 
subject to the same consultation requirements as State consolidated 
plans. Two new paragraphs would be added to paragraph (a) of this 
section.
    Paragraph (a)(1) would specifically address consultation pertaining 
to public housing, with the objective to ensure that the PHA Plan is 
consistent with the consolidated plan, including with respect to the 
fair housing goals established in the Equity Plan.
    Paragraph (a)(2) would address consultation pertaining to 
affirmatively furthering fair housing, with the objective to ensure 
that there is a meaningful Equity Plan.
Citizen Participation Plan; States (Sec.  91.115)
    References to the Equity Plan would be added to paragraphs (a)(1) 
and (2) of this section. The amendments to this section include the 
revisions to paragraphs (a)(3) and (4) that would require reasonable 
efforts to provide language assistance to LEP residents and adding new 
paragraph (a)(5) that requires ensuring effective communication with 
persons with disabilities, as required by section 504 of the 
Rehabilitation Act and title II of the Americans with Disabilities Act, 
and their respective implementing regulations.
    Paragraph (b) of this section, which addresses development of the 
consolidated plan, would be amended to address development of the 
Equity Plan in addition to the consolidated plan, to the extent the 
State decides to include the Equity Plan in its citizen participation 
plan.
    Paragraphs (f) and (h) of this section, which address availability 
of information to the public's access to records, and complaints, 
respectively, would be amended to reference the Equity Plan. Paragraph 
(h) would also be revised to make clear that the complaint process in 
the State's citizen participation plan is distinct from the

[[Page 8542]]

processes that apply to the Equity Plan set forth at Sec. Sec.  
5.158(i) and 5.170.
Strategic Plan (Sec.  91.215)
    This section of the consolidated plan regulations describes the 
prescribed content of the local government's strategic plan. This 
proposed rule adds to this section a new paragraph (a)(5) that requires 
the jurisdiction's consolidated plan to describe how the priorities and 
specific objectives of the jurisdiction will affirmatively further fair 
housing, and that the description should be done by setting forth 
strategies and actions consistent with the goals and other elements 
identified in an Equity Plan conducted in accordance with Sec.  5.154. 
New paragraph (a)(5) provides that for issues not addressed by these 
priorities and objectives, the plan must identify how these goals have 
been incorporated into the plan consistent with the requirements of 
Sec. Sec.  5.150 through 5.180.
Action Plan (Sec.  91.220)
    This section of the consolidated plan regulations lists the items 
that comprise a local government's action plan. Paragraph (k) of Sec.  
91.220 is divided into two paragraphs. Paragraph (k)(1) requires the 
action plan to address the actions that the local government plans to 
take during the next year to address fair housing issues identified in 
the Equity Plan. Paragraph (k)(2) addresses the existing provision of 
paragraph (k), which is the requirement of the local government to list 
the actions that it plans to take to address, among other things, 
obstacles to meeting underserved needs, and fostering and maintaining 
affordable housing.
    Paragraph (l) of this section, which sets forth the program-
specific requirements, would be revised to include references to the 
Equity Plan and the fair housing goals incorporated from the Equity 
Plan for purposes of how they relate to each program covered by the 
Action Plan.
Certifications (Sec.  91.225)
    The proposed rule would amend paragraph (a)(1) of this section to 
require the local government's certification that it will affirmatively 
further fair housing and it will take no action that is materially 
inconsistent with fair housing and civil rights requirements throughout 
the period for which Federal financial assistance is extended.
Monitoring (Sec.  91.230)
    The proposed rule revises this section to provide that a local 
government's monitoring of its activities carried out in furtherance of 
the consolidated plan, must include monitoring of strategies and 
actions that address the fair housing issues identified in the Equity 
Plan.
Special Case: Abbreviated Consolidated Plan (Sec.  91.235)
    Paragraph (c) of this section, which defines what is an abbreviated 
plan, is revised to provide that the abbreviated plan must describe how 
the jurisdiction will affirmatively further fair housing by addressing 
issues identified in an Equity Plan conducted in accordance with 24 CFR 
5.154.
Housing and Homeless Needs Assessment (Sec.  91.305)
    The proposed rule would amend Sec.  91.305, which requires States 
to provide a concise summary of the estimated housing needs projected 
for the ensuing 5-year period, would be revised in paragraph (b), which 
requires a description of the persons affected under the plan, in order 
to allow States to utilize the analysis contained in the Equity Plan 
relating to affordable housing opportunities pursuant to Sec. Sec.  
5.152 and 5.154 to satisfy this requirement, to the extent the Equity 
Plan already contains such information.
Strategic Plan (Sec.  91.315)
    This section of the consolidated plan regulations describes the 
prescribed content of the State government's strategic plan. The 
changes made to this section mirror the changes made to Sec.  91.215.
Action Plan (Sec.  91.320)
    This section of the consolidated plan regulations describes the 
prescribed content of the State government's action plan. The changes 
made to this section mirror the changes made to Sec.  91.220, but are 
found in paragraph (j) of Sec.  91.320. In addition, paragraph (k) of 
this section, which describes the program-specific requirements, would 
be revised to distinguish any activities or procedures applicable for 
programmatic requirements from those relating to fair housing and civil 
rights requirements, including the obligation to affirmatively further 
fair housing.
Certifications (Sec.  91.325)
    Similar to the amendment to Sec.  91.225, the proposed rule would 
amend paragraph (a)(1) of Sec.  91.325 to require the State's 
certification that it will affirmatively further fair housing and that 
it will take no action that is materially inconsistent with fair 
housing and civil rights requirements throughout the period for which 
Federal financial assistance is extended.
Monitoring (Sec.  91.330)
    This section of the consolidated plan regulations describes the 
State's monitoring of its activities carried out in furtherance of the 
consolidated plan. The changes made to this section mirror the changes 
made to Sec.  91.230.
Strategic Plan (Sec.  91.415)
    This section of the consolidated plan regulations describes the 
prescribed content of a consortium's strategic plan. This section 
requires a consortium to comply with the provisions of Sec.  91.215, 
which is proposed to be revised by this rule to incorporate the Equity 
Plan in the strategic plan. The change that would be made to Sec.  
91.415 by this rule is to require the consortium to set forth, in its 
strategic plan, strategies and actions consistent with the fair housing 
goals identified in an Equity Plan conducted in accordance with new 
Sec. Sec.  5.150 through 5.180.
Action Plan (Sec.  91.420)
    This section of the consolidated plan regulations describes the 
prescribed content of a consortium's action plan. Paragraph (b) of 
Sec.  91.420 is revised to provide that the action plan must include 
actions that the consortium plans to take during the next year that 
will address fair housing issues identified in the consortium's Equity 
Plan.
Certifications (Sec.  91.425)
    As with the amendments to Sec. Sec.  9.225 and 91.325, the proposed 
rule would amend paragraph (a)(1) of this section to require the 
consortium's certification that it will affirmatively further fair 
housing and that it will take no action that is materially inconsistent 
with fair housing and civil rights requirements throughout the period 
for which Federal financial assistance is extended.
Monitoring (Sec.  91.430)
    This section of the consolidated plan regulations describes the 
consortium's monitoring of its activities carried out in furtherance of 
the consolidated plan. The changes made to this section mirror the 
changes made to Sec.  91.230.
HUD Approval Action (Sec.  91.500)
    This section of the consolidated plan regulations sets out, among 
others, the standards by which HUD will review a submitted consolidated 
plan. Paragraph (b) of this section would be revised to make clear for 
program participants that the standards set forth in this section are 
for purposes of the consolidated plan and are distinct from the 
standards at Sec.  5.162 for purposes of the Equity Plan.

[[Page 8543]]

Amendments to the Consolidated Plan (Sec.  91.505)
    This section lists the criteria and procedures by which a 
jurisdiction must amend its approved consolidated plan. The proposed 
rule adds a new paragraph (a)(4) to allow amendments to the plan to 
make necessary changes to account for any revisions to an Equity Plan 
that is accepted or revised pursuant to Sec.  5.164 after a 
consolidated plan is in effect.

HOME Investment Partnerships (HOME) Program Regulations (24 CFR Part 
92)

Definitions (Sec.  92.2)
    Section 92.2, the definitions section of HUD's HOME regulation, 
would be revised to reflect that the terms ``affirmatively furthering 
fair housing'' and ``Equity Plan'' are defined in 24 CFR part 5.
Affirmatively Furthering Fair Housing (Sec.  92.5)
    This section specifics that all participating jurisdictions must 
comply with the requirements to affirmatively further fair housing.
Program Description (Sec.  92.61)
    This section sets forth how a recipient will structure its use of 
HOME funds. Paragraph (c)(5) of this section specifies the 
certifications required for insular areas and would be amended to 
account for an insular area's obligation to affirmatively further fair 
housing and conduct its federally funded programs and activities in a 
manner that is consistent with Federal fair housing and civil rights 
requirements.
Submission of a Consolidated Plan and Equity Plan (Sec.  92.104)
    This section of the HOME program regulations which addresses the 
responsibility of a participating jurisdiction to submit its 
consolidated plan to HUD is revised to provide that the jurisdiction 
must also submit its Equity Plan to HUD in accordance with the AFFH 
regulations in 24 CFR part 5, subpart A.
Eligible Administrative and Planning Costs (Sec.  92.207)
    This section sets forth the eligible administrative and planning 
costs for the HOME program. Paragraph (d) of this section specifically 
allows for activities relating to fair housing and the obligation to 
affirmatively further fair housing, and would be amended to cross 
reference certifications under Sec.  5.166.
Other Federal Requirements and Nondiscrimination (Sec.  92.350)
    This section requires participating jurisdictions to comply with 
Federal requirements, including nondiscrimination requirements. 
Paragraph (a) of this section would be amended to include the 
obligation to affirmatively further fair housing.
Affirmative Marketing; Minority Outreach Program (Sec.  92.351)
    This section requires each participating jurisdiction to adopt and 
follow affirmative marketing procedures and requirements. Paragraph (a) 
would be amended for consistency with the obligation to affirmatively 
further fair housing and to better clarify a recipient's affirmative 
marketing obligations.
Recordkeeping (Sec.  92.508)
    The proposed rule would amend the recordkeeping requirements of the 
HOME program to provide in paragraph (a)(7)(i)(B) of this section to 
require as part of the documentation that the participating 
jurisdiction has taken actions to affirmatively further fair housing, 
including documentation relating to the participating jurisdiction's 
Equity Plan and the requirements at Sec.  5.168, as well as 
documentation relating to the participating jurisdiction's AFFH 
certification.

Housing Trust Fund (HTF) Regulations (24 CFR Part 93)

Definitions (Sec.  93.2)
    Section 93.2, the definitions section of HUD's HTF regulation, 
would be revised to include introductory text to reflect that the terms 
``affirmatively furthering fair housing'' and ``Equity Plan'' are 
defined in 24 CFR part 5.
Affirmatively Furthering Fair Housing (Sec.  93.4)
    This section specifics that all recipients of HTF funds must comply 
with the requirements to affirmatively further fair housing.
Participation and Submission Requirements (Sec.  93.100)
    Section 93.100 requires a grantee to submit a consolidated plan in 
order to receive HTF grants. The proposed rule would amend this 
section, at paragraph (b), to also include the requirement to submit an 
Equity Plan.
Eligible Activities; General (Sec.  93.200)
    This section of the HTF regulation details the general activities 
that are eligible to be funded using the HTF grant. Paragraph (a)(1) 
would be amended by this proposed rule, for consistency with other 
program regulations for which a consolidated plan is required, to 
clarify that to the extent the activities in question otherwise are 
eligible, one potential use of HTF funds may be to implement fair 
housing goals from an Equity Plan developed pursuant to Sec. Sec.  
5.150 through 5.180.
Eligible Administrative and Planning Costs (Sec.  93.202)
    This section of the HTF regulation describes the eligible 
administrative and planning costs for administering the HTF program. 
The changes made to this section mirror the changes made to Sec.  
92.207.
Other Federal Requirements and Nondiscrimination; Affirmative Marketing 
(Sec.  93.350)
    This section sets forth the generally applicable nondiscrimination 
and affirmative marketing requirements for purposes of the HTF program. 
The changes made to this section are substantially similar to the 
changes made to Sec.  92.351.
Recordkeeping (Sec.  93.407)
    This section requires HTF grantees to maintain records relating to 
the implementation of its HTF program. This proposed rule would add new 
paragraph (a)(1)(vii), which would require grantees to maintain records 
documenting the actions the grantee has taken to affirmatively further 
fair housing, including documentation related to the grantee's Equity 
Plan described at Sec.  5.168.

Community Development Block Grant (CDBG) Regulations (24 CFR Part 570)

Definitions (Sec.  570.3)
    Section 570.3, the definitions section of HUD's CDBG regulation, 
would be revised to reflect that the terms ``affirmatively furthering 
fair housing'' and ``Equity Plan'' are defined in 24 CFR part 5.
Affirmatively Furthering Fair Housing (Sec.  570.6)
    This section specifies that all programs covered by this part must 
comply with the requirements to affirmatively further fair housing.
Eligible Planning, Urban Environmental Design, and Policy Planning 
Management--Capacity Building Activities (Sec.  570.205)
    This section which lists policy planning and capacity building 
activities would add new paragraph

[[Page 8544]]

(a)(4)(viii) to reference the Equity Plan. In paragraph (a)(6) of this 
section, references to the implementation of fair housing goals from 
the Equity Plan would be added throughout.
Program Administrative Costs (Sec.  570.206)
    This section sets forth the permissible program administrative 
costs for the CDBG program and paragraph (c) specifically lists fair 
housing activities as covered by this section. This proposed rule would 
revise paragraph (c) to update terminology that is outdated.
Citizen Participation--Insular Areas (Sec.  570.441)
    The amendments to this section include inserting references to the 
Equity Plan.
Other Applicable Laws and Related Program Requirements (Sec.  570.487)
    Paragraph (b) of this section, which addresses the requirement to 
affirmatively further fair housing, provides that a State is required 
to certify to HUD's satisfaction that it will affirmatively further 
fair housing consistent with the requirements of Sec. Sec.  5.150 
through 5.180 and will take no action that is inconsistent with fair 
housing and civil rights requirements throughout the period for which 
Federal financial assistance is extended. Similarly, this paragraph 
would provide that each unit of general local government is also 
required to make such a certification.
Recordkeeping Requirements (Sec.  570.490)
    This section sets forth that States and local governments that 
receive CDBG funds must maintain records and have requirements for 
maintaining records of the administration of CDBG funds. Paragraphs (a) 
and (b) of this section would be revised to include records relating to 
the use of CDBG funds for purposes of affirmatively furthering fair 
housing and the grantee's Equity Plan, in accordance with Sec.  5.168.
Records To Be Maintained (Sec.  570.506)
    Similar to the amendment to Sec.  570.490, the proposed rule would 
amend this section to provide in paragraph (g)(1) that documentation 
related to the grantee's Equity Plan is required pursuant to Sec.  
5.168.
Public Law 88-352 and Public Law 90-284; Affirmatively Furthering Fair 
Housing; Equal Opportunity; Executive Order 11063 (Sec.  570.601)
    The heading of this section would be revised to read ``Civil 
rights; affirmatively furthering fair housing; equal opportunity 
requirements,'' and paragraph (a)(2) of this section would be amended 
to provide that the program participant's responsibility to undertake 
fair housing planning includes taking meaningful actions to further the 
fair housing goals identified in an Equity Plan that is developed in 
accordance with the requirements of Sec. Sec.  5.150 through 5.180 and 
that it will take no action that is inconsistent with fair housing and 
civil rights requirements.
Equal Opportunity and Fair Housing Review Criteria (Sec.  570.904)
    Paragraph (c)(2) clarifies that the review undertaken pursuant to 
this section is distinct from the procedures set forth at 24 CFR part 
1, 3, 5, 6, 8, or 146 or 28 CFR part 35 conducted by the Responsible 
Civil Rights Official, which are reviews for purposes of determining a 
grantee's compliance with Federal fair housing and civil rights 
requirements, including the grantee's obligation to affirmatively 
further fair housing.

Housing Opportunities for Persons With AIDS (HOPWA) Regulations (24 CFR 
Part 574)

Definitions (Sec.  574.3)
    Section 574.3, the definitions section of HUD's HOWPA regulation, 
would be revised to reflect that the term ``affirmatively furthering 
fair housing'' is defined in 24 CFR part 5.
Affirmatively Furthering Fair Housing (Sec.  574.4)
    This section specifies that all grantees must comply with the 
requirements to affirmatively further fair housing.
Recordkeeping (Sec.  574.530)
    The proposed rule would amend this section of the HOPWA regulations 
to include documentation of a program participant's Equity Plan, 
consistent with Sec.  5.168.

Emergency Solutions Grants Program (ESG) Regulations (24 CFR Part 576)

Definitions (Sec.  576.2)
    Section 576.2, the definitions section of HUD's ESG regulation, 
would be revised to include introductory text to reflect that the term 
``affirmatively furthering fair housing'' is defined in 24 CFR part 5.
Affirmatively Furthering Fair Housing (Sec.  576.4)
    This section specifies that all recipients of ESG funds must comply 
with the requirements to affirmatively further fair housing.
Recordkeeping and Reporting Requirements (Sec.  576.500)
    The proposed rule would amend paragraph (s)(1)(ii) of this section 
to provide that documentation related to its Equity Plan, consistent 
with Sec.  5.168, must be maintained.

Public Housing Agency Plans (24 CFR Part 903)

What is the purpose of this subpart? (Sec.  903.1)
    The proposed rule would amend this section to account for the PHA's 
obligation to affirmatively further fair housing and comply with the 
requirements set forth at Sec. Sec.  5.150 through 5.180.
What are the Public Housing Agency plans? (Sec.  903.4)
    The proposed rule would add new paragraph (a)(3) to this section to 
explain that the plans described in this section also include the 
incorporation of the fair housing goals established in the PHA's Equity 
Plan pursuant to Sec.  5.156.
What information must a PHA provide in the 5-year plan (Sec.  903.6)
    The proposed rule would add new paragraph (a)(4) to this section to 
account for the requirement that the 5-year plan include the PHA's fair 
housing strategies and meaningful actions it intends to undertake in 
order to implement the fair housing goals incorporated from the PHA's 
Equity Plan pursuant to Sec.  5.156.
    Paragraph (b)(2), which requires the PHA to account for progress 
made in meeting the goals and objectives in the PHA's previous 5-year 
plan, would be revised to permit PHAs to rely on the annual progress 
evaluations required for the Equity Plan, conducted pursuant to 
Sec. Sec.  5.152, 5.154(i) and (j), 5.156(d), and 5.160(f) and (i) for 
purposes of meeting this requirement as it relates to the PHA's fair 
housing goals. This means PHAs would not be required to compile new 
reports on the same information multiple times.
What information must a PHA provide in the annual plan? (Sec.  903.7)
    The proposed rule would revise Sec.  903.7 to account for the 
requirement to develop an Equity Plan and incorporate the fair housing 
goals from the Equity Plan into the PHA Plan. Paragraph

[[Page 8545]]

(a)(1)(iii) would be revised to permit the PHA, once it has submitted 
an Equity Plan pursuant to the submission schedule at Sec.  5.160, to 
rely on its analysis of affordable housing opportunities and the 
analysis conducted pursuant to Sec.  5.154(e) in connection with its 
Equity Plan, to the extent applicable, for purposes of the PHA's Annual 
Plan.
    Paragraph (b) of this section would be revised to require that the 
PHA's deconcentration and other policies that govern eligibility, 
selection, and admission be consistent with the PHA's obligation to 
affirmatively further fair housing and the PHA's Equity Plan.
    Paragraph (o) of this section would be revised to indicate that 
each PHA must certify, among other things, that it will affirmatively 
further fair housing and that it will take no action that is materially 
inconsistent with fair housing and civil rights requirements throughout 
the period for which Federal financial assistance is extended pursuant 
to Sec.  5.166. These revisions relate to the 5-Year Plan and the 
Annual Plan.
What is a Resident Advisory Board and what is the role in development 
of the annual plan? (Sec.  903.13)
    This section specifies the requirements for the Resident Advisory 
Board, and the proposed rule would revise paragraphs (a) and (c) to 
account for any community engagement activities relating to the Equity 
Plan pursuant to Sec.  5.158, as well as other consultation 
requirements relating to the development of the Equity Plan and the 
incorporation of the fair housing goals from the PHA's Equity Plan into 
the PHA Plan. The revisions to paragraph (c) also distinguish the 
different complaint processes as they relate to complaints about the 
PHA Plan as opposed to complaints relating to the Equity Plan or the 
PHA's obligation to affirmatively further fair housing.
What is the relationship of PHA Plan to the Consolidated Plan and a 
PHA's Fair Housing and Civil Rights requirements? (Sec.  903.15)
    The proposed rule would revise the heading of this section to 
include ``civil rights,'' as PHAs are subject to requirements beyond 
the Fair Housing Act. The proposed rule would revise Sec.  903.15 in 
paragraph (a) to indicate that the PHA Plan must be consistent with any 
applicable Equity Plan incorporated into the applicable consolidated 
plan pursuant to Sec.  5.156.
    Paragraphs (b) and (c) would be revised to reference the Equity 
Plan. Paragraph (c) would also be revised to reflect the applicable 
nondiscrimination requirements and the obligation to affirmatively 
further fair housing. Paragraph (c) is also amended to clarify the 
certification the PHA must make pursuant to Sec.  903.7(o), and the 
procedures HUD will follow if HUD challenges the validity of a PHA's 
certification.
What is the process for obtaining public comment process on PHA Plans? 
(Sec.  903.17)
    The proposed rule would amend this section to account for the 
Equity Plan, including the community engagement requirements under 
Sec.  5.158 and the obligation to incorporate the Equity Plan's fair 
housing goals into the PHA Plan pursuant to Sec.  5.156.
When is the 5-year plan or annual plan ready for submission to HUD? 
(Sec.  903.19)
    The proposed rule would add new paragraph (d) to Sec.  903.19 to 
clarify for PHAs that the plan is not ready for submission to HUD until 
the PHA has incorporated the fair housing goals from its Equity Plan.
What is the process by which HUD reviews, approves, and disapproves an 
annual plan? (Sec.  903.23)
    The proposed rule would amend paragraph (f) of Sec.  903.23 to 
require PHAs to maintain records relating to its Equity Plan, 
consistent with Sec.  5.168, and records relating to the PHA's AFFH 
certification.
How does HUD ensure PHA compliance with its PHA Plan? (Sec.  903.25)
    The proposed rule would amend this section to clarify that the 
procedures HUD will use for the PHA Plan are different from those HUD 
will use for the Equity Plan, and specifies that the procedures for the 
Equity Plan are set forth at Sec. Sec.  5.162, 5.170, 5.172, and 5.174.

Project-Based Voucher (PBV) (24 CFR Part 983)

Site Selection Standards (Sec.  983.57)
    The proposed rule would amend paragraph (b)(1) of Sec.  983.57 to 
reference the PHA's Equity Plan and to remove paragraph (b)(1)(iii) 
from this section.

IV. Questions for Comments

    HUD welcomes comments on all aspects of the proposal. In addition, 
HUD specifically requests comments on the following topics:
    1. Are there ways in which HUD can further streamline this proposed 
rule or further reduce burden, while continuing to ensure an 
appropriate and necessary fair housing analysis that would enable 
program participants to set meaningful goals that will affirmatively 
further fair housing?
    2. Does HUD's removal of the requirement to identify and prioritize 
contributing factors still allow for a meaningful analysis that will 
allow program participants to set goals for overcoming systemic and 
longstanding inequities in their jurisdictions? If not, how can HUD 
ensure that such an analysis occurs without imposing undue burden on 
program participants?
    3. HUD intends to continue to provide much of the same data it made 
available in connection with the implementation of the 2015 AFFH Rule 
through the AFFH-T, which is available at https://egis.hud.gov/affht/, 
while exploring possible improvements to the existing AFFH-T Data & 
Mapping Tool. HUD is also exploring other approaches to facilitating 
program participants' data analysis and making HUD-provided data as 
useful and easy to understand as possible for program participants and 
the public. HUD seeks comment on the following related questions:
    a. This notice of proposed rulemaking describes potential HUD-
provided data, data and mapping tools, guidance, and technical 
assistance that may highlight some of the key takeaways from the HUD-
provided data and help program participants identify likely fair 
housing issues. Should HUD also provide static data packages that 
include some of the data included in the AFFH-T and a narrative 
description of those data? If so, what data would be most helpful to 
include in these data packages and narrative descriptions? For which 
program participants would data packages and narrative descriptions be 
most useful?
    b. What additional data and tools could HUD provide to facilitate a 
regional analysis?
    c. What types of data relating to homeownership opportunities 
should HUD consider providing? In addition to data on homeownership 
rates, which already are available in the consolidated planning data 
(CHAS) (which can be accessed at https://www.huduser.gov/portal/datasets/cp.html), including by protected class, what other data 
sources are reflective of disparities in homeownership opportunity?
    d. What other data sources should HUD provide for program 
participants to better identify the various types of inequity 
experienced by members of protected class groups that are the subject 
of the proposed rule's required analysis?
    e. Are there specific functions that could be included in the AFFH-
T to allow the data to be more usable, more

[[Page 8546]]

clearly displayed, or otherwise easier to interpret? If so, please 
provide a description of such functionality.
    f. Should HUD consider providing data that are not nationally 
uniform if they are available for certain program participants even if 
such data are not available for all program participants? If so, please 
provide examples of data that would be useful to provide for which 
there is not nationally uniform data and the reasons why it would be 
useful for HUD to provide these data.
    g. Are there additional data sets HUD could provide or require to 
be used for purposes of conducting a fair housing analysis that relate 
to eviction, neighborhood features (access to parks, green space, 
trees), zoning and land use, and housing-related costs (like 
transportation)?
    4. Are there different or additional regulatory changes HUD could 
make to the proposed rule that would be more effective in affirmatively 
furthering fair housing, including ways to improve access to community 
assets and other housing-related opportunities for members of protected 
class groups, including historically underserved communities, 
individuals with disabilities, and other vulnerable populations?
    5. In what ways can HUD assist program participants in facilitating 
the community engagement process so that the Equity Plans program 
participants develop are comprehensive and account for issues faced by 
members of protected class groups and underserved communities that 
program participants may not necessarily be aware of? HUD specifically 
seeks feedback on the following:
    a. Should HUD require that a minimum number of meetings be held at 
various times of day and various accessible locations to ensure that 
all members of a community have an opportunity to be heard? Should HUD 
require that at least one meeting be held virtually?
    b. Should HUD provide different requirements for community 
engagement based on the type of geographic area the program participant 
serves (e.g., rural, urban, suburban, statewide, etc.) and if so, why 
should requirements differ based on type of geography?
    c. Should HUD require program participants to utilize different 
technology to conduct outreach and engagement? If so, which 
technologies have proven to be successful tools for community 
engagement? Are these technologies usable by individuals with 
disabilities, including those who utilize assistive technology or 
require reasonable accommodations such as real-time captioning or sign-
language interpreters?
    d. Has HUD sufficiently distinguished the differences between 
community engagement and citizen participation or resident 
participation such that program participants understand that HUD 
expects a more robust engagement process for purposes of the 
development of the Equity Plan than has previously been required for 
purposes of programmatic planning? How can HUD ensure that these 
important conversations are fully had within communities while not 
significantly increasing the burden on program participants and the 
communities themselves? Are there ways in which HUD can reduce any 
unnecessary burden resulting from separate requirements to conduct 
community engagement and citizen participation (for consolidated plan 
program participants) or resident participation (for PHAs)?
    e. Are there specific types of technical assistance that HUD can 
provide to assist program participants in conducting robust community 
engagement, including how community engagement can inform goal setting, 
implementation of goals, and progress evaluations? If so, please 
specify the types of technical assistance that would be must useful.
    f. Should HUD require the community engagement process to afford a 
minimum amount of time for different types of engagement activities 
(e.g., public comments on proposed Equity Plans, notice before public 
meetings)? If so, what should the minimum amount of time be in order to 
afford members of the community an equal and fair opportunity to 
participate in the development of the Equity Plan?
    6. HUD seeks comments on whether the definition of ``affordable 
housing opportunities'' is sufficiently clear. HUD also seeks comment 
on whether the definition should apply to both rental and owner-
occupied units. Are there other categories of affordable housing that 
should be explicitly referenced in this definition?
    7. HUD has provided a new definition of ``geographic area of 
analysis,'' which is intended to provide program participants and the 
public a clear understanding of the types and levels of analysis that 
are needed by different types of program participants. Does this 
definition clearly articulate the geographic areas of analysis for each 
type of program participant and are the levels of analyses for the 
types of program participants appropriate to ensure Equity Plans are 
developed and implemented in a manner that advances equity?
    8. HUD requests commenters provide feedback on new Sec.  5.154, 
which sets out the content of the Equity Plan. HUD specifically 
requests comment on the following:
    a. Are the questions in this proposed rule at Sec.  5.154 effective 
for purposes of how to assess where equity is lacking and to facilitate 
the development of meaningful goals that are designed and can be 
reasonably expected to overcome the effects of past or current policies 
that have contributed to a systemic lack of equity? Put differently, do 
the proposed questions clearly elicit from program participants an 
assessment of the fair housing issues that exist and their causes so 
that goals can be appropriately tailored to address the identified fair 
housing issues?
    b. Does the analysis in proposed Sec.  5.154 lend itself to 
identifying fair housing issues for each of the following protected 
class groups: race, color, national origin, sex, religion, familial 
status, and disability? If not, how can HUD improve this aspect of the 
analysis to better serve this purpose? Are there additional data 
sources that would assist in facilitating this analysis?
    c. What additional areas of analysis, if any, should HUD include in 
Sec.  5.154 that are not currently included in this proposed rule?
    d. Should the section on fair housing goals (Sec.  5.154(g)) be 
modified, improved, or streamlined so that program participants can set 
appropriate goals for overcoming systemic issues impacting their 
communities?
    e. This proposed rule does not currently identify which specific 
maps and tables contained in the HUD-provided data program participants 
should rely on in answering specific questions provided at Sec.  5.154. 
Should HUD require the use of specific data sets when responding to 
these questions in Sec.  5.154, and if so, what benefit would that 
have? How can HUD ensure that program participants, in using the HUD-
provided data, identify the fair housing issues and underlying reasons 
for what the data show in order to assess where equity is truly lacking 
in their geographic areas of analysis?
    f. What is the proper regional analysis program participants should 
undertake in order to identify fair housing issues and set meaningful 
fair housing goals? Should different program participants have 
different required regional analyses (e.g., States vs. local 
governments; non-statewide PHAs)?
    g. Does HUD need to more specifically explain the required level of 
geographic analysis, whether in this rule itself or in

[[Page 8547]]

sub-regulatory guidance, for purposes of the development of the Equity 
Plan, including how different levels of geographic analysis would 
facilitate the setting of fair housing goals that would result in 
material positive change that advances equity within communities? For 
example, should HUD require certain types of program participants to 
conduct an analysis at the following levels of geography for each fair 
housing issue: Core-Based Statistical Area, Metropolitan Statistical 
Areas, Block Groups, Census Tracts, and counties?
    h. Are there different or additional questions that HUD should pose 
to rural areas to assist such areas in meeting their obligations to 
affirmatively further fair housing? If so, how should the analysis for 
rural areas differ from the required analysis in proposed Sec.  5.154?
    i. Has HUD sufficiently explained how to prioritize fair housing 
issues within fair housing goal categories for purposes of establishing 
meaningful fair housing goals? What additional clarification is needed, 
if any?
    j. In new Sec.  5.154(e), the required analysis for public housing 
agencies (PHAs), has HUD sufficiently tailored the analysis required 
for these entities, in particular for small or rural PHAs, while still 
ensuring the PHA's Equity Plan is developed and implemented in a manner 
that advances equity for members of protected class groups, 
particularly those the PHAs serves or who are eligible to be served by 
the PHA? How can HUD continue to streamline the required analysis for 
PHAs while also ensuring an appropriate fair housing analysis is 
conducted and meaningful fair housing goals are established and 
implemented?
    k. Are there areas of analysis that HUD should include for PHAs 
that it has not included in this proposed rule that would better assist 
PHAs in meeting their obligation to affirmatively further fair housing? 
This may include analysis addressed to PHA-specific programs, such as 
public housing, vouchers, Moving To Work, or other PHA programs, as 
well as by type of PHA, such as troubled or qualified PHAs.\28\
---------------------------------------------------------------------------

    \28\ Section 2702 of title II of the Housing and Economic 
Recovery Act (HERA) introduced a definition of ``qualified PHAs'' to 
exempt such PHAs, that is, PHAs that have a combined total of 550 or 
fewer public housing units and Section 8 vouchers, are not 
designated as troubled under section 6(j)(2) of the 1937 Act, and do 
not have a failing score under the Section Eight Management 
Assessment Program (SEMAP) during the prior 12 months, from the 
burden of preparing and submitting an annual PHA Plan. See Public 
Law 110-289, 122 Stat. 2654, approved July 30, 2008, see 122 Stat. 
2863.
---------------------------------------------------------------------------

    l. Are there additional ways HUD could incentivize PHAs to 
collaborate with consolidated plan program participants in conducting 
an Equity Plan such that they can pool resources and develop broader 
solutions to fair housing issues?
    m. Since HUD has removed the requirement to identify and prioritize 
contributing factors, as was required by the Assessment Tool under the 
2015 AFFH Rule, do the questions in Sec.  5.154 appropriately solicit 
responses that would include the underlying causes of the fair housing 
issues identified?
    n. Are there specific questions HUD should ask that it has not 
proposed in Sec.  5.154 of this proposed rule?
    9. In order to reduce burden on program participants, and based on 
the lessons learned from the implementation of the 2015 AFFH Rule, HUD 
requests comments on how Equity Plans should be submitted to the 
Department (e.g., through a secure portal, via email, through a web 
page that allows uploads, etc.) and whether HUD should mandate the file 
format the Equity Plan is submitted in (e.g., MS Word, PDF, etc.).
    10. HUD has included several new definitions in this proposed rule 
and requests feedback on whether they should be drafted differently, 
whether there may be additional definitions that are not included that 
would be useful, and whether any definitions included in this proposed 
rule are unnecessary.
    11. Has HUD appropriately captured the types of populations--based 
on the characteristics protected by the Fair Housing Act--that have 
historically been underserved and continue to be underserved today in 
communities in the new definition of ``Underserved communities,'' and 
if not, which additional types of populations or groups should HUD 
consider adding to this definition?
    12. HUD requests feedback on whether including the definition of 
``Balanced approach'' is helpful in understanding how to connect 
funding decisions to advancing equity within communities and how this 
definition can be modified or improved in order to more clearly make 
that connection.
    13. HUD has changed the way submission deadlines are determined 
from the way submission deadlines were established under the 2015 AFFH 
Rule and requests feedback on whether the new submission deadlines 
provided in Sec.  5.160 are clearer and are the appropriate way to 
create tiers for the submission by entities of different sizes. HUD 
welcomes feedback on different cutoffs for this section that are 
accompanied by explanations of why different cut offs should be used 
instead of those in this proposed rule. HUD also welcomes comment on 
whether the timeframes set out in Sec.  5.162 are appropriate and what, 
if any, obstacles might these new timeframes present with respect to 
the development of the Equity Plan and compliance with other 
programmatic requirements?
    14. HUD seeks comment on whether it should require new program 
participants to engage in any specific planning process or other 
actions to meet their obligation to affirmatively further fair housing 
prior to the submission of their first Equity Plan.
    15. HUD requests specific feedback on new sections Sec. Sec.  5.170 
through 5.174 and whether the compliance procedures and procedures for 
effecting compliance can be further clarified and improved.
    16. This proposed rule provides a stronger link between the 
regulatory requirements for implementing the AFFH mandate and program 
participants' subsequent planning processes in order to better ensure 
that all programs and activities are administered in a manner that 
affirmatively furthers fair housing, including by taking into account 
how to allocate funding to effectuate that obligation. HUD requests 
comments on how HUD can further ensure that program participants are 
adequately planning to carry out activities necessary to advance equity 
in their communities. Specifically, are certifications and assurances 
requirements in this proposed rule, along with the new regulatory 
provision at Sec.  5.166 sufficient to achieve this objective, and if 
not, what additional regulatory language can be added that would 
achieve this objective?
    17. Has HUD adequately incorporated the need to assess any lack of 
homeownership opportunities for protected class groups in this proposed 
rule? If not, in what ways should access to homeownership be further 
incorporated? Is there specific data that HUD could provide to further 
facilitate this analysis?
    18. Are there other types of ``community assets,'' that should be 
included in the new definition and the analysis of disparities in 
access to opportunity for purposes of the Equity Plan? If so, which 
assets should be included that are not currently included in this 
proposed rule?
    19. How can HUD best facilitate receiving feedback on Equity Plans 
submitted for its review from members of the public in order to inform 
the review process and how should HUD consider such feedback? HUD seeks 
comment on whether changes to the

