Breaking Down Income Discrimination

May 2, 2023

Veterans and low-income families rely on Housing Vouchers to secure stable housing. California banned source of income discrimination and Congressman Peters’ Fair Housing Improvement Act would expand this protection nationwide so no American is denied housing due to the source of their income or their veteran status.

Read more about it in this October 28th piece from Affordable Housing Finance, posted below:

Breaking Down Income Discrimination

By Jacqueline Waggoner

October 28, 2022

It’s been well over half a century since Congress passed the Fair Housing Act, the landmark law that made it illegal to deny people housing due to race, color, religion, sex, or national origin. And yet today it is still perfectly legal to deny someone housing because of how they’re going to pay for it. Even as rent prices skyrocket and cities of all sizes struggle to support a growing homeless population, our neighbors with vouchers in hand still can’t get keys to homes.

This is called source of income discrimination, and it impacts people whose incomes come from nontraditional sources like veterans’ benefits, disability benefits, Section 8 housing vouchers—which more than 2.2 million American families rely on—Social Security, and more. It disproportionately impacts people of color and lower-income families, who are more likely to rely on these resources, and many landlords use it to legally prevent families of color from renting.

Clearly, housing discrimination is still a nationwide issue. And yet, it’s being left to individual cities and states to pass bans on source of income discrimination. While eight states and dozens of localities ban it outright—including California—the majority of Americans remain unprotected.

It’s time for a federal ban on source of income discrimination to ensure everyone who has the means to pay for a home isn’t turned away

First, let’s be clear that source of income discrimination is racial discrimination. More than half of all Black and Latino households rent, compared with just a quarter of white households. The median net wealth for white households is eight times and five times higher than the median net wealth for Black and Latino households, respectively. The racial wealth gap means it is no coincidence that 65% of all voucher holders are people of color. Income discrimination is a leftover piece of the myriad systems put in place to keep neighborhoods segregated.

As the rental affordability crisis rages nationwide, housing options for people with lower incomes are scarce. Source of income discrimination shrinks that pool even further. In 2018, the Urban Institute conducted a study in which landlords were asked if they accepted vouchers. Nearly 60% of landlords outright refused to accept a tenant with a voucher. In wealthier areas, which often have the best schools and job prospects, rejection rates were even higher—over 80% in some cities.

The need for a federal ban is more pressing now than ever. This summer, one Texas community decided it wasn’t just enough to permit discrimination. It proactively banned all voucher holders from the community. Ninety-three percent of the families affected by the ban on the acceptance of Section 8 vouchers were Black.

Without adequate federal protections against source of income discrimination, it’s not outlandish to expect more and more municipalities to pass similar rules, creating a new version of redlining (the historic practice used to enforce segregation) that will prevent thousands of families of color from finding affordable places to live in communities across the country.

A federal ban is also necessary because many current local bans have not done enough to prevent source of income discrimination for voucher holders. In New York City, for example, it is illegal to reject prospective tenants who intend to pay with a voucher. Yet a monthslong sting operation by the Housing Rights Initiative found that landlords across the city were still actively discriminating against voucher holders. A national ban would leave little room for confusion about the law and pave the way for legitimate enforcement.

Representatives on Capitol Hill have taken up the call to eliminate this loophole in the Fair Housing Act that allows for de facto discrimination against BIPOC and lower-income renters. This year, Sen. Tim Kaine (D-Va.) and Rep. Scott Peters (D-Calif.) introduced the Fair Housing Improvement Act, which would “prohibit discrimination based on source of income, veteran status, or military status.” This bill, which would mandate that landlords accept tenants who use housing vouchers, veterans’ benefits, and other forms of income to pay their rent, is critical to ensuring the low-income and BIPOC renters who predominately use these benefits have the opportunity to find a safe and affordable place to call home.

The Fair Housing Act was designed to prevent all forms of housing discrimination. More than 50 years later, we are still working to make that a reality—and BