Representative work done by Daniel & Beshara, P.C.
for the Inclusive Communities Project, Inc.
Some of the work done by Daniel & Beshara, P.C. on behalf of the Inclusive Communities Project, Inc. is described below. This work furthers the mission of the Walker Housing Fund Charitable Trust and ICP.
The Inclusive Communities Project, Inc.
The Walker Project, Inc. (WPI) was established in 1990 pursuant to the Consent Decree in the Walker v. HUD housing desegregation litigation to promote fair housing and provide support to Walker class members, Black or African American public housing and voucher participants in DHA’s programs. WPI operated in that capacity through the Spring of 2001. After several years of inactivity, the newly constituted Board of Directors of WPI changed the name of the 13-year-old non-profit, and committed to revitalize its activity in the area of civil rights, fair housing, and inclusive, non-discriminatory community development. As of April 28, 2004, the Walker Project became the Inclusive Communities Project (ICP).
ICP engages in educational, research, and advocacy activities that promote and support the policies underlying the passage of the Fair Housing Act of 1968, as amended, 42 USC 3601, et. seq. and related civil rights laws. These policies include the creation and maintenance of stable, racially, ethnically and economically integrated communities, expansion of fair and affordable housing opportunities for low income families, and seeking redress for policies and practices that perpetuate the effects of racial and ethnic discrimination and segregation. http://inclusivecommunities.net/about.php
Housing Choice Voucher desegregation effort against HUD.
In ICP v. United States Department of Housing and Urban Development, 2009 WL 3122610 (N.D. Tex 2009) and 2009 WL 3446232 (N.D. Tex. 2009), ICP challenged HUD’s use of rent data from a 12 county area to set a single fair market rent for the Housing Choice Voucher program. These fair market rents set the amount of subsidy that will be paid to the landlord on behalf of the voucher family. HUD had long used the rents in the low income minority concentrated areas to set the rents for the entire multi-county region. This made most of the units in those low income minority concentrated areas available for vouchers while severely limiting the availability of units in the predominantly White, high opportunity areas.
ICP settled the case when HUD agreed to use Zip Codes as the geographic basis for fair market rents in the Dallas area. The FY 2011 Zip Code fair market rents were the first Zip Code fair market rents adopted by HUD pursuant to the settlement. These fair market rents allowed hundreds of HCV participants to locate in majority White Zip Codes. According to an independent study, the 2011 Zip Code fair market rents had the following results:
After this intervention, [the ICP settlement] voucher recipients in Dallas chose neighborhoods with substantially lower violent crime rates and lower poverty rates, and the net cost of the intervention was zero. Collinson, Robert A. and Ganong, Peter, Incidence and Price Discrimination: Evidence from Housing Vouchers (June 9, 2013). Available at SSRN: http://ssrn.com/abstract=2255799 or http://dx.doi.org/10.2139/ssrn.2255799.
The complaint and the amended complaint, the judicial decision denying HUD’s motion to dismiss, the settlement, and the objections to the 2012, 2013, and 2014 SAFMRs are identified or linked below.
● Complaint and amended complaint icp hud complaint.pdf icp hud amended complaint.pdf
● Inclusive Communities Project, Inc. v. U.S. Dept. of Housing and Urban Development, Slip Copy, 2009 WL 3446232, N.D. Tex., October 26, 2009(No. 3-07-CV-0945-O.) Opinion granting motion for leave to file amended complaint despite HUD's objections.
● Inclusive Communities Project, Inc. v. U.S. Dept. of Housing and Urban Development, Slip Copy, 2009 WL 3122610, N.D. Tex., September 29, 2009 (No. 3:07-CV-0945-O.) Order adopting the included U.S. Magistrate Judge’s recommendation to deny HUD’s motion to dismiss the affirmatively further fair housing claim and to grant the motion to deny the National Housing Act based claim.
● Settlement and required Federal Register noticeSigned Settlement Agreement and Letter.pdf Small Area FMR Demonstration Notice Federal Register Version.pdf
After 2011, HUD reverted to the same pattern of overpaying in minority areas and underpaying in White areas that marked the previous FMR setting process. On behalf of ICP, Daniel & Beshara, P.C. filed objections to the subsequent reversal of the 2011 maximum rental rates in the 2012 through 2014 SAFMRS.