[[Page 8548]]

regulatory text are necessary, and specifically whether the new 
definition of ``publication'' at Sec.  5.152 and the provisions in 
Sec.  5.160 achieve this objective.
    20. Are there ways that HUD could better clarify how the fair 
housing goals from an Equity Plan are incorporated into subsequent 
planning processes? If so, how can HUD clarify this requirement such 
that program participants will be able to implement their fair housing 
goals and achieve positive fair housing outcomes in their communities?
    21. What forms of technical assistance could HUD provide that would 
better position program participants and their communities to develop 
their Equity Plans and ultimately implement and achieve the fair 
housing outcomes set therein?
    22. HUD specifically solicits comment on the proposal to publish 
submitted plans that it is reviewing but has not yet accepted or non-
accepted. HUD seeks comment on both the benefits of this proposal and 
concerns with it.
    23. HUD specifically asks for input on the following proposals for 
reducing burden on small program participants:
    a. HUD notes that some pieces of the analysis may not always be 
relevant to some small program participants, depending on the local 
circumstances. If specific parts of the proposed analysis are not 
applicable to a small program participant's local circumstances, should 
HUD permit the program participant to respond to that specific piece of 
the analysis with ``not applicable''? If so, please identify the 
specific parts of the analysis that might not always be applicable and 
the circumstances under which it would not be applicable. If HUD were 
to permit this, are there procedures it should follow to ensure that 
program participants still conduct an appropriate fair housing 
analysis, such as requiring an explanation of why the piece of the 
analysis is not applicable, with reference to HUD-provided data, local 
data, and local knowledge, including information gained from community 
engagement? HUD seeks comment on the extent to which it can achieve 
significant burden reduction for smaller program participants (and in 
particular small PHAs) by clarifying expectations in this manner rather 
than altering the proposed questions. In responding to this request for 
comment, to the extent a commenter contends that a particular program 
participant can or cannot reasonably conduct the analysis set forth in 
the proposed rule, please describe the relevant local circumstances for 
the program participant, including any demographic patterns, number of 
units or consolidated plan program allocations, and local 
infrastructure, as well as the analysis the commenter believes the 
question is requiring.
    b. HUD intends that the burden of analysis for many of the 
questions in the proposed rule will be lower for smaller program 
participants that have fewer people, places, and geographic areas to 
analyze and seeks comment on this topic. Do the questions proposed in 
Sec.  5.154 appropriately scale with the size and complexity of a 
program participant, such that it would be easier for smaller program 
participants to complete the analysis than larger program participants? 
For example, does the fact that smaller program participants often 
operate in smaller communities with fewer people, fewer community 
assets, and less public infrastructure make the analysis easier to 
complete? If so, how can HUD make explicit that the same question is 
expected to result in a less burdensome analysis for smaller or less 
complex program participants? What other mechanisms could be utilized 
to minimize the burden for all program participants, but particularly 
smaller program participants, while ensuring an appropriate analysis is 
conducted to meet the proposed requirements in this rule?
    c. Are there other ways in which HUD can alter the required 
analysis for small program participants that meaningfully reduce burden 
while ensuring an appropriate AFFH analysis such that these program 
participants can establish meaningful fair housing goals?
    d. To what extent, if any, should small program participants have 
modified community engagement requirements, such as requiring fewer in-
person meetings and allowing different formats for meetings? Are there 
other ways this proposed rule could modify community engagement 
requirements to reduce burden on small program participants, while 
ensuring that underserved communities and groups who have historically 
not participated in this type of engagement have the opportunity to be 
part of the process? For purposes of small program participants, are 
there other ways they may be able to receive equivalent input from the 
community, aside from those contemplated in the community engagement 
process set forth in the proposed rule, that would reduce their burden 
in obtaining local data and local knowledge, while still ensuring they 
have the necessary information to produce a well-informed and 
meaningful analysis?
    e. Would it be appropriate to modify the goal-setting requirements 
for smaller PHAs and consolidated plan participants and, if so, what 
modification would be appropriate? The proposed rule does not specify 
the number of goals that program participants must set. It does provide 
that program participants must set goals that collectively address each 
of the seven fair housing goal categories (which may require fewer than 
seven goals, since a goal can address more than one category), unless 
no fair housing issue is identified for any category, in which case no 
goal is required to address that category. HUD seeks comment on whether 
any modification of this requirement is appropriate for smaller 
entities.
    24. One way small program participants can reduce the burden of 
completing the required analysis is to complete joint Equity Plans with 
other program participants. HUD seeks comment on how it can further 
encourage small program participants to complete joint Equity Plans.
    25. HUD seeks comment on whether it is necessary to establish a 
definition of ``small PHA'' or ``small consolidated plan participant'' 
and, if so, how HUD should define these terms.
    26. Program participants who collaborate and conduct a joint Equity 
Plan may benefit from pooling resources to overcome fair housing 
issues. Are there further incentives HUD should or could offer to 
program participants that submit joint Equity Plans to HUD?
    27. Proposed Sec.  5.164 sets out the minimum criteria for when an 
Equity Plan must be revised. HUD seeks comment on whether the proposed 
Sec.  5.164 properly captures the circumstances under which a program 
participant should revise its Equity Plan, and in particular on the 
circumstances under which a disaster should or should not trigger the 
need for such revision.
    28. With respect to the proposed AFFH enforcement scheme, proposed 
Sec.  5.170 would provide that complaints alleging the failure of a 
program participant to affirmatively further fair housing must be filed 
with HUD within 365 days of the date of the last incident of the 
alleged violation, unless the Responsible Civil Rights Official extends 
the time limit for good cause. While noting that the proposed inclusion 
of a good cause exception reflects HUD's intent to be consistent with 
the regulations and practices of Federal agencies with respect to 
enforcement of various civil rights statutes, HUD specifically seeks 
comment on the following:

[[Page 8549]]

    a. Is 365 days an appropriate time limit? Are there specific 
considerations that argue for a longer or shorter time limit?
    b. What specific circumstances might constitute ``good cause,'' 
under which the Responsible Civil Rights Official might be justified in 
extending the proposed 365-day deadline (e.g., the conduct constituting 
the alleged violation was not known or made public within the 365-day 
period)? Are there specific concerns that mitigate against a good cause 
exception (e.g., a concern about inconsistent application)?
    29. A large amount of Federal funding flows through States to local 
jurisdictions, and HUD is interested in hearing about how States can 
utilize those funds to affirmatively further fair housing. HUD 
recognizes the unique planning responsibilities of States, as well as 
the wide variation in data, including with respect to the varying sizes 
and geographies of States (e.g., urban and rural areas). HUD 
specifically seeks comment on the data needs and tools that may be 
useful to States in conducting their Equity Plans.
    a. How can States encourage broader fair housing strategies at the 
State level and in localities, and what changes, if any, are needed to 
the proposed rule that could improve its effectiveness as a tool for 
States to further fair housing goals?
    b. Are there data that HUD could provide to States to assist and 
facilitate the fair housing analysis required by Sec.  5.154?
    c. Is there additional information HUD could provide to States, 
such as, for example, identifying regional issues where metropolitan 
areas cross State borders?
    d. How can HUD best display or provide data to States given their 
varied sizes and geographies in order to facilitate the analysis 
required by Sec.  5.154?
    e. Given the unique role that States play, does the analysis and 
content required in the Equity Plan provide States with sufficient 
opportunities to coordinate both within the State (e.g., across various 
departments, offices, or agencies as well as with local jurisdictions) 
and, as appropriate, with neighboring States?
    30. HUD seeks comment on whether the conforming amendments in 24 
CFR parts 91, 92, 93, 570, 574, 576, 903, and 983 are adequate to 
ensure that programmatic requirements are consistent with program 
participants' implementation of this proposed rule's requirements. 
Specifically, HUD seeks comment on whether the specific provisions 
amended are sufficient or whether additional amendments should be made. 
Are there specific ways in which HUD can further clarify the conforming 
amendments to assist program participants in understanding and 
fulfilling their obligations to affirmatively further fair housing?
    31. Certain definitions in this proposed rule contain language 
explaining how the defined term applies to the analysis required by 
Sec.  5.154 and the type of analysis that HUD expects to be included in 
an Equity Plan. HUD seeks comment on whether the inclusion of this type 
of language in the regulations is helpful and provides additional 
clarity regarding how the defined term should be used for purposes of 
developing an Equity Plan.
    32. As explained in this preamble, the proposed rule would take a 
different approach than the 2015 AFFH Rule did as it relates to 
circumstances in which HUD has not accepted a program participant's 
fair housing plan prior to the date HUD must accept or reject its 
programmatic plan (i.e., consolidated plan or PHA Plan). Under the 2015 
AFFH Rule, HUD was required to disapprove a program participant's 
programmatic plan under such circumstances, putting the program 
participant's continued funding at risk. This meant HUD had only two 
options: (a) accept a fair housing plan despite deficiencies or (b) 
terminate the program participant's funding. In practice, although HUD 
rejected some program participants' fair housing plans on initial 
review and required them to be revised and resubmitted, HUD then 
accepted every resubmitted plan before the program plan was due, and 
thus never invoked the only available remedy of rejecting a 
programmatic plan. In this proposed rule, HUD sets out a more flexible 
framework that would enable HUD to take additional steps that do not 
put funding immediately at risk but give a program participant a 
reasonable opportunity to address deficiencies and submit an acceptable 
fair housing plan. Under the proposed framework, HUD can reject a 
program participant's Equity Plan but accept its programmatic plan, 
allowing funding to continue so long as the program participant signs 
special assurances prepared by the Responsible Civil Rights Official 
that require the program participant to submit and obtain HUD 
acceptance of an Equity Plan by a specific date. The proposed rule 
provides that the program participant must commit to achieving an 
Equity Plan that meets regulatory requirements within 180 days of the 
end of the HUD review period for the programmatic plan and to amend its 
programmatic plans to reflect the Equity Plan's fair housing goals 
within 180 days of HUD's acceptance of the Equity Plan in order to 
continue to receive Federal financial assistance from HUD. A program 
participant's failure to enter into special assurances will result in 
disapproval of its funding plan. Those program participants that submit 
special assurances but do not fulfill them within the timeline provided 
will face enforcement action that includes the initiation of fund 
termination and a refusal to grant or to continue to grant Federal 
financial assistance. Consistent with the increased transparency this 
proposed rule provides, HUD will publicly post all executed special 
assurances, and subsequently publicly post Equity Plans submitted 
pursuant to the special assurances and HUD's decision to accept the 
plans or not. HUD requests specific feedback on this special assurance 
framework in general and on revisions that would better effectuate the 
purposes expressed here and throughout this preamble. In particular, 
HUD asks:
    a. Does the special assurance framework, which would make program 
participants that enter into special assurances subject to the remedies 
set out in Sec. Sec.  5.172 and 5.174, provide sufficient incentive for 
program participants to develop and submit compliant Equity Plans in a 
timely manner? Are there changes that can be made to this proposed rule 
that would further incentivize timely and sufficient submissions?
    b. Are the remedies available to HUD under this framework 
sufficient? Does HUD need to set forth with greater specificity the 
remedies that a program participant could face for failing to provide 
an acceptable Equity Plan by the time its programmatic plan must be 
accepted? In particular, should the final rule specify the 
circumstances under which a program participant necessarily will lose 
funding, and if so, what are those circumstances?

V. Findings and Certifications

Regulatory Planning and Review--Executive Orders 12866 and 13563

    Under Executive Order 12866,\29\ the Office of Management and 
Budget (OMB) must determine whether this regulatory action is 
``significant'' and, therefore, subject to the requirements of the 
Executive order and subject to review by OMB.
---------------------------------------------------------------------------

    \29\ Exec. Order on Regulatory Planning and Review, E.O. 12866, 
58 FR 190 (Oct. 4, 1993), https://www.reginfo.gov/public/jsp/Utilities/EO_12866.pdf.

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[[Page 8550]]

    This proposed action is ``significant'' and therefore subject to 
review by OMB under section 3(f)(4) of Executive Order 12866. The 
Department has assessed the potential costs and benefits, both 
quantitative and qualitative, of this proposed regulatory action and 
has determined that the benefits would justify the costs.
    The Department has also reviewed these proposed regulations under 
Executive Order 13563,\30\ which supplements and explicitly reaffirms 
the principles, structures, and definitions governing regulatory review 
established in Executive Order 12866. Executive Order 13563 also 
requires an agency ``to use the best available techniques to quantify 
anticipated present and future benefits and costs as accurately as 
possible.'' The Office of Information and Regulatory Affairs of OMB has 
emphasized that these techniques may include ``identifying changing 
future compliance costs that might result from technological innovation 
or anticipated behavioral changes.''
---------------------------------------------------------------------------

    \30\ Exec. Order on Improving Regulation and Regulatory Review, 
E.O. 13563, 76 FR 3821 (Jan. 18, 2011), https://www.govinfo.gov/content/pkg/FR-2011-01-21/pdf/2011-1385.pdf.
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    The Department is issuing the proposed regulations only on a 
reasoned determination that their benefits would justify their costs. 
In choosing among alternative regulatory approaches, the Department 
selected those approaches that maximize net benefits. HUD completed a 
Regulatory Impact Analysis for this proposal. This section summarizes 
the findings of that analysis and explains why the Department believes 
that the proposed regulations are consistent with the principles in 
Executive Order 13563.
    The Department also has determined that this regulatory action 
would not unduly interfere with State, local, or Tribal governments in 
the exercise of their governmental functions.
1. Need for Regulatory Action
    The segregation and disparities in access to opportunity that 
prompted the Fair Housing Act's drafters to codify the AFFH obligation 
persist. This Nation's failure to engage in a concerted and systematic 
effort to redress its history of housing discrimination has further 
perpetuated barriers to opportunity, compounding the damage done and 
heightening the need for regulatory action. This rule operationalizes 
the statutory obligation to AFFH by creating a streamlined structure 
for program participants to engage in fair housing planning, in the 
form of an Equity Plan, calculated to satisfy the AFFH mandate by 
prompting program participants to take meaningful actions to achieve 
outcomes that remedy the pervasive segregation and disparities in 
access to opportunity that the Fair Housing Act was designed to 
redress.
    This rule is necessary to establish an effective approach to 
implement the AFFH mandate. HUD is currently implementing the 
obligation to AFFH by requiring that HUD program participants certify 
that they will affirmatively further fair housing in their programs and 
activities. The current framework, established by the AFFH IFR, 
provides program participants with flexibility to choose the method of 
fair housing planning that they undertake to support their 
certification. However, the current regulatory regime would benefit 
from a standardized mechanism to promote compliance with the statutory 
obligation. This proposed rule restores the planning structure 
associated with the 2015 AFFH Rule, but with substantial improvements 
that increase transparency and accountability, while retaining 
flexibility for program participants to establish fair housing goals 
based on local circumstances.
    This rule creates a guided inquiry to enable program participants 
to engage in fair housing planning that empowers them to advance equity 
for members of protected class groups and underserved communities in 
their jurisdictions and set meaningful goals that effectuate positive 
fair housing outcomes. In addition, the rule establishes a direct 
connection between fair housing goals and subsequent planning processes 
in the consolidated plan, annual action plan, or PHA Plan, thus 
supporting program participants in embedding equity throughout their 
decision-making and planning processes as directed by Executive Order 
13985.
    Without such a guided inquiry, program participants will be greatly 
hindered in their efforts to redress inequities in their policies, 
activities, services, and programs that serve as barriers to 
opportunity and fair housing choice. The rule also provides both HUD 
and the public with enhanced transparency over, and participation in, a 
program participant's fair housing planning. This proposed rule would 
also address HUD's current lack of a mechanism to engage in oversight 
and enforcement to ensure that program participants comply with their 
AFFH obligations.
    The baseline situation would reflect a similar landscape as HUD's 
implementation of the AFFH obligation prior to the promulgation of the 
2015 AFFH Rule. Prior to that rule, without a formal regulatory 
planning scheme in place, HUD's implementation of the AFFH obligation 
was reliant on providing program participants with guidance, mainly in 
the form of the Fair Housing Planning Guide, to support a broadly 
permissive approach to fair housing planning which did not require 
submission of fair housing planning documents to HUD for review. 
However, as noted by advocates, stakeholders, and community members, 
and reinforced by the U.S Government Accountability Office in its 
report, ``HUD Needs to Enhance Its Requirements and Oversight of 
Jurisdiction's Fair Housing Plans,'' \31\ such an approach failed to 
ensure that program participants consistently embedded the required 
fair housing considerations in their decision-making processes. This 
approach also prevented HUD from engaging in effective oversight of 
fair housing planning.
---------------------------------------------------------------------------

    \31\ GAO-10-905, Sept. 14, 2010, available at https://www.gao.gov/products/gao-10-905.
---------------------------------------------------------------------------

    HUD's recently published AFFH IFR was intended to be an interim 
measure, necessary to expeditiously repeal the PCNC Rule and restore 
legally supportable definitions and certifications for program 
participants. This proposed rule would reinstate an effective and 
meaningful regulatory scheme to implement the AFFH mandate, enhanced by 
efficiencies derived from lessons learned from the implementation of 
the 2015 AFFH Rule.
    With appropriate planning, guided by the Equity Plan framework laid 
out in this rule, program participants can be more intentional and 
strategic in their work to take meaningful actions that overcome 
patterns of segregation and foster inclusive communities. This proposed 
rule offers a more streamlined approach to better ensure that tangible 
fair housing outcomes are achieved. This rule also commits HUD to 
helping program participants more easily identify where equity in their 
communities is lacking and how they can advance equity for protected 
class groups using HUD funds and other investments.
2. Summary Discussion of Costs, Benefits
    HUD has analyzed the costs and benefits of complying with this 
proposed regulation. HUD firmly believes that the benefits of this rule 
justify the costs of compliance. While program participants will incur 
costs associated with compliance, including in the development of the 
Equity Plan, HUD believes such costs are justified by the benefits to 
society and to individuals of not having to endure the

[[Page 8551]]

costs of racial and other forms of inequity. Additionally, as noted, 
the approach here reduces prior burdens associated with fair housing 
planning imposed by the 2015 AFFH Rule, greatly alleviating the 
compliance costs that were associated with the 2015 AFFH Rule.
3. Benefits of the Proposed Regulations
    HUD has analyzed the benefits of complying with the proposed 
regulations. Executive Order 13985 begins with an acknowledgement that 
equal opportunity is the bedrock of our democracy. Yet because of our 
country's legacy of segregation, systemic racism, and other forms of 
injustice against protected groups, far too many have been denied equal 
opportunity. This rule directly implements this Executive order's 
command of affirmatively advancing equity, requiring that program 
participants, with the support of HUD, identify and address housing-
related disparities and other significant disparities in access to 
opportunity. This rule would specifically provide substantial benefits 
directly to groups protected by the Act by requiring HUD program 
participants to expand fair housing choice and improve access to 
opportunity. By enhancing such opportunity for these groups, 
implementation of this proposed rule will also promote a more just and 
equal society.
    Current patterns of residential segregation are largely reflective 
of this Nation's legacy of racially discriminatory housing, ableism, 
and other policies. As noted earlier in this preamble, these vestiges 
of discrimination, as well as the corresponding inequitable access to 
opportunity, persist to this day. This proposed rule requires program 
participants to redress these injustices. Program participants will be 
required to promote fair housing choice, enhancing the opportunity for 
protected groups to live where they choose by addressing the variety of 
barriers that inhibit such access. For many program participants, 
expanding access to fair housing choice will necessitate both 
preserving and expanding accessible and affordable housing 
opportunities, a critical and urgent need for this country. In 
particular, this rule requires an analysis of barriers to affordable 
housing, representing a key opportunity for program participants to 
identify the policies and practices, such as land use and zoning 
ordinances, that impede the development and maintenance of affordable 
housing commensurate with need.
    Increasing access to homeownership opportunities based on race can 
begin to address the racial wealth gap, enabling families of color to 
accumulate wealth and develop financial security.\32\ Individuals with 
disabilities will also greatly benefit from enhanced access to 
accessible and affordable housing opportunities, particularly where 
expanded affordable housing enables individuals with disabilities to 
access supportive services in a community-based setting.
---------------------------------------------------------------------------

    \32\ See supra note 16, McCargo and Choi; note 17, Schuetz.
---------------------------------------------------------------------------

    This rule creates a clearer definition of a balanced approach. A 
balanced approach entails the balancing of place-based strategies that 
target investment in areas that have historically been denied critical 
resources along with strategies designed to combat segregation and 
promote integration of protected class groups. There is a thorough and 
growing body of social science research documenting the enhanced 
quality of life outcomes based on living in well-resourced areas of 
opportunity.\33\ As noted above, growing up in neighborhoods with lower 
levels of poverty improves children's long-term prospects, through a 
combination of a variety of factors, including through greater access 
to quality schools and lower exposure to environmental and other health 
hazards. This research furnishes strong empirical support for the 
proposition that where one lives has a profound impact on their 
trajectory in life. By facilitating moves to areas of opportunity on a 
substantial scale, as well as place-based transformation of existing 
areas to areas with opportunity, this rule has the capacity to improve 
the quality of life of many individuals.\34\
---------------------------------------------------------------------------

    \33\ See supra notes 8, 9, 10, 11, 12, 15.
    \34\ Id.; see also infra note 12.
---------------------------------------------------------------------------

    The concept of community assets, embedded as a critical focus in 
the Equity Plan framework used by the rule, acknowledges that 
residential segregation did not simply act to produce racially 
homogenous neighborhoods. Rather, segregation also acted to deprive 
people of color of access to high-quality features that enhance 
equality of opportunity and quality of life.\35\ Disparities in access 
to community assets overlap significantly with enduring patterns of 
residential segregation. By directly requiring that program 
participants consider community assets in their fair housing planning, 
this rule will prompt greater access for underserved populations to, 
among other features, environmentally healthy neighborhoods, grocery 
stores, employment opportunities that pay a living wage, and reliable 
transportation services.
---------------------------------------------------------------------------

    \35\ See, e.g., Troustine, Segregation by Design: Local Politics 
and Inequality in American Cities, November 2018.
---------------------------------------------------------------------------

    For example, the rule critically identifies ``high quality 
schools'' as an example of a community asset that is not often 
equitably distributed and available within communities. In 1954, the 
Supreme Court in Brown v. Board of Education found that separate 
educational facilities are inherently unequal.\36\ Yet students of 
color across the Nation are still disproportionately confined to 
racially and economically segregated, underfunded schools.\37\ 
Disparities in access to equal educational opportunity continue to 
persist based on protected class group, largely because where a child 
lives often dictates their ability to attend a high-quality school. 
Research has shown that most schools' racial composition is relatively 
similar to that of their surrounding neighborhoods due to existing 
school boundaries, which has perpetuated school segregation.\38\ This 
rule acknowledges the direct link between housing opportunities and 
access to equal educational opportunity and prompts program 
participants to address and eliminate discriminatory housing policies 
that lead to segregation among schools.\39\
---------------------------------------------------------------------------

    \36\ Brown v. Bd. of Educ. of Topeka (No. 1.), 347 U.S. 483, 495 
(1954).
    \37\ ``Closing America's Education Funding Gaps,'' The Century 
Foundation (July 22, 2020), https://tcf.org/content/report/closing-americas-education-funding/.
    \38\ Richard V. Reeves, Nathan Joo, and Grover J. ``Russ'' 
Whitehurst, ``How school district boundaries can create more 
segregated schools,'' Brookings (November 20, 2017), https://www.brookings.edu/blog/social-mobility-memos/2017/11/20/how-school-district-boundaries-can-create-more-segregated-schools/.
    \39\ See also Executive Order on White House Initiative on 
Advancing Educational Equity, Excellence, and Economic Opportunity 
for Black Americans (October 19, 2021), https://www.whitehouse.gov/briefing-room/presidential-actions/2021/10/19/executive-order-on-white-house-initiative-on-advancing-educational-equity-excellence-and-economic-opportunity-for-black-americans/.
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    Recent research has identified the extent to which modification of 
a single school's boundary can upend entrenched patterns of residential 
and corresponding school segregation.\40\ This research highlights the 
dramatic degree to which school attendance boundaries demarcate 
racially and ethnically unequal schools, with corresponding data 
identifying the extent to which these schools are also

[[Page 8552]]

unequal in terms of student achievement, staffing, academic offerings, 
and discipline rates.\41\ In turn, unequal schools further perpetuate 
both racial and ethnic segregation.\42\ This research simultaneously 
illuminates the depth of this persistent problem while also showcasing 
the extent to which the housing-school segregation relationship can be 
disrupted through meaningful yet realistic actions by program 
participants within their control. In addition to perpetuating the 
racial achievement gap, such segregation often denies equal educational 
opportunity to many students with disabilities, who lack access to 
well-resourced special education programs and related services.
---------------------------------------------------------------------------

    \40\ Tomas Monarrez & Carina Chien, ``Dividing Lines: Racially 
Unequal School Boundaries in US Public School Systems,'' Urban 
Institute (September 2021), https://www.urban.org/research/publication/dividing-lines-racially-unequal-school-boundaries-us-public-school-systems.
    \41\ Id.
    \42\ Id.
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    The proposed rule also offers healthcare services as another 
example of a community asset. Disparities in access to healthcare 
services, particularly for individuals of color, have been widely 
documented. The Centers for Disease Control (CDC) has highlighted the 
extent to which the COVID-19 pandemic has unequally affected many 
racial and ethnic minority groups, placing them at higher risk of 
getting sick and dying from COVID-19.\43\ The American Medical 
Association explains that racial and ethnic minorities experience a 
lower quality of health care, are less likely to receive routine 
medical care, and face higher rates of morbidity and mortality than 
nonminorities.\44\ By asking program participants to consider 
inequities in access to healthcare services that are driven by lack of 
fair housing choice, this proposed rule would seek to expand critical 
access for racial minorities and other protected class groups to 
quality healthcare services.
---------------------------------------------------------------------------

    \43\ CDC, Health Equity Considerations and Racial and Ethnic 
Minority Groups, https://www.cdc.gov/coronavirus/2019-ncov/community/health-equity/race-ethnicity.html.
    \44\ See Reducing Disparities in Health Care, American Medical 
Association, available at https://www.ama-assn.org/delivering-care/patient-support-advocacy/reducing-disparities-health-care.
---------------------------------------------------------------------------

    Finally, the proposed rule also implements a more transparent 
process, allowing the public to have access to all submitted Equity 
Plans. This will afford the public an opportunity to provide comments 
to HUD on Equity plan submissions, allowing the public to provide the 
Department with information relating to a submission that may be useful 
to HUD in its review of the Equity Plan. The rule also creates a 
mechanism for HUD to engage in oversight and enforcement of the 
obligation to affirmatively further fair housing, increasing the 
likelihood that program participants achieve tangible outcomes that 
advance equity and increase opportunity for protected groups.

Quantifiable Benefits

    There will be substantial benefits associated with the promulgation 
of this rule. The precise manner in which program participants will 
comply with this obligation will vary substantially based on the unique 
local fair housing issues of each program participant. Therefore, it is 
not possible to quantify many of these benefits with precision. 
However, once implemented, HUD expects this rule will greatly enhance 
the welfare of members of protected class groups across a variety of 
quality-of-life metrics.

Benefits That Cannot Be Quantified

    In acknowledging the limitations of assessing proposed regulations 
exclusively based on those benefits that can be quantified, Executive 
Order 12866 and Executive Order 13563 require that agencies include 
qualitative consideration of benefits. This principle, recently 
affirmed by the White House's Memorandum on Modernizing Regulatory 
Review, acknowledges that many of the benefits associated with an 
agency's rulemaking, including equity, justice, and human dignity, are 
difficult or impossible to quantify.
    This rule would promote social welfare, racial justice, human 
dignity, and equity, essential values not susceptible to 
quantification. By requiring that program participants effectuate 
positive fair housing outcomes by reducing longstanding inequities 
faced by people of color, persons with disabilities, and other 
protected class groups, this rule would greatly advance racial justice 
and begin to redress our Nation's history of discriminatory housing 
policies and practices. It is not enough for governments of all levels 
to acknowledge the role they played in systematically declining to 
invest in communities. They must take meaningful actions to overcome 
the effects of past and current injustices, which HUD is requiring in 
this rule.
    Individuals with disabilities have historically faced 
discrimination that has limited their opportunity to live independently 
in community-based settings, resulting in them unnecessarily living in 
institutions or other segregated settings that limit their autonomy and 
ability to enjoy the freedom of expression and association that is part 
of everyday life in the United States. Preventing unnecessary 
institutionalization and enabling an individual with a disability to 
live independently and access affordable accessible housing and 
supportive services in their community is invaluable. Additionally, by 
improving access to efficient and accessible transportation for this 
group, individuals with disabilities are more likely to enjoy the 
independence and dignity associated with employment that pays a living 
wage.
    This rule will also spur program participants to take actions to 
ensure that other underserved communities have equitable access to 
affordable housing opportunities, including for LGBTQ+ persons and 
survivors of domestic violence who face discrimination because of their 
protected characteristics. Facilitating access to housing can serve as 
a critical lifeline for these populations that have long been denied 
equal access in many aspects of American life. While the precise fair 
housing goals will vary based on the program participant, in the 
aggregate, these benefits will likely be realized after implementation 
of this rule. Although the Department cannot, at this time, entirely 
quantify the economic impacts of the benefits outlined above, the 
Department believes that they are substantial and outweigh the 
estimated costs of the proposed regulations.
4. Costs of the Proposed Regulations
    HUD does not expect a large change in compliance cost as a result 
of the rule, as States, local governments, and PHAs are already 
required to engage in fair housing planning to support their 
certifications. As discussed more fully in the Regulatory Impact 
Analysis, HUD estimates a low-end collective compliance cost impact of 
$21.4 million per 5-year planning cycle for program participants, or 
about $4.3 million per year. HUD estimates the high-end collective 
compliance cost to be $135 million per 5-year planning cycle for 
program participants, or about $27 million per year. The aggregate cost 
of complying with the planning requirements in this proposed rule is 
not uniformly distributed among the 5,000 program participants that 
would bear the costs. Costs would vary among program participants due 
to several factors.
    Given the many uncertainties in the precise cost program 
participants will incur in complying with the planning processes 
proposed in this rule, HUD requests public comment on the accuracy of 
the assumptions contained

[[Page 8553]]

in estimates in the Regulatory Impact Analysis. As explained above, HUD 
is committed to mitigating compliance costs for these entities by 
providing technical assistance, including related to the HUD-provided 
data, particularly so that the required analysis and planning can be 
completed without the need to hire external consultants and 
contractors.
    HUD also notes that the goal of this rule is to establish a 
regulatory framework by which program participants may more effectively 
meet an existing statutory obligation; one that has applied to all 
recipients of Federal financial assistance for over 50 years. HUD 
intends for the streamlined analysis proposed in this rule to enhance 
the efficacy of the fair housing process while lightening the burden 
faced by program participants in complying with the statutory 
requirement.
4. A Selected Changes in the Proposed Regulation Not Estimated To Have 
Costs
    HUD does not anticipate that most of the provisions in this 
proposed rule would generate costs for program participants. Program 
participants are currently required to certify compliance with a 
definition of AFFH that is substantially similar to the definition 
proposed in this rule. Thus, to support this certification, program 
participants must currently incur some costs to comply. While this rule 
would reduce some of the currently provided flexibility in fair housing 
planning, given the streamlined nature of the Equity Plan, HUD 
anticipates that program participants can accomplish the requirements 
of this rule by using their existing fair housing planning 
infrastructure.
    As noted earlier in the preamble, this proposed rule refocuses fair 
housing planning toward the development of meaningful fair housing 
goals through the Equity Plan framework, which will make the fair 
housing planning process simpler, while also improving the likelihood 
of success for program participants. This proposed rule contains 
substantially fewer questions compared to the requirements of the 2015 
AFFH Rule for program participants to answer to determine how best to 
advance equity for members of protected class groups and underserved 
communities in their jurisdictions. To the extent program participants 
were using a process analogous to the 2015 AFFH Rule to support their 
fair housing planning, this proposed rule would reduce much of that 
analysis.
    HUD has further committed to providing program participants with a 
data analysis to inform fair housing planning, which, when supplemented 
with local knowledge, will streamline the identification of fair 
housing issues. The Department will also provide robust technical 
assistance and feedback to program participants during the Equity Plan 
process. Taken together, these process improvements are likely to 
reduce the compliance costs associated with this rule, let alone impose 
additional costs over current compliance costs.

Distributional Impacts

    As noted, HUD believes that the benefits of this rule will exceed 
the costs associated with compliance. Even if the aggregate costs 
associated with compliance with this rule exceeded the net benefits, 
the rule would still be justified due to its distributional impacts. 
Under applicable Executive orders governing agency rulemaking, as well 
as OMB Circular A-4, agencies are required to consider the 
distributional impacts associated with any rulemaking to ensure that 
the regulation appropriately benefits, and does not inappropriately 
burden, disadvantaged, vulnerable, or marginalized communities.
    By design and definition, this rule will distribute substantial 
benefits to groups that lack equitable access to fair housing 
opportunities, often because they have historically experienced 
disadvantage. The benefits of this rule will be accrued primarily by 
protected groups as defined by the Fair Housing Act. These are groups 
that have been and continue to be denied fair housing choice, isolated 
in racially or ethnically concentrated areas of poverty or other 
segregated settings, and subjected to disparities in access to 
opportunity. HUD also does not believe that this rule places any burden 
on these groups. In light of the modest anticipated compliance costs 
associated with the rule, HUD believes that the substantial 
distributional benefits justify the promulgation of this rule.
5. Regulatory Alternatives Considered
    The Department considered the following alternatives to the 
proposed regulations (1) leaving the current regulations in place 
without issuing the proposed regulations and (2) repromulgating the 
2015 AFFH Rule. The Department rejected alternative (1) for the reasons 
expressed in the preamble. The current regime, while providing 
substantial flexibility, lacks a standardized mechanism to promote 
compliance with the statutory obligation. Under the current framework, 
HUD also lacks the ability to engage in effective oversight and 
enforcement of program participants' fair housing planning. Alternative 
(2) was also rejected for reasons expressed in the preamble. This 
proposed rule provides a more transparent and streamlined approach than 
the one HUD implemented in 2015 to help guide communities in taking 
meaningful actions to achieve tangible fair housing outcomes. After 
careful consideration of these alternatives, the Department believes 
that the proposed regulations represent the most effective way to 
implement the obligation to affirmatively further the purposes and 
policies of the Fair Housing Act.

Environmental Impact

    This proposed rule is a policy document that sets out fair housing 
and nondiscrimination standards. Accordingly, under 24 CFR 
50.19(c)(13), this proposed rule is categorically excluded from 
environmental review under the National Environmental Policy Act of 
1969 (42 U.S.C. 4321 et seq.).

Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) generally 
requires an agency to conduct a regulatory flexibility analysis of any 
rule subject to notice and comment rulemaking requirements, unless the 
agency certifies that the rule will not have a significant economic 
impact on a substantial number of small entities. The undersigned 
certifies that this rule would not have a significant economic impact 
on a substantial number of small entities.
    This rule proposes to strengthen the way in which HUD and its 
program participants meet the requirement under the Fair Housing Act to 
take affirmative steps to further fair housing. The preamble identifies 
the statutes, executive orders, and judicial precedent that address 
this requirement and that place responsibility directly on certain HUD 
program participants, specifically local governments, States, insular 
areas, and PHAs, underscoring that the use of Federal funds must 
promote fair housing choice and open communities. Although local 
governments, States, insular areas, and PHAs must affirmatively further 
fair housing independent of any regulatory requirement imposed by HUD, 
HUD recognizes its responsibility to provide leadership and direction 
in this area, while preserving local determination of fair housing 
needs and strategies.
    This rule primarily focuses on establishing a regulatory framework 
by which program participants may more

[[Page 8554]]

effectively meet their statutory obligation to affirmatively further 
fair housing. The statutory obligation to affirmatively further fair 
housing applies to all program participants, large and small. The 
statutory obligation requires program participants to develop 
strategies to affirmatively further fair housing as part of statutorily 
imposed plans that address the use of HUD funds and that must be 
submitted to HUD for review and approval. This proposed rule builds on 
the statutory requirements to affirmatively further fair housing in 
conjunction with the development of consolidated plans for States, 
insular areas, and local governments, and PHA Plans for PHAs, and, in 
doing so, provides for all program participants to comply with their 
statutory requirements in a cost-efficient, yet meaningful and 
effective manner.
    The current statutory requirement imposed on States, insular areas, 
local governments, and PHAs requires the program participant to certify 
that it is affirmatively furthering fair housing. While that 
certification is a simple and brief document submitted to HUD, it 
nevertheless represents the attestation of the program participant that 
it will take meaningful actions to affirmatively further fair housing. 
While the certification is an important component of a program 
participant's statutory obligation to affirmatively further fair 
housing, even more important are the specific actions the program 
participant takes to affirmatively further fair housing. Because the 
Fair Housing Act requires that HUD programs and activities be 
administered in a manner that affirmatively furthers the policies of 
the Fair Housing Act, it is important for HUD to review the plans that 
delineate how HUD programs will be implemented so that the Secretary 
can be assured that HUD program participants are in fact affirmatively 
furthering fair housing. The proposed rule, therefore, provides for 
program participants to submit an Equity Plan to HUD.
    The rule proposes to reduce administrative burden on program 
participants in preparing and submitting an Equity Plan to HUD as 
compared to the prior AI or AFH processes because HUD has proposed to 
codify, in this proposed rule, the precise and direct questions to 
which program participants must respond and will assist program 
participants by providing data, guidance, and technical assistance. HUD 
will continue to provide local and regional data on access to community 
assets, such as education, transportation, employment, low-poverty 
exposure, as well as patterns of integration and segregation, and the 
demographics of particular types of housing. By responding to the 
questions in this proposed rule, engaging with their communities, and 
bringing to bear the knowledge they already have, along with relying on 
the HUD-provided data, program participants will engage in a more 
meaningful evaluation of who has access to equity in their communities. 
This more straightforward and direct analysis will allow program 
participants to more clearly identify how HUD funds can be used to 
promote equity, overcome patterns of segregation, and increase access 
to opportunity and community assets for underserved communities. HUD 
will also be available to provide technical assistance to program 
participants in the development of their Equity Plans and 
implementation of meaningful fair housing strategies and actions. It is 
HUD's position that this more streamlined approach will reduce burden 
for program participants, large and small, in meeting their statutory 
obligation to affirmatively further fair housing, relative to the 2015 
AFFH Rule. Nonetheless, HUD is sensitive to the fact that the uniform 
application of requirements on entities of differing sizes often places 
a disproportionate burden on small entities. HUD commits to provide 
guidance to small entities on how the Equity Plan's direct questions 
may be answered without the need for consultants, contractors, 
statisticians, or other experts and how they may still establish 
meaningful and achievable fair housing goals that result in a material 
positive change.

Executive Order 13132, Federalism

    Executive Order 13132 (entitled ``Federalism'') prohibits, to the 
extent practicable and permitted by law, an agency from promulgating a 
regulation that has federalism implications and either imposes 
substantial direct compliance costs on State and local governments and 
is not required by statute, or preempts State law, unless the relevant 
requirements of section 6 of the Executive order are met. This rule 
does not have federalism implications and does not impose substantial 
direct compliance costs on State and local governments or preempt State 
law within the meaning of the Executive order.
    The proposed rule will assist program participants of HUD funds to 
satisfactorily fulfill the statutory obligation to affirmatively 
further fair housing. As HUD has noted in the preceding section 
discussing the Regulatory Flexibility Act, and in the Background 
section of this preamble, the obligation to affirmatively further fair 
housing is imposed by statute directly on local governments, States, 
insular areas, and PHAs. As the agency charged with administering the 
Fair Housing Act, HUD is responsible for overseeing that its programs 
are administered in a manner that affirmatively furthers the fair 
housing and civil rights-related purposes and policies of the entities 
receiving HUD funds and that they fulfill their affirmatively 
furthering fair housing obligation.
    The approach taken by HUD in this proposed rule is to help local 
governments, States, insular areas, and PHAs meet this obligation in a 
way that is meaningful, but without undue burden. As noted throughout 
this preamble, HUD proposes to provide local and regional data on 
patterns of integration and segregation and access to community assets 
such as education, transportation, employment, and other important 
community amenities. This approach, in which HUD offers data, clear 
standards and required areas of analysis, guidance, and technical 
assistance, is anticipated to reduce burden and costs that have 
historically been involved in regulatory schemes governing 
affirmatively furthering fair housing. Since Federal law requires 
States, insular areas, local governments, and PHAs to affirmatively 
further fair housing, there is no preemption, by this rule, of State 
law.

Paperwork Reduction Act

    The information collection requirements contained in this proposed 
rule will be submitted to the Office of Management and Budget (OMB) 
under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). In 
accordance with the Paperwork Reduction Act, an agency may not conduct 
or sponsor, and a person is not required to respond to, a collection of 
information, unless the collection displays a currently valid OMB 
control number.
    Currently, States, local governments, and PHAs are encouraged to 
prepare written plans to affirmatively further fair housing, undertake 
activities to overcome identified barriers to fair housing choice, and 
maintain records of the activities and their impact consistent with 
their planning documents and certification. This burden is generally 
accounted for in the Consolidated Planning and PHA Plan Information 
Collection Requests (ICRs). OMB Control No. 2506-0117 (Consolidated 
Plan, Annual Action Plan & Annual Performance Report) estimates 1,234 
Localities spend 305 hours

[[Page 8555]]

annually on their planning and 50 States spend 741 hours annually on 
their planning. OMB Control No. 2577-0226 (PHA Plans) estimates that 
3,780 PHAs will spend 37.88 hours annually on their planning.
    These currently approved collections do not account for the 
specific burden for the affirmatively furthering fair housing 
activities addressed in this notice of proposed rulemaking. HUD 
proposes that the burden of these ICRs would be reduced by accounting 
for the burden of the affirmatively furthering fair housing planning 
process provided for in this new ICR. HUD estimates that the burden 
reduction for the existing collection would be 5%, which HUD would 
update in future revisions to ICR 2506-0117 and ICR 2577-0226. HUD 
estimates that the burden hours to develop an Equity Plan will be on a 
sliding scale from the largest program participants to the smallest 
considering that the number of factors to consider in an Equity Plan 
also scales to the size of the program participant. As detailed more 
fully below, for example, HUD estimates it would take 150 hours for the 
largest program participants to develop an Equity Plan, i.e., those 
consolidated planning program participants receiving more than $100 
million in annual entitlement allocations and PHAs with 50,000 or more 
combined public housing and HCV units, as compared to 50 hours for the 
smallest consolidated planning and PHA program participants, i.e., 
those consolidated planning program participants receiving less than $1 
million in annual entitlement allocations and PHAs with 1,000 or fewer 
public housing and HCV units.
    HUD provides these sliding scale estimates for several reasons. HUD 
proposes significant changes in this proposed rule from the final 2015 
AFFH Rule in order to reduce burden. In particular, HUD is proposing to 
codify the analysis questions for all program participants rather than 
having separate assessment tools subject to change through PRA every 
three years. Because larger program participants tend to operate in 
larger geographic areas with larger populations, in particular, large 
metropolitan areas, States, and insular areas, these larger program 
participants will have more content to analyze. Conversely, smaller 
program participants tend to operate in less densely populated areas 
and tend to have fewer community assets. The questions proposed are 
expected to scale with the size of the jurisdiction of the program 
participant. In addition, HUD has eliminated various components of the 
2015 AFFH Rule's AFH analysis, including, for example, the contributing 
factors analysis. HUD anticipates that the more streamlined Equity Plan 
analysis, which will not change every three years pursuant to PRA, will 
provide a significantly reduced burden. HUD also bases these estimates, 
including the sliding scale, on the burden hours estimated for AFH 
preparation during implementation of the 2015 AFFH Rule. Smaller 
program participants took significantly less time to prepare AFHs than 
did the larger program participants, and the AFHs were similarly less 
extensive. These combined factors led to HUD's estimate of 150 hours 
for the largest program participants, which is 50 hours less than the 
expected burden for the preparation of all AFHs under the 2015 AFFH 
Rule.
    HUD notes that while these burdens are listed as annual 
obligations, the majority of any burden will happen for most program 
participants once every five years. Based on HUD's experience 
implementing its 2015 AFFH Rule, HUD estimates that 50% of plans will 
be joint Equity Plans, whereby burden is significantly reduced for 
program participants. HUD estimates that such joint Equity Plans will, 
on average, include four joint program participants, and the program 
participant burden will be reduced to 50 hours per program participant.
    In certain circumstances, program participants will be required to 
revise their Equity Plans. HUD anticipates that 5% of program 
participants would be required to or voluntarily would revise their 
Equity Plan, and the revised planning process would take an additional 
50 hours per participant. As part of the Equity Plan and revising such 
plan, program participants will have to complete community engagement 
activities and maintain records of these activities. HUD estimates that 
recordkeeping under the proposed rule will be 5 hours per program 
participant. In support of their progress under the Equity Plan, 
program participants must complete and provide to HUD annual progress 
evaluations which are estimated for each program participant to take 10 
hours.
    As a part of this rulemaking, HUD is providing a process whereby 
individuals can submit complaints related to the program participant's 
obligations to affirmatively further fair housing, and HUD anticipates 
100 complaints to be received each year, with an estimated total 
processing burden time of 10 hours for program participants.
    The burden of the information collections in this proposed rule is 
estimated as follows:

                                       Reporting and Recordkeeping Burden
----------------------------------------------------------------------------------------------------------------
                                                                                     Estimated
                                                                     Number of     average time        Total
                Section reference                    Number of     responses per        for          estimated
                                                      parties          party        requirement    annual burden
                                                                                      (hours)         (hours)
----------------------------------------------------------------------------------------------------------------
      Sec.  Sec.   5.154, 5.168(a)(1) and (3) Equity Plan--Analysis, Fair Housing Goals, Meaningful Actions
----------------------------------------------------------------------------------------------------------------
Consolidated Plan Program Participant (States,        \45\ 1,250               1  ..............  ..............
 Insular Areas, Local Governments, and
 Consortia).....................................
$100 Million or More............................              10               1             150           2,700
$30-99 Million..................................              40               1             125           6,000
$1-29 Million...................................             660               1             100          63,800
Less than $1 Million............................             540               1              50          24,150
                                                 ---------------------------------------------------------------
    Total Consolidated Plan Program Participant   ..............  ..............  ..............          96,650
     Burden.....................................
All PHAs........................................      \46\ 3,835               1  ..............  ..............
50,000 or More Public Housing and Voucher Unit                 5               1             150             600
 PHAs...........................................
10,000-49,999 Public Housing and Voucher Unit                 50               1             125           6,125
 PHAs...........................................
1,000-9,999 Public Housing and Voucher Unit PHAs             610               1             100          61,000
Fewer than 1,000 Public Housing and Voucher Unit           3,170               1              50         158,600
 PHAs...........................................
                                                 ---------------------------------------------------------------

[[Page 8556]]

 
    Total PHA Plan Program Participant Burden...  ..............  ..............  ..............         226,325
Joint Equity Plans (Total Burden for All Joint             2,511               1              50         125,550
 Program Participants Combined).................
Cumulative Total Burden Hours for Equity Plans             5,022  ..............  ..............       * 287,038
 and Joint Equity Plans.........................
Sec.  Sec.   5.158, 5.168 Recordkeeping for                5,022               1               5          25,110
 Community Engagement and Other Activities......
Sec.   5.160(f) Annual progress evaluations.....           5,022               1              10          50,220
Sec.   5.170 Complaints.........................             100               1              10           1,000
Sec.  Sec.   5.162(c) and 5.164 Revisions of                 251               1              50          12,550
 Equity Plans...................................
                                                 ---------------------------------------------------------------
    Total Burden................................  ..............  ..............  ..............         375,918
----------------------------------------------------------------------------------------------------------------
*(Con Plan + PHA)/2 + Joint Equity Plan.

    In accordance with 5 CFR 1320.8(d)(1), HUD is soliciting comments 
from members of the public and affected agencies concerning this 
collection of information to:
---------------------------------------------------------------------------

    \45\ Based on FY2021 data.
    \46\ Based on FY2022 data.
---------------------------------------------------------------------------

    (1) Evaluate whether the proposed collection of information is 
necessary for the proper performance of the functions of the agency, 
including whether the information will have practical utility;
    (2) Evaluate the accuracy of the agency's estimate of the burden of 
the proposed collection of information;
    (3) Enhance the quality, utility, and clarity of the information to 
be collected; and
    (4) Minimize the burden of the collection of information on those 
who are to respond, including through the use of appropriate automated 
collection techniques or other forms of information technology, e.g., 
permitting electronic submission of responses.
    Interested persons are invited to submit comments regarding the 
information collection requirements in this rule. Comments must refer 
to the proposal by name and docket number (FR-5593-P-01) and must be 
sent to:

HUD Desk Officer, Office of Management and Budget, New Executive Office 
Building, Washington, DC 20503, Fax: (202) 395-6947
And

Reports Liaison Officer, Office of Public and Indian Housing, 
Department of Housing and Urban Development, Room 451, 7th Street SW, 
Washington, DC 20410

    Interested persons may submit comments regarding the information 
collection requirements electronically through the Federal eRulemaking 
Portal at https://www.regulations.gov. HUD strongly encourages 
commenters to submit comments electronically. Electronic submission of 
comments allows the commenter maximum time to prepare and submit a 
comment, ensures timely receipt by HUD, and enables HUD to make them 
immediately available to the public. Comments submitted electronically 
through the https://www.regulations.gov website can be viewed by other 
commenters and interested members of the public. Commenters should 
follow the instructions provided on that site to submit comments 
electronically.

List of Subjects

24 CFR Part 5

    Administrative practice and procedure, Aged, Claims, Grant 
programs--housing and community development, Individuals with 
disabilities, Intergovernmental relations, Loan programs--housing and 
community development, Low and moderate income housing, Mortgage 
insurance, Penalties, Pets, Public housing, Rent subsidies, Reporting 
and recordkeeping requirements, Social security, Unemployment 
compensation, Wages.

24 CFR Part 91

    Aged, Grant programs--housing and community development, Homeless, 
Individuals with disabilities, Low and moderate income housing, 
Reporting and recordkeeping requirements.

24 CFR Part 92

    Administrative practice and procedure, Grant programs--housing and 
community development, Low and moderate income housing, Manufactured 
homes, Rent subsidies, Reporting and recordkeeping requirements.

24 CFR Part 93

    Administrative practice and procedure, Grant programs--housing and 
community development, Low- and moderate-income housing, Manufactured 
homes, Rent subsidies, Reporting and recordkeeping requirements.

24 CFR Part 570

    Administrative practice and procedure, American Samoa, Community 
development block grants, Grant programs--education, Grant programs--
housing and community development, Guam, Indians, Lead poisoning, Loan 
programs--housing and community development, Low and moderate income 
housing, New communities, Northern Mariana Islands, Pacific Islands 
Trust Territory, Pockets of poverty, Puerto Rico, Reporting and 
recordkeeping requirements, Small cities, Student aid, Virgin Islands.

24 CFR Part 574

    Community facilities, Disabled, Grant programs--health programs, 
Grant programs--housing and community development, Grant programs--
social programs, HIV/AIDS, Homeless, Housing, Low and moderate income 
housing, Non profit organizations, Rent subsidies, Reporting and 
recordkeeping requirements, Technical assistance.

24 CFR Part 576

    Community facilities, Emergency solutions grants, Grant programs--
housing and community development, Grant program--social programs, 
Homeless, Reporting and recordkeeping requirements.

24 CFR Part 903

    Administrative practice and procedure, Public housing, Reporting 
and recordkeeping requirements.

[[Page 8557]]

24 CFR Part 983

    Grant programs--housing and community development, Grant programs--
Indians, Indians, Public Housing, Rent subsidies, Reporting and 
recordkeeping requirements.
    Accordingly, for the reasons described in the preamble, HUD 
proposes to amend 24 CFR parts 5, 91, 92, 93, 570, 574, 576, 903, and 
983 as follows:

PART 5--GENERAL HUD PROGRAM REQUIREMENTS; WAIVERS

0
1. The authority citation for part 5 continues to read as follows:

    Authority: 29 U.S.C. 794, 42 U.S.C. 1437a, 1437c, 1437c-1(d), 
1437d, 1437f, 1437n, 3535(d), and Sec. 327, Pub. L. 109-115, 119 
Stat. 2936; 42 U.S.C. 3600-3620; 42 U.S.C. 5304(b); 42 U.S.C. 12101 
et seq.; 42 U.S.C. 12704-12708; E.O. 11063, 27 FR 11527, 3 CFR, 
1958-1963 Comp., p. 652; E.O. 12892, 59 FR 2939, 3 CFR, 1994 Comp., 
p. 849.

Subpart A--Generally Applicable Definitions and Requirements; 
Waivers

0
2. Revise Sec. Sec.  5.150 through 5.180 under the undesignated center 
heading ``Affirmatively Furthering Fair Housing'' to read as follows:

Affirmatively Furthering Fair Housing

Sec.
5.150 Affirmatively furthering fair housing: Purpose.
5.151 Affirmatively furthering fair housing: Application.
5.152 Definitions.
5.154 Equity Plan.
5.156 Affirmatively furthering fair housing through Equity Plan 
incorporation into subsequent planning documents.
5.158 Community engagement.
5.160 Submission requirements.
5.162 Review of Equity Plan.
5.164 Revising an accepted Equity Plan.
5.166 AFFH certifications required for the receipt of Federal 
financial assistance.
5.168 Recordkeeping.
5.170 Compliance procedures.
5.172 Procedures for effecting compliance.
5.174 Hearings.
5.175-5.180 [Reserved]

Affirmatively Furthering Fair Housing


Sec.  5.150   Affirmatively furthering fair housing: Purpose.

    (a) This section and Sec. Sec.  5.151 through 5.180 implement the 
Fair Housing Act's affirmatively furthering fair housing (AFFH) 
mandate, which requires Federal housing and urban development programs 
and activities to be administered in a manner that not only avoids and 
eliminates discrimination, but also remedies the legacy of public and 
private policies and practices that have created segregated communities 
and enduring inequities in housing and related opportunities throughout 
the Nation. This section and Sec. Sec.  5.151 through 5.180 are 
intended to ensure that HUD program participants, while making local 
decisions responsive to local circumstances, commit to and implement 
concrete actions that will meaningfully remedy persistent segregation, 
limitations on fair housing choice, and unequal access to community 
assets and related economic opportunities. This section and Sec. Sec.  
5.151 through 5.180 aim to provide publicly transparent processes, to 
provide flexibility and avoid unnecessary burden and confusion for 
program participants, and to create accountability mechanisms that 
ensure HUD, program participants, and the public at large, all can play 
a part in meeting the urgent need to ensure that local fair housing 
issues are fully identified and meaningfully addressed.
    (b) To further these aims, this section and Sec. Sec.  5.151 
through 5.180 set out a process under which program participants, after 
robust engagement with their communities, will conduct a focused 
analysis of the fair housing issues in their areas, establish fair 
housing goals to overcome them, and submit their analysis and 
commitments for HUD review, with the public having an opportunity to 
submit comments for consideration during HUD's review. Program 
participants will submit annual progress evaluations, made available to 
the public, on their accomplishments under each goal they commit to 
achieve, and will be able to amend or adjust goals that cannot be met 
or that may require additional time. This section and Sec. Sec.  5.151 
through 5.180 provide procedures for the public to file complaints 
alleging violations of this section and Sec. Sec.  5.151 through 5.180 
or the duty to affirmatively further fair housing, as well as for HUD 
to conduct investigations and take any actions necessary to ensure 
compliance.
    (c) Ultimately, this section and Sec. Sec.  5.151 through 5.180 
seek to further implement the AFFH statutory mandate by requiring and 
assisting HUD program participants to embed fairness and equity in 
their decision-making processes, particularly with respect to the use 
of Federal financial assistance and resources, as they recognize and 
redress inequities in their policies, activities, services, and 
programs that serve as barriers to equal opportunity in housing. This 
section and Sec. Sec.  5.151 through 5.180 seek to expand equitable 
access to housing and related opportunities across all protected 
classes, including race, color, national origin, religion, sex 
(including gender identity, sexual orientation, and nonconformance with 
gender stereotypes), disability, and familial status.


Sec.  5.151   Affirmatively furthering fair housing: Application.

    All programs and activities relating to housing and urban 
development must comply with the obligation to affirmatively further 
fair housing. Sections 5.150 through 5.180 also include specific 
planning requirements for program participants, as defined in Sec.  
5.152.


Sec.  5.152   Definitions.

    For purposes of Sec. Sec.  5.150 through 5.180, the terms 
``consolidated plan,'' ``consortium,'' ``unit of general local 
government,'' ``jurisdiction,'' and ``State'' are defined in 24 CFR 
part 91. For public housing agencies (PHAs), ``jurisdiction'' is 
defined in 24 CFR 982.4. The following additional definitions are 
provided solely for purposes of Sec. Sec.  5.150 through 5.180 and 
related amendments in 24 CFR parts 91, 92, 93, 570, 574, 576, 903, and 
983.
    Affirmatively furthering fair housing means taking meaningful 
actions, in addition to combating discrimination, that overcome 
patterns of segregation, eliminate inequities in housing and related 
community assets, and foster inclusive communities free from barriers 
that restrict access to opportunity based on protected characteristics. 
Specifically, affirmatively furthering fair housing means taking 
meaningful actions that, taken together, reduce or end significant 
disparities in housing needs and in access to opportunity, replacing 
segregated living patterns with truly integrated and balanced living 
patterns, transforming racially and ethnically concentrated areas of 
poverty into well-resourced areas of opportunity, and fostering and 
maintaining compliance with civil rights and fair housing laws and 
requirements. The duty to affirmatively further fair housing extends to 
all of a program participant's activities, services, and programs 
relating to housing and community development; it extends beyond a 
program participant's duty to comply with Federal civil rights laws and 
requires a program participant to take actions, make investments, and 
achieve outcomes that remedy the segregation, inequities, and 
discrimination the Fair Housing Act was designed to redress.
    Affordable housing opportunities means:
    (1) Housing that:
    (i) Is affordable to low- and moderate-income households;
    (ii) Has a sufficient number of bedrooms to meet the needs of 
families

[[Page 8558]]

of various sizes, particularly large families; and
    (iii) Meets basic habitability requirements.
    (2) Affordable housing includes publicly supported housing as well 
as housing that is otherwise affordable to low-income households. For 
publicly supported housing, such housing must comply with applicable 
program requirements for affordability and habitability.
    (3)(i) The term ``affordable housing opportunities'' includes the 
location of such housing, including proximity to community assets, 
locations that promote integration, and locations that provide access 
to opportunity and well-resourced areas.
    (ii) Affordable housing opportunities also includes housing that is 
accessible to individuals with disabilities, including by providing 
necessary accessibility features.
    (iii) Affordable housing opportunities also includes housing 
stability for protected class groups, which may be adversely affected 
by factors such as, but not limited to, rising rents, loss of existing 
affordable housing, and displacement due to economic pressures, 
evictions, source of income discrimination, or code enforcement.
    Analysis of Impediments to Fair Housing Choice means the analysis 
described in the Fair Housing Planning Guide (FHPG) originally 
published by the Department in 1996 or in any subsequent update to the 
FHPG that HUD may make available.
    Balanced approach means and refers to an approach to community 
planning and investment that balances a variety of actions to eliminate 
the housing-related disparities that result from segregation, racially 
or ethnically concentrated areas of poverty (R/ECAPs), the lack of 
affordable housing in well-resourced areas of opportunity, the lack of 
investment in community assets in R/ECAPs and other high-poverty areas, 
and the loss of affordable housing to meet the needs of underserved 
communities. A balanced approach includes a combination of actions 
designed to address all these disparities. For example, place-based 
strategies include actions and investment to substantially improve 
living conditions and community assets in high-poverty neighborhoods 
while preserving existing affordable housing stock to meet the needs of 
underserved communities and address inequitable access to affordable 
rental and homeownership opportunities. Mobility strategies, on the 
other hand, focus on the removal of barriers that prevent people from 
accessing affordable housing, for example in well-resourced areas of 
opportunity that have historically lacked such housing and effective 
housing mobility programs and services. To achieve a balanced approach, 
community planning and investment would need to balance place-based 
strategies with mobility strategies. Both place-based and mobility 
strategies that are part of a balanced approach must be designed to 
achieve positive fair housing outcomes. A program participant that has 
the ability to create greater fair housing choice outside segregated, 
low-income areas should not rely on solely place-based strategies 
consistent with a balanced approach.
    Community assets means programs, infrastructure, and facilities 
that provide opportunity and a desirable environment. Examples of 
community assets include: high performing schools (as well as quality 
daycare and childhood educational services), desirable employment 
opportunities, efficient transportation services, safe and well-
maintained parks and recreation facilities, well-resourced libraries 
and community centers, community-based supportive services for 
individuals with disabilities, responsive emergency services (including 
law enforcement), healthcare services, environmentally healthy 
neighborhoods (including clean air, clean water, access to healthy 
food), grocery stores, retail establishments, infrastructure and 
municipal services, banking and financial institutions, and other 
assets that meet the needs of residents throughout the community.
    Community engagement, as required by Sec.  5.158, means a 
solicitation of views and recommendations from members of the community 
and other interested parties, consideration of the views and 
recommendations received, and a process for incorporating such views 
and recommendations into planning processes, decisions, and outcomes.
    Consolidated plan program participant. See definition of ``program 
participants'' in this section.
    Data collectively refers to:
    (1) HUD-provided data. The term ``HUD-provided data'' refers to 
metrics, statistics, and other quantified information, including data 
sets specific to each program participant, provided by HUD, that 
program participants are required to use in preparing an Equity Plan. 
HUD-provided data will not only be provided to program participants but 
will also be posted on HUD's website for public availability; and
    (2) Local data. The term ``local data'' refers to metrics, 
statistics, and other quantified information, subject to a 
determination of reliability or statistical validity by HUD, relevant 
to the program participant's geographic areas of analysis, that program 
participants can find through a reasonable amount of search, are 
readily available at little or no cost, including the location of 
publicly supported housing, and are necessary for the completion of the 
Equity Plan.
    Days means calendar days.
    Disability, as used in this part:
    (1) The term ``disability'' means, with respect to an individual:
    (i) A physical or mental impairment that substantially limits one 
or more major life activities of such individual;
    (ii) A record of such an impairment; or
    (iii) Being regarded as having such an impairment.
    (2) The term ``disability'' as used in this part shall be 
interpreted consistent with the definition of such term under section 
504 of the Rehabilitation Act of 1973, as amended by the ADA Amendments 
Act of 2008. This definition does not change the definition of 
``disability'' or ``disabled person'' adopted pursuant to a HUD program 
statute for purposes of determining an individual's eligibility to 
participate in a housing program that serves a specified population.
    Equity or equitable means the consistent and systematic fair, just, 
and nondiscriminatory treatment of all individuals, regardless of 
protected characteristic, including concerted actions to overcome past 
discrimination against underserved communities that have been denied 
equal opportunity or otherwise adversely affected because of their 
protected characteristics by public and private policies and practices 
that have perpetuated inequality, segregation, and poverty.
    Equity Plan means:
    (1) The plan prepared by program participants, pursuant to Sec.  
5.154, to advance local equity in housing, community development 
programs, and access to well-resourced areas, opportunity, and 
community assets. The Equity Plan includes two distinct parts:
    (i) The analysis of fair housing data and identification of fair 
housing issues required by the fair housing goal category; and
    (ii) The establishment and commitment to undertake fair housing 
goals, strategies, and meaningful actions for each fair housing goal 
category, which program participants shall incorporate into subsequent 
planning documents that identify how the program participant will use 
funds or take actions to affirmatively further fair housing.

[[Page 8559]]

    (2) Program participants submit their Equity Plan to HUD for 
review. The Equity Plan may be conducted and submitted by an individual 
program participant (individual Equity Plan) or may be a single Equity 
Plan that is jointly conducted and submitted by two or more program 
participants (joint Equity Plan). The Equity Plan includes program 
participants' submission of annual progress evaluations, which will be 
published on HUD maintained web pages.
    Fair housing choice means that individuals and families have the 
information, opportunity, and options to live where they choose, 
including in well-resourced areas, without unlawful discrimination and 
other barriers related to race, color, religion, sex (including sexual 
orientation gender identity, and nonconformance with gender 
stereotypes), familial status, national origin, or disability. Fair 
housing choice encompasses:
    (1) Actual choice, which means the existence of realistic housing 
options (e.g., those that are affordable and attainable), including but 
not limited to homeownership options;
    (2) Protected choice, which means housing that can be accessed 
without discrimination; and
    (3) Enabled choice, which means realistic access to sufficient 
information, services, and other options regarding both rental housing 
and homeownership so that any choice is informed. For persons with 
disabilities, fair housing choice includes a realistic opportunity to 
obtain and maintain housing with accessibility features meeting the 
individual's disability-related needs, housing provided in the most 
integrated setting appropriate to an individual's needs, and housing 
where community assets are accessible to individuals with disabilities, 
including voluntary disability-related services that an individual 
needs to live in such housing.
    Fair housing goals means the goals developed by program 
participants that are based on the analysis conducted in the Equity 
Plan and are designed and can be reasonably expected to overcome 
circumstances that cause, increase, contribute to, maintain, or 
perpetuate fair housing issues in the program participant's geographic 
areas of analysis. Fair housing goals include a description of 
progress-oriented, specific measurable steps, including timeframes for 
achievement, and a description of the amount of and potential sources 
of funds (if any) needed to implement the goal. Fair housing goals may 
be short-term, in that they can be achieved relatively quickly, or more 
ambitious, long-term goals, in that they may take more than a single 
funding cycle to be fulfilled. Fair housing goals are designed to 
achieve tangible, positive, and measurable fair housing outcomes for 
each of the seven fair housing goal categories in the program 
participant's community. A program participant's fair housing goals 
must work together to overcome fair housing issues identified in the 
program participant's Equity Plan. To ensure program participants 
affirmatively further fair housing, if program participants establish 
ambitious goals that are contingent upon funding or other actions that 
are not entirely within their control, program participants also must 
establish fair housing goals that will achieve positive fair housing 
outcomes in each goal category without reliance on contingencies that 
may not be fulfilled. Each fair housing goal includes a description of 
the key fair housing issue(s) it is designed to remedy or overcome. 
When achieved, fair housing goals must result in a material positive 
change toward overcoming fair housing issues.
    Fair housing goal categories means the following categories for 
which program participants must establish fair housing goals to 
overcome identified fair housing issues:
    (1) Integration and segregation;
    (2) Racially or ethnically concentrated areas of poverty (R/ECAPs);
    (3) Significant disparities in access to opportunity;
    (4) Inequitable access to affordable housing and homeownership 
opportunities;
    (5) Laws, ordinances, policies, practices, and procedures that 
impede the provision of affordable housing in well-resourced areas of 
opportunity, including housing that is accessible for individuals with 
disabilities;
    (6) Inequitable distribution of local resources, which may include 
State or municipal services, emergency services, community-based 
supportive services, and investments in infrastructure; and
    (7) Discrimination or violations of civil rights law or regulations 
related to housing and access to community assets.
    Fair housing issue means a condition in a program participant's 
geographic area of analysis that restricts fair housing choice or 
access to opportunity and community assets. Examples of such conditions 
include but are not limited to: ongoing local or regional segregation 
or lack of integration, racially or ethnically concentrated areas of 
poverty, significant disparities in access to opportunity, inequitable 
access to affordable housing opportunities and homeownership 
opportunities, laws, ordinances, policies, practices, and procedures 
that impede the provision of affordable housing in well-resourced 
neighborhoods of opportunity, inequitable distribution of local 
resources, which may include municipal services, emergency services, 
community-based supportive services, and investments in infrastructure, 
and discrimination or violations of civil rights law or regulations 
related to housing or access to community assets. Participation in 
``housing programs serving specified populations,'' as defined in this 
section, does not present a fair housing issue of segregation, provided 
that such programs are administered by program participants so that the 
programs comply with title VI of the Civil Rights Act of 1964 (42 
U.S.C. 2000d--2000d-4) (Nondiscrimination in Federally Assisted 
Programs); the Fair Housing Act (42 U.S.C. 3601-19), including the duty 
to affirmatively further fair housing; section 504 of the 
Rehabilitation Act of 1973 (29 U.S.C. 794); the Americans with 
Disabilities Act (ADA) (42 U.S.C. 12101, et seq.); and other Federal 
civil rights statutes and regulations.
    Fair housing strategies and actions means the specific policies and 
actions intended to implement fair housing goals established in an 
Equity Plan that are incorporated into the program participant's 
subsequent planning documents (e.g., consolidated plan, annual action 
plan, PHA Plan, and other plans relating to education, transportation, 
infrastructure, and environmental protection, including those required 
in connection with the receipt of Federal financial assistance from any 
executive agency or department). Fair housing strategies and actions 
describe how the funds that are the subject of the particular planning 
document will be used to affirmatively further fair housing in the 
program participant's jurisdiction consistent with the Equity Plan.
    Funding decisions means decisions made to allocate resources, 
including Federal financial assistance, State or local funds, bond 
financing, and the administration, utilization, and allocation of low-
income housing tax credits by States, local governments, public housing 
agencies (as applicable), or other entities.
    Geographic area, geographic area of analysis, or area means the 
areas, including a jurisdiction, region, State, Core-Based Statistical 
Area (CBSA), or other applicable area (e.g., census tract, 
neighborhood, ZIP code, block group,

