Linked below is a complaint in a lawsuit filed recently in US District Court in Texas by Inclusive Communities Project, Inc. (the plaintiff in the Texas Department of Housing and Community Affairs fair housing suit from a couple years ago) against the United States Treasury Department and Office of the Controller of the Currency (the federal agency which regulates national banks), alleging that these agencies’ administration of the LIHTC program promotes the placement of LIHTC units in predominantly minority communities and promotes racial segregation in the Dallas, Texas area. The plaintiffs are seeking injunctive relief against the agencies to regulate the program in a way that would end these practices and which would require that profits from tax credit investments and income from debt investments by banks be devoted in part of housing mobility counseling services. The plaintiffs have done a lot of homework and cite a substantial amount of evidence; of course, this is their complaint and it’s only their side of the story. The defendant agencies have yet to file their reply and it will likely be several weeks or months before a response is submitted to the court. The judge assigned to the case is familiar with these issues, having issued a ruling in favor of the plaintiffs in the TDHCA fair housing case.
AHTCC’s legal counsel has briefly reviewed the case. Although the suit is centered on the Dallas area, because the suit is against two federal agencies, this has the potential of having national implications. It’s way too early to predict any outcomes here, but this is something that we will have to keep an eye on. In addition, this could get the attention of Congress, particularly Members from Texas. This is a matter that will likely be discussed among state housing credit agencies and within the industry as a whole.
As always, the Coalition welcomes your thoughts on this matter. We will try to keep you posted as this lawsuit moves through the judicial process.