● Objection to proposed 2012 SAFMRs2011 Comment on 2012 SAFMRs 1.pdf 2011 Comment on 2012 SAFMRs 2.pdf
● Objection to proposed 2013 SAFMRS 2012 Comment on 2013 SAFMRs cover letter.pdf 2012 Comment on 2013 SAFMRs.pdf
● Objection to proposed 2014 SAFMRS2013 Comment on 2014 SAFMRs Cover letter.pdf 2013 Comment on 2014 SAFMRs.pdf
DBPC filed a new lawsuit for ICP challenging HUD’s administration of the SAFMR process in the Dallas area from 2012 through 2014. The complaint was filed on April 22, 2014.
● April 22, 2014 complaint
in The Inclusive Communities Project, Inc. v. The United States Department of Housing and Urban Development, U.S. District Court of Texas, Northern District, Dallas Division, 3:14-cv-01465-L.
ICP v. TDHCA
TDHCA is the Texas state administrator of the low income housing tax credit program.
Low Income Housing Tax Credit (LIHTC) units are important to ICP and its clients. The owners of tax credit units cannot discriminate against voucher families because the family wants to use a voucher. Texas law also prohibits LIHTC landlords from charging more than 2.5 times the voucher families’ share of the rent. Because of this unique access to affordable units, the disproportionate location of the tax credit units in predominantly minority areas, including those marked by conditions of slum and blight, injures ICP’s clients. The clients are attempting to find housing outside of those areas. The current locations of most of the LIHTC units also make it more difficult, expensive, and time consuming for ICP to assist its clients in finding units outside of the predominantly minority areas marked by conditions of slum and blight.
A December 2006 State of Texas House of Representatives Urban Affairs Committee Report found that the state’s system of low income housing tax credit housing was racially segregated. The House Committee found that TDHCA and the Bond Review Board disproportionately allocated federal low income housing tax credit funds to developments located in predominantly minority areas. The Committee found that the vast majority of low income housing tax credits and tax-exempt bonds that fund developments in the Dallas, Fort Worth, Austin and Houston metropolitan areas have been placed in minority and low income impacted areas. The report established that, as of 2006, 77% of LIHTC units in the Dallas metropolitan area were in above-average minority areas, leading to "concentration problems.” Interim Report 2006 A Report to the House of Representatives 80th Texas Legislature, December 6, 2006, Robert Talton, Chairman, Findings page 48. Talton excerpts.pdf
.The report made recommendations to remedy the segregation that include set asides and higher points for applications to place units in non-impacted areas. Id. at 49. TDHCA took no action to implement the remedial suggestions.
ICP attempted to negotiate with TDHCA. The lawsuit was filed after the attempt failed. The complaint was filed in 2008. The suit was based on the facts found by the Urban Affairs Committee, HUD reports, the occupancy and location patterns of the TDHCA tax credit units, and other facts. The complaint stated the importance of the tax credit housing to ICP and its clients and the injuries inflicted by TDHCA’s racial segregation of the units. Complaint.
TDHCA filed a motion to dismiss that was denied. ICP v. TDHCA, 2008 WL 5191935 (N.D. Tex. 2008) opinion denying motion to dismiss.pdf
. The cross motions for summary judgment resulted in a motion for partial summary judgment in favor of ICP and a denial of TDHCA’s motions. ICP v. TDHCA, 749 F.Supp.2d 486 (N.D. Tex 2010) opinion on summary judgments.pdf
. As of 2008, 92.29% of low income housing tax credit non-elderly units in the City of Dallas were located in census tracts with greater than 50% minority residents. Id. at 499.
After a four day trial and several months of post trial briefing, District Judge Sidney Fitzwater found no purposeful racial discrimination but held that ICP had shown a violation of the Fair Housing Act under the discriminatory impact - perpetuating racial segregation - standard. Judge Fitzwater ordered the submission of remedial proposals by TDHCA. ICP v. TDHCA, 860 F.Supp.2d 312 (N.D. Tex. 2012) ICP v TDHCA liability.pdf
The maps at the tab Racial Segregation of Dallas Low Income Housing Tax Credit units and lack of Community Revitalization.pdf
show the racially segregated pattern of housing tax credit units in the City of Dallas as of September 2012. This is very close to the earlier pattern upon which liability was based.
Frazier Revitalization Inc. (FRI) was allowed to intervene as a defendant after the trial court’s ruling. The Court granted the intervention for FRI to protect the interests in a remedy that will not unnecessarily hinder the award of LIHTCs to developments that revitalize low-income areas, even if located in predominately minority areas. Order allowing FRI to intervene.pdf
The remedy order is based on TDHCA’s proposals with some changes as set out in the opinion, order amending judgment and amended judgment. Remedial order and opinion.pdf
; order granting in part motion to amend judgment.pdf
; amended judgment.pdf
The District Court's identification of TDHCA's discriminatory practice in the summary judgment order in this case is one of HUD's examples of a discriminatory housing practice cited in the proposed Fair Housing Act discriminatory impact rule notice. The case is used in HUD's discussion of the proposed disparate impact rule.
Perpetuation of Segregation. A person or entity may be liable for a housing policy or practice that has a discriminatory effect on the community because the practice has the effect of creating, perpetuating, or increasing housing patterns that segregate by race, color, religion, sex, familial status, national origin, or disability. Examples of such claims can be found in the following court cases: . . . and Inclusive Communities Projects, Inc. v. Texas Dep't of Housing & Community Affairs, 749 F. Supp. 2d 486, 500 (N.D. Tex. 2010), where the state's disproportionate denial of tax credits for nonelderly housing in predominately white neighborhoods had a segregative impact on the community. Implementation of the Fair Housing Act's Discriminatory Effects Standard, Proposed Rule 76 Fed.Reg. 70921, 70925 (2011).
HUD’s explanation for its adopted final Fair Housing Act disparate impact regulation cites the summary judgment order in this case to show that the use of the disparate impact framework will not inhibit the development of affordable housing. Implementation of the Fair Housing Act's Discriminatory Effects Standard, Final Rule 78 Fed.Reg. 11460, 11477 (2013).
The New York Times/Texas Tribune and the San Antonio Express News ran a story on the liability finding. See http://www.nytimes.com/2012/04/22/us/low-income-housing-program-compels-building-in-poor-texas-areas.html.
The story illustrated the perpetuation of racial segregation in the low income housing tax credit program by setting up an interactive web page to show the locations of the tax credit projects by race and income of the census tract. The page included the larger cities in Texas. http://www.texastribune.org/library/data/tax-credit-housing-locations.
TDHCA and FRI appealed to the United States Court of Appeals for the Fifth Circuit. No. 12-11211, Inclusive Communities Project v. TX Dept of Housing, et al. TDHCA also appealed the award of attorney fees and litigation expenses to ICP. No. 13-10306. The Fifth Circuit noted the absence of controlling Fifth Circuit precedent on the appropriate legal standards to apply to a disparate impact housing discrimination claim. Rather than adopt a standard from another U.S. Court of Appeals circuit, the Court held that HUD’s regulation setting the standard for proof of such claims should apply. Congress had given the Secretary of HUD the authority and responsibility to issue regulations interpreting the Fair Housing Act. The Secretary had issued such a regulation setting the standards for discriminatory impact cases in March, 2013. 24 CFR § 100.500. The Fifth Circuit noted that the regulation was passed after the District Court’s liability decision and remanded the case for the court to apply the legal standard in the HUD regulation to the facts of the case. The opinion went on to make clear that:
. . . we do not hold that the district court must retry the case; we leave it
to the sound discretion of that court to decide whether any additional
proceedings are necessary or appropriate.
● https_ecf.ca5.uscourts Opinion 3 24 2014.pdf
TDHCA’s first Qualified Allocation Plan adopted under the remedial opinion was for 2013. In addition to including the remedial elements for the Dallas area, TDHCA adopted and implemented the remedy elements on a statewide basis.● TDHCA 2013 Qualified Allocation Plan 13-QAP
● TDHCA 13-Uniform-MFRules
TDHCA submitted its first annual report on November 22, 2013. Defendants' Annual Report Regarding Low-Income Housing Tax Credits wo attachments.pdf
. Analysis of the first year implementation of the remedy shows that 53% , 412 of 780, of the 9% program units receiving a 2013 tax credit award in the Dallas remedial area were in 50% or greater Caucasian census tracts. The elements in the Court approved plan produced a remedial result. ICP response to TDHCA annual report.pdf.