[[Page 8560]]

housing development, or portion thereof) relevant to the analysis 
required by Sec.  5.154. The geographic areas of analysis for the 
different types of program participants are as follows:
    (1) For States or insular areas, the expected geographic area of 
analysis includes the whole State or insular area pursuant to 24 CFR 
91.5, including entitlement and non-entitlement areas, on a county-by-
county basis (not neighborhood-by-neighborhood), and, where necessary 
to identify fair housing issues, lower levels of geography, while also 
including any analysis of circumstances outside the State that impact 
fair housing issues within the State;
    (2) For local governments, the expected geographic area of analysis 
includes the whole jurisdiction of the local government pursuant to 24 
CFR 91.5, the CBSA, and where necessary to identify fair housing 
issues, lower levels of geography such as neighborhoods, ZIP codes, 
census tracts, block groups, housing developments, or portions thereof, 
while also including any analysis of circumstances outside the 
jurisdiction that impact fair housing issues within the jurisdiction; 
and
    (3)(i) For PHAs that operate below the State level, the expected 
geographic area of analysis includes the PHA's whole service area 
(e.g., the area where a public housing agency is authorized to 
operate), the CBSA, and where necessary to identify fair housing 
issues, includes lower levels of geography such as neighborhoods, ZIP 
codes, census tracts, block groups, housing developments, or portions 
thereof, along with locations where vouchers administered by the PHA 
are or could be utilized, while also including any analysis of 
circumstances outside the service area that impact fair housing issues 
within the service area.
    (ii) For PHAs that operate within an entire State, the PHA's 
expected geographic area of analysis includes the areas of analysis for 
States as referenced in paragraph (3)(i) of this definition along with 
the areas in which the PHA owns, operates, and administers housing 
programs, and where necessary to identify fair housing issues, includes 
lower levels of geography.
    Homeownership opportunity means that one has the actual choice to 
own, sell, buy, and finance a home, without discrimination based on a 
protected characteristic.
    Housing programs serving specified populations are HUD and Federal 
housing programs, including designations in the programs, as 
applicable, such as HUD's Supportive Housing for the Elderly, 
Supportive Housing for Persons with Disabilities, homeless assistance 
programs under the McKinney-Vento Homeless Assistance Act (42 U.S.C. 
11301 et seq.), and housing designated under section 7 of the United 
States Housing Act of 1937 (42 U.S.C. 1437e), that:
    (1) Serve specific identified populations; and
    (2) Comply with title VI of the Civil Rights Act of 1964 (42 U.S.C. 
2000d--2000d-4) (Nondiscrimination in Federally Assisted Programs); the 
Fair Housing Act (42 U.S.C. 3601-19), including the duty to 
affirmatively further fair housing; section 504 of the Rehabilitation 
Act of 1973 (29 U.S.C. 794); the Americans with Disabilities Act (42 
U.S.C. 12101, et seq.); and other Federal civil rights statutes and 
regulations.
    Insular area has the same meaning as provided in 24 CFR 570.405.
    Integration means a condition, within the program participant's 
geographic area of analysis, in which there is not a high concentration 
of persons of a particular race, color, religion, sex, familial status, 
national origin, or having a disability or a particular type of 
disability when compared to a broader geographic area. Racial 
integration means that people of different racial groups generally are 
not highly concentrated in distinct geographic areas within a community 
(e.g., census tract or block group). For individuals with disabilities, 
integration also means that such individuals are able to access housing 
and services in the most integrated setting appropriate to the 
individual's needs. The most integrated setting is one that enables 
individuals with disabilities to interact with persons without 
disabilities to the fullest extent possible, consistent with the 
requirements of the Americans with Disabilities Act (42 U.S.C. 12101, 
et seq.) and section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 
794). See 28 CFR part 35, appendix B (addressing 28 CFR 35.130 and 
providing guidance on the Americans with Disabilities Act regulation on 
nondiscrimination on the basis of disability in State and local 
government services).
    Joint program participants means two or more program participants 
that are jointly conducting and submitting a single Equity Plan (a 
joint Equity Plan), in accordance with Sec.  5.156 and 24 CFR 
903.15(a)(1) and (2), as applicable. Joint program participants pool 
resources to work together to solve cross-jurisdictional fair housing 
issues.
    Local knowledge means information not provided by HUD that relates 
to the program participant's geographic areas of analysis, is relevant 
to the identification of fair housing issues in the program 
participant's Equity Plan and for setting of fair housing goals to 
overcome the effects of identified fair housing issues pursuant to 
Sec.  5.154, is known or becomes known to the program participant, and 
is necessary for the completion of the Equity Plan. Local knowledge 
includes, but is not limited to:
    (1) Historical information on why current conditions within the 
geographic areas of analysis exist and persist, which may include State 
or local laws, ordinances, or policies that cause, perpetuate, increase 
the severity of, or maintain fair housing issues;
    (2) Information provided to the program participant during the 
community engagement process that draws attention to the existence or 
cause of one or more fair housing issues; and
    (3) Information that assists the program participant in identifying 
the causes of their local fair housing issues along with appropriate 
solutions.
    Meaningful actions means significant actions that are designed and 
can be reasonably expected to achieve a material positive change that 
affirmatively furthers fair housing by, for example, decreasing 
segregation and increasing integration, increasing fair housing choice, 
or decreasing disparities in access to opportunity in the program 
participant's jurisdiction.
    Program participants means:
    (1) Jurisdictions and insular areas that are required to submit 
consolidated plans for the following programs:
    (i) The Community Development Block Grant (CDBG) program (see 24 
CFR part 570, subparts D, F, and I);
    (ii) The Emergency Solutions Grants (ESG) program (see 24 CFR part 
576);
    (iii) The HOME Investment Partnerships (HOME) program (see 24 CFR 
part 92);
    (iv) The Housing Opportunities for Persons With AIDS (HOPWA) 
program (see 24 CFR part 574); and
    (v) The Housing Trust Fund (HTF) program (see 24 CFR part 93).
    (2) Public housing agencies (PHAs) receiving assistance under 
sections 8 or 9 of the United States Housing Act of 1937 (42 U.S.C. 
1437f or 1437g).
    Protected characteristics are race, color, religion, sex (including 
sexual orientation, gender identity, and nonconformance with gender 
stereotypes), familial status, national origin, having a disability, 
and having a type of disability.
    Protected class means a group of persons who have the same 
protected characteristic; e.g., a group of persons who are of the same 
race are a protected

[[Page 8561]]

class. Similarly, a person who has a mobility disability is a member of 
the protected class of persons with disabilities and a member of the 
protected class of persons with mobility disabilities.
    Publication means the public online posting of the Equity Plans and 
annual progress evaluations submitted to HUD for review on HUD-
maintained web pages. These web pages will include, among other things, 
a dashboard to track the status of a program participant's AFFH 
planning and implementation-related activities and access to Equity 
Plan submissions, annual progress evaluation reports, and related 
notifications from the Department.
    Publicly supported housing means affordable housing assisted with 
funding through Federal, State, or local agencies or programs as well 
as affordable housing financed or administered by or through any such 
agencies or programs. Examples of publicly supported housing for 
purposes of the analysis required by Sec.  5.154 include: public 
housing; Project-Based Section 8; Other HUD Multifamily Housing (e.g., 
Section 202 Supportive Housing for the Elderly and Section 811 
Supportive Housing for Persons with Disabilities); housing financed 
with Low-Income Housing Tax Credits (LIHTC); housing financed through 
loan guarantees (Section 108); and housing subsidized with Housing 
Choice Vouchers. Other publicly supported housing includes housing 
funded through the U.S. Department of Agriculture and the U.S. 
Department of Veterans Affairs, or other HUD-funded housing, such as 
affordable multifamily housing financed using HOME Investment 
Partnerships funds, housing financed through the Housing Trust Fund, 
and housing converted under the Rental Assistance Demonstration.
    Racially or ethnically concentrated areas of poverty or R/ECAPs 
means a geographic area with both significant concentrations of poverty 
and segregation of racial or ethnic populations.
    Region means the larger geographic area that a jurisdiction lies 
within. Regions may vary in size, scope, and relevance based on the 
nature of the jurisdiction and the fair housing issues present. 
Regions, which include areas outside the program participant's 
jurisdiction that are identified in HUD-provided data and supplemented 
based on local data and local knowledge, and that impact fair housing 
issues in the jurisdiction. For local government or PHA program 
participants' jurisdictions that are adjacent to but not located within 
a Core-Based Statistical Area (CBSA), the region includes the CBSA. For 
local government or PHA program participants' jurisdictions that are 
located within CBSAs, the region includes but is not necessarily 
limited to the other portions of the CBSA.
    Responsible Civil Rights Official means the Assistant Secretary for 
Fair Housing and Equal Opportunity (FHEO) or his or her designee.
    Reviewing Civil Rights Official means the FHEO official with the 
designated authority to carry out the actions described in Sec. Sec.  
5.170 and 5.172.
    Segregation means a condition within the program participant's 
geographic areas of analysis in which there is a significant 
concentration of persons of a particular race, color, religion, sex 
(including sexual orientation, gender identity, and nonconformance with 
gender stereotypes), familial status, national origin, or having a 
disability or a type of disability in a particular geographic area when 
compared to a different or broader geographic area. Racial segregation 
includes a concentration of persons of the same race regardless of 
whether that race is the majority or minority of the population in the 
geographic area of analysis. For example, in a community where persons 
of one race (e.g., White) are concentrated in one neighborhood and 
persons of another race (e.g., African American) are concentrated in a 
different neighborhood, racial segregation exists in each of the 
neighborhoods. For persons with disabilities, segregation includes a 
condition in which available housing or services are not in the most 
integrated setting appropriate to an individual's needs in accordance 
with the requirements of the Americans with Disabilities Act (42 U.S.C. 
12101, et seq.) and section 504 of the Rehabilitation Act of 1973 (29 
U.S.C. 794). See 28 CFR part 35, appendix B (addressing 28 CFR 35.130). 
Participation in ``housing programs serving specified populations'' as 
defined in this section does not present a fair housing issue of 
segregation, provided that such programs are administered to comply 
with title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d--2000d-
4) (Nondiscrimination in Federally Assisted Programs); the Fair Housing 
Act (42 U.S.C. 3601-19), including the duty to affirmatively further 
fair housing; section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 
794); the Americans with Disabilities Act (42 U.S.C. 12101, et seq.); 
and other Federal civil rights statutes and regulations.
    Significant disparities in access to opportunity means substantial 
and measurable differences in access to and quality of housing, 
education, transportation, economic, and other important opportunities 
in a community, including community assets, based on protected class 
and related to where individuals of a particular protected class reside 
in the program participant's geographic areas of analysis.
    Siting decisions means decisions made by State or local entities, 
including cities, counties, or general units of local government 
regarding where and where not in a jurisdiction to locate, build, 
finance, rehabilitate, develop, or permit the development of affordable 
housing.
    Underserved communities means groups or classes of individuals 
(i.e., underserved populations), that are protected classes or who 
share a particular characteristic, disproportionately include members 
of protected class groups, and have not received equitable treatment, 
as well as geographic communities (i.e., underserved geographic areas) 
where members of protected class groups do not enjoy equitable access 
to housing, education, transportation, economic, and other important 
housing and community-related opportunities, including well-resourced 
areas and community assets. Examples of underserved communities 
include: communities of color, individuals experiencing homelessness, 
Lesbian, Gay, Bisexual, Transgender, Queer, + persons (LGBTQ+), low-
income communities or neighborhoods, survivors of domestic violence, 
persons with criminal records, and rural communities.
    Well-resourced areas means areas within the program participant's 
geographic area of analysis that have high-quality and well-maintained 
community assets (in view of local economic circumstances), as defined 
in Sec.  5.152, which afford residents genuine access to opportunity 
(e.g., transportation, infrastructure, high performing schools, 
economic opportunity, etc.) as a result of public and private 
investments.


Sec.  5.154   Equity Plan.

    (a) General. (1) Program participants must develop an Equity Plan 
in accordance with this section. To develop an Equity Plan that is 
successful in overcoming local fair housing issues, program 
participants must first conduct an analysis--informed by community 
engagement, HUD-provided data, and local data and local knowledge--to 
identify the fair housing issues in their geographic area

[[Page 8562]]

of analysis as well as the circumstances and factors that cause, 
increase, contribute to, maintain, or perpetuate those fair housing 
issues. Program participants' analysis will focus, at minimum, on seven 
areas of inquiry specified in this section. These seven areas are the 
core fair housing goal categories for which program participants must 
establish fair housing goals for identified fair housing issues.
    (2) After engaging with the community in accordance with Sec.  
5.158, conducting the analysis, and identifying fair housing issues, 
circumstances, and factors, program participants must then prioritize 
the identified fair housing issues in accordance with paragraph (f)(2) 
of this section for purposes of setting one or more fair housing 
goal(s) for each fair housing goal category.
    (3) After prioritizing fair housing issues, program participants 
must then establish one or more fair housing goal(s) to overcome the 
prioritized fair housing issues for each fair housing goal category. A 
well-designed fair housing goal may be effective in overcoming more 
than one fair housing issue, including fair housing issues in more than 
one fair housing goal category.
    (4) After the program participant has established fair housing 
goals, the program participant must submit the Equity Plan to HUD for 
review in accordance with Sec.  5.160.
    (5) Once a program participant's Equity Plan has been reviewed and 
accepted by HUD in accordance with Sec.  5.162, the program participant 
must incorporate the fair housing goals from its Equity Plan, along 
with the fair housing strategies and actions that are necessary to 
implement the goals, into its planning documents that are required by 
Federal statutes or regulations as described in Sec.  5.156.
    (6) On an annual basis following the acceptance of a program 
participant's Equity Plan, the program participant must prepare and 
submit to HUD for review an annual progress evaluation that describes 
the program participant's progress toward achieving each fair housing 
goal in the Equity Plan, any changed circumstances that are likely to 
affect the program participant's ability to achieve any of its 
established fair housing goals, and any proposed adjustments to the 
program participant's fair housing goals that are necessary to ensure 
that the program participant will be able to achieve the fair housing 
goals in its Equity Plan and comply with the requirements of this 
subpart.
    (7) Following the submission of a program participant's annual 
progress evaluation, HUD will accept the proposed adjustment to any 
fair housing goal(s) or provide feedback to the program participant 
describing how the fair housing goals may be adjusted so HUD can accept 
them. The fair housing goals of an Equity Plan that has been accepted 
by HUD will remain in effect unless a program participant's adjusted 
goal has been accepted by HUD.
    (b) Development of the Equity Plan. Aided by training, technical 
assistance, and HUD-provided data as well as local knowledge, local 
data, and information from engaging with their communities and other 
agencies or government entities in their geographic area of analysis, 
program participants will develop the Equity Plan and submit to HUD for 
review. Certain portions of the analysis required for the development 
of an Equity Plan may rely on local data, local knowledge, or 
information obtained through community engagement to supplement HUD-
provided data or in lieu of HUD-provided data if HUD is unable to 
provide data.
    (c) Content of Equity Plan--(1) General. Each program participant 
shall prepare an Equity Plan for the purpose of developing fair housing 
goals, strategies, and meaningful actions that are designed and can be 
reasonably expected to overcome identified fair housing issues in each 
fair housing goal category and advance equity based on protected 
characteristics in its geographic area of analysis with respect to its 
programs, services, and activities, including funding and siting 
decisions.
    (2) Fair housing goals. Fair housing goals established by the 
program participant in the Equity Plan shall include strategies and 
meaningful actions. The fair housing goals, strategies, and meaningful 
actions shall be incorporated, pursuant to Sec.  5.156, into the 
program participant's consolidated plans, annual action plans, PHA 
Plans, and any other plan incorporated therein, and community plans 
including, but not limited to, education, transportation, or 
environment and climate related plans, including those required in 
connection with the receipt of Federal financial assistance from any 
Federal executive agency or department.
    (3) Scope of analysis. The Equity Plan's analysis, identification 
of fair housing issues, and establishment of goals must address, at 
minimum, the following fair housing goal categories:
    (i) Segregation and integration;
    (ii) Racially or ethnically concentrated areas of poverty (R/
ECAPs);
    (iii) Disparities in access to opportunity;
    (iv) Inequitable access to affordable housing opportunities and 
homeownership opportunities;
    (v) Laws, ordinances, policies, practices, and procedures that 
impede the provision of affordable housing in well-resourced areas of 
opportunity, including housing that is accessible for individuals with 
disabilities;
    (vi) Inequitable distribution of local resources, which may include 
municipal services, emergency services, community-based supportive 
services and investments in infrastructure; and
    (vii) Discrimination or violations of civil rights law or 
regulations related to housing or access to community assets based on 
race, color, national origin, religion, sex, familial status, and 
disability.
    (4) Conducting the analysis. In conducting the Equity Plan's 
analysis, the program participant must evaluate the jurisdiction's 
local policies and practices impacting fair housing to determine 
whether changes are necessary in order to affirmatively further fair 
housing. The analysis required will depend on whether the program 
participant is a local government, State, insular area, or a PHA.
    (d) Content: Analysis--local governments, States, and insular 
areas. At minimum, using HUD-provided data, local data, and local 
knowledge, including information obtained through community engagement 
required by Sec.  5.158, the Equity Plan shall respond to the following 
questions with respect to the program participant's jurisdiction and 
region:
    (1) Demographics. (i) What are the current demographics of the 
geographic area of analysis by protected class group (race, color, 
national origin, religion, sex, familial status, and disability) and 
how have demographics changed over time (e.g., since 1990 or the three 
last decennial censuses, whichever is shorter)?
    (ii) What are the current demographics of residents of different 
categories of publicly supported housing in the jurisdiction and how 
have those demographics changed over time?
    (2) Segregation and integration. (i)(A) Which areas within the 
geographic area of analysis have significant concentrations of 
particular protected class groups, including racial/color/ethnic 
groups, national origin groups, particular limited English proficient 
(LEP) groups, individuals with disabilities, and other protected class 
groups?
    (B) Which, if any, of these geographic areas extend beyond the 
boundaries of

[[Page 8563]]

the jurisdiction? Please note that depending on the geographic areas 
used in this analysis, the jurisdiction's analysis may need to include 
areas that go beyond the jurisdiction's specific boundaries.
    (ii) How have patterns of segregation and integration in particular 
geographic areas, as defined in Sec.  5.152, changed over time in the 
jurisdiction and region?
    (iii)(A) Compare the locations of publicly supported housing with 
the areas of concentration (identified in paragraph (d)(2)(i) of this 
section).
    (B) How do the demographics of publicly supported housing compare 
to the demographics of areas where the housing is located (identified 
in paragraph (d)(2)(i) of this section)?
    (C) How have siting decisions of private or publicly supported 
housing or the location of residents using Housing Choice Vouchers 
impacted the overall patterns of concentration (identified in paragraph 
(d)(2)(i) of this section)?
    (iv) What public or private policies or practices, demographic 
shifts, economic trends, or other factors may have caused or 
contributed to the patterns described in paragraphs (d)(2)(i) through 
(iii) of this section?
    (3) R/ECAPs. (i)(A) Identify and describe R/ECAPs, including their 
location.
    (B) What are the demographic groups living in R/ECAPs by protected 
class?
    (C) Which protected class groups predominantly reside in R/ECAPS? 
To the extent that data is available, what percentage of each protected 
class group in the jurisdiction or region resides in R/ECAPs?
    (ii) How have the demographics and location of R/ECAPs changed over 
time? For example, has there been an expansion or decrease in the 
number of R/ECAPs in the geographic area of analysis? Has concentration 
of protected class groups within each R/ECAP increased or decreased?
    (iii)(A) How do R/ECAPs in the geographic area of analysis align 
with the location of publicly supported housing?
    (B) What are the demographics of residents of publicly supported 
housing residing in R/ECAPs, including by program category, in 
comparison to the demographics of R/ECAPs?
    (iv) What public or private policies or practices, demographic 
shifts, economic trends, or other factors may have caused or 
contributed to the patterns described in the responses to paragraphs 
(d)(3)(i) through (iii) of this section?
    (4) Access to community assets. (i) Describe which protected class 
groups experience significant disparities in access to the following 
community assets:
    (A) Education;
    (B) Employment;
    (C) Transportation;
    (D) Low-poverty neighborhoods;
    (E) Environmentally healthy neighborhoods; and
    (F) Other community assets as defined in Sec.  5.152?
    (ii)(A) Are there locations in the geographic areas of analysis in 
which protected class groups experience significant disparities in 
access to community assets listed in paragraph (d)(4)(i) of this 
section?
    (B) If so, which protected class groups experience lack of access 
and where?
    (C) Describe whether there is a difference in whether residents of 
segregated areas and R/ECAPs, identified in paragraphs (d)(2) and (3) 
of this section, have access to each of the community assets listed in 
paragraph (d)(4)(i) of this section compared to the jurisdiction as a 
whole?
    (iii) Describe the barriers that deny individuals with disabilities 
access to opportunity and community assets in your geographic area of 
analysis with regard to the following:
    (A) Accessible and affordable housing;
    (B) Accessible government facilities and websites;
    (C) Accessible public infrastructure (sidewalks, pedestrian 
crossings, parks and recreation, libraries);
    (D) Reliable and accessible transportation;
    (E) Accessible schools and educational programs, and, in 
particular, high-performing schools and educational programs;
    (F) Employment; and
    (G) Community-based supportive services.
    (iv)(A) In what ways do residents of publicly supported housing, by 
protected class group, experience disparities in access to opportunity 
and community assets described in paragraphs (d)(4)(i) through (iii) of 
this section?
    (B) In what ways do underserved communities experience such 
disparities?
    (v) Is there a disproportionate need in underserved communities for 
place-based community or economic development, such as assistance for 
small businesses and microenterprises, infrastructure, commercial 
redevelopment, job creation or retention and job training? If so, note 
the type of issues identified by program participants or residents.
    (vi) What public or private policies or practices, demographic 
shifts, economic trends, or other factors may have caused or 
contributed to the patterns described in the responses to paragraphs 
(d)(4)(i) through (iv) of this section?
    (5) Access to affordable housing opportunities. (i) Describe the 
availability of affordable housing opportunities that are affordable to 
families, by protected class group, at various income levels and where 
such housing is located in the geographic area of analysis, including 
whether such housing affords access to community assets and well-
resourced areas. This assessment includes an evaluation of whether 
different protected class groups at various income levels have fair 
housing choice in their ability to access affordable housing in 
particular areas in the jurisdiction.
    (ii) Describe the housing cost burden (e.g., more than 30 percent 
of monthly income) and severe housing cost burden (e.g., more than 50 
percent of monthly income) and overcrowding (particularly for large 
families) experienced by protected class groups and indicate whether 
such burden aligns with previously identified segregated or integrated 
areas, or R/ECAP or non-R/ECAP areas.
    (iii) Describe disparities in housing quality (i.e., substandard 
housing conditions) by protected class group and indicate whether such 
disparities align with previously identified segregated or integrated 
areas, or R/ECAP or non-R/ECAP areas.
    (iv) Which protected class groups, in the geographic area of 
analysis, disproportionately face housing instability due to rising 
rents, loss of existing affordable housing, and displacement due to 
economic pressures, eviction, source of income discrimination, or code 
enforcement?
    (v) Describe how access to affordable housing opportunities has 
changed in the geographic area of analysis over time. Describe how this 
change has affected patterns of segregation and integration or the 
expansion or contraction of R/ECAP and non-R/ECAP areas in the 
geographic area of analysis.
    (vi) What public or private policies or practices, demographic 
shifts, economic trends, or other factors may have caused or 
contributed to the patterns described in responses to paragraphs 
(d)(5)(i) through (v) of this section?
    (6) Access to homeownership and economic opportunity. (i)(A) Which 
protected class groups experience significant disparities in access to 
homeownership opportunities?
    (B) What are the homeownership rates by protected class?
    (ii) Are there protected class groups that experience significant 
disparities in

[[Page 8564]]

access to other economic opportunities, which may include but are not 
limited to:
    (A) Access to livable-wage jobs;
    (B) Access to services of reputable mortgage lenders and other 
financial institutions;
    (C) Access to fair and affordable credit;
    (D) Access to reputable financial counseling services; and
    (E) Fair residential real estate appraisals and valuations? If so, 
which protected class groups experience lack of access?
    (iii) What public or private policies or practices, demographic 
shifts, economic trends, or other factors may have caused or 
contributed to the patterns described in responses to paragraphs 
(d)(6)(i) and (ii) of this section?
    (7) Local and State policies and practices impacting fair housing. 
(i) How do local laws, policies, ordinances, and other practices impede 
or promote the siting or location of affordable housing in well-
resourced neighborhoods? What is the relationship between those laws, 
policies, ordinances, and other practices and the segregated or 
integrated areas and R/ECAP or non-R/ECAP areas identified in 
paragraphs (d)(2) and (3) of this section?
    (ii) How do local laws, policies, ordinances, and other practices 
impede or promote equitable access to homeownership and other asset 
building and economic opportunities by protected class group?
    (iii) How have existing zoning and land use policies or ordinances, 
the presence or lack of source of income anti-discrimination laws, 
eviction policies and practices, and other State and local policies or 
practices contributed to the patterns of segregation, integration, and 
R/ECAPs identified in paragraphs (d)(2) and (3) of this section, as 
well as access to affordable housing opportunities in well-resourced 
areas throughout the geographic area of analysis for protected class 
groups?
    (iv) Describe the efforts and activities undertaken by the program 
participant to work, collaborate, or partner with other offices, 
departments, agencies, or entities within the program participant's 
jurisdiction that aim to advance equity.
    (v) What is the status of any unresolved findings, lawsuits, 
enforcement actions, settlements, or judgments in which the program 
participant has been a party related to fair housing or other civil 
rights laws in the jurisdiction?
    (vi) What efforts does the program participant take to increase 
fair housing compliance and enforcement capacity, and to ensure 
compliance with existing fair housing and civil rights laws and 
regulations, in its geographic area?
    (e) Content: Analysis--public housing agencies. PHAs must include 
in their Equity Plan an analysis of the area in which the PHA operates, 
whether the PHA operates in all parts of its authorized service area, 
and the PHA's programs. PHAs may rely on relevant aspects of the 
analysis contained in an accepted Equity Plan of the jurisdiction 
within which it operates to ensure consistency with the jurisdiction's 
consolidated plan, to the extent the accepted Equity Plan covers the 
PHA's service area or region. PHAs may rely on the jurisdiction's 
analysis with respect to general demographics, areas of segregation and 
integration, the location of R/ECAPs, and where certain opportunities 
exist or do not exist, but must perform its own analysis of how those 
background circumstances affect equity in its own programs, activities, 
and services. Similarly, PHAs that conduct a joint Equity Plan with a 
local government, State, or insular area may rely on the analysis 
provided by the other joint program participants with respect to 
certain aspects of the analysis (so long as the analysis is sufficient 
for the PHA to meet its own obligations with respect to this section), 
such as general demographics, areas of segregation and integration, the 
location of R/ECAPs, and where certain opportunities exist or do not 
exist within the PHA's service area and region. Using HUD-provided 
data, local data, and local knowledge, including information obtained 
through community engagement required by Sec.  5.158, the Equity Plan 
shall respond to the following questions with respect to the PHA's 
service area and region:
    (1) Demographics. (i) What are the current demographics of the 
geographic area of analysis by protected class group (race, color, 
national origin, religion, sex, familial status, and disability) and 
how have those demographics changed over time (e.g., since 1990 or the 
three last decennial censuses, whichever is shorter)?
    (ii)(A) What are the current demographics of the different 
categories of PHA owned or administered housing, and how have those 
demographics changed over time?
    (B) What are the current demographics of the different categories 
of other publicly supported housing in the PHA's geographic area of 
analysis, and how have those demographics changed over time?
    (2) Segregation and integration. (i) Which areas within the 
geographic area of analysis have significant concentrations of 
particular protected class groups, including racial/color/ethnic 
groups, national origin groups, particular limited English proficient 
(LEP) groups, individuals with disabilities, and other protected class 
groups? Which, if any, of these areas extend beyond the boundaries of 
the service area?
    (ii) How have patterns of segregation and integration in particular 
geographic areas changed over time?
    (iii)(A) How do patterns of segregation and integration in the 
geographic area of analysis align with the demographics and location of 
publicly supported housing developments?
    (B) Since 1990 or the three last decennial censuses, whichever is 
shorter, how have publicly supported housing siting decisions resulted 
in an increase or decrease of patterns of segregation or integration in 
the area, or have no such changes related to publicly supported housing 
siting decisions been experienced?
    (iv) What public or private policies or practices, demographic 
shifts, economic trends, or other factors may have caused or 
contributed to the patterns described in responses to paragraphs 
(e)(2)(i) through (iii) of this section?
    (3) R/ECAPs. (i)(A) Identify and describe R/ECAPs, including their 
location.
    (B) What are the demographic groups (by protected class) living in 
R/ECAPs?
    (C) What percentage of each protected class group in the 
jurisdiction or region resides in R/ECAPs?
    (ii)(A) How have the demographics and location of R/ECAPs changed 
over time? For example, has there been an expansion or decrease in the 
number of R/ECAPs in the geographic area of analysis? Has concentration 
of protected class groups within each R/ECAP increased or decreased?
    (B) Describe the conditions in R/ECAPs that limit access to 
opportunity for the residents who live there, including housing costs 
and cost burden, housing quality, housing instability, displacement, 
source of income discrimination, and eviction risk. How have these 
conditions changed over time?
    (iii)(A) How many of the PHAs' public housing developments are 
located in R/ECAPs?
    (B) Compare the demographics and location of the residents of 
public housing with the demographics and location of the R/ECAP.
    (iv)(A) What proportion of the PHA's vouchers are inside R/ECAPs 
compared to those outside R/ECAPs?
    (B) What are the demographics (by protected class) of the PHA's 
Housing

[[Page 8565]]

Choice Voucher assisted households residing inside R/ECAPs compared to 
those outside R/ECAPs?
    (C) Compare the locations of the Housing Choice Vouchers in the 
service area (including other PHAs' Housing Choice Vouchers) to the 
location of R/ECAPs described in paragraph (e)(3)(i) of this section.
    (v) What public or private policies or practices, demographic 
shifts, economic trends, or other factors may have caused or 
contributed to the patterns described in paragraph (e)(3)(i) through 
(iv) of this section?
    (4) Access to community assets and affordable housing 
opportunities. (i)(A) Describe which protected class groups have a 
disproportionately greater need for affordable housing opportunities. 
How do these groups compare to the PHA's current assisted resident 
demographics?
    (B) Are there other underserved communities or groups (e.g., 
persons experiencing homelessness) that also have a disproportionately 
greater need for affordable housing opportunities?
    (ii)(A) Of PHA participants, describe which protected class groups 
experience significant disparities in access to the following community 
assets:
    (1) Education;
    (2) Employment;
    (3) Transportation;
    (4) Low-poverty neighborhoods;
    (5) Environmentally healthy neighborhoods;
    (6) Affordable housing opportunities and homeownership 
opportunities; and
    (7) Other community assets as defined in Sec.  5.152.
    (B) Which protected class groups on the PHA's waiting list or who 
want to be on the PHA's waiting list experience significant disparities 
in access to the community assets identified in paragraph (e)(4)(ii)(A) 
of this section based on available local data and local knowledge?
    (iii)(A) Compare locations of the PHA's public housing and Housing 
Choice Vouchers and the demographics of voucher assisted households 
with areas that have greater access or that lack access to these 
community assets identified in paragraph (e)(4)(i)(A) of this section.
    (B) Using this comparison, together with the analysis on 
segregation (paragraph (e)(2)(i) of this section) and R/ECAPs 
(paragraph (e)(3)(i) of this section), is there a lack of affordable 
rental opportunities in more well-resourced areas, including units 
affordable for housing choice vouchers and for improved voucher 
mobility outcomes?
    (C) How has access to community assets changed for the PHA's 
residents based on the PHA's funding and sitting decisions?
    (iv) Are there developments in the PHA's stock or residents of the 
PHA's publicly supported housing in particular neighborhoods in the 
PHA's service area that do not have the same access to the community 
assets compared to other residents located in the PHA's service area? 
Assets in this question refer to those described in paragraph (e)(4)(i) 
of this section as well as other infrastructure and municipal services 
(e.g., potable drinking water, sewer and drainage systems, trash 
collection, snow removal, sidewalks, etc.).
    (v) Describe any differences, based on local data and local 
knowledge, in the quality of the PHA's housing for residents residing 
in:
    (A) R/ECAPs compared to the housing the PHA offers residents 
residing in other parts of the PHA's service area; and
    (B) Elderly-designated housing or housing disproportionately 
serving older adults (whether or not specifically authorized to do so) 
compared to housing serving families.
    (vi) Describe whether individuals with disabilities who participate 
in or who are eligible to participate in the PHA's programs, services, 
and activities experience barriers that deny individuals with 
disabilities access to opportunity and community assets in the 
geographic areas of analysis with regard to the following:
    (A) Accessible and affordable housing;
    (B) Accessible government facilities and websites;
    (C) Accessible public infrastructure;
    (D) Reliable and accessible transportation;
    (E) Accessible schools and educational programs, and in particular, 
high-performing schools and educational programs;
    (F) Employment; and
    (G) Community-based supportive services.
    (vii) What public or private policies or practices, demographic 
shifts, economic trends, or other factors may have caused or 
contributed to the patterns described in the responses to paragraphs 
(e)(4)(i) through (vi) of this section?
    (5) Local policies and practices impacting fair housing. (i) How do 
local laws, policies, ordinances, and other practices impede or promote 
the siting of affordable housing and use of Housing Choice Vouchers in 
well-resourced areas of opportunity? This analysis shall include both 
policies of the kind that are under the PHA's direct control (for 
example, preferences, types of housing designations, creation and 
retention of units for large families) and municipal or State policies, 
such as zoning and land use policies, ordinances, or regulations, 
eviction policies and procedures, or the lack of laws banning source of 
income discrimination, that are known to the PHA that impact the siting 
of affordable housing and voucher mobility.
    (A) Describe the boundaries of the PHA's service area.
    (B) Describe the PHA's mobility and portability policies and 
activities; is there a need for additional mobility services, landlord 
incentives, policies related to portability policies or to payment 
standards and fair market rents, or other policies that might improve 
housing choice voucher mobility outcomes?
    (C) Is there a need for services, improved access to economic 
opportunity, or place-based investments to assist the PHA's assisted 
residents or the neighborhoods where its housing developments or 
Housing Choice Vouchers are located? Examples could include a need for 
services for residents, job training and placement, service 
coordinators, health access, after-school programs or tutors, broadband 
access, access to reputable and affordable financial services?
    (ii) Describe the efforts and activities undertaken by the PHA to 
work, collaborate, or partner with other offices, departments, 
agencies, or entities within the program participant's jurisdiction 
that aim to advance equity.
    (iii) What is the status of any unresolved findings, lawsuits, 
enforcement actions, settlements, or judgments involving the PHA 
related to fair housing or other civil rights laws?
    (iv) What specific steps does the PHA take to ensure compliance 
with existing fair housing and civil rights laws and regulations, 
including the implementation of discretionary policies and practices 
(e.g., policies related to preferences, portability, reasonable 
accommodations, unit tenanting, including designated accessible units, 
evictions)?
    (f) Content: Description and prioritization of fair housing issues. 
(1) For each program participant, the Equity Plans shall include a 
description of the fair housing issues identified during the analysis 
conducted for each fair housing goal category. The description of a 
fair housing issue shall include the specific conditions that 
constitute the fair housing issue and the protected class groups that 
are adversely affected by the issue. Program participants are expected 
to identify all fair housing issues. They must also identify those that 
present the

