Last week, the U.S. Department of Housing and Urban Development (HUD) issued a Notice of Proposed Rulemaking, seeking public comment on its proposal to amend existing regulations that govern admission to public housing and housing programs for applicants with criminal records and eviction or termination of assistance of persons on the basis of illegal drug use, drug-related criminal activity, or other criminal activity. The proposed rule would require that, prior to any discretionary denial or termination for criminal activity, public housing agencies (PHAs) and assisted housing owners take into consideration multiple sources of information, including but not limited to the recency and relevance of prior criminal activity. The proposed rule also seeks to clarify existing PHA and owner obligations and reduce the risk of violation of nondiscrimination laws.

The proposed rule would cover various HUD programs, including public housing and Section 8 assisted housing programs, as well as the Section 221(d)(3) below market interest rate program, the Section 202 program for the elderly, the Section 811 program for persons with disabilities, and the Section 236 interest reduction payment program.

Highlights of the proposed rule include:

• Clarifying that assisted owners and PHAs may not deny admission for categories of criminal activity beyond those which are specified in the regulations, would require the establishment of a “lookback period” limiting the reliance on old convictions, and would provide that prohibiting admission for more than three years following any particular criminal activity is “presumptively unreasonable.”
  • The general rule would be that PHAs and assisted owners cannot make decisions based on criminal history that research indicates is not predictive of future criminal activity, that is irrelevant to safety, health, or fitness for tenancy, or that is based on incomplete or unreliable evidence of criminal activity.
• Clarifying that tenants must be given at least 15 days to challenge the accuracy and relevance of the information and to provide mitigating information prior to an admissions decision.
• Clarifying that for all discretionary admission and termination determinations, PHAs and assisted owners must consider relevant mitigating circumstances such as how long ago the offense occurred, mitigating conduct that has taken place since (e.g., evidence of rehabilitation and successful reentry, including employment and tenancy), and completion of drug or alcohol treatment programs.
• Requiring owners to update their tenant selection plans to reflect the relevant policies they employ within six months following the proposed rule’s effective date. The proposed rule would also require PHAs and owners to make PHA administrative plans and tenant selection policies more widely available.
• Specifying that, except in circumstances where housing providers and PHAs rely exclusively on an applicant’s self-disclosure of a criminal record, they may not bar admission for failure to disclose a criminal record unless that criminal record would have been material to the decision.
• Prohibiting the consideration of arrest records standing alone (in the absence of other reliable evidence of criminal conduct) for any exclusion from housing, and providing that criminal conduct or any other finding on which such an exclusionary decision is made must be based on a preponderance of the evidence.

According to HUD, the proposed rule is aimed at ensuring that people are considered as individuals in HUD-assisted housing. “Requiring housing providers and PHAs to make fact-specific determinations based on the totality of the circumstances, rather than denying opportunities based solely on criminal history, would help ensure that stale, inaccurate, and/or incomplete evidence and stigma surrounding people with criminal justice system involvement do not create unnecessary and counterproductive barriers to safe and affordable housing.” While HUD emphasizes that housing providers would retain the authority to screen out individuals who they determine, based on consideration of relevant information, pose a threat to the health and safety of other tenants, the proposed rule would bar the categorical, blanket exclusion of people with criminal records without regard to all relevant and contextualizing evidence.

Public comments on the Notice of Proposed Rulemaking will be accepted until June 10, 2024. We will continue to monitor this proposed rulemaking.