City of McKinney and McKinney Housing Authority’s refusal to participate in ICP’s local political subdivision tax credit development program.
ICP developed its local political subdivision tax credit development program to encourage the use of low income housing tax credits to provide desegregated housing opportunities for its clients and other voucher families. Two of the local entities ICP asked to participate in the program were the City of McKinney and the McKinney Housing Authority. Both refused. Litigation ensued. Inclusive Communities Project, Inc. v. City of McKinney, Tex., Slip Copy, 2009 WL 2590121, E.D. Tex., August 18, 2009 (No. 4:08-CV-434.). complaint filed.pdf
. The City and Housing Authority’s motions to dismiss were denied. Opinion and Order adopting the included U.S. Magistrate Judge's Recommendation to deny the defendants' motions to dismiss. opinion deny motion to dismiss MHA City.pdf
The settlement with the McKinney Housing Authority required it to provide local political subdivision contribution loans for up to 400 Low Income Housing Tax Credit units. ICP can provide at least $1,000,000 for these loans and has the option to provide additional funds to obtain the maximum 400 units required if the funds are made available. The City was dismissed from the case. The consent decree was subsequently amended to provide for the use of 4% tax credits. consent decree.pdf
; Modified consent decree.pdf
One application sponsored by ICP and the McKinney Housing Authority received a tax credit allocation in TDHCA’s 2013 9% tax credit allocation cycle. This 164 unit tax credit development Millenium-McKinney will be on the higher income, predominantly White west side of McKinney.
The City of McKinney recently passed a resolution supporting another low income housing tax credit project on the west side of McKinney. The consent decree between ICP and the McKinney Housing Authority was cited as the reason for the approval. Pages from 020414 Agenda Packet Millenium 2.pdf
ICP asked the Town of Flower Mound to participate in the ICP local political subdivision tax credit development program to encourage the use of low income housing tax credits to provide desegregated housing opportunities for its clients and other voucher families. The Town refused. Litigation ensued. Inclusive Communities Project, Inc. v. Town of Flower Mound, Tex., Slip Copy, 2009 WL 2591176, E.D. Tex., August 18, 2009 (No. 4:08-CV-433.); Inclusive Communities Project, Inc. v. Town of Flower Mound, Tex., Slip Copy, 2009 WL 2145909, E.D. Tex., July 15, 2009 (No. 4:08-CV-433.) U.S. Magistrate Judge's recommendation to deny the defendant's motion to dismiss. Opinion and Order adopting the U.S. Magistrate Judge's recommendation to deny the defendant's motion to dismiss. After a bench trial the Court ruled that ICP had failed to prove that the Town’s refusal to participate in the grant program was due to purposeful discrimination.
City of Frisco
ICP approached the City of Frisco with an offer to loan the city money from the Walker Housing Fund Charitable Trust to assist in the development of low income housing tax credit units in the City. These units would benefit ICP’s clients and other low income families. The City originally refused to even discuss the matter. Daniel & Beshara, P.C. represented ICP in subsequent negotiations with the City of Frisco. The Frisco City Manager credits the litigation brought by ICP against McKinney and Flower Mound for the City’s change of position.
“If Frisco had not negotiated the agreement with ICP, then the likely outcome would have been a federal lawsuit filed against Frisco by ICP as it did against both McKinney and Flower Mound,” said George Purefoy, City Manager. “After 14 months of litigation, the McKinney Housing Authority is negotiating a settlement agreement with ICP which establishes the same general parameters as the Frisco agreement, except it includes a longer term agreement (5 years vs. 3 years) and it pays some of ICP’s attorneys’ fees.” Proposed_Low_Income_ Section 8 Frisco.pdf, page 2
An agreement was signed. The City of Frisco endorsed an application for low income housing tax credits. The Texas Department of Housing and Community Affairs, while in litigation with ICP, issued the tax credits. This 130 unit low income housing tax credit complex, North Court Villas, was opened in 2013 and is currently housing low income tenants including ICP’s clients and other families using housing vouchers. http://www.dallasnews.com/news/community-news/frisco/headlines/20131115-grand-opening-held-for-affordable-housing-complex-in-frisco.ece .
ICP’s actions providing access to desegregated housing opportunities for Black or African American housing choice voucher holders help implement the public housing and voucher program desegregation remedy in Walker v U.S. Department of Housing and Urban Development, 3:85-CV-1210-O (N.D. Tex.).
ICP v. Town of Sunnyvale
The Town’s racially exclusionary zoning practices were held to violate the civil rights laws in Dews v. Town of Sunnyvale, 109 F.Supp.2d 526 (N.D. Tex. 2000). ICP as the successor plaintiff in the case entered into an agreed remedial settlement order with the Town in 2004. final judgment.pdf
. The Town made no effort to produce the low income units required by the settlement. ICP purchased land and sought zoning for multifamily housing in order to provide the units. The Town denied ICP’s request for the rezoning and continued to violate the Settlement. The District Court granted ICP’s motion to enforce the settlement and held the Town in contempt of court on March 22, 2010. order finding contempt.pdf
. After further proceedings, the District Court extended the Town’s deadline to have a tax credit project approved until August 14, 2013. order extending time.pdf
As part of the proceedings, Daniel and Beshara, P.C. filed a new ICP lawsuit based on the claim because the Town unilaterally imposed a discretionary, very low density form of zoning on ICP’s land. The lawsuit stated the Town violated the Fair Housing Act by preventing the development of affordable housing on ICP’s land by the rezoning. complaint.pdf
While this second suit was pending, the Town recruited a low income housing tax credit developer for a different site on the south side of the Town. The Town rezoned this site twice in order to allow the LIHTC developer to receive an award of housing tax credits. The tax credits were awarded and the development of the 96 units of low income affordable rental housing in Sunnyvale is proceeding. Based on this progress, ICP dismissed the second lawsuit. If the development is built and accepts housing choice vouchers, the Town will satisfy the settlement and the contempt remedy order. 26 years after the litigation was filed, there will be 96 units of low income housing in the Town of Sunnyvale. The Town has resisted this result for many years. http://www.dmagazine.com/Home/D_Magazine/2012/March/Sunnyvale_The_Whitest_Town_in_North_Texas.aspx .
DBPC’s investigative/research/GIS team produced data analysis and presentation for ICP on a wide variety of subjects.
DBPC’s investigative/research/GIS team produces the data analysis and presentations for use in connection with the ICP litigation and other advocacy by DBPC. The team also produced data analysis and presentations for ICP in other contexts. The following are some examples of this work.
Carolina Planning published “Community Revitalization, Civil Rights, and the Low Income Housing Tax Credit Program” in its 2013 Volume 38. The article by Elizabeth K. Julian, ICP’s President, used national low income housing tax credit data and U.S. census data to raise questions about the efficacy of low income housing tax credit units as a revitalizing tool in highly distressed census tracts. Abigail Self and Katy Lopez of DBPC provided the underlying census and LIHTC data, tables, and map used in the article. Carolina Planning - Community Revitalization, Civil Rights, and the Low Income Housing Tax Credit Program, Elizabeth K. Julian.pdf
Two works on this website were prepared by Ms. Lopez and Ms. Self and set out the lack of neighborhood revitalization solely from just placing low income housing tax credit units in areas of slum and blight. Racial Segregation, Community Revitalization and Low Income Housing Tax Credit Units in the City of Dallas, Texas; Hatcher Square PowerPoint.pdf
Ms. Self did the analysis, maps and tables in the Mobility Works ICP publication available at http://inclusivecommunities.net/MobilityWorks.pdf
. The analysis indicates that Black HCV holders who receive some type of mobility assistance live in higher quality neighborhood with more opportunity, less distress, and less crime. Households that receive multiple types of mobility assistance live in better conditions than households with less mobility assistance. The more mobility assistance a Black household receives, the better the conditions are in the neighborhoods to which they move.