[[Page 8566]]

greatest barriers to fair housing choice and deny equitable access to 
community assets for protected class groups.
    (2) For purposes of establishing the Equity Plan's fair housing 
goals, program participants must prioritize the identified fair housing 
issues in each fair housing goal category. When prioritizing fair 
housing issues, program participants must give consideration to fair 
housing issues faced by underserved communities that have historically 
been denied fair housing choice, isolated in racially or ethnically 
concentrated areas of poverty or other segregated settings, and 
subjected to disparities in access to opportunity, including the 
opportunity to live in well-resourced areas, the opportunity to enjoy 
equal access to community assets, and access to homeownership 
opportunities. In determining how to prioritize fair housing issues 
within each fair housing goal category, program participants shall give 
highest priority to fair housing issues that will result in the most 
effective fair housing goals for achieving material positive change for 
underserved communities, taking into account that different protected 
class groups may be impacted by different fair housing issues.
    (g) Content: Fair housing goals. (1) For each program participant, 
the Equity Plan shall include the establishment of fair housing goals 
that are designed and can be reasonably expected to overcome the fair 
housing issues identified through the analysis conducted pursuant to 
paragraphs (d) and (e) of this section. Program participants are not 
required to set fair housing goals for fair housing goal categories 
that do not have identified fair housing issues. While HUD expects to 
see progress toward the achievement of each goal by the time of the 
program participant's next Equity Plan, HUD recognizes that all goals 
may not be fully achieved during a single five-year cycle.
    (2) Fair housing goals, when taken together, must be designed to 
overcome prioritized fair housing issues in each fair housing goal 
category and must be designed and reasonably expected to result in 
material positive change and consistent with a balanced approach.
    (3) A program participant's goals may consist of short-term goals 
such that material positive change is readily achieved, as well as 
long-term goals such that material positive change occurs within the 
jurisdiction over a prolonged but reasonable period of time. When 
establishing fair housing goals, program participants may adopt a small 
number of goals if such goals could ultimately result in outcomes that 
have a significant impact toward advancing equity for protected class 
groups by reducing the adverse effects of fair housing issues. Program 
participants' consideration of the reach and breadth of their own 
authority and spheres of influence must be taken into account when 
determining which goals to set. A program participant may prioritize 
implementation of particular goals over others but must ensure that any 
prioritization will result in meaningful actions that affirmatively 
further fair housing. So long as a program participant meets these 
requirements, the program participant has discretion to set goals that 
can reasonably be expected to address local fair housing issues and to 
specify actions necessary to implement those goals. The following are 
examples of some goals that may be appropriate depending on the 
circumstances facing the jurisdiction; these examples are not the only 
types of goals program participants may set nor are program 
participants required to set these specific goals if they would not 
address the fair housing issues in their communities.
    (i) A fair housing goal to overcome segregation in specific 
neighborhoods in the jurisdiction could consist of:
    (A) Siting development of future affordable housing outside of 
segregated areas; and
    (B) Eliminating barriers to homeownership for members of protected 
class groups that have historically been denied an equal opportunity to 
become homeowners.
    (ii) A fair housing goal to overcome segregation in specific 
neighborhoods and promote integration and fair housing choice in others 
could consist of expanding mobility programs to provide more housing 
opportunities in well-resourced areas of opportunity for individuals or 
families that utilize housing vouchers.
    (iii) A fair housing goal to overcome disparities in access to 
affordable housing could consist of a PHA's revision of its own 
policies to provide more flexibility in admission criteria (for 
example, with respect to those who have previously faced eviction due 
to financial hardship or individuals who have been denied access to 
housing due to prior involvement in the justice system), efforts to 
combat source of income discrimination, and any necessary revisions to 
a PHA's eviction policies so individuals from protected class groups 
are not excluded from the PHA's programs or activities.
    (iv) A fair housing goal to overcome inequitable access to high-
performing schools could consist of realignment of school district 
boundaries, school zones, or school feeder patterns and increasing the 
funding for schools in R/ECAPs to ensure that members of historically 
underserved protected class groups have equitable access to educational 
opportunities regardless of where they live; such a goal could require 
multiple parts of the jurisdiction to work together to advance equity 
and may require leaders in the community to provide the political will 
for such a goal to be established and implemented.
    (v) A fair housing goal to increase housing and neighborhood access 
could consist of reducing land use and zoning restrictions that limit 
housing supply and increase housing costs in order to ensure that 
members of historically underserved communities and protected class 
groups have equitable access to affordable housing opportunities in 
well-resourced areas throughout the jurisdiction.
    (vi) A fair housing goal to ensure that underserved communities 
have equitable access to affordable housing opportunities, 
homeownership, and community assets may include amending local laws to 
include additional protections for certain underserved populations, 
such as LGBTQ+ persons or survivors of domestic violence, and may 
include the removal of barriers that exist in local laws such as 
nuisance or crime free ordinances, which may limit access to affordable 
housing because of protected characteristics.
    (vii) A fair housing goal to overcome the fair housing issues of 
segregation and disparities in access to opportunity for individuals 
with disabilities due to a lack of accessible, affordable housing could 
include the incorporation of the provision of enhanced accessibility 
features (e.g., features that provide greater accessibility than the 
minimum features required by accessibility standards) in new 
construction and rehabilitation of affordable housing to create greater 
access to integrated housing opportunities for individuals with 
disabilities.
    (viii) A fair housing goal to enact source of income anti-
discrimination laws, and/or to develop better enforcement strategies 
around such laws to ensure that underserved communities have equitable 
access to housing assistance programs, affordable housing 
opportunities, and community assets.
    (4) Though program participants may not have direct or sole control 
over certain issues within their communities, HUD expects program 
participants to work closely with entities that have control of such 
issues to achieve fair housing outcomes. With respect to identified 
fair housing issues over which the program participant has

[[Page 8567]]

limited control, the program participant must consider the types of 
goals it can achieve that would ameliorate the effects of prioritized 
fair housing issues using the authority, tools, and influence it does 
have, including by collaborating with other program participants.
    (5) Fair housing goals in the Equity Plan must not result in 
policies or practices that discriminate in violation of the Fair 
Housing Act or other Federal civil rights laws. Fair housing goals also 
may not require residents of racially or ethnically concentrated areas 
of poverty to move away from those areas if they prefer to stay in 
those areas as a matter of fair housing choice.
    (6) In addition, fair housing goals must:
    (i) Identify the fair housing issue(s) the goal is designed to 
address--for instance, where segregation in a development or geographic 
area is determined to be a fair housing issue, HUD expects the Equity 
Plan to establish one or more goals to reduce the segregation;
    (ii) Explain how the goal, alone or in concert with other goals, 
will overcome the fair housing issue(s) it is designed to address;
    (iii) Set timeframes for achievement of the goal, including metrics 
and milestones for how achievement of the goal will be measured; and
    (iv) Describe the specific steps or actions that need to be taken 
to achieve the goal and the amount of funding that will be needed in 
order to fully achieve the goal.
    (h) Additional content. (1) Program participants must include the 
following additional content as part of their Equity Plan submitted to 
HUD:
    (i) A summary of the community engagement activities undertaken 
pursuant to Sec.  5.158;
    (ii) A description of how the program participant addressed the 
comments received through the community engagement process required by 
Sec.  5.158;
    (iii) As an attachment, all written comments received and 
transcripts or audio or video recordings of hearings held during the 
development of the Equity Plan; and
    (iv) Signed certifications and assurances, as required by Sec.  
5.160.
    (2) Program participants may include an executive summary or any 
other information the program participant believes relevant to the 
Equity Plan.
    (i) Progress evaluation. (1) Program participants should engage in 
continual evaluation of their progress, but must do so no less 
frequently than once per year, to determine whether any changes, 
adjustments, or new information requires a revision to the Equity Plan 
or a subsequent planning document.
    (2) Program participants must conduct and submit annual progress 
evaluations to HUD in a manner specified by the Responsible Civil 
Rights Official. The annual progress evaluation shall include the 
program participant's report on progress achieved under each fair 
housing goal, including whether goals have been fully achieved, and 
assessment of whether the fair housing goals established in the Equity 
Plan require adjustment because of changed circumstances or because 
they are unlikely to result in material positive change in overcoming 
fair housing issues. The program participants' annual progress 
evaluation must be accompanied by the signed certifications and 
assurances required by Sec.  5.160 and shall be published on HUD-
maintained web pages.
    (3) For each Equity Plan submitted after the first Equity Plan 
submission, the program participant shall provide a summary of the 
progress achieved in meeting the fair housing goals set in the prior 
Equity Plan. This summary progress evaluation shall be part of the 
subsequent Equity Plan (and is distinct from the annual progress 
evaluations required by paragraphs (i)(1) and (2) of this section, but 
may include a compilation of those progress evaluations) subject to 
community engagement as part of the subsequent Equity Plan's 
development.
    (4) All progress evaluations (i.e., annual progress evaluations and 
summaries for purposes of subsequent Equity Plans) shall include, at 
minimum:
    (i) An evaluation of the progress on each goal established in the 
prior Equity Plan, including whether the goal was achieved, some 
progress toward achieving the goal was made, or no progress toward 
achieving the goal was made;
    (ii) An identification of any barriers that impeded the progress or 
achievement of the fair housing goals in the prior Equity Plan;
    (iii) A description of any changes or adjustments to the goals 
undertaken during the prior Equity Plan cycle and how those changes or 
adjustments impacted the progress toward achievement of the goal;
    (iv) A description of HUD funds or other Federal, State, local 
funds, or philanthropic support that were used toward achievement of 
the goal; and
    (v) An explanation of the outcomes based on the achievement of the 
goal. For example, this explanation may include any results with 
respect to the reduction of segregation in a particular geographic 
area, increased access to opportunity by protected class groups, or 
other material positive change observed, including how the program 
participant advanced equity for members of protected class groups and 
underserved communities since the goal was implemented.
    (j) Publication. The Equity Plan, progress evaluations, and HUD 
notifications related to Equity Plans shall be public documents.
    (1) Program participants shall make drafts of the Equity Plan 
available pursuant to Sec.  5.158 for purposes of community engagement.
    (2) Upon submission of the Equity Plan to HUD, HUD will publish the 
submitted Equity Plan on a HUD-maintained web page and will update this 
web page to reflect the status of the Equity Plan pursuant to Sec.  
5.162. In particular, this web page will reflect whether an Equity Plan 
has been accepted and if an accepted Equity Plan differs from the 
initially submitted version. HUD may publish final Equity Plans or 
portions of such plans on other HUD-maintained web pages for the 
purposes of disseminating best practices and in a searchable 
information clearinghouse to benefit program participants and the 
general public. Program participants are also encouraged to post their 
HUD-reviewed Equity Plans on their official websites, in formats that 
satisfy civil rights requirements including title VI of the Civil 
Rights Act of 1964 and the regulation at 24 CFR part 1; section 504 of 
the Rehabilitation Act of 1973 and the regulation at 24 CFR part 8; and 
the Americans with Disabilities Act and the regulations at 28 CFR parts 
35 and 36, as applicable.
    (3) HUD will accept information from the public during its review 
of the submitted Equity Plan, consistent with Sec.  5.162, relating to 
whether the Equity Plan was developed in accordance with the required 
community engagement, whether the content of a published Equity Plan is 
deficient, including whether fair housing issues were appropriately 
identified, whether the information provided during the community 
engagement process required by Sec.  5.158 was appropriately 
incorporated into the Equity Plan, whether fair housing issues were 
appropriately prioritized, and whether the fair housing goals are 
appropriate, meaning that they are designed and can be reasonably 
expected to overcome the effects of the identified fair housing issues.

[[Page 8568]]

Sec.  5.156   Affirmatively furthering fair housing through Equity Plan 
incorporation into subsequent planning documents.

    (a) General. It is the Department's policy to ensure that program 
funding is used to eliminate disparities resulting from Federal, State, 
and local laws, policies, and practices that have perpetuated 
segregation or denied equal opportunity because of a protected 
characteristic. Accordingly, any policies or practices adopted through 
program participants' planning documents or as part of program 
participants' implementation of programs, activities, and services 
shall be consistent with the commitments program participants have made 
in their Equity Plans, this part, and the AFFH mandate. By 
incorporating their fair housing goals, strategies, and actions into 
their planning documents, program participants will be better 
positioned to build equity and fairness into their decision-making 
processes for the use of resources and other investments, live up to 
the commitments they have made in Equity Plans, and ultimately fulfill 
their obligations to affirmatively further fair housing. A program 
participant must incorporate its implementation of these concepts and 
commitments in its Equity Plan into other planning documents, such as 
the consolidated plan, annual action plan, PHA Plan, disaster plan, or 
any plan incorporated therein.
    (b) Strategies and meaningful actions. To implement the fair 
housing goals from the Equity Plan, program participants must include 
strategies and meaningful actions in their consolidated plans, annual 
action plans, and PHA Plans (including any plans incorporated therein). 
Program participants are only required to include the implementation of 
fair housing goals that are intended to be undertaken or funded in a 
particular program year in their annual action plans, though all fair 
housing goals must be incorporated into their 3-5-year consolidated or 
PHA Plans. Strategies and meaningful actions must affirmatively further 
fair housing and identify specific expected allocation of funding by 
program year for the use of HUD and other funds to implement each fair 
housing goal (if funding is necessary). Strategies and meaningful 
actions may include, but are not limited to: elimination of local laws 
or ordinances that are barriers to equitable access to homeownership or 
other affordable housing opportunities; enactment of local laws or 
ordinances that remove barriers or increase access to homeownership or 
other affordable housing opportunities; build strong fair housing and 
civil rights protections into State and local laws; enhancing mobility 
strategies and encouraging development of new affordable housing in 
well-resourced areas of opportunity; and place-based strategies and 
meaningful actions that are a part of a balanced approach, including 
preservation of existing HUD-assisted and other affordable housing.
    (c) Other planning activities or processes. Program participants 
must incorporate the fair housing goals from their Equity Plans into 
planning documents required in connection with the receipt of Federal 
financial assistance from any other Federal executive department or 
agency. This incorporation shall include the allocation of resources 
necessary for achievement of the goal. The program participant's 
progress evaluation includes an evaluation of the goals incorporated 
into these other planning documents as required pursuant to Sec.  
5.154.
    (d) Meaning of approval or acceptance of planning documents. 
Approval by HUD or any other agency of a planning document that must be 
approved or accepted by the Department or any other agency for purposes 
of program administration does not mean that the program participant 
has complied with the incorporation requirements set forth in this 
section or has otherwise complied with its obligation to affirmatively 
further fair housing or any other Federal fair housing and civil rights 
requirements.
    (e) Failure to incorporate fair housing goals into planning 
documents. A program participant must incorporate the fair housing 
goals from its Equity Plan into its consolidated plan or PHA Plan in 
order to allocate funding for implementation of such goals as 
strategies and meaningful actions. Upon a determination by HUD that 
fair housing goals from the Equity Plan have not been incorporated into 
subsequent plans, and following notification to the program participant 
and opportunity for the program participant to respond and cure any 
deficiency, the Secretary may condition a grant (see e.g., 2 CFR 
200.208), obtain an assurance that the program participant will revise 
the plan to comply with the requirements of Sec. Sec.  5.150 through 
5.180 by a specified date, or may disapprove a consolidated plan or 
reject a PHA Plan consistent with 24 CFR 91.500 for consolidated plans 
and 24 CFR 903.23 for PHA Plans, or may take the actions set forth at 
Sec. Sec.  5.170 and 5.172.


Sec.  5.158   Community engagement.

    (a) General. (1) To ensure that the Equity Plan is informed by 
meaningful input from the community, program participants must engage 
with the public during the development of the Equity Plan, including 
with respect to both the identification of fair housing issues 
(including inequities faced by members of protected class groups and 
underserved communities) and the setting of fair housing goals to 
remedy the identified fair housing issues. Community engagement 
includes program participants' consideration of the views and 
recommendations received from members of the community and other 
interested parties.
    (2) Program participants must proactively facilitate community 
engagement to ensure they receive and address information from the 
community regarding the effects of historical decisions and practices, 
current conditions, and other concerns relating to fair housing choice, 
equitable provision of services, access to opportunity, and specific 
fair housing issues. Members of the community are in a unique position 
to provide the program participant with perspectives on the impact of 
fair housing issues facing the community.
    (3) To the extent practicable, program participants are permitted 
to combine this engagement with other community, resident, or citizen 
participation required for purposes of other HUD programs and planning 
processes; however, program participants are required to explain the 
Fair Housing Act's affirmatively furthering fair housing duty and 
ensure the engagement regarding the Equity Plan meets all the criteria 
set forth in this section.
    (4) In addition, and in accordance with program regulations, the 
public shall have reasonable opportunity for involvement in the 
incorporation of the fair housing goals as strategies and meaningful 
actions into the consolidated plan, annual action plan, PHA Plan (and 
any plans incorporated therein), and other required planning documents.
    (5) Program participants must employ communication methods designed 
to reach the broadest possible audience and should make efforts to 
reach members of protected class groups that have historically been 
denied equal opportunity and underserved communities. Such 
communications may include but are not limited to publishing a summary 
of each document on the program participant's official government 
website and one or more newspapers of general circulation, and by 
making copies of each document available on the internet (including 
free web-based social bulletin boards and

[[Page 8569]]

platforms), and as well at libraries, government offices, and public 
places.
    (6) In order to comply with the obligation to affirmatively further 
fair housing, program participants must actively engage with a wide 
variety of diverse perspectives within their communities and use the 
information available in a manner that promotes the setting of 
meaningful fair housing goals that will lead to material positive 
change.
    (7) Program participants must ensure that all aspects of community 
engagement are conducted in accordance with fair housing and civil 
rights requirements, including title VI of the Civil Rights Act of 1964 
and the regulations at 24 CFR part 1; section 504 of the Rehabilitation 
Act of 1973 and the regulations at 24 CFR part 8; and the Americans 
with Disabilities Act and the regulations at 28 CFR parts 35 and 36, as 
applicable.
    (8) A program participant may, if practicable, combine the 
requirements of this section with applicable public participation 
requirements of consolidated plan program participants and PHAs, 
subject to the following requirements:
    (i) Consolidated plan program participants. The consolidated plan 
program participant may, if practical, combine the requirements of this 
section with its applicable citizen participation plan requirements, 
adopted pursuant to 24 CFR part 91 (see 24 CFR 91.105, 91.115, and 
91.401). However, the community engagement for purposes of developing 
an Equity Plan must allow for sufficient opportunity for the community 
to have the in-depth discussions about fair housing issues required by 
this section. Therefore, to the extent the citizen participation plan 
does not provide for this opportunity, program participants must 
undertake separate engagement activities.
    (ii) PHAs. To the extent practicable, PHAs may combine the 
requirements of this section when implementing the procedures described 
in 24 CFR 903.13, 903.15, 903.17, and 903.19 in the process of 
developing the Equity Plan, obtaining Resident Advisory Board and 
community feedback, and addressing complaints. The community engagement 
for purposes of developing an Equity Plan must allow for sufficient 
opportunity for the community to have the in-depth discussions about 
fair housing issues required by this section. Accordingly, to the 
extent the regulations at 24 CFR part 903 do not provide for this 
opportunity, PHAs must undertake separate engagement activities or 
incorporate such activities into the implementation of the specific, 
applicable program regulations.
    (b) Coordination. (1) To the extent practicable, program 
participants submitting a joint Equity Plan may fulfill their community 
engagement responsibilities by combining efforts with other program 
participants by:
    (i) Jointly conducting community engagement activities with a 
consolidated plan program participant;
    (ii) Jointly conducting community engagement activities with one or 
more PHAs; or
    (iii) Separately conducting community engagement activities.
    (2) Joint program participants are encouraged to enter into 
Memoranda of Understanding (MOUs) to clearly define the functions, 
level of member participation, method of dispute resolution, and 
decision-making process of the program participants, for purposes of 
engaging with the community as well as in the development of the Equity 
Plan.
    (c) Frequency. (1) Program participants must engage with their 
communities prior to and during the development of an Equity Plan.
    (2) While the Equity Plan is in effect, program participants must 
engage with their communities on at least an annual basis. To the 
extent practicable, this engagement may be combined with any citizen 
participation or resident participation for purposes of developing 
annual plans pursuant to program requirements. The purpose of such 
annual engagement shall be to receive community input as to whether the 
program participant is taking effective and necessary actions to 
implement the Equity Plan's fair housing goals, whether adjustments to 
goals need to be made, and whether a change in circumstance may require 
a revision of the Equity Plan pursuant to Sec.  5.164, including the 
formulation of additional goals.
    (d) Methods. Program participants may choose any methods that are 
effective in engaging their communities, but at minimum must employ the 
following methods:
    (1) For the development of an Equity Plan, hold at least three (3) 
public meetings, at various accessible locations and at different times 
to ensure that members of protected class groups and underserved 
communities are afforded opportunities to provide input. At least one 
such meeting shall be held in a location in the jurisdiction in which 
underserved communities disproportionately reside and efforts to obtain 
input from underserved populations who do not live in underserved 
neighborhoods shall also be employed;
    (2) For the annual engagement, hold at least two (2) public 
meetings, at different locations, one of which shall be located in an 
area of the jurisdiction in which underserved communities predominantly 
reside;
    (3) Connect with and provide information about fair housing 
planning to local community leaders, which may include, but are not 
limited to advocates, community-based organizations, clergy, healthcare 
professionals, educational leaders or teachers, and other service 
providers such as social workers and case managers to provide and 
solicit the views of the communities they serve; and
    (4) Make available to the public data and information demonstrating 
the existence of fair housing issues (including segregated areas).


Sec.  5.160   Submission requirements.

    (a) General. Program participants must submit an Equity Plan to HUD 
for review pursuant to the schedule set forth in this section. Program 
participants may submit an individual Equity Plan or may collaborate 
with other program participants (joint program participants) to submit 
a joint Equity Plan.
    (1) Goals in an individual Equity Plan may contemplate and include 
coordination or collaboration with other program participants or other 
public or private entities even if those entities are not part of a 
joint Equity Plan.
    (2) Program participants are encouraged to collaborate to conduct 
and submit a single Equity Plan (i.e., a joint Equity Plan) for the 
purpose of sharing resources and developing partnerships to address 
fair housing issues. When collaborating to submit a joint Equity Plan, 
joint program participants may divide work as they choose, but all 
program participants are accountable for any joint analysis and any 
joint fair housing goals. Program participants are accountable for 
their individual analysis and fair housing goals included in the joint 
Equity Plan. Participation in a joint Equity Plan does not relieve each 
program participant from its obligation to analyze and address fair 
housing issues by setting goals and implementing strategies and 
meaningful actions to overcome the effects of any identified fair 
housing issues. Each program participant must sign the joint Equity 
Plan and associated certifications and assurances submitted to HUD.
    (i) Program participants that are either not located within the 
same CBSA or

[[Page 8570]]

that are not located within the same State that seek to collaborate on 
a joint Equity Plan must submit a written request to HUD for approval 
of the collaboration, stating why the collaboration is appropriate. The 
written request must be submitted not less than 180 days before the 
start of the development of the joint Equity Plan. The joint Equity 
Plan may not proceed until such time as the Responsible Civil Rights 
Official approves the collaboration.
    (ii) All other joint Equity Plan program participants must promptly 
notify HUD of their intent to collaborate, but need not obtain HUD 
approval prior to conducting the joint Equity Plan. The notification to 
HUD must include a copy of their written agreement.
    (iii) Program participants must designate, through express written 
consent, one program participant to serve as the lead entity to oversee 
the submission of the joint Equity Plan. The notification to HUD of the 
collaboration shall include the identification of the lead entity.
    (iv) The submission schedule for the joint Equity Plan shall be the 
schedule that ordinarily would apply to the joint Equity Plan's lead 
entity unless the Responsible Civil Rights Official determines that an 
earlier submission is required for good cause, in which case the 
Responsible Civil Rights Official will designate an earlier submission 
date that provides the collaborating program participants a reasonable 
amount of time to develop and submit a joint Equity Plan.
    (v) Program participants conducting a joint Equity Plan must have a 
plan for community engagement that complies with the requirements of 
Sec. Sec.  5.150 through 5.180, and must include the jurisdictions of 
each program participant, not just that of the lead entity. A material 
change that requires the revision of an Equity Plan pursuant to Sec.  
5.164 for any program participant that is part of a joint Equity Plan 
will trigger a requirement to revise the joint Equity Plan, including 
any necessary community engagement.
    (vi) Program participants conducting a joint Equity Plan may 
determine that it would be practicable to align program and fiscal 
years according to the procedures set forth at 24 CFR 91.10 and 24 CFR 
part 903, as applicable for purposes of the submission schedule set 
forth in this section. To the extent that alignment of program and 
fiscal years is not practicable, a program participant may be required 
by the Secretary to make appropriate revisions to its full consolidated 
plan or PHA Plan, or any plan incorporated therein, that was approved 
by HUD prior to the submission and HUD review of the joint Equity Plan 
in order to appropriately incorporate strategies and meaningful actions 
to implement the fair housing goals from the joint Equity Plan.
    (vii) A program participant that, for any reason, decides to 
withdraw from a previously arranged joint Equity Plan must promptly 
notify HUD of the withdrawal. HUD will work with the withdrawing 
program participant, as well as the remaining program participants 
conducting the joint Equity Plan, to determine whether a new submission 
date is needed for the withdrawing participant or the remaining 
participants. If a new submission date is needed for the withdrawing 
participant or the remaining participants, HUD will establish a 
submission date for the program participant's individual Equity Plan 
that is as close as feasible to the originally intended submission date 
and is no later than the original submission date for the joint Equity 
Plan, unless good cause for an extension is shown, as determined by the 
Responsible Civil Rights Official.
    (b) Submission of first Equity Plan--consolidated plan program 
participants. (1) For each program participant that receives a total of 
$100 million or more in formula grant funds from programs that are 
subject to the consolidated plan requirements for the program year that 
begins on or after January 1, 2024, the first Equity Plan shall be 
submitted by 24 months after [effective date of final rule], or 365 
calendar days prior to the date for which a new consolidated plan is 
due, whichever is earlier.
    (2) For each program participant that receives a total of $30-99 
million in formula grant funds for the program year that begins on or 
after January 1, 2025, the first Equity Plan shall be submitted no 
later than 365 calendar days prior to the date for which a new 
consolidated plan is due.
    (3) For each program participant that receives a total of $1-29 
million in formula grant funds for the program year that begins on or 
after January 1, 2026, the first Equity Plan shall be submitted no 
later than 365 calendar days prior to the date for which a new 
consolidated plan is due.
    (4) For each program participant that receives a total of less than 
$1 million in formula grant funds for the program year that begins on 
or after January 1, 2027, the first Equity Plan shall be submitted no 
later than 365 calendar days prior to the date for which a new 
consolidated plan is due.
    (c) Submission of first Equity Plan--public housing agencies 
(PHAs). For purposes of determining the PHA's total number of public 
housing units and vouchers, the inventory shall be determined as of 
[effective date of final rule].
    (1) For each PHA with a combined total number of public housing 
units and vouchers of 50,000 or more, the first Equity Plan shall be 
submitted no later than 24 months after [effective date of final rule], 
or 365 calendar days prior to the date for which a new 5-year plan is 
due following the start of the fiscal year that begins on or after 
January 1, 2024, whichever is earlier.
    (2) For each PHA with a combined total number of public housing 
units and vouchers between 10,000 and 49,999, the first Equity Plan 
shall be submitted no later than 365 calendar days prior to the date 
for which a new 5-year plan is due following the start of the fiscal 
year that begins on or after January 1, 2025.
    (3) For each PHA with a combined total number of public housing 
units and vouchers between 1,000 and 9,999 or PHAs that operate 
statewide, which includes certain Qualified PHAs, the first Equity Plan 
shall be submitted no later than 365 calendar days prior to the date 
for which a new 5-year plan is due following the start of the fiscal 
year that begins on or after January 1, 2026.
    (4) For each PHA with a combined total number of public housing 
units and vouchers that is less than 1,000, the first Equity Plan shall 
be submitted no later than 365 calendar days prior to the date for 
which a new 5-year plan is due following the start of the fiscal year 
that begins on or after January 1, 2027.
    (d) How to comply with AFFH planning and certification requirements 
until first Equity Plan submission. (1) Except as provided in paragraph 
(e) of this section, until such time as a program participant submits 
or is required to submit an Equity Plan, the program participant shall 
engage in fair housing planning (e.g., prepare an Analysis of 
Impediments to Fair Housing Choice, Assessment of Fair Housing, or 
other fair housing plan). Program participants that have not conducted 
or updated their fair housing plans for more than three years prior to 
[effective date of final rule], and who are not required to submit an 
Equity Plan pursuant to paragraph (b) or (c) of this section within 
twenty-four months of [effective date of final rule], shall either 
conduct or update their fair housing plans (i.e., Analysis of 
Impediments to Fair Housing Choice, Assessment of Fair Housing, or 
other fair housing plan) and submit such plan to HUD for publication 
and potential review no later than 365 days from [effective date

[[Page 8571]]

of final rule]. Program participants that have conducted or updated 
their fair housing plans during the three years prior to [effective 
date of final rule], are not required to undertake additional updates 
pursuant to this paragraph (d)(1), but must submit their existing fair 
housing plan to the Department for publication and potential review no 
later than 120 days from [effective date of final rule]. Program 
participants may, alternatively, conduct an Equity Plan in advance of 
when such plan would otherwise be due for submission to HUD pursuant to 
paragraph (b) or (c) of this section. The Responsible Civil Rights 
Official may review and provide feedback on a program participant's 
submitted fair housing plan. If the Secretary determines there is 
evidence that challenges the accuracy of the program participant's 
certification that it will affirmatively further fair housing, the 
Secretary will provide written notification to the program participant 
of such a determination consistent with 24 CFR 91.500 for consolidated 
plans and 24 CFR 903.23 for PHA Plans and Sec.  5.162. The Responsible 
Civil Rights Official's review of a fair housing plan under this 
paragraph (d)(1) may also provide reason for the initiation of a 
compliance review pursuant to Sec.  5.170.
    (2) Program participants shall continue to update their fair 
housing plans at least every five years and submit updated plans to HUD 
for publication and potential review until such time as the program 
participant is required to begin preparing its Equity Plan for 
submission to HUD.
    (e) New program participants. For a new program participant that 
has not submitted a consolidated plan or PHA Plan as of [30 days after 
date of publication of final rule], HUD will provide the new program 
participant with a deadline for submission of its first Equity Plan, 
which shall be at least 24 months after the date for which the program 
participant's first consolidated plan or PHA Plan is due. Prior to the 
submission of its first Equity Plan, new program participants are 
required to affirmatively further fair housing and engage in fair 
housing planning during the development of its first consolidated or 
PHA Plan.
    (f) Annual progress evaluations. Program participants shall, in 
accordance with Sec.  5.154(h), submit annual progress evaluations to 
the Responsible Civil Rights Official, which shall be accompanied by 
the certifications and assurances in paragraph (i) of this section. The 
first annual progress evaluation shall be submitted for publication and 
review no later than 365 days from the date of HUD's notification that 
the Equity Plan is accepted, and subsequent progress evaluations shall 
be submitted for publication and review no later than 365 days from the 
date of the last progress evaluation submitted.
    (g) Second and subsequent Equity Plans. Following the first Equity 
Plan, for all program participants, subsequent Equity Plans shall be 
submitted for publication and review 365 days before the date for which 
a new 3- to 5-year consolidated plan or PHA Plan is due (as 
applicable).
    (h) Frequency. All program participants shall submit an Equity Plan 
no less frequently than once every 5 years, or at such time agreed upon 
in writing by the Responsible Civil Rights Official and the program 
participant, as necessary to remedy or avoid noncompliance with Federal 
fair housing and civil rights requirements.
    (i) Equity Plan certifications and assurances. Each program 
participant, including program participants submitting a joint Equity 
Plan, must include the following certifications and assurances with 
each Equity Plan and annual progress evaluation submitted to HUD:
    (1) The program participant's statements and information contained 
in the Equity Plan submitted to HUD are true, accurate, and complete 
and that the program participant developed the Equity Plan in 
compliance with the requirements of Sec. Sec.  5.150 through 5.180.
    (2) The program participant will take meaningful actions to 
implement the goals established in its Equity Plan conducted in 
accordance with the requirements of Sec. Sec.  5.150 through 5.180 and 
24 CFR 91.225(a)(1), 91.325(a)(1), 91.425(a)(1), 570.487(b)(1), 
570.601, 903.7(o), and 903.15(d), as applicable, which require that the 
program participant will affirmatively further fair housing. In 
addition, the program participant will take no action that is 
materially inconsistent with the duty to affirmatively further fair 
housing.
    (3) The program participant shall submit, in conjunction with the 
Equity Plan submitted to HUD, an assurance to HUD that its programs, 
activities, and services are operated in compliance with the 
requirements of Sec. Sec.  5.150 through 5.180 and in a manner that 
affirmatively furthers fair housing, as well as that its programs, 
activities, and services are operated in compliance with Federal fair 
housing and civil rights nondiscrimination requirements. The assurance 
shall obligate the program participant to comply with Sec. Sec.  5.150 
through 5.180 for the full period during which Federal financial 
assistance is extended.


Sec.  5.162   Review of Equity Plan.

