The Texas Department of Housing and Community Affairs (TDHCA) received 139 applications requesting a total of $183,919,660 in credits. TDHCA has an estimated credit ceiling of $46,911,792 giving the state a projected oversubscription rate of 292%:
A recent meeting of the Downtown Dallas Inc focused on a plan to continue the revitalization of the city’s downtown district. According the organization You+Dallas, key elements of the plan, entitled “Downtown Dallas 360″, include:
proposed changes in downtown transit, the beautification of publc areas, the creation of a viable and active downtown residential neighborhood focused on affordable housing, and creating a more modern urban design to support street level retail businesses among other things
However, in order to see those objectives become reality, affordable housing included, city residents and planners need to figure out what to do with the the tunnel system that helped contribute to the commercial decline of a once-vibrant downtown.
TDHCA acknowledged the statistical findings of segregation but argued that § 42 gave them a mitigating “compelling government interest”. TDHCA cited the mandate in § 42, “to give preference to projects that serve the lowest income tenants and that are located in HUD-designated ‘qualified census tracts’”. The court denied summary judgment on this defense, claiming the, “Defendants have failed to establish that TDHCA cannot comply with § 42 in a way that has less discriminatory impact on the community” and citing that by TDHCA’s own admission, there is no conflict between § 42 and the Fair Housing Act.
This is not the first case of its kind in recent years. In 2003 a group of four public interest organizations challenged the validity of New Jersey’s Qualified Action Plan. On appeal (In RE: Adoption of the 2003 Low Income Housing Tax Credit Qualified Allocation Plan) a judge ruled in favor of the state, finding that the state satisfied it’s fair housing duties given its agenda under section 42 of the tax code, “[the fair housing duties] must be defined congruent with its [New Jersey Housing Mortgage Finance Agency's] express statutory powers and far-reaching housing agenda as defined under federal and state law. See 26 U.S.C.A. §42…”
While the subsequent legal proceedings in Texas have potentially significant implications on tax credit allocation policy within the state, this case is part of a broader national conversation on the roll of allocation policies in perpetuating segregation and discrimination.