    (a) HUD review of submitted Equity Plan--(1) General. HUD's review 
of an Equity Plan is to determine whether the program participant has 
developed an Equity Plan that includes the required analysis, 
identification of fair housing issues, and establishment of fair 
housing goals, as set forth in Sec.  5.154. HUD will promptly publish 
each submitted Equity Plan on HUD-maintained web pages. Members of the 
public may submit comments regarding the submitted Equity Plan to HUD 
in a manner specified by the Responsible Civil Rights Official during 
the timeframe for HUD's review and should do so no later than 60 days 
from the date the Equity Plan is submitted to HUD. The timeframe for 
submission of comments may be extended for good cause by the 
Responsible Civil Rights Official. Providing comments on a submitted 
Equity Plan pursuant to this paragraph (a)(1) is distinct from the 
filing of complaints pursuant to Sec.  5.170.
    (2) HUD review. Within 100 calendar days after the date HUD 
receives the Equity Plan, HUD will accept the Equity Plan unless on or 
before that date the Responsible Civil Rights Official provides the 
program participant notification that the date is extended for good 
cause or that HUD does not accept the Equity Plan. If HUD does not 
accept the Equity Plan, in its notification, HUD will inform the 
program participant in writing of the reasons why HUD has not accepted 
the Equity Plan and actions the program participant may take to resolve 
the nonacceptance. HUD will publish any written feedback that it 
provides on accepted Equity Plans, as well as notifications of non-
acceptance, and related notifications and communications on HUD-
maintained web pages. HUD ordinarily will review an Equity Plan before 
acceptance, though an Equity Plan may be accepted without HUD review 
due to infeasibility or other exigent circumstances beyond HUD's 
control.
    (3) Meaning of HUD acceptance of an Equity Plan. HUD's acceptance 
of an Equity Plan means only that, for purposes of administering HUD 
program funding, HUD has not found that the program participant has 
failed to comply with the required elements, as set forth in Sec.  
5.154. HUD's acceptance of an Equity Plan does not mean that the 
program participant has complied with its obligation to affirmatively 
further fair housing under the Fair Housing Act; has complied with 
other provisions of the Fair Housing Act; or has complied with other 
civil rights laws and regulations. HUD's acceptance of an Equity Plan 
also

[[Page 8572]]

does not limit HUD's ability to undertake an investigation pursuant to 
Sec.  5.170.
    (b) Nonacceptance of an Equity Plan. (1) The Responsible Civil 
Rights Official will not accept an Equity Plan if the Equity Plan or a 
portion of the Equity Plan is inconsistent with fair housing or civil 
rights requirements, which includes but is not limited to any material 
noncompliance with the requirements of Sec. Sec.  5.150 through 5.180. 
In connection with a joint Equity Plan, HUD's determination to not 
accept the Equity Plan with respect to one program participant does not 
necessarily affect the status of the Equity Plan with respect to 
another program participant. The following are non-exclusive examples 
of an Equity Plan that is inconsistent with fair housing and civil 
rights requirements:
    (i) HUD determines that the analysis of fair housing issues and 
fair housing goals contained in the Equity Plan would result in 
policies or practices that would operate to discriminate in violation 
of the Fair Housing Act or other civil rights laws;
    (ii) The Equity Plan does not identify local policies or practices 
as fair housing issues when such policies or practices pose a barrier 
to equity;
    (iii) The fair housing goals contained in the Equity Plan are not 
designed and cannot be reasonably expected to result in a material 
positive change with respect to one or more identified and prioritized 
fair housing issues;
    (iv) The fair housing goals contained in the Equity Plan merely 
consist of actions already required to comply with nondiscrimination 
requirements (e.g., establishing a process for reviewing, making, and 
documenting decisions on reasonable accommodation requests received by 
the program participant);
    (v) The Equity Plan was developed without the required community 
engagement;
    (vi) The Equity Plan contains an analysis in which the 
identification of fair housing issues or the established fair housing 
goals are materially inconsistent with the data or other evidence 
available to the program participant, or in which fair housing goals 
are not designed to overcome the effects of identified fair housing 
issues as required by Sec. Sec.  5.150 through 5.180;
    (vii) The Equity Plan fails to acknowledge the existence of a fair 
housing issue identified during community engagement; or
    (viii) The Equity Plan does not contain the required certifications 
and assurances pursuant to Sec.  5.160.
    (2) HUD will provide written notification to the program 
participant, including each program participant involved in a joint 
Equity Plan, explaining HUD's decision to accept or not accept the 
Equity Plan. For Equity Plans that are not accepted, the written 
notification will provide guidance on how a non-accepted Equity Plan 
may be revised to achieve acceptance and how a program participant may 
request reconsideration by the Reviewing Civil Rights Official of HUD's 
non-acceptance of an Equity Plan, including by submitting clarifying 
information that may be sufficient to address the concerns raised in 
HUD's notification of non-acceptance. HUD will provide a decision on 
the request for reconsideration in advance of the deadline to resubmit 
a revised Equity Plan. To provide transparency regarding the status of 
program participants' Equity Plans, HUD will publish all such 
notifications on HUD-maintained web pages.
    (c) Revisions and resubmission. In HUD's notification of non-
acceptance, HUD will provide a program participant, including each 
program participant involved in a joint Equity Plan, with a reasonable 
time period to revise and resubmit the Equity Plan. All revisions or 
resubmissions, and any HUD notifications relating to revisions and 
resubmissions, shall be published on HUD-maintained web pages.
    (1) If HUD does not accept the Equity Plan, HUD will provide 
written notification to the program participant and shall provide no 
more than 60 calendar days after the date of HUD's notification to 
revise and resubmit the Equity Plan. HUD may extend this date for good 
cause.
    (2) The revised Equity Plan will be reviewed by HUD within 75 
calendar days of the date by which HUD receives the revised Equity 
Plan. HUD may provide notification that HUD does not accept the revised 
Equity Plan on or before that date. If HUD does not accept the 
revision, the procedures set forth in this section will continue to 
apply until such time as the program participant's revised Equity Plan 
has been accepted by HUD or the Responsible Civil Rights Official 
instead determines that a different procedure is necessary to ensure 
compliance, such as the procedures set forth at Sec.  5.172.
    (3) If a program participant's Equity Plan is accepted by HUD and 
the program participant voluntarily revises its Equity Plan in response 
to feedback contained in HUD's notification of acceptance, the revised 
Plan shall be submitted no later than 120 days following the date of 
HUD's notification of acceptance of the Equity Plan. If the revised 
Equity Plan does not meet the requirements set forth in Sec. Sec.  
5.150 through 5.180, HUD will not accept the revision, and the 
previously accepted Equity Plan will remain in effect. If HUD 
determines a revision is necessary pursuant to the requirements of this 
section, the procedures set forth in this section will continue to 
apply until such time as the program participant's revised Equity Plan 
has been accepted by HUD or the Responsible Civil Rights Official 
instead determines that a different procedure is necessary to ensure 
compliance, such as the procedures set forth at Sec.  5.172.
    (d) Incentives. At its discretion and consistent with applicable 
laws and program objectives, HUD may establish incentives or other ways 
to recognize program participants that set ambitious goals that are 
designed and can be reasonably expected to overcome challenging fair 
housing issues. These incentives may include HUD recognizing the value 
of relevant, effective fair housing goals when HUD establishes the 
criteria for evaluating applications for discretionary funding. Program 
participants are encouraged to include implementation of fair housing 
goals from their Equity Plans in subsequent applications to HUD for 
discretionary funding for purposes of securing additional resources to 
implement such goals.
    (e) Failure to have an accepted Equity Plan at the time of 
submission of the consolidated plan or PHA Plan. (1) At the time a 
program participant submits its consolidated plan or PHA Plan, as 
applicable, the program participant must have either a current, 
accepted Equity Plan or must have executed special assurances that 
require the program participant to submit and obtain HUD's acceptance 
of its Equity Plan by a specified date following the end of HUD's 
review period for the consolidated plan or PHA Plan. A program 
participant's failure to provide the required special assurances will 
lead to the disapproval of a consolidated plan or PHA Plan, and a 
program participant's failure to provide or comply with special 
assurances will jeopardize funding in accordance with Sec. Sec.  5.172 
and 5.174. Failure to provide or comply with special assurances may 
constitute evidence that a program participant's AFFH certification is 
inaccurate pursuant to 24 CFR 91.500 or that the program participant's 
AFFH certification appears inaccurate pursuant to 24 CFR 903.15, 
providing the Secretary a basis to challenge the validity of the AFFH 
certification pursuant to Sec.  5.166.
    (i) If a consolidated plan program participant does not have an 
Equity Plan

[[Page 8573]]

that has been accepted by HUD as provided by Sec.  5.160 at the time 
the program participant submits its consolidated plan, the Responsible 
Civil Rights Official shall obtain special assurances prior to the date 
the consolidated plan must be disapproved pursuant to 24 CFR 91.500 
(i.e., within 45 days of the date the consolidated plan is submitted to 
HUD); if a program participant fails to provide such special 
assurances, HUD will initiate the disapproval of the consolidated plan. 
The special assurances shall:
    (A) Require the program participant to achieve an accepted Equity 
Plan that meets the requirements of Sec. Sec.  5.150 through 5.180 no 
later than 180 days following the end of HUD's 45-day review period for 
the consolidated plan;
    (B) Set out a date, consistent with that deadline, by which the 
program participant shall submit its Equity Plan to HUD for review; and
    (C) Require the program participant to amend its consolidated plan 
to incorporate the fair housing goals of the accepted Equity Plan no 
later than 180 days from the date the Equity Plan is accepted by HUD.
    (ii) If a PHA does not have an Equity Plan that has been accepted 
by HUD as provided by Sec.  5.160 at the time the program participant 
submits its PHA Plan, the Responsible Civil Rights Official shall 
obtain special assurances prior to the date the PHA Plan must be 
disapproved pursuant to 24 CFR 903.23 (i.e., 75 days from the date the 
PHA Plan is submitted to HUD); if a program participant fails to 
provide such special assurances, HUD will disapprove the PHA Plan. The 
special assurances shall:
    (A) Require the program participant to achieve an accepted Equity 
Plan that meets the requirements of Sec. Sec.  5.150 through 5.180 no 
later than 180 days following the end of HUD's 75-day review period for 
the PHA Plan;
    (B) Set out a date, consistent with that deadline, by which the 
program participant shall submit its Equity Plan to HUD for review; and
    (C) Require the program participant to amend its PHA Plan to 
incorporate the fair housing goals of the accepted Equity Plan no later 
than 180 days from the date the Equity Plan is accepted by HUD.
    (2) Upon a determination by the Secretary that the program 
participant has failed to submit an Equity Plan that meets the 
requirements of Sec. Sec.  5.150 through 5.180, and after the 180-day 
period described in any applicable special assurance has expired, the 
following shall apply.
    (i) With respect to a consolidated plan program participant:
    (A) The Secretary shall promptly initiate termination of funding;
    (B) The Secretary shall refuse to grant or not continue granting 
applicable Federal financial assistance until such time as the program 
participant comes into compliance; and
    (C) The Secretary shall follow the procedures at Sec.  5.172 to 
effect these remedies.
    (ii) With respect to a PHA:
    (A) The Secretary shall notify the PHA that it is in substantial 
default;
    (B) The Secretary shall take any other action authorized by law to 
effect compliance; and
    (C) The Secretary shall follow the procedures at Sec.  5.172 to 
effect these remedies.
    (3) Special assurances and any submission of an Equity Plan, 
including HUD's decision to accept or not accept the Equity Plan shall 
be subject to the publication requirement at Sec.  5.154(j). Such 
publication shall indicate whether the special assurances have been 
satisfied as part of HUD's decision to accept the Equity Plan.


Sec.  5.164  Revising an accepted Equity Plan.

    (a) General--circumstances for revising an Equity Plan. (1) An 
Equity Plan previously accepted by HUD must be revised and submitted to 
HUD for review under the following circumstances:
    (i) A material change occurs. A material change is a change in 
circumstances in a program participant's jurisdiction that affects the 
information on which the Equity Plan is based to the extent that the 
analysis and fair housing goals of the Equity Plan no longer reflect 
actual circumstances. An Equity Plan must be revised in the event of a 
presidentially declared disaster that impacts a program participant's 
jurisdiction and is expected to result in additional Federal financial 
assistance for the jurisdiction, under title IV of the Robert T. 
Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 
et seq.); or
    (ii) Upon the Responsible Civil Rights Official's written 
notification specifying a material change that requires the revision.
    (2) An Equity Plan previously accepted by HUD may be revised and 
submitted to HUD for review under the following circumstances:
    (i) If there are changes in the program participant's geographic 
area of analysis that significantly impact the steps a program 
participant may need to take to affirmatively further fair housing;
    (ii) A fair housing goal established in the Equity Plan cannot be 
achieved;
    (iii) Significant demographic changes occur;
    (iv) New fair housing issues emerge in the jurisdiction;
    (v) Short-term fair housing goals have been achieved;
    (vi) Civil rights findings, determinations, settlements (including 
Voluntary Compliance Agreements), or court orders are entered; or
    (vii) The program participant advises HUD of a change that 
similarly may merit the program participant's submission of a revised 
Equity Plan, and HUD grants the program participant permission to 
submit a revised Equity Plan by a specific date for HUD review.
    (3) Requirements for revisions of an Equity Plan. A revision 
pursuant to paragraph (a)(1) or (2) of this section consists of 
preparing any necessary amended analyses and fair housing goals that 
take into account the change, including any new fair housing issues. A 
revision may not necessarily require the submission of an entirely new 
Equity Plan and a program participant may focus only on the change and 
the appropriate and necessary adjustments to the analysis and fair 
housing goals, but any revision shall trigger the program participant's 
obligation to conduct community engagement on the amended portions of 
the Equity Plan pursuant to the requirements at Sec.  5.158.
    (b) Timeframe for required revisions. (1) Where a revision is 
undertaken pursuant to paragraph (a)(1)(i) of this section, such 
revision shall be submitted within 12 months of the onset of the 
material change, or at such later date as the Responsible Civil Rights 
Official may provide. When the material change is the result of a 
presidentially declared disaster, such time shall be automatically 
extended to the date that is 2 years after the date upon which the 
disaster declaration is made, and the Responsible Civil Rights Official 
may extend such deadline, upon request, for good cause shown.
    (2)(i) When a revision is required under paragraph (a)(1)(ii) of 
this section, the Responsible Civil Rights Official will specify a date 
by which the program participant must submit the revision of the Equity 
Plan to HUD, considering the material change and the need for a valid 
Equity Plan to guide planning activities. The Responsible Civil Rights 
Official may extend the due date upon written request by the program 
participant that describes the reasons the program participant is 
unable to satisfy the deadline for submitting a revised Equity Plan.
    (ii) On or before 30 calendar days following the date of HUD's 
written notification under paragraph (a)(1)(ii) of this section, the 
program participant may advise the Responsible Civil Rights

[[Page 8574]]

Official in writing of its belief that a revision to the Equity Plan is 
not required. The program participant must state with specificity the 
reasons for its belief that a revision is not required. The Responsible 
Civil Rights Official will take into account any such response and 
issue to the program participant in writing a determination as to 
whether the program participant must proceed with the revision. The 
Responsible Civil Rights Official may establish a new due date that is 
later than the date specified in the original notification.
    (c) Submission of the revised Equity Plan. Upon completion, any 
revision to the Equity Plan must be submitted to HUD and will be 
published in accordance with Sec.  5.154(j). The revised Equity Plan 
will follow the same procedures for HUD review at Sec.  5.162.
    (d) Incorporation of revised fair housing goals into subsequent 
planning documents. Upon HUD's notice that the revised Equity Plan has 
been accepted, the program participant shall, within 12 months, 
incorporate any revised fair housing goals into its consolidated plan, 
annual action plan, or PHA Plan, or any plan incorporated therein.


Sec.  5.166  AFFH certifications required for the receipt of Federal 
financial assistance.

    (a) Certifications. Prior to the receipt of Federal financial 
assistance, program participants must certify that they will 
affirmatively further fair housing, which means engaging in fair 
housing planning and taking meaningful actions in accordance with the 
requirements of Sec. Sec.  5.150 through 5.180 and 24 CFR 91.225, 
91.325, 91.425, 570.487, 570.601, 903.7, and 903.15, and take no action 
that is materially inconsistent with the duty to affirmatively further 
fair housing throughout the period for which Federal financial 
assistance is extended. Such certifications must be made in accordance 
with applicable program regulations, specifically 24 CFR part 91 for 
consolidated plan program participants and 24 CFR part 903 for PHAs.
    (b) Procedures for challenging the validity of an AFFH 
certification--(1) Consolidated plan program participants. If HUD has 
evidence that could be used to challenge the accuracy of a program 
participant's AFFH certification, the Secretary may provide written 
notice of the intent to reject the program participant's AFFH 
certification as inaccurate. The notice will include the evidence 
challenging the accuracy of the AFFH certification and provide the 
program participant an opportunity to comment and submit additional 
evidence to the Secretary in support of the AFFH certification. The 
notice may include other actions the program participant may take for 
the Secretary to accept the AFFH certification, including conditions 
(see e.g., 2 CFR 200.208). The failure to comply with the conditions 
established by the Secretary may trigger the procedures set forth in 
Sec.  5.172. The notice will also provide a date by which the program 
participant must respond. After consideration of the evidence and any 
other actions taken by the program participant, if the Secretary 
determines that the AFFH certification is inaccurate, the Secretary may 
reject the certification consistent with 24 CFR 91.500.
    (2) PHAs. If, consistent with the criteria at 24 CFR 903.15, HUD 
challenges the validity of a PHA's certification, HUD will do so in 
writing, specifying the deficiencies, and will give the PHA an 
opportunity to respond to the particular challenge in writing. In 
responding to the specified deficiencies, a PHA must establish, as 
applicable, that it has complied with fair housing and civil rights 
laws and regulations and has adopted policies and undertaken actions to 
affirmatively further fair housing, including but not limited to, 
providing a full range of housing opportunities to applicants and 
tenants and taking affirmative steps as described in 24 CFR 
903.15(c)(2) in a nondiscriminatory manner. In responding to the PHA, 
HUD may accept the PHA's explanation and withdraw the challenge, 
undertake further investigation, or pursue other remedies available 
under law. HUD will seek to obtain voluntary corrective action 
consistent with the specified deficiencies. In determining whether a 
PHA has complied with its certification, HUD will review the PHA's 
circumstances, including characteristics of the population served by 
the PHA; characteristics of the PHA's existing housing stock; and 
decisions, plans, goals, priorities, strategies, and actions of the 
PHA, including those designed to affirmatively further fair housing. If 
the PHA has not resolved the identified deficiencies, the Secretary may 
pursue any other appropriate remedies under law, including:
    (i) Requiring the PHA to revise and resubmit its PHA Plan and 
corresponding certifications in a manner that would demonstrate the 
PHA's certifications are valid;
    (ii) Requiring the execution of a Voluntary Compliance Agreement 
that permits the Secretary to determine the PHA's certifications are 
valid; or
    (iii) Finding the PHA in substantial default on an Annual 
Contributions Contract.
    (3) Joint Equity Plans. In the case of a joint Equity Plan, if the 
Secretary rejects the AFFH certification for one program participant's 
consolidated plan, annual action plan, or PHA Plan, this rejection 
shall not affect the certifications of the other joint program 
participants unless the Secretary provides written notification to each 
program participant. The Secretary shall employ the procedures set 
forth in paragraph (b)(1) or (2) of this section, depending on whether 
the program participant is a consolidated plan program participant or a 
PHA.


Sec.  5.168  Recordkeeping.

    Each program participant must establish and maintain sufficient 
records to enable the Responsible Civil Rights Official to determine 
whether the program participant has complied with or is complying with 
the requirements of this subpart. A PHA not preparing its own Equity 
Plan in accordance with 24 CFR 903.15(a)(3) must maintain a copy of the 
applicable Equity Plan and records reflecting actions to affirmatively 
further fair housing as described in 24 CFR 903.7(o). All program 
participants shall permit access by the Responsible Civil Rights 
Official during normal business hours to its electronically stored 
information, books, records, accounts, and other sources of 
information, and its facilities, as may be pertinent to ascertain 
compliance with Sec. Sec.  5.150 through 5.180. Where any information 
required of a program participant is in the exclusive possession of any 
other agency, institution, or person and this agency, institution, or 
person fails or refuses to furnish this information, the program 
participant shall so certify to the Responsible Civil Rights Official 
and set forth what efforts the program participant made to obtain the 
information. At a minimum, the following records, which may be 
maintained and provided in electronic format, are needed for each 
consolidated plan program participant and each PHA that prepares its 
own Equity Plan:
    (a) Information and records relating to the program participant's 
Equity Plan and any significant revisions to the Equity Plan, 
including, but not limited to, statistical data, studies, and other 
diagnostic tools used by the jurisdiction; and any policies, 
procedures, or other documents relating to the analysis or preparation 
of the Equity Plan;
    (b) Records demonstrating compliance with the community engagement 
requirements of Sec. Sec.  5.150 through 5.180,

[[Page 8575]]

including the names of organizations involved in the development of the 
Equity Plan, summaries or transcripts of public meetings or hearings, 
written public comments, public notices and other correspondence, 
distribution lists, surveys, or interviews (as applicable);
    (c) Records demonstrating the meaningful actions the program 
participant has taken to affirmatively further fair housing, including 
activities carried out in furtherance of the Equity Plan; the program 
participant's fair housing goals set forth in its Equity Plan, and 
strategies and meaningful actions, including funding allocations in its 
consolidated plan, or PHA Plan, and any plan incorporated therein; and 
the actions the program participant has carried out to implement the 
fair housing goals identified in accordance with Sec.  5.154 during the 
preceding 5 years;
    (d) Where a court or an agency of the United States Government or 
of a State government has found that the program participant has 
violated any applicable nondiscrimination and equal opportunity 
requirement set forth in Sec.  5.105(a) or any applicable civil rights-
related program requirement, documentation related to the underlying 
judicial or administrative finding and affirmative measures that the 
program participant has taken in response;
    (e) Documentation relating to the program participant's efforts to 
ensure that housing and community development activities (including 
those assisted under programs administered by HUD) are in compliance 
with applicable nondiscrimination and equal opportunity requirements 
set forth in Sec.  5.105(a) and applicable civil rights related program 
requirements;
    (f) Records demonstrating that consortium members, units of general 
local government receiving allocations from a State, or units of 
general local government participating in an urban county have 
conducted their own or contributed to the jurisdiction's Equity Plan 
(as applicable) and documents demonstrating their meaningful actions to 
affirmatively further fair housing;
    (g) Evidence of the program participant's or its subrecipients' 
certifications and assurances of compliance in accordance with 
Sec. Sec.  5.160 and 5.162(e), or any other civil rights-related 
certifications and assurances required in connection with the receipt 
of Federal financial assistance; and
    (h) Any other evidence relied upon by the program participant to 
support its affirmatively furthering fair housing certifications and 
assurances.


Sec.  5.170   Compliance procedures.

    (a) Complaints. (1) Complaints may be submitted by an individual, 
association, or other organization that alleges that a program 
participant has failed to comply with this subpart, noncompliance with 
the program participant's commitments made under this subpart, or that 
the program participant has taken action that is materially 
inconsistent with the obligation to affirmatively further fair housing, 
as defined in Sec.  5.152.
    (2) Complaints related to the Equity Plan, the requirements of 
Sec. Sec.  5.150 through 5.180, and the AFFH obligation may be 
submitted to the Responsible Civil Rights Official. The Responsible 
Civil Rights Official shall process the complaint in accordance with 
the procedures set forth in this section and, upon the acceptance of a 
complaint, the Responsible Civil Rights Official will provide 
notification to the complainant and the program participant. If the 
Responsible Civil Rights Official determines a complaint does not 
contain sufficient information, the Responsible Civil Rights Official 
will notify the complainant and specify the additional information 
needed to complete the complaint. If the complainant fails to complete 
this complaint within a timeframe established by the Responsible Civil 
Rights Official, the Responsible Civil Rights Official will close the 
complaint without prejudice.
    (3) Complaints shall be filed within 365 days of date of the last 
incident of the alleged violation, unless the Responsible Civil Rights 
Official extends the time limit for good cause shown.
    (b) Investigations and compliance reviews. (1) The Responsible 
Civil Rights Official shall investigate complaints and may periodically 
conduct reviews of program participants in order to ascertain whether 
there has been a failure to comply with this subpart or the program 
participant's obligation to affirmatively further fair housing under 
the Fair Housing Act. If the investigation implicates an alleged 
failure to comply with any other Federal civil rights law for which HUD 
has jurisdiction, the notification provided pursuant to paragraph 
(a)(2) of this section shall include notification that the 
investigation will also involve a review under those laws.
    (2) The Responsible Civil Rights Official may conduct interviews, 
request records, and obtain other information required to be maintained 
by the program participant pursuant to Sec.  5.168 in furtherance of 
the investigation and in order to determine whether there has been 
noncompliance with Sec. Sec.  5.150 through 5.180 or the program 
participant's obligation to affirmatively further fair housing.
    (3) Where appropriate, the Responsible Civil Rights Official shall 
attempt informal resolution of any matter being investigated under this 
section. If voluntary resolution is not achieved and a violation is 
found, the Responsible Civil Rights Official shall issue a Letter of 
Findings to the program participant and complainant, if any.
    (4) The Letter of Findings shall include:
    (i) Findings of fact and conclusions of law;
    (ii) A description of a remedy for each violation found;
    (iii) Notice of the rights and procedures under this paragraph (b) 
and Sec. Sec.  5.172 and 5.174; and
    (iv) Notice of the right of the program participant or complainant, 
if any, to request review of the Letter of Findings not later than 30 
calendar days from the date of issuance of the Letter of Findings by 
mailing or delivering to the Reviewing Civil Rights Official, Office of 
Fair Housing and Equal Opportunity, Washington, DC 20410, a written 
statement of the reasons why the letter of findings should be modified 
in light of supplementary information provided by the program 
participant or complainant, if any.
    (5) Upon receipt of a request for review of the Letter of Findings, 
the Reviewing Civil Rights Official shall either sustain or modify the 
Letter of Findings, which will occur within 120 days, subject to 
extension for good cause as determined by the Reviewing Civil Rights 
Official. The Reviewing Civil Rights Official's decision shall 
constitute the formal determination.
    (6) If no request for review is submitted to the Reviewing Civil 
Rights Official under paragraph (b)(4)(iv) of this section, the Letter 
of Findings shall constitute the formal determination.
    (c) Voluntary compliance. (1) It is the policy of the Department to 
encourage the informal resolution of matters. Additionally, it is the 
policy of the Department to ensure appropriate actions are taken to 
remedy noncompliance and prevent future noncompliance in an effort to 
avoid more severe corrective actions. In attempting informal 
resolution, the Responsible Civil Rights Official shall attempt to 
achieve a just resolution of the matter that will satisfactorily remedy 
any violations of Sec. Sec.  5.150 through 5.180 or the program 
participant's obligation to affirmatively further fair housing. The 
Responsible Civil Rights Official may require in any

[[Page 8576]]

Voluntary Compliance Agreement that the program participant will take 
certain actions with respect to any aggrieved individual or class of 
individuals. The Responsible Civil Rights Official, in appropriate 
circumstances, may seek, in lieu of a Voluntary Compliance Agreement, 
assurances or special assurances of compliance. Any informal resolution 
shall include actions that will prevent the occurrence of such 
violations in the future. The Responsible Civil Rights Official may 
attempt to resolve a matter through informal means at any stage of 
processing. A matter may be resolved by informal means through entry 
into a Voluntary Compliance Agreement at any time. If a Letter of 
Findings of Noncompliance is issued, the Responsible Civil Rights 
Official or Reviewing Civil Rights Official shall attempt to resolve 
the matter by informal means, as applicable.
    (2) In the event a program participant fails to comply with the 
terms of a Voluntary Compliance Agreement or assurance, the Responsible 
Civil Rights Official shall provide prompt notice to the program 
participant of its failure to comply and provide the program 
participant with a timeframe to cure the noncompliance. If the 
Responsible Civil Rights Official determines the program participant 
has failed to cure the noncompliance within the specified timeframe, 
any remedy provided by law may be used, including the procedures set 
forth in Sec.  5.172.
    (d) Intimidatory or retaliatory acts prohibited. No program 
participant or other person shall intimidate, threaten, coerce, or 
discriminate against any person for the purpose of interfering with 
HUD's administration of Sec. Sec.  5.150 through 5.180 or the Fair 
Housing Act, or because he, she, or they have testified, assisted, or 
participated in any manner in an investigation, proceeding, or hearing 
under Sec. Sec.  5.150 through 5.180 or the Fair Housing Act.


Sec.  5.172   Procedures for effecting compliance.

    (a) General. If the Responsible Civil Rights Official determines 
that compliance cannot be secured by voluntary means and ten days have 
elapsed since the determination of noncompliance was issued pursuant to 
Sec.  5.170(b)(5) and (6), compliance with Sec. Sec.  5.150 through 
5.180 or the obligation to affirmatively further fair housing under the 
Fair Housing Act may be effected through such actions, which may 
include, but are not limited to:
    (1) A referral to the Department of Justice with a recommendation 
that appropriate proceedings be brought to enforce any rights of the 
United States under any law of the United States, or any assurance or 
other contractual undertaking;
    (2) The initiation of an administrative proceeding by filing a 
Complaint and Notice of Proposed Adverse Action pursuant to 24 CFR 
180.415 seeking suspension or termination of or refusal to grant or to 
continue to grant Federal financial assistance and any other 
appropriate relief necessary to remedy the non-compliance, including 
but not limited to conditioning the use of Federal financial 
assistance, and other declaratory, injunctive, or monetary relief;
    (3) The initiation of debarment proceedings pursuant to 2 CFR part 
2424; and
    (4) Any applicable proceeding under State or local law.
    (b) Noncompliance with Sec.  5.160(i), Sec.  5.162(e), or Sec.  
5.170(c). If a program participant fails or refuses to furnish an 
assurance required under Sec.  5.160(i), Sec.  5.162(e), or Sec.  
5.170(c), or otherwise fails or refuses to comply with the requirements 
imposed by Sec. Sec.  5.150 through 5.180, Federal financial assistance 
may be refused under paragraph (c) of this section. HUD is not required 
to provide assistance during the pendency of the administrative 
proceeding under paragraph (a)(2) or (c) of this section.
    (c) Termination of or refusal to grant or to continue to grant 
Federal financial assistance. Should HUD seek to terminate, refuse to 
grant or to not continue granting Federal financial assistance through 
an action initiated pursuant to paragraph (a)(2) of this section, no 
order suspending, terminating, or refusing to grant or to continue to 
grant Federal financial assistance shall become effective until:
    (1) The Responsible Civil Rights Official has advised the program 
participant of its failure to comply and has determined that compliance 
cannot be secured by voluntary means;
    (2) There has been an express finding on the record, after an 
opportunity for a hearing, of a failure by the program participant to 
comply with the requirements of Sec. Sec.  5.150 through 5.180 or its 
obligation to affirmatively further fair housing under the Fair Housing 
Act;
    (3) The action has been approved by the Secretary; and
    (4) Any action to suspend or terminate, or to refuse to grant or to 
continue Federal financial assistance shall be limited to the 
particular political entity, or part thereof, or the particular program 
participant as to whom such a finding has been made and shall be 
limited in its effect to the particular program, or part thereof, in 
which such noncompliance has been found.
    (d) Notice to State or local government. Whenever the Secretary 
determines that a State or local government that is a recipient of 
Federal financial assistance under title I of the Housing and Community 
Development Act of 1974, as amended (42 U.S.C. 5301-5318) has failed to 
comply with a requirement of Sec. Sec.  5.150 through 5.180 or its 
obligation to affirmatively further fair housing under the Fair Housing 
Act, the Secretary shall notify the Governor of the State or the chief 
executive officer of the unit of general local government of the 
noncompliance and shall request the Governor or the chief executive 
officer secure compliance. Such notification may be satisfied through 
the procedures set forth in Sec.  5.170(c). The notice shall be given 
at least sixty days before:
    (1) An order suspending, terminating, or refusing to grant or to 
continue to grant Federal financial assistance becomes effective under 
paragraph (a)(2) or (c) of this section; or
    (2) Any other action to effect compliance is taken under paragraph 
(a) of this section.


Sec.  5.174   Hearings.

    (a) Opportunity for hearing. Whenever an opportunity for a hearing 
is required by Sec.  5.172 (a)(2) or (c), notice shall be given by 
certified mail, return receipt requested, to the affected program 
participant. This notice, pursuant to 24 CFR 180.415, shall advise the 
program participant of the action proposed to be taken, the specific 
provisions under which the proposed action against it is to be taken, 
and the matters of fact or law asserted as the basis for this action. 
This notice shall accompany service of a complaint filed pursuant to 24 
CFR part 180. The notice shall:
    (1) Fix a date not less than twenty days after the date of the 
notice for the program participant to request the administrative law 
judge schedule a hearing; or
    (2) Advise the program participant that the matter has been 
scheduled for hearing at a stated time and place. The time and place so 
fixed shall be reasonable and shall be subject to change for cause. A 
program participant may waive a hearing and submit written information 
and argument for the record. The failure of a program participant to 
request a hearing under this paragraph (a) or to appear at a hearing 
for which a date has been set is a waiver of the right to a hearing 
under Sec.  5.172(a)(2) or (c) and consent to the

[[Page 8577]]

making of a decision on the basis of available information.
    (b) Hearing procedures. Hearings shall be conducted in accordance 
with 24 CFR part 180.


Sec. Sec.  5.175-5.180  [Reserved]

PART 91--CONSOLIDATED SUBMISSION FOR COMMUNITY PLANNING AND 
DEVELOPMENT PROGRAMS

0
3. The authority citation for part 91 continues to read as follows:

    Authority:  42 U.S.C. 3535(d), 3601-3619, 5301-5315, 11331-
11388, 12701-12711, 12741-12756, and 12901-12912.

0
4. In Sec.  91.2, paragraph (e) is added to read as follows:


Sec.  91.2   Applicability.

* * * * *
    (e) All programs covered by the consolidated plan must comply with 
the requirements to affirmatively further fair housing, including those 
at Sec. Sec.  5.150 through 5.180 of this title.
0
5. In Sec.  91.5, the introductory text is revised to read as follows:


Sec.  91.5  Definitions.

    The terms affirmatively furthering fair housing, elderly person, 
Equity Plan, and HUD are defined in 24 CFR part 5.
* * * * *
0
6. In Sec.  91.100, paragraph (c) is revised and paragraph (e) is added 
to read as follows:


Sec.  91.100   Consultation; local governments.

* * * * *
    (c) Public housing agencies (PHAs). (1) The jurisdiction shall 
consult with local PHAs operating in the jurisdiction regarding 
consideration of public housing needs, planned programs and activities, 
and the fair housing strategies and meaningful actions that will 
implement the fair housing goals from the Equity Plan consistent with 
Sec.  5.156 of this title. This consultation will help provide a better 
basis for the certification by the authorized official that the PHA 
Plan is consistent with the consolidated plan and the local 
government's description of its strategy for affirmatively furthering 
fair housing and the manner in which it will address the needs of 
public housing and, where necessary, the manner in which it will 
provide financial or other assistance to a troubled PHA to improve the 
PHA's operations and remove the designation of troubled, as well as 
obtaining PHA input on addressing fair housing issues in the Public 
Housing and Housing Choice Voucher programs.
    (2) This consultation will also help ensure that activities with 
regard to affirmatively furthering fair housing, local drug 
elimination, neighborhood improvement programs, and resident programs 
and services, those funded under a PHA's program and those funded under 
a program covered by the consolidated plan, are fully coordinated to 
implement the fair housing goals from the jurisdiction's and PHA's 
Equity Plan, achieve comprehensive community development goals, and 
affirmatively further fair housing. If a PHA is required to implement 
remedies under a Voluntary Compliance Agreement, the local jurisdiction 
should work with or consult with the PHA, as appropriate, to identify 
actions the jurisdiction may take, if any, to assist the PHA in 
implementing the required remedies.
* * * * *
    (e) Affirmatively furthering fair housing. (1) For the Equity plan, 
the jurisdiction shall follow the community engagement requirements at 
Sec.  5.158 of this title. For the consolidated plan, the jurisdiction 
shall consult with community-based and regionally-based organizations 
that represent protected class members and organizations that enforce 
fair housing laws, such as State or local fair housing enforcement 
agencies (including participants in the Fair Housing Assistance Program 
(FHAP)), fair housing organizations and other non-profit organizations 
that receive funding under the Fair Housing Initiatives Program (FHIP), 
and other public and private fair housing service agencies, to the 
extent that such entities operate within its jurisdiction. This 
consultation will help provide a better basis for the jurisdiction's 
Equity Plan, its certification to affirmatively furthering fair 
housing, and other portions of the consolidated plan concerning 
affirmatively further fair housing.
    (2) This consultation must occur with any organizations that have 
relevant knowledge or data to inform the Equity Plan and that are 
sufficiently independent and representative to provide meaningful 
feedback to a jurisdiction on the Equity Plan and its implementation.
    (3) Consultation must occur at various points in the fair housing 
planning process, meaning that, at a minimum, the jurisdiction will 
consult with the organizations described in this paragraph (e) in the 
development of both the Equity Plan and the consolidated plan. 
Consultation on the consolidated plan shall specifically seek input 
into how the fair housing goals identified in an accepted Equity Plan 
will be achieved through the priorities and objectives of the 
consolidated plan.
0
7. In Sec.  91.105, paragraphs (a), (b), (c), (e) heading, (e)(1)(i), 
(e)(2) through (4), (f), (g), (i), and (j) are revised to read as 
follows:


Sec.  91.105   Citizen participation plan; local governments.

    (a) Applicability and adoption of the citizen participation plan--
(1) Citizen participation plan. The jurisdiction is required to adopt a 
citizen participation plan that sets forth the jurisdiction's policies 
and procedures for citizen participation for purposes of the 
consolidated plan. The citizen participation plan may include the 
community engagement procedures for development of the Equity Plan, 
which shall be consistent with the requirements set forth at Sec.  
5.158 of this title.
    (2) Encouragement of citizen participation. (i) The citizen 
participation plan must provide for and encourage citizens to 
participate in the development of the Equity Plan, any revisions to the 
Equity Plan, the consolidated plan, any substantial amendment to the 
consolidated plan, and the performance report. The requirements in this 
paragraph (a)(2)(i) are designed especially to encourage participation 
by low- and moderate-income persons, particularly those persons living 
in areas designated by the jurisdiction as a revitalization area or in 
a slum and blighted area and in areas where CDBG funds are proposed to 
be used, and by residents of predominantly low- and moderate-income 
neighborhoods, as defined by the jurisdiction, as well as members of 
protected class groups that have historically been denied equal 
opportunity, and underserved communities. A jurisdiction must take 
appropriate actions to encourage the participation of all its 
residents, including minorities and non-English speaking persons, as 
provided in paragraph (a)(4) of this section, as well as persons with 
disabilities, as provided in paragraph (a)(5) of this section.
    (ii) The jurisdiction shall encourage the participation of local 
and regional institutions, Continuums of Care, and other organizations 
(including businesses, developers, non-profit organizations, 
philanthropic organizations, metropolitan planning organizations, and 
community-based and faith-based organizations) in the process of 
developing and implementing the Equity Plan and consolidated plan.
    (iii) The jurisdiction shall encourage, in conjunction with 
consultation with

[[Page 8578]]

public housing agencies, the participation of residents of public and 
assisted housing developments (including any resident advisory boards, 
resident councils, and resident management corporations) in the process 
of developing and implementing the consolidated plan, along with other 
low-income residents of targeted revitalization areas in which the 
developments are located. The jurisdictions shall make an effort to 
provide information to the PHA about how the jurisdiction will 
affirmatively furthering fair housing through implementation of its 
fair housing goals from the Equity Plan, and other consolidated plan 
activities related to the PHA's developments and surrounding 
communities so that the PHA can make this information available at the 
annual public hearing(s) required for the PHA Plan.
    (iv) The jurisdiction should explore alternative public involvement 
techniques and quantitative ways to measure efforts that encourage 
citizen participation in a shared vision for change in communities and 
neighborhoods, and the review of program performance; e.g., use of 
focus groups, the internet, and social media. To the extent the 
jurisdiction includes the community engagement requirements for the 
Equity Plan in its citizen participation plan, the techniques described 
in this paragraph (a)(2)(iv) that are utilized for purposes of 
community engagement pursuant to Sec.  5.158 of this title shall be 
consistent with the requirements of that section, including the 
nondiscrimination requirements described at Sec.  5.158(a)(7) of this 
title.
    (3) Citizen comment on the citizen participation plan and 
amendments. The jurisdiction must provide citizens with a reasonable 
opportunity to comment on the original citizen participation plan and 
on substantial amendments to the citizen participation plan, and must 
make the citizen participation plan public. The citizen participation 
plan must be in a format accessible to persons with disabilities and 
shall provide meaningful access to limited English proficient persons 
as more fully described in paragraphs (a)(4) and (5) of this section.
    (4) Language assistance for individuals with limited English 
proficiency. The citizen participation plan shall describe the 
jurisdiction's procedures for assessing its language needs and identify 
any need for translation of notices and other vital documents. At a 
minimum, the citizen participation plan shall require that the 
jurisdiction take reasonable steps to provide language assistance to 
ensure meaningful access to participation by non-English-speaking 
residents of the community in the development of the consolidated plan.
    (5) Accessibility for persons with disabilities. The citizen 
participation plan shall describe the jurisdiction's procedures for 
ensuring effective communication with persons with disabilities, 
consistent with the jurisdiction's obligations under section 504 of the 
Rehabilitation Act and HUD's implementing regulation at 24 CFR part 8 
and title II of the Americans with Disabilities Act and the 
implementing regulation at 28 CFR part 35. At minimum, the citizen 
participation plan shall include the requirement that the jurisdiction 
furnish appropriate auxiliary aids and services where necessary to 
afford persons with disabilities an equal opportunity to participate in 
the development of the consolidated plan.
    (b) Development of the consolidated plan. The citizen participation 
plan must include the following minimum requirements for the 
development of the consolidated plan:
    (1)(i) The citizen participation plan must require that at or as 
soon as feasible after the start of the public participation process 
the jurisdiction will make the HUD-provided data and any other 
supplemental information the jurisdiction plans to incorporate into its 
Equity Plan or consolidated plan available to its residents, public 
agencies, and other interested parties.
    (ii) The citizen participation plan must require that, before the 
jurisdiction adopts a consolidated plan, the jurisdiction will make 
available to residents, public agencies, and other interested parties 
information that includes the amount of assistance the jurisdiction 
expects to receive (including grant funds and program income) and the 
range of activities that may be undertaken, including the estimated 
amount that will benefit persons of low- and moderate-income. The 
citizen participation plan also must set forth the jurisdiction's plans 
to minimize displacement of persons and to assist any persons 
displaced, specifying the types and levels of assistance the 
jurisdiction will make available (or require others to make available) 
to persons displaced, even if the jurisdiction expects no displacement 
to occur.
    (iii) The citizen participation plan must state when and how the 
jurisdiction will make this information available.
    (2) The citizen participation plan must require the jurisdiction to 
publish the proposed consolidated plan in a manner that affords its 
residents, public agencies, and other interested parties a reasonable 
opportunity to examine its content and to submit comments. The citizen 
participation plan must set forth how the jurisdiction will publish the 
proposed consolidated plan and give reasonable opportunity to examine 
each document's content. The requirement for publishing may be met by 
publishing a summary of each document in one or more newspapers of 
general circulation, and by making copies of each document available on 
the internet, on the jurisdiction's official government website and 
pages on social media, and as well at libraries, government offices, 
and public places. The summary must describe the content and purpose of 
the consolidated plan and must include a list of the locations where 
copies of the entire proposed documents may be examined. In addition, 
the jurisdiction must provide a reasonable number of free copies of the 
plans to residents and groups that request them.
    (3) The citizen participation plan must provide for at least one 
public hearing during the development of the consolidated plan. See 
paragraph (e) of this section for public hearing requirements, 
generally. See Sec.  5.158(d) of this title for public hearing 
requirements for purposes of the Equity Plan.
    (4) The citizen participation plan must provide a period, not less 
than 30 calendar days, to receive comments from residents of the 
community on the consolidated plan. This timing is distinct from the 
required community engagement for purposes of the Equity Plan set forth 
at Sec.  5.158(a)(8)(i) of this title.
    (5) The citizen participation plan shall require the jurisdiction 
to consider any comments or views of residents of the community 
received in writing, or orally at the public hearings, in preparing the 
consolidated plan. A summary of these comments or views, and a summary 
of any comments or views not accepted and the reasons why, shall be 
attached to the final consolidated plan. See Sec.  5.154(h) of this 
title for the content requirements for purposes of the Equity Plan's 
community engagement process.
    (c) Consolidated plan amendments and Equity Plan revisions. (1) The 
citizen participation plan must specify the criteria the jurisdiction 
will use for determining what changes in the jurisdiction's planned or 
actual activities constitute a substantial amendment to the 
consolidated plan. (See Sec.  91.505.) The citizen participation plan 
must include, among the criteria

[[Page 8579]]

for a substantial amendment, changes in the use of CDBG funds from one 
eligible activity to another. If the jurisdiction includes the Equity 
Plan in its citizen participation plan, then the citizen participation 
plan shall specify the criteria for revisions of the Equity Plan, which 
shall, at minimum, be consistent with Sec.  5.164 of this title.
    (2) The citizen participation plan must provide community residents 
with reasonable notice and an opportunity to comment on substantial 
amendments to the consolidated plan. The citizen participation plan 
must state how reasonable notice and an opportunity to comment will be 
given. The citizen participation plan must provide a period, of not 
less than 30 calendar days, to receive comments on the consolidated 
plan substantial amendment before the consolidated plan substantial 
amendment is implemented. If the citizen participation plan includes 
the Equity Plan, it shall be consistent with the requirements at Sec.  
5.164(a)(3) of this title.
    (3) The citizen participation plan shall require the jurisdiction 
to consider any comments or views of residents of the community 
received in writing, or orally at public hearings, if any, in preparing 
the substantial amendment of the consolidated plan. A summary of these 
comments or views, and a summary of any comments or views not accepted 
and the reasons why, shall be attached to the substantial amendment of 
the consolidated plan. If the jurisdiction includes the Equity Plan in 
the citizen participation plan, it shall be consistent with the 
requirements set forth at Sec. Sec.  5.154(h) and 5.158 of this title.
* * * * *
    (e) Public hearings. (1)(i) Consolidated plan. The citizen 
participation plan must provide, for purposes of the consolidated plan, 
for at least two public hearings per year to obtain residents' views 
and to respond to proposals and questions, to be conducted at a minimum 
of two different stages of the program year. Together, the hearings 
must address housing and community development needs, development of 
proposed activities, proposed fair housing strategies and meaningful 
actions for affirmatively furthering fair housing based on the fair 
housing goals from the Equity Plan consistent with Sec.  5.156 of this 
title, and a review of program performance. If the jurisdiction has 
included the community engagement procedures for development of the 
Equity Plan in its citizen participation plan, the requirements at 
Sec.  5.158 of this title shall apply.
* * * * *
    (2) The citizen participation plan must state how and when adequate 
advance notice will be given to citizens of each hearing on the 
consolidated plan, with sufficient information published about the 
subject of the hearing to permit informed comment. (Publishing small 
print notices in the newspaper a few days before the hearing does not 
constitute adequate notice. Although HUD is not specifying the length 
of notice required, it would consider two weeks adequate.)
    (3) The citizen participation plan must provide that hearings be 
held at times and locations convenient to potential and actual 
beneficiaries, and accessible to persons with disabilities. The citizen 
participation plan must specify how it will meet the requirements in 
this paragraph (e)(3).
    (4) The citizen participation plan must identify how the needs of 
non-English speaking residents will be met in the case of public 
hearings where a significant number of non-English speaking residents 
can be reasonably expected to participate.
    (f) Meetings. The citizen participation plan, for purposes of the 
consolidated plan, must provide residents of the community with 
reasonable and timely access to local meetings, consistent with 
accessibility and reasonable accommodation requirements, in accordance 
with section 504 of the Rehabilitation Act of 1973 and the regulations 
at 24 CFR part 8; and the Americans with Disabilities Act and the 
regulations at 28 CFR parts 35 and 36, as applicable. If the Equity 
Plan is included in the jurisdiction's citizen participation plan, the 
requirements for meetings set forth at Sec.  5.158 of this title shall 
apply.
    (g) Availability to the public. The citizen participation plan must 
provide that the consolidated plan as adopted, consolidated plan 
substantial amendments, and the performance report will be available to 
the public, including the availability of materials in a form 
accessible to persons with disabilities and shall provide meaningful 
access to limited English proficient persons as more fully described in 
paragraphs (a)(4) and (5) of this section. The citizen participation 
plan must state how these documents will be available to the public.
* * * * *
    (i) Technical assistance. The citizen participation plan must 
provide for technical assistance to groups representative of persons of 
low- and moderate-income that request such assistance in commenting on 
the Equity Plan and in developing proposals for funding assistance 
under any of the programs covered by the consolidated plan, with the 
level and type of assistance determined by the jurisdiction. The 
assistance need not include the provision of funds to the groups.
    (j) Complaints. The citizen participation plan shall describe the 
jurisdiction's appropriate and practicable procedures to handle 
complaints from its residents related to the consolidated plan, 
amendments, revisions, and the performance report. At a minimum, the 
citizen participation plan shall require that the jurisdiction must 
provide a timely, substantive written response to every written 
resident complaint, within an established period of time (within 15 
working days, where practicable, if the jurisdiction is a CDBG grant 
recipient). This procedure is distinct from the processes that apply to 
the Equity Plan set forth at Sec. Sec.  5.158(i) and 5.170 of this 
title.
* * * * *
0
8. In Sec.  91.110, paragraph (a) is revised to read as follows:


Sec.  91.110  Consultation; States.

    (a) When preparing the consolidated plan, the State shall consult 
with other public and private agencies that provide assisted housing 
(including any State housing agency administering public housing), 
health services, and social and fair housing services (including those 
focusing on services to children, elderly persons, persons with 
disabilities, including persons with HIV/AIDS and their families, and 
homeless persons). For the Equity Plan, the jurisdiction shall follow 
the community engagement requirements at Sec.  5.158 of this title.
    (1) With respect to public housing or Housing Choice Voucher 
programs, the State shall consult with any housing agency administering 
public housing or the section 8 program on a Statewide basis as well as 
PHAs that certify consistency with the State's consolidated plan. State 
consultation with these entities may consider public housing needs, 
planned programs and activities, the Equity Plan strategies for 
affirmatively furthering fair housing and proposed actions to 
affirmatively further fair housing. This consultation helps provide a 
better basis for the certification by the authorized official that the 
PHA Plan is consistent with the consolidated plan and the State's 
description of its strategy to affirmatively further fair housing, and 
the manner in which the State will

[[Page 8580]]

address the needs of public housing and, where applicable, the manner 
in which the State may provide financial or other assistance to a 
troubled PHA to improve its operations and remove such designation, as 
well as in obtaining PHA input on addressing fair housing issues in 
public housing and the Housing Choice Voucher programs. This 
consultation also helps ensure that activities with regard to 
affirmatively furthering fair housing, local drug elimination, 
neighborhood improvement programs, and resident programs and services, 
funded under a PHA's program covered by the consolidated plan are fully 
coordinated to achieve comprehensive community development goals and 
affirmatively further fair housing. If a PHA is required to implement 
remedies under a Voluntary Compliance Agreement, the State should 
consult with the PHA and identify actions the State may take, if any, 
to assist the PHA in implementing the required remedies.
    (2) The State shall consult with State-based and regionally-based 
organizations that represent protected class groups, including 
underserved communities, and organizations that enforce fair housing 
laws, such as State fair housing enforcement agencies (including 
participants in the Fair Housing Assistance Program (FHAP)), fair 
housing organizations and other non-profit organizations that receive 
funding under the Fair Housing Initiatives Program (FHIP), and other 
public and private fair housing service agencies, to the extent such 
entities operate within the State. This consultation will help provide 
a better basis for the State's Equity Plan, its certification that it 
is affirmatively furthering fair housing, and other portions of the 
consolidated plan concerning affirmatively furthering fair housing. 
This consultation should occur with organizations that have the 
capacity to engage with data informing the Equity Plan and be 
sufficiently independent and representative to provide meaningful 
feedback on the Equity Plan, the consolidated plan, and their 
implementation. Consultation must occur at various points in the fair 
housing planning process, meaning that, at a minimum, the jurisdiction 
will consult with the organizations described in this paragraph (a)(2) 
in the development of both the Equity Plan and the consolidated plan. 
Consultation on the consolidated plan shall specifically seek input 
into how the fair housing goals established in the Equity Plan will be 
incorporated into the priorities and objectives of the consolidated 
plan.
* * * * *
0
9. In Sec.  91.115:
0
a. Paragraphs (a)(1), (a)(2)(i) and (ii), and (a)(3) and (4) are 
revised;
0
b. Paragraph (a)(5) is added; and
0
c. The introductory text of paragraph (b), paragraphs (b)(1) and (2), 
the introductory text of paragraph (b)(3), and paragraphs (b)(4) and 
(5), (f), and (h) are revised.
    The revisions and addition read as follows:


Sec.  91.115  Citizen participation plan; States.

    (a) * * *
    (1) When citizen participation plan must be amended. The State is 
required to adopt a citizen participation plan that sets forth the 
State's policies and procedures for citizen participation for purposes 
of the consolidated plan. The citizen participation plan may include 
the community engagement procedures for development of the Equity Plan, 
which shall be consistent with the requirements set forth at Sec.  
5.158 of this title.
    (2) * * *
    (i) The citizen participation plan must provide for and encourage 
citizens to participate in the development of the Equity Plan, any 
revisions to the Equity Plan, the consolidated plan, any substantial 
amendments to the consolidated plan, and the performance report. These 
requirements are designed especially to encourage participation by low- 
and moderate-income persons, particularly those living in slum and 
blighted areas and in areas where CDBG funds are proposed to be used 
and by residents of predominantly low- and moderate-income 
neighborhoods. A State must take appropriate actions to encourage the 
participation of all its residents, including minorities and non-
English speaking persons, as provided in paragraph (a)(4) of this 
section, as well as persons with disabilities, as provided in paragraph 
(a)(5) of this section.
    (ii) The State shall encourage the participation of Statewide and 
regional institutions, Continuums of Care, and other organizations 
(including businesses, developers, non-profit organizations, 
philanthropic organizations, metropolitan planning organizations, and 
community-based and faith-based organizations) that are involved with 
or affected by the programs or activities covered by the consolidated 
plan in the process of developing and implementing the Equity Plan and 
consolidated plan. Commencing with consolidated plans submitted in or 
after January 1, 2018, the State shall also encourage the participation 
of public and private organizations, including broadband internet 
service providers, organizations engaged in narrowing the digital 
divide, agencies whose primary responsibilities include the management 
of flood prone areas, public land or water resources, and emergency 
management agencies in the process of developing the consolidated plan. 
For purposes of the development of the Equity Plan, this obligation 
shall commence following [30 DAYS AFTER DATE OF PUBLICATION OF FINAL 
RULE].
* * * * *
    (3) Citizen and local government comment on the citizen 
participation plan and amendments. The State must provide citizens and 
units of general local government a reasonable opportunity to comment 
on the original citizen participation plan and on substantial 
amendments to the citizen participation plan, and must make the citizen 
participation plan public. The citizen participation plan must be in a 
format accessible to persons with disabilities and shall provide 
meaningful access to limited English proficient persons as more fully 
described in paragraphs (a)(4) and (5) of this section.
    (4) Language assistance for individuals with limited English 
proficiency. The citizen participation plan shall describe the State's 
procedures for assessing its language needs and identify any need for 
translation of notices and other vital documents. At a minimum, the 
citizen participation plan shall require the State to make reasonable 
efforts to provide language assistance to ensure meaningful access to 
participation by non-English speaking persons in the development of the 
consolidated plan.
    (5) Accessibility for persons with disabilities. The citizen 
participation plan shall describe the jurisdiction's procedures for 
ensuring effective communication with persons with disabilities, 
consistent with the jurisdiction's obligations under section 504 of the 
Rehabilitation Act and HUD's implementing regulation at 24 CFR part 8 
and title II of the Americans with Disabilities Act and the 
implementing regulation at 28 CFR part 35. At minimum, the citizen 
participation plan shall include the requirement that the jurisdiction 
furnish appropriate auxiliary aids and services where necessary to 
afford persons with disabilities an equal opportunity to participate in 
the development of the consolidated plan.

[[Page 8581]]

    (b) Development of the Equity Plan and consolidated plan. The 
citizen participation plan must include the following minimum 
requirements for the development of the Equity Plan and consolidated 
plan:
    (1) The citizen participation plan must require that, before the 
State adopts a consolidated plan, the State will make available to its 
residents, public agencies, and other interested parties information 
that includes the amount of assistance the State expects to receive and 
the range of activities that may be undertaken, including the estimated 
amount that will benefit persons of low- and moderate-income and the 
plans to minimize displacement of persons and to assist any persons 
displaced. The State will also provide the amount of any assistance 
that will benefit protected class groups and underserved communities 
that have historically been denied access to opportunity. The citizen 
participation plan must state when and how the State will make this 
information available.
    (2) The citizen participation plan must require the State to 
publish the proposed Equity Plan and the proposed consolidated plan in 
a manner that affords residents, units of general local governments, 
public agencies, and other interested parties a reasonable opportunity 
to examine the document's content and to submit comments. The citizen 
participation plan must set forth how the State will make publicly 
available the proposed Equity Plan and proposed consolidated plan and 
give reasonable opportunity to examine each document's content. To 
ensure that the Equity Plan, consolidated plan, and the PHA Plan are 
informed by meaningful community participation, program participants 
should employ communications means designed to reach the broadest 
audience. Such communications may be met by publishing a summary of 
each document in one or more newspapers of general circulation, and by 
making copies of each document available on the internet, on the 
grantee's official government website and its pages on social media, 
and as well at libraries, government offices, and public places. The 
summary must describe the content and purpose of the Equity Plan and 
consolidated plan, and must include a list of the locations where 
copies of the entire proposed document(s) may be examined. In addition, 
the State must provide a reasonable number of free copies of the plans 
to its residents and groups that request a copy of the plan.
    (3) The citizen participation plan must provide for at least one 
public hearing on housing and community development needs before the 
proposed consolidated plan is published for comment. See Sec.  5.158(d) 
of this title for public hearing requirements for purposes of the 
Equity Plan.
* * * * *
    (4) The citizen participation plan must, for purposes of the 
consolidated plan, provide a period of not less than 30 calendar days, 
to receive comments from residents and units of general local 
government on the consolidated plan. This timing is distinct from the 
required community engagement for purposes of the Equity Plan set forth 
at Sec.  5.158(a)(8)(i) of this title.
    (5) The citizen participation plan shall require the State to 
consider any comments or views of its residents and units of general 
local government received in writing, or orally at the public hearings, 
in preparing the final Equity Plan or consolidated plan. A summary of 
these comments or views, and a summary of any comments or views not 
accepted and the reasons therefore, shall be attached to the final 
consolidated plan (as applicable). See Sec.  5.154(h) of this title for 
the content requirements for purposes of the Equity Plan's community 
engagement process.
* * * * *
    (f) Availability to the public. The citizen participation plan must 
provide that the consolidated plan as adopted, consolidated plan 
substantial amendments and the performance report will be available to 
the public, including the availability of materials in a form 
accessible to persons with disabilities and shall provide meaningful 
access to limited English proficient persons as more fully described in 
paragraphs (a)(4) and (5) of this section. The citizen participation 
plan must state how these documents will be available to the public.
* * * * *
    (h) Complaints. The citizen participation plan shall describe the 
State's appropriate and practicable procedures to handle complaints 
from its residents related to the consolidated plan, consolidated plan 
amendments, and the performance report. At a minimum, the citizen 
participation plan shall require that the State must provide a timely, 
substantive written response to every written resident complaint, 
within an established period of time (within 15 working days, where 
practicable, if the State is a CDBG grant recipient). This procedure is 
distinct from the processes that apply to the Equity Plan set forth at 
Sec. Sec.  5.158(i) and 5.170 of this title.
* * * * *
0
10. In Sec.  91.215:
0
a. Paragraph (a)(4) is amended by removing the period at the end of the 
paragraph and adding ``; and'' in its place; and
0
b. Paragraph (a)(5) is added.
    The addition reads as follows:


Sec.  91.215   Strategic plan.

    (a) * * *
    (5)(i) Describe how the priorities and specific objectives of the 
jurisdiction under paragraph (a)(4) of this section will affirmatively 
further fair housing by setting forth fair housing strategies and 
meaningful actions consistent with the fair housing goals and other 
elements of the Equity Plan conducted in accordance with Sec. Sec.  
5.150 through 5.180 of this title.
    (ii) For any fair housing goals from the Equity Plan not addressed 
by the priorities and objectives under paragraph (a)(4) of this 
section, identify how these goals have been incorporated into the plan 
consistent with the requirements of Sec.  5.156.
* * * * *
0
11. In Sec.  91.220, paragraphs (k), (l)(1)(iv), and (l)(3) are revised 
to read as follows:


Sec.  91.220   Action plan.

* * * * *
    (k) Affirmatively furthering fair housing and other actions--(1) 
Affirmatively furthering fair housing. Actions the jurisdiction plans 
to take during the next year to implement the fair housing goals 
established in the Equity Plan developed pursuant to Sec. Sec.  5.150 
through 5.180 of this title or other actions to address fair housing 
issues consistent with the jurisdiction's obligation to affirmatively 
further fair housing.
    (2) Other actions. Actions it plans to take during the next year to 
address obstacles to meeting underserved needs, foster and maintain 
affordable housing, evaluate and reduce lead-based paint hazards, 
reduce the number of poverty-level families, develop institutional 
structure, and enhance coordination between public and private housing 
and social service agencies (see Sec.  91.215(a), (b), (i), (j), (k), 
and (l)).
    (l) * * *
    (1) * * *
    (iv) The plan shall identify the estimated amount of CDBG funds 
that will be used for activities that benefit persons of low- and 
moderate-income. The information about activities shall be in 
sufficient detail, including location, to allow residents to determine 
the degree to which they are affected. The information about activities 
shall also include whether the activities are for purposes of 
implementing any fair

[[Page 8582]]

housing goals from the Equity Plan incorporated pursuant to Sec.  5.156 
of this title.
* * * * *
    (3) HOPWA. For HOPWA funds, the jurisdiction must specify one-year 
goals for the number of households to be provided housing through the 
use of HOPWA activities for: short-term rent, mortgage, and utility 
assistance payments to prevent homelessness of the individual or 
family; tenant-based rental assistance; and units provided in housing 
facilities that are being developed, leased, or operated with HOPWA 
funds and shall identify the method of selecting project sponsors 
(including providing full access to grassroots faith-based and other 
community organizations). The information about activities shall 
include whether the activities are for purposes of implementing the 
fair housing goals, from the Equity Plan.
* * * * *
0
12. In Sec.  91.225, paragraph (a)(1) is revised to read as follows:


Sec.  91.225   Certifications.

    (a) * * *
    (1) Affirmatively furthering fair housing. Each jurisdiction is 
required to submit a certification that they will affirmatively further 
fair housing, which includes engaging in fair housing planning and 
taking meaningful actions, in accordance with the requirements of 
Sec. Sec.  5.150 through 5.180 of this title, and that it will take no 
action that is materially inconsistent with the duty to affirmatively 
further fair housing throughout the period for which Federal financial 
assistance is extended.
* * * * *
0
13. Section 91.230 is revised to read as follows:


Sec.  91.230   Monitoring.

    The plan must describe the standards and procedures that the 
jurisdiction will use to monitor activities carried out in furtherance 
of the plan, including strategies and actions that address the fair 
housing issues and goals identified in the Equity Plan and that the 
jurisdiction will use to ensure long-term compliance with requirements 
of the programs involved, including civil rights related program 
requirements, minority business outreach, and the comprehensive 
planning requirements.
0
14. In Sec.  91.235, paragraphs (c)(1) and (4) are revised to read as 
follows:


Sec.  91.235   Special case; abbreviated consolidated plan.

* * * * *
    (c) * * *
    (1) Assessment of needs, resources, and planned activities. An 
abbreviated plan must contain sufficient information about needs, 
resources, and planned activities to address the needs to cover the 
type and amount of assistance anticipated to be funded by HUD. The 
jurisdiction must describe how the jurisdiction will affirmatively 
further fair housing by implementing the fair housing goals established 
in the Equity Plan developed in accordance with Sec. Sec.  5.150 
through 5.180 of this title.
* * * * *
    (4) Submissions, certifications, amendments, and performance 
reports. An insular area grantee that submits an abbreviated 
consolidated plan under this section must comply with the submission, 
certification, amendment, and performance report requirements of Sec.  
570.440 of this title. This includes the certification that the grantee 
will affirmatively further fair housing, which means that it will take 
meaningful actions to implement the goals identified in the Equity Plan 
in accordance with the requirements of Sec. Sec.  5.150 through 5.180 
of this title and that it will take no action that is materially 
inconsistent with its obligation to affirmatively further fair housing.
* * * * *
0
15. In Sec.  91.305, paragraph (b)(1)(ii) is revised to read as 
follows:


Sec.  91.305   Housing and homeless needs assessment.

* * * * *
    (b) * * *
    (1) * * *
    (ii) The description of housing needs shall include a concise 
summary of the cost burden and severe cost burden, overcrowding 
(especially for large families), and substandard housing conditions 
being experienced by extremely low-income, low-income, moderate-income, 
and middle-income renters and owners compared to the State as a whole. 
(The State must define in its consolidated plan the terms ``standard 
condition'' and ``substandard condition but suitable for 
rehabilitation.'') The State may utilize the analysis contained in the 
Equity Plan relating to affordable housing opportunities pursuant to 
Sec. Sec.  5.152 and 5.154 of this title to satisfy the requirement in 
this paragraph (b)(1)(ii).
* * * * *
0
16. In Sec.  91.315, paragraph (a)(5) is added to read as follows:


Sec.  91.315   Strategic plan.

    (a) * * *
    (5)(i) Describe how the priorities and specific objectives of the 
State under paragraph (a)(4) of this section affirmatively further fair 
housing by setting forth fair housing strategies and meaningful actions 
consistent with the fair housing goals and other elements of the Equity 
Plan conducted in accordance with Sec. Sec.  5.150 through 5.180 of 
this title.
    (ii) For any fair housing goals from the Equity Plan not addressed 
by the priorities and objectives under paragraph (a)(4) of this 
section, identify how these goals have been incorporated into the plan 
consistent with the requirements of Sec. Sec.  5.150 through 5.180.
* * * * *
0
17. In Sec.  91.320, paragraphs (j), (k)(3)(iv), and (k)(4), the 
introductory text of paragraph (k)(5), and paragraph (k)(5)(ii) are 
revised to read as follows:


Sec.  91.320   Action plan.

* * * * *
    (j) Affirmatively furthering fair housing and other actions--(1) 
Affirmatively furthering fair housing. Actions it plans to take during 
the next year that implement fair housing goals established in the 
Equity Plan.
    (2) Other actions. Actions it plans to take during the next year to 
implement its strategic plan and address obstacles to meeting 
underserved needs, foster and maintain affordable housing (including 
allocation plans and policies governing the use of Low-Income Housing 
Credits under 26 U.S.C. 42, which are more commonly referred to as Low-
Income Housing Tax Credits), evaluate and reduce lead-based paint 
hazards, reduce the number of poverty-level families, develop 
institutional structure, enhance coordination between public and 
private housing and social service agencies, address the needs of 
public housing (including providing financial or other assistance to 
troubled PHAs), and encourage public housing residents to become more 
involved in management and participate in homeownership.
    (k) * * *
    (3) * * *
    (iv) The State must describe the performance standards for 
evaluating ESG activities, which includes implementation of the fair 
housing goals from the Equity Plan.
* * * * *
    (4) HOPWA. For HOPWA funds, the State must specify one-year goals 
for the number of households to be provided housing through the use of 
HOPWA activities for short-term rent; mortgage and utility assistance 
payments to prevent homelessness of the individual or family; tenant-
based rental assistance; and units provided in housing facilities

[[Page 8583]]

that are being developed, leased or operated with HOPWA funds, and 
shall identify the method of selecting project sponsors (including 
providing full access to grassroots faith-based and other community-
based organizations). The information about activities shall include 
whether the activities are for purposes of implementing the fair 
housing goals from the Equity Plan.
    (5) Housing Trust Fund. The action plan must include the HTF 
allocation plan that describes the distribution of the HTF funds, and 
establishes the application requirements and the criteria for selection 
of applications submitted by eligible recipients that meet the State's 
priority housing needs. The plan must also establish the State's 
maximum per-unit development subsidy limit for housing assisted with 
HTF funds. If the HTF funds will be used for first-time homebuyers, it 
must state the guidelines for resale and recapture as required in 24 
CFR 93.304. The plan must reflect the State's decision to distribute 
HTF funds through grants to subgrantees and/or to select applications 
submitted by eligible recipients. If the State is selecting 
applications submitted by eligible recipients, the plan must include 
the following:
* * * * *
    (ii) The plan must include the requirement that the application 
contain a description of the eligible activities to be conducted with 
the HTF funds (as provided in 24 CFR 93.200) and contain a 
certification by each eligible recipient that housing units assisted 
with the HTF will comply with HTF requirements. The plan must also 
describe eligibility requirements for recipients (as defined in 24 CFR 
93.2). The information about activities shall include whether the 
activities are for purposes of implementing the fair housing goals from 
the Equity Plan.
* * * * *
0
18. In Sec.  91.325, paragraph (a)(1) is revised as follows:


Sec.  91.325   Certifications.

    (a) * * *
    (1) Affirmatively furthering fair housing. Each State is required 
to submit a certification that it will affirmatively further fair 
housing, which includes engaging in fair housing planning and taking 
meaningful actions, in accordance with the requirements of Sec. Sec.  
5.150 through 5.180, and that it will take no action that is materially 
inconsistent with the duty to affirmatively further fair housing 
throughout the period for which Federal financial assistance is 
extended.
* * * * *
0
19. Section 91.330 is revised to read as follows:


Sec.  91.330   Monitoring.

    The consolidated plan must describe the standards and procedures 
that the State will use to monitor activities carried out in 
furtherance of the plan including strategies and actions that address 
the fair housing issues and goals identified in the Equity Plan and 
that the State will use to ensure long-term compliance with the 
programs involved including civil rights related program requirements, 
minority business outreach, and the comprehensive planning 
requirements.
0
20. Section 91.415 is revised to read as follows:


Sec.  91.415   Strategic plan.

    Strategies and priority needs must be described in the consolidated 
plan, in accordance with the provisions of Sec.  91.215, for the entire 
consortium. The consortium is not required to submit a nonhousing 
Community Development Plan; however, if the consortium includes CDBG 
entitlement communities, the consolidated plan must include the 
nonhousing Community Development Plans of the CDBG entitlement 
community members of the consortium. The consortium must set forth its 
priorities for allocating housing resources (including CDBG and ESG, 
where applicable) geographically within the consortium, describing how 
the consolidated plan will address the needs identified (in accordance 
with Sec.  91.405), setting forth fair housing strategies and 
meaningful actions to implement the fair housing goals of the Equity 
Plan developed pursuant to Sec. Sec.  5.150 through 5.180 of this 
title, describing the reasons for the consortium's allocation 
priorities, and identifying any obstacles there are to addressing 
underserved needs.
0
21. In Sec.  91.420, paragraph (b) is revised to read as follows:


Sec.  91.420   Action plan.

* * * * *
    (b) Description of resources and activities. The action plan must 
describe the resources to be used and activities to be undertaken to 
pursue its strategic plan, including actions the consortium intends to 
undertake in the next year to address fair housing issues identified in 
the Equity Plan. The consolidated plan must provide this description 
for all resources and activities within the entire consortium as a 
whole, as well as a description for each individual community that is a 
member of the consortium.
* * * * *
0
22. In Sec.  91.425, paragraph (a)(1)(i) is revised to read as follows:


Sec.  91.425   Certifications.

    (a) * * *
    (1) * * *
    (i) Affirmatively furthering fair housing. Each consortium must 
certify that it will affirmatively further fair housing, which includes 
engaging in fair housing planning and taking meaningful actions, in 
accordance with the requirements of Sec. Sec.  5.150 through 5.180 of 
this title, and that it will take no action that is materially 
inconsistent with the duty to affirmatively further fair housing 
throughout the period for which Federal financial assistance is 
extended.
* * * * *
0
23. Section 91.430 is revised to read as follows:


Sec.  91.430   Monitoring.

    The consolidated plan must describe the standards and procedures 
that the consortium will use to monitor activities carried out in 
furtherance of the plan, including strategies and actions that address 
the fair housing issues and goals identified in the Equity Plan and 
that the consortium will use to ensure long-term compliance with 
requirements of the programs involved, including civil rights related 
program requirements, minority business outreach, and the comprehensive 
planning requirements.
0
24. In Sec.  91.500, the introductory text in paragraph (b) is revised 
to read as follows:


Sec.  91.500   HUD approval action.

* * * * *
    (b) Standard of review. The standards in this section apply to the 
consolidated plan. The standards for HUD's review of the Equity Plan at 
Sec.  5.162 of this title are distinct from the actions described in 
this section. HUD may disapprove a consolidated plan or a portion of a 
consolidated plan if it is inconsistent with the purposes of the 
Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12703), if 
it is substantially incomplete, or, in the case of certifications 
applicable to the CDBG program under Sec.  91.225(a) and (b) or Sec.  
91.325(a) and (b), if it is not satisfactory to the Secretary in 
accordance with Sec.  570.304, Sec.  570.429(g), or Sec.  570.485(c) of 
this title, as applicable. The following are examples of consolidated 
plans that are substantially incomplete:
* * * * *

[[Page 8584]]

0
25. In Sec.  91.505:
0
a. Remove the word ``or'' at the end of paragraph (a)(2);
0
b. Remove the period at the end of paragraph (a)(3) and add ``; or'' in 
its place; and
0
c. Add paragraph (a)(4).
    The addition reads as follows:


Sec.  91.505   Amendments to the consolidated plan.

    (a) * * *
    (4) To incorporate fair housing goals when an Equity Plan is 
accepted or revised after a consolidated plan is in effect.
* * * * *

PART 92--HOME INVESTMENT PARTNERSHIP PROGRAM

0
26. The authority citation for part 92 continues to read as follows:

    Authority:  42 U.S.C. 3535(d), 12 U.S.C. 1701x and 4568.

0
27. In Sec.  92.2, the introductory text is revised to read as follows:


Sec.  92.2   Definitions.

    The terms 1937 Act, affirmatively furthering fair housing, ALJ, 
Equity Plan, Fair Housing Act, HUD, Indian Housing Authority (IHA), 
public housing, public housing agency (PHA), and Secretary are defined 
in 24 CFR part 5.
* * * * *
0
28. Section 92.5 is added to read as follows:


Sec.  92.5   Affirmatively furthering fair housing.

    All participating jurisdictions must comply with the requirements 
to affirmatively further fair housing, including those at Sec. Sec.  
5.150 through 5.180 of this title.
0
29. In Sec.  92.61, paragraph (c)(5) is revised to read as follows:


Sec.  92.61   Program description.

* * * * *
    (c) * * *
    (5) A certification that the insular area will use HOME funds in 
compliance with all requirements of this part, including the insular 
area's obligation to affirmatively further fair housing and conduct its 
federally funded programs and activities in a manner that is consistent 
with Federal fair housing and civil rights requirements;
* * * * *
0
30. Section 92.104 is revised to read as follows:


Sec.  92.104   Submission of a consolidated plan.

    A jurisdiction that has not submitted a consolidated plan to HUD 
must submit to HUD, not later than 90 calendar days after providing 
notification under Sec.  92.103, a consolidated plan in accordance with 
24 CFR part 91 and submit an Equity Plan in accordance with Sec. Sec.  
5.150 through 5.180 of this title.
0
31. In Sec.  92.207, paragraph (d) is revised to read as follows:


Sec.  92.207   Eligible administrative and planning costs.

* * * * *
    (d) Fair housing, civil rights, and equal opportunity. Activities 
to affirmatively further fair housing in accordance with the 
participating jurisdiction's certification under Sec.  5.166 and part 
91 of this title.
* * * * *
0
32. In Sec.  92.350, paragraph (a) is revised to read as follows:


Sec.  92.350   Other Federal requirements and nondiscrimination.

    (a) The Federal requirements set forth in 24 CFR part 5, subpart A, 
are applicable to participants in the HOME program. The requirements of 
this subpart include: nondiscrimination and equal opportunity; 
affirmatively furthering fair housing; disclosure requirements; 
debarred, suspended or ineligible contractors; drug-free work; and 
housing counseling.
* * * * *
0
33. In Sec.  92.351, paragraph (a)(1) is revised to read as follows:


Sec.  92.351   Affirmative marketing; minority outreach program.

    (a) * * *
    (1) Each participating jurisdiction must adopt and follow 
affirmative marketing procedures and requirements for rental and 
homebuyer projects containing five or more HOME-assisted housing units. 
Affirmative marketing requirements and procedures also apply to all 
HOME-funded programs, including, but not limited to, tenant-based 
rental assistance and downpayment assistance programs. Affirmative 
marketing steps consist of actions to provide effective information and 
otherwise attract and provide access to the available housing 
throughout the housing market area regardless of race, color, national 
origin, sex (including sexual orientation, gender identity, and 
nonconformance with gender stereotypes), religion, familial status, or 
disability. If participating jurisdiction's written agreement with the 
project owner permits the rental housing project to limit tenant 
eligibility or to have a tenant preference in accordance with Sec.  
92.253(d)(3), the participating jurisdiction must have affirmative 
marketing procedures and requirements that apply in the context of the 
limited/preferred tenant eligibility for the project.
* * * * *
0
34. In Sec.  92.508, paragraph (a)(7)(i)(B) is revised to read as 
follows:


Sec.  92.508   Recordkeeping.

    (a) * * *
    (7) * * *
    (i) * * *
    (B) Documentation of the actions the participating jurisdiction has 
taken to affirmatively further fair housing, including documentation 
related to the participating jurisdiction's Equity Plan as described at 
Sec.  5.168 of this title.
* * * * *

PART 93--HOUSING TRUST FUND

0
35. The authority citation for part 93 continues to read as follows:

    Authority: 42 U.S.C. 3535(d), 12 U.S.C. 4568.

0
36. In Sec.  93.2, introductory text is added to read as follows:


Sec.  93.2   Definitions.

    The terms affirmatively furthering fair housing and Equity Plan are 
defined in 24 CFR part 5.
* * * * *
0
37. Section 93.4 is added to read as follows:


Sec.  93.4  Affirmatively furthering fair housing.

    All recipients of HTF funds must comply with the requirements to 
affirmatively further fair housing, including those at Sec. Sec.  5.150 
through 5.180 of this title.
0
38. In Sec.  93.100, paragraph (b) is revised to read as follows:


Sec.  93.100   Participation and submission requirements.

* * * * *
    (b) Submission requirement. To receive its HTF grant, the grantee 
must submit a consolidated plan in accordance with 24 CFR part 91 and 
an Equity Plan pursuant to Sec. Sec.  5.150 through 5.180 of this 
title.
0
39. In Sec.  93.200, paragraph (a)(1) is revised to read as follows:


Sec.  93.200  Eligible activities: General.

    (a)(1) HTF funds may be used for the production, preservation, and 
rehabilitation of affordable rental housing and affordable housing for 
first-time homebuyers through the acquisition (including assistance to 
homebuyers), new construction, reconstruction, or rehabilitation of 
nonluxury housing with suitable amenities, including real property

[[Page 8585]]

acquisition, site improvements, conversion, demolition, and other 
expenses, including financing costs, relocation expenses of any 
displaced persons, families, businesses, or organizations; for 
operating costs of HTF-assisted rental housing; and for reasonable 
administrative and planning costs. Not more than one third of each 
annual grant may be used for operating cost assistance and operating 
cost assistance reserves. Operating cost assistance and operating cost 
assistance reserves may be provided only to rental housing acquired, 
rehabilitated, reconstructed, or newly constructed with HTF funds. Not 
more than 10 percent of the annual grant shall be used for housing for 
homeownership. HTF-assisted housing must be permanent housing. The 
specific eligible costs for these activities are found in Sec. Sec.  
93.201 and 93.202. The activities and costs are eligible only if the 
housing meets the property standards in Sec.  93.301, as applicable, 
upon project completion. HTF Funds may be used for any activity 
otherwise eligible under this part that implements goals from an Equity 
Plan pursuant to Sec. Sec.  5.150 through 5.180 of this part.
* * * * *
0
40. In Sec.  93.202, paragraph (e) is revised to read as follows:


Sec.  93.202   Eligible administrative and planning costs.

* * * * *
    (e) Fair housing, civil rights, and equal opportunity. Activities 
to affirmatively further fair housing in accordance with the grantee's 
certification under Sec.  5.166 and part 91 of this title.
* * * * *
0
41. In Sec.  93.350, the section heading and paragraphs (a) and (b)(1) 
are revised to read as follows:


Sec.  93.350   Other Federal requirements and nondiscrimination; 
affirmative marketing.

    (a) General. The Federal requirements set forth in 24 CFR part 5, 
subpart A, are applicable to participants in the HTF program. The 
requirements of this subpart include: nondiscrimination and equal 
opportunity, affirmatively furthering fair housing; disclosure 
requirements; debarred, suspended, or ineligible contractors; drug-free 
work; and housing counseling.
    (b) * * *
    (1) Each grantee must adopt and follow affirmative marketing 
procedures and requirements for rental projects containing five or more 
HTF-assisted housing units and for homeownership assistance programs. 
Affirmative marketing steps consist of actions to provide effective 
information and otherwise attract and provide access to the available 
housing throughout the housing market area regardless of race, color, 
national origin, sex (including sexual orientation, gender identity, 
and nonconformance with gender stereotypes), religion, familial status, 
or disability. If a grantee's written agreement with the project owner 
permits the rental housing project to limit tenant eligibility or to 
have a tenant preference in accordance with Sec.  93.303(d)(3), the 
grantee must have affirmative marketing procedures and requirements 
that apply in the context of the limited/preferred tenant eligibility 
for the project.
* * * * *
0
42. In Sec.  93.407, paragraph (a)(1)(vii) is added to read as follows:


Sec.  93.407   Recordkeeping.

    (a) * * *
    (1) * * *
    (vii) Records documenting the actions the grantee has taken to 
affirmatively further fair housing, including documentation relating to 
the grantee's Equity plan described at Sec.  5.168 of this title.
* * * * *

PART 570--COMMUNITY DEVELOPMENT BLOCK GRANTS

0
43. The authority citation for part 570 continues to read as follows:

    Authority:  12 U.S.C. 1701x, 1701x-1; 42 U.S.C. 3535(d) and 
5301-5320.

0
44. In Sec.  570.3, the introductory text is revised to read as 
follows:


Sec.  570.3   Definitions.

    The terms affirmatively furthering fair housing, Equity Plan, HUD, 
and Secretary are defined in 24 CFR part 5. All of the following 
definitions in this section that rely on data from the United States 
Bureau of the Census shall rely upon the data available from the latest 
decennial census or the American Community Survey.
* * * * *
0
45. Section 570.6 is added to read as follows:


Sec.  570.6   Affirmatively furthering fair housing.

    All programs covered by this part must comply with the requirements 
to affirmatively further fair housing, including those at Sec. Sec.  
5.150 through 5.180 of this title.
0
46. In Sec.  570.205:
0
a. Remove the word ``and'' at the end of paragraph (a)(4)(vi);
0
b. Remove the period at the end of paragraph (a)(4)(vii) and add ``; 
and'' in its place;
0
c. Add paragraph (a)(4)(viii);
0
d. Revise paragraph (a)(6); and
0
e. Add reserved paragraph (b).
    The additions and revision read as follows:


Sec.  570.205   Eligible planning, urban environmental design and 
policy-planning-management-capacity building activities.

    (a) * * *
    (4) * * *
    (viii) The Equity Plan.
* * * * *
    (6) Policy--planning--management--capacity building activities 
which will enable the recipient to:
    (i) Determine its needs;
    (ii) Set long-term goals and short-term objectives, including those 
related to urban environmental design and implementation of fair 
housing goals from the Equity Plan;
    (iii) Devise programs and activities to meet these goals and 
objectives, including implementation of fair housing goals from the 
Equity plan;
    (iv) Evaluate the progress of such programs and activities in 
accomplishing these goals and objectives; and
    (v) Carry out management, coordination and monitoring of activities 
necessary for effective planning implementation, including with respect 
to any fair housing goals from the Equity Plan, but excluding the costs 
necessary to implement such plans.
    (b) [Reserved]
0
47. In Sec.  570.206, paragraph (c) is revised to read:


Sec.  570.206   Program administrative costs.

* * * * *
    (c) Fair housing activities. Provision of fair housing services 
designed to affirmatively further the purposes of the Fair Housing Act 
(42 U.S.C. 3601-20) by making all persons, without regard to race, 
color, religion, sex (including gender identity, sexual orientation, 
and nonconformance with gender stereotypes), national origin, familial 
status, or disability, aware of the range of housing opportunities 
available to them; other fair housing enforcement, education, and 
outreach activities; and other activities designed to further fair 
housing.
* * * * *
0
48. In Sec.  570.441, paragraphs (b)(1)(ii) and (d) are revised to read 
as follows:


Sec.  570.441   Citizen participation--insular areas.

* * * * *

[[Page 8586]]

    (b) * * *
    (1) * * *
    (ii) The range of activities that may be undertaken with those 
funds which may include Equity Plan fair housing goals incorporated 
pursuant to Sec.  5.156 of this title;
* * * * *
    (d) Preparation of the final statement. An insular area 
jurisdiction must prepare a final statement. In the preparation of the 
final statement, the jurisdiction shall consider comments and views 
received relating to the proposed document and may, if appropriate, 
modify the final document. To the extent comments or views were 
received that relate to the incorporation of the Equity Plan pursuant 
to Sec.  5.156 of this title, the jurisdiction shall specifically note 
how the document was modified in response, and if not, the reasons why. 
The final statement shall be made available to the public. The final 
statement shall include the community development objectives, projected 
use of funds, and the community development activities.
* * * * *
0
49. In Sec.  570.487, paragraph (b) is revised to read as follows:


Sec.  570.487   Other applicable laws and related program requirements.

* * * * *
    (b) Affirmatively furthering fair housing. The requirements set 
forth at 24 CFR part 5, subpart A, are applicable to CDBG grantees. 
Each jurisdiction is required to submit a certification that they will 
affirmatively further fair housing which means engaging in fair housing 
planning and taking meaningful actions, in accordance with the 
requirements of Sec. Sec.  5.150 through and 5.180 of this title, and 
that it will take no action that is materially inconsistent with the 
duty to affirmatively fair housing throughout the period for which 
Federal financial assistance is extended. Each unit of general local 
government is required to certify that it will affirmatively further 
fair housing, in accordance with the requirements of Sec. Sec.  5.150 
through and 5.180 of this title, and that it will take no action that 
is materially inconsistent with the duty to affirmatively further fair 
housing throughout the period for which Federal financial assistance is 
extended.
* * * * *
0
50. In Sec.  570.490, paragraphs (a)(1) and (b) are revised to read as 
follows:


Sec.  570.490  Recordkeeping requirements.

    (a) * * *
    (1) The State shall establish and maintain such records as may be 
necessary to facilitate review and audit by HUD of the State's 
administration of CDBG funds under Sec.  570.493. The content of 
records maintained by the State shall be as jointly agreed upon by HUD 
and the States and sufficient to enable HUD to make the determinations 
described at Sec.  570.493. For fair housing and equal opportunity 
purposes, whereas such data is already being collected and where 
applicable, such records shall include data on the racial, ethnic, and 
gender characteristics of persons who are applicants for, participants 
in, or beneficiaries of the program. Such records shall include 
documentation relating to the State's Equity Plan as described at Sec.  
5.168 of this title. The records shall also permit audit of the States 
in accordance with 2 CFR part 200.
* * * * *
    (b) Unit of general local government's record. The State shall 
establish recordkeeping requirements for units of general local 
government receiving CDBG funds that are sufficient to facilitate 
reviews and audits of such units of general local government under 
Sec. Sec.  570.492 and 570.493. For fair housing and equal opportunity 
purposes, whereas such data is already being collected and where 
applicable, such records shall include data on the racial, ethnic, and 
gender characteristics of persons who are applicants for, participants 
in, or beneficiaries of the program. Such records shall include 
documentation related to the State's Equity Plan as described at Sec.  
5.168 of this title.
* * * * *
0
51. In Sec.  570.506, paragraph (g)(1) is revised to read as follows:


Sec.  570.506   Records to be maintained.

* * * * *
    (g) * * *
    (1) Documentation of the actions the recipient has taken to 
affirmatively further fair housing, including documentation related to 
the recipient's Equity Plan described at Sec.  5.168 of this title.
* * * * *
0
52. In Sec.  570.601, the section heading and paragraph (a)(2) is 
revised to read as follows:


Sec.  570.601   Civil rights; affirmatively furthering fair housing; 
equal opportunity requirements.

    (a) * * *
    (2) Public Law 90-284, which is the Fair Housing Act (42 U.S.C. 
3601-3620). In accordance with the Fair Housing Act, the Secretary 
requires that grantees administer all programs and activities related 
to housing and community development in a manner to affirmatively 
further the policies of the Fair Housing Act. The affirmatively 
furthering fair housing requirements set forth in 24 CFR part 5, 
subpart A, are applicable to CDBG grantees. Furthermore, in accordance 
with section 104(b)(2) of the Act, for each community receiving a grant 
under subpart D of this part, the certification, that the grantee will 
affirmatively further fair housing, shall specifically require the 
grantee to take meaningful actions to further the fair housing goals 
established in the Equity Plan developed pursuant to Sec. Sec.  5.150 
through 5.180 of this title, and that it will take no action that is 
materially inconsistent with the duty to affirmatively further fair 
housing.
* * * * *
0
53. In Sec.  570.904, paragraph (c)(2) is revised to read as follows:


Sec.  570.904  Equal opportunity and fair housing review criteria.

* * * * *
    (c) * * *
    (2) Affirmatively furthering fair housing. HUD will review a 
recipient's performance to determine if it has administered all 
programs and activities related to housing and urban development in 
accordance with Sec.  570.601(a)(2) for purposes of administration of 
CDBG funds, which sets forth the grantee's responsibility to 
affirmatively further fair housing. The review undertaken pursuant to 
this section is distinct from the procedures set forth at 24 CFR part 
1, 3, 5, 6, 8, or 146 or 28 CFR part 35 conducted by the Responsible 
Civil Rights Official (as defined in 24 CFR part 5), which are reviews 
for purposes of determining a grantee's compliance with Federal fair 
housing and civil rights requirements, including the grantee's 
obligation to affirmatively further fair housing.
* * * * *

PART 574--HOUSING OPPORTUNITIES FOR PERSONS WITH AIDS

0
54. The authority citation for part 574 continues to read as follows:

    Authority: 12 U.S.C. 1701x, 1701 x-1; 42 U.S.C. 3535(d) and 
5301-5320.

0
55. In Sec.  574.3, the introductory text is revised to read as 
follows:


Sec.  574.3   Definitions.

    The terms affirmatively furthering fair housing, grantee, and 
Secretary are defined in 24 CFR part 5.
* * * * *
0
56. Section 574.4 is added to read as follows:

[[Page 8587]]

Sec.  574.4  Affirmatively furthering fair housing.

    All grantees must comply with the requirements to affirmatively 
further fair housing, including those at Sec. Sec.  5.150 through 5.180 
of this title.
0
57. In Sec.  574.530, paragraph (b) is revised to read as follows:


Sec.  574.530   Recordkeeping.

* * * * *
    (b) Documentation of the actions the grantee has taken to 
affirmatively further fair housing pursuant to Sec. Sec.  5.150 through 
5.180 of this title.
* * * * *

PART 576--EMERGENCY SOLUTIONS GRANTS PROGRAM

0
58. The authority citation for part 576 continues to read as follows:

    Authority:  12 U.S.C. 1701x, 1701 x-1; 42 U.S.C. 11371 et seq., 
42 U.S.C. 3535(d).

0
59. In Sec.  576.2, introductory text is added to read as follows:


Sec.  576.2   Definitions.

    The term affirmatively furthering fair housing is defined in 24 CFR 
part 5.
* * * * *
0
60. Section 576.4 is added to read as follows:


Sec.  576.4  Affirmatively furthering fair housing.

    All recipients of ESG funds must comply with the requirements to 
affirmatively further fair housing, including those at Sec. Sec.  5.150 
through 5.180 of this title.
0
61. In Sec.  576.500, paragraph (s)(1)(ii) is revised to read as 
follows:


Sec.  576.500   Recordkeeping and reporting requirements.

* * * * *
    (s) * * *
    (1) * * *
    (ii) Documentation of the actions that the recipient has taken to 
affirmatively further fair housing pursuant to Sec. Sec.  5.150 through 
5.180 of this title.
* * * * *

PART 903--PUBLIC HOUSING AGENCY PLANS

0
62. The authority citation for part 903 continues to read as follows:

    Authority: 42 U.S.C. 1437c; 42 U.S.C. 1437c-1; Pub. L. 110-289; 
42 U.S.C. 3535d.

0
63. Section 903.1 is revised to read as follows:


Sec.  903.1   What is the purpose of this subpart?

    The purpose of this subpart is to specify the process which a 
public housing agency (PHA), as part of its annual planning process and 
development of an admissions policy, must follow in order to develop 
and apply a policy that provides for deconcentration of poverty and 
income mixing in certain public housing developments. This subpart also 
includes requirements for the PHA's obligation to affirmatively further 
fair housing and comply with the requirements set forth at Sec. Sec.  
5.150 through 5.180 of this title.
0
64. In Sec.  903.4, paragraph (a)(3) is added to read as follows:


Sec.  903.4   What are the public housing agency plans?

    (a) * * *
    (3) The plans described in this section include the incorporation, 
pursuant to Sec.  5.156 of this title, of the fair housing goals 
established in the PHA's Equity Plan.
* * * * *
0
65. In Sec.  903.6, paragraph (a)(4) is added and paragraph (b)(2) is 
revised to read as follows:


Sec.  903.6   What information must a PHA provide in the 5-Year Plan?

    (a) * * *
    (4) The PHA's fair housing strategies and meaningful actions it 
intends to undertake in order to implement the fair housing goals 
incorporated from the PHA's Equity Plan pursuant to Sec.  5.156 of this 
title.
    (b) * * *
    (2) The progress the PHA has made in meeting the goals and 
objectives described in the PHA's previous 5-Year Plan. For purposes of 
the requirement in this paragraph (b)(2) as it relates to the PHA's 
fair housing goals, the PHA may rely on the progress evaluations 
required for purposes of the Equity Plan, conducted pursuant to 
Sec. Sec.  5.152, 5.154(i) and (j), 5.156(d), and 5.160(f) and (i) of 
this title.
0
66. In Sec.  903.7, the introductory text and paragraphs (a)(1)(iii), 
(b) introductory text, and (o) are revised to read as follows:


Sec.  903.7   What information must a PHA provide in the Annual Plan?

    With the exception of the first Annual Plan submitted by a PHA, the 
Annual Plan must include the information provided in this section. HUD 
will advise PHAs by separate notice, sufficiently in advance of the 
first Annual Plan due date, of the information described in this 
section that must be part of the first Annual Plan submission, and any 
additional instructions or directions that may be necessary to prepare 
and submit the first Annual Plan. The information described in this 
section applies to both public housing and tenant-based assistance, 
except where specifically stated otherwise. The information that the 
PHA must submit for HUD approval under the Annual Plan includes the 
discretionary policies of the various plan components or elements (for 
example, rent policies) and not the statutory or regulatory 
requirements that govern these plan components and that provide no 
discretion on the part of the PHA in implementation of the 
requirements. The PHA's Annual Plan must be consistent with the goals 
and objectives of the PHA's 5-Year Plan and the PHA's Equity Plan once 
an Equity Plan is required by Sec. Sec.  5.150 through 5.180 of this 
title.
    (a) * * *
    (1) * * *
    (iii) Households with individuals with disabilities and households 
of various races and ethnic groups residing in the jurisdiction or on 
the waiting list. Once the PHA has submitted its Equity Plan pursuant 
to the submission schedule at Sec.  5.160 of this title, the PHA may 
rely on its analysis of affordable housing opportunities and the 
analysis conducted pursuant to Sec.  5.154(e) of this title in 
connection with its Equity Plan, to the extent applicable and still up-
to-date and relevant, for purposes of the PHA's Annual Plan.
* * * * *
    (b) A statement of the PHA's deconcentration and other policies 
that govern eligibility, selection, and admissions. This statement must 
describe the PHA's policies that govern resident or tenant eligibility, 
selection, and admission and shall be consistent with the PHA's 
obligation to affirmatively further fair housing and the PHA's Equity 
Plan developed pursuant to Sec. Sec.  5.150 through 5.180 of this 
title. This statement also must describe any PHA admission preferences, 
and any occupancy policies that pertain to public housing units and 
housing units assisted under section 8(o) of the 1937 Act, as well as 
any unit assignment policies for public housing. This statement must 
include the following information:
* * * * *
    (o) Civil rights certification. (1) The PHA must certify that it 
will carry out its plan in conformity with title VI of the Civil Rights 
Act of 1964 (42 U.S.C. 20000d-2000d-4), the Fair Housing Act (42 U.S.C. 
3601-19), section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 
794), and title II of the Americans with Disabilities Act of 1990 (42 
U.S.C. 12101, et seq.), and other applicable

[[Page 8588]]

Federal civil rights laws. The PHA must also certify that it will 
affirmatively further fair housing, and that it will take no action 
that is materially inconsistent with the duty to affirmatively further 
fair housing throughout the period for which Federal financial 
assistance is extended pursuant to Sec.  5.166 of this title.
    (2) The certification is applicable to the 5-Year Plan and the 
Annual Plan, and any plan incorporated therein.
    (3) The PHA shall demonstrate compliance with the certification 
requirement to affirmatively further fair housing by fulfilling the 
requirements of this paragraph (o) and Sec.  903.15 by engaging in the 
following:
    (i) Examines its programs and activities or proposed programs and 
activities consistent with the requirements of Sec. Sec.  5.150 through 
5.180 of this title;
    (ii) Identifies fair housing issues in its programs and activities 
or proposed programs and activities, in accordance with Sec.  5.154 of 
this title;
    (iii) Specifies fair housing strategies and meaningful actions to 
address fair housing issues and implement fair housing goals 
established in the PHA's Equity Plan, consistent with Sec.  5.154 of 
this title;
    (iv) Works with the jurisdiction to implement any of the 
jurisdiction's initiatives to affirmatively further fair housing that 
require the PHA's involvement;
    (v) Operates its programs and activities in a manner consistent 
with the PHA's obligation to affirmatively further fair housing and 
consistent with any applicable consolidated plan under 24 CFR part 91, 
and consistent with any order or agreement to comply with the 
authorities specified in paragraph (o)(1) of this section;
    (vi) Complies with the community engagement requirements set forth 
at Sec.  5.158 of this title for purposes of developing the PHA's 
Equity Plan and the incorporation of the Equity Plan's fair housing 
goals pursuant to Sec.  5.156 of this title;
    (vii) Maintains records, in accordance with Sec.  5.168 of this 
title, reflecting the PHA's efforts to affirmatively further fair 
housing; and
    (viii) Takes appropriate actions, to the satisfaction of the 
Responsible Civil Rights Official, to remedy known fair housing or 
civil rights violations.
* * * * *
0
67. In Sec.  903.13, paragraphs (a)(1) and (2) and (c) are revised to 
read as follows:


Sec.  903.13   What is a Resident Advisory Board and what is its role 
in development of the Annual Plan?

    (a) * * *
    (1) The role of the Resident Advisory Board (or Resident Advisory 
Boards) is to assist and make recommendations regarding the development 
of the Equity Plan in accordance with Sec.  5.158 of this title, the 
PHA plan, and any significant amendment or modification to the PHA 
plan, including based on any revision to an Equity Plan pursuant to 
Sec.  5.164 of this title.
    (2) The PHA shall allocate reasonable resources to ensure the 
effective functioning of Resident Advisory Boards. Reasonable resources 
for the Resident Advisory Boards must provide reasonable means for them 
to become informed on programs covered by the Equity Plan pursuant to 
Sec. Sec.  5.150 through 5.180 of this title, the PHA Plan, to 
communicate in writing and by telephone with assisted families and hold 
meetings with those families, and to access information regarding 
covered programs on the internet, taking into account the size and 
resources of the PHA.
* * * * *
    (c) The PHA must consider the recommendations of the Resident 
Advisory Board or Boards in preparing the final Equity Plan pursuant to 
Sec. Sec.  5.150 through 5.180 of this title, the final Annual Plan, 
and any significant amendment or modification to the Annual Plan, 
including based on any revision to an Equity Plan pursuant to Sec.  
5.164 of this title, and as provided in Sec.  903.21.
    (1) In submitting the final plan to HUD for approval, or any 
significant amendment or modification to the plan to HUD for approval, 
the PHA must include a copy of the recommendations made by the Resident 
Advisory Board or Boards and a description of the manner in which the 
PHA addressed these recommendations. For purposes of any fair housing 
goals incorporated into the final plan submitted to HUD for approval, 
the PHA shall comply with the requirements set forth at Sec. Sec.  
5.154(h) and 5.158 of this title.
    (2) Notwithstanding the 75-day limitation on HUD review, in 
response to a written request from a Resident Advisory Board claiming 
that the PHA failed to provide adequate notice and opportunity for 
comment, HUD may make a finding of good cause during the required time 
period and require the PHA to remedy the failure before final approval 
of the plan. The Resident Advisory Board's claims pursuant to this 
paragraph (c)(2) are distinct from any complaint filed with HUD 
pursuant to Sec.  5.170 of this title.
0
68. In Sec.  903.15, the section heading, introductory text of 
paragraph (a), and paragraphs (b) and (c) are revised to read as 
follows:


Sec.  903.15   What is the relationship of the public housing agency 
plans to the Consolidated Plan and a PHA's fair housing and civil 
rights requirements?

    (a) Consistency with consolidated plan. The PHA must ensure that 
the Annual Plan is consistent with any applicable Consolidated Plan for 
the jurisdiction in which the PHA is located, including any applicable 
Equity Plan incorporated into the applicable Consolidated Plan pursuant 
to Sec.  5.156 of this title.
* * * * *
    (b) PHA fiscal year. A PHA may request to change its fiscal year to 
better coordinate its planning with the planning done under the Equity 
Plan pursuant to Sec.  5.160(a) of this title, the Consolidated Plan 
process, or by the State or local officials, as applicable.
    (c) Fair housing and civil rights requirements. A PHA is obligated 
to affirmatively further fair housing in its operating policies, 
procedures, and capital activities. All admission and occupancy 
policies for public housing and Section 8 tenant-based housing programs 
must comply with Fair Housing Act requirements and other civil rights 
laws and regulations and with a PHA's plans to affirmatively further 
fair housing, including the PHA's Equity Plan developed pursuant to 
Sec. Sec.  5.150 through 5.180 of this title. The PHA may not impose 
any specific income or racial quotas for any development or 
developments.
    (1) Nondiscrimination. The PHA must carry out its Equity Plan and 
PHA Plan in conformity with the nondiscrimination requirements in 
Federal civil rights laws, including title VI of the Civil Rights Act 
of 1964, section 504 of the Rehabilitation Act of 1973, the Americans 
with Disabilities Act, and the Fair Housing Act, including the PHA's 
obligation to affirmatively further fair housing. A PHA may not assign 
housing to persons in a particular section of a community or to a 
development or building based on race, color, religion, sex, 
disability, familial status, or national origin for purposes of 
segregating populations.
    (2) Affirmatively furthering fair housing. A PHA's policies should 
be designed to reduce the concentration of tenants and other assisted 
persons by race, color, national origin, religion, sex, familial 
status, and disability. Any affirmative steps or incentives a PHA

[[Page 8589]]

plans to take must be stated in the admission policy.
    (i) All PHAs must comply with the requirements to affirmatively 
further fair housing, including those at Sec. Sec.  5.150 through 5.180 
of this title, including where those regulations impose different or 
greater requirements than this part.
    (ii) HUD regulations provide that PHAs must take steps to 
affirmatively further fair housing. PHAs shall develop an Equity Plan 
pursuant to Sec. Sec.  5.150 through 5.180 of this title. PHA policies, 
consistent with the analysis and fair housing goals established in the 
Equity Plan, shall include affirmative steps to overcome the effects of 
discrimination and the effects of conditions that resulted in limiting 
participation of persons because of their race, color, national origin, 
religion, sex, familial status, or disability.
    (iii) Such affirmative steps may include, but are not limited to, 
marketing efforts, use of nondiscriminatory tenant selection and 
assignment policies that lead to desegregation, additional applicant 
consultation and information, including mobility counseling, services, 
and assistance in identifying affordable housing opportunities in well-
resourced areas, provision of additional supportive services and 
amenities to a development (such as supportive services that enable an 
individual with a disability to transfer from an institutional setting 
into the community), and engagement in ongoing coordination with State 
and local disability agencies to provide additional community-based 
housing opportunities for individuals with disabilities and to connect 
such individuals with supportive services to enable an individual with 
a disability to transfer from an institutional setting into the 
community.
    (3) Validity of certification. (i) A PHA's certification under 
Sec.  903.7(o) will be subject to challenge by HUD where it appears 
that a PHA:
    (A) Fails to meet the requirements set forth at Sec. Sec.  5.150 
through 5.180 of this title;
    (B) Takes action that is materially inconsistent with the duty to 
affirmatively further fair housing; or
    (C) Fails to comply with the fair housing, civil rights, and 
affirmatively furthering fair housing requirements in Sec.  903.7(o).
    (ii) If HUD challenges the validity of a PHA's certification, HUD 
will do so in writing specifying the deficiencies, and will give the 
PHA an opportunity to respond to the particular challenge in writing. 
In responding to the specified deficiencies, a PHA must establish, as 
applicable, that it has complied with fair housing and civil rights 
laws and regulations, or has remedied violations of fair housing and 
civil rights laws and regulations, and has adopted policies and 
undertaken actions to affirmatively further fair housing, including, 
but not limited to, providing a full range of housing opportunities to 
applicants and tenants in a nondiscriminatory manner. In responding to 
the PHA, HUD may accept the PHA's explanation and withdraw the 
challenge, undertake further investigation, or pursue other remedies 
available under law. HUD will seek to obtain voluntary corrective 
action consistent with the specified deficiencies. In determining 
whether a PHA has complied with its certification, HUD will review the 
PHA's circumstances relevant to the specified deficiencies, including 
characteristics of the population served by the PHA; characteristics of 
the PHA's existing housing stock; and decisions, plans, goals, 
priorities, strategies, and actions of the PHA. For purposes of the 
PHA's fair housing and civil rights certification pursuant to 
Sec. Sec.  903.7(o) and 5.166 of this title, the procedures set forth 
at Sec.  5.166(b) shall apply.
0
69. In Sec.  903.17, paragraph (a), the introductory text of paragraph 
(b), and paragraph (c) are revised to read as follows:


Sec.  903.17   What is the process for obtaining public comment on the 
plans?

    (a) The PHA's board of directors or similar governing body must 
conduct a public hearing to discuss the PHA plan (either the 5-Year 
Plan and/or Annual Plan, as applicable) and invite public comment on 
the plan(s). The hearing must be conducted at a location that is 
convenient to the residents served by the PHA. For purposes of the 
incorporation of the Equity Plan required by Sec.  5.156 of this title, 
the community engagement requirements of Sec.  5.158 of this title 
shall apply.
    (b) For purposes of the PHA's 5-Year Plan and Annual Plan, and 
notwithstanding the requirements set forth at Sec.  5.158 of this title 
for purposes of the Equity Plan's incorporation into such plans 
pursuant to Sec.  5.156 of this title, not later than 45 days before 
the public hearing is to take place, the PHA must:
* * * * *
    (c) PHAs shall conduct reasonable outreach activities to encourage 
broad public participation in the PHA plans. This outreach is for 
purposes of the 5-Year Plan and Annual Plan. The requirements of Sec.  
5.158 of this title shall apply for purposes of the Equity Plan.
0
70. In Sec.  903.19:
0
a. Paragraph (c) is amended by removing the period at the end of the 
paragraph and adding ``; and'' in its place; and
0
b. Paragraph (d) is added.
    The addition reads as follows:


Sec.  903.19   When is the 5-Year Plan or Annual Plan ready for 
submission to HUD?

* * * * *
    (d) The PHA has incorporated the fair housing goals from its Equity 
Plan pursuant to Sec.  5.156 of this title.
0
71. In Sec.  903.23, paragraph (f) is revised to read as follows:


Sec.  903.23   What is the process by which HUD reviews, approves, or 
disapproves an Annual Plan?

* * * * *
    (f) Recordkeeping. PHAs must maintain records reflecting actions 
the PHA has taken to affirmatively further fair housing, including 
documentation related to the PHA's Equity Plan described at Sec.  5.168 
of this title, and documentation relating to the PHA's certifications 
made pursuant to Sec. Sec.  5.166 of this title and 903.7(o).
0
72. Section 903.25 is revised to read as follows:


Sec.  903.25   How does HUD ensure PHA compliance with its PHA plan?

    A PHA must comply with the rules, standards, and policies 
established in the plans. To ensure that a PHA is in compliance with 
all policies, rules, and standards adopted in the plan approved by HUD, 
HUD shall, as it deems appropriate, respond to any complaint concerning 
PHA noncompliance with its plan. If HUD should determine that a PHA is 
not in compliance with its plan, HUD will take whatever action it deems 
necessary and appropriate. For purposes of the PHA's Equity Plan, the 
procedures set forth at Sec. Sec.  5.162, 5.170, 5.172, and 5.174 of 
this title shall apply.

PART 983--PROJECT-BASED VOUCHER (PBV) PROGRAM

0
73. The authority citation for part 983 continues to read as follows:

    Authority:  42 U.S.C. 1437f and 3535(d).

0
74. In Sec.  983.57:
0
a. Revise the introductory text of paragraph (b)(1);
0
b. Remove paragraph (b)(1)(iii); and
0
c. Redesignate paragraphs (b)(1)(iv) through (vii) as paragraphs 
(b)(1)(iii) through (vi), respectively.
    The revision reads as follows:


Sec.  983.57   Site selection standards.

* * * * *
    (b) * * *
    (1) Project-based assistance for housing at the selected site is 
consistent

[[Page 8590]]

with the goal of deconcentrating poverty and expanding housing and 
economic opportunities. The standard for deconcentrating poverty and 
expanding housing and economic opportunities must be consistent with 
the PHA Plan under 24 CFR part 903, the PHA Administrative Plan, and 
the PHA's Equity Plan developed pursuant to Sec. Sec.  5.150 through 
5.180 of this title. In developing the standards to apply in 
determining whether a proposed PBV development will be selected, a PHA 
must consider the following:
* * * * *

Marcia L. Fudge,
Secretary.
[FR Doc. 2023-00625 Filed 2-8-23; 8:45 am]
BILLING CODE 4210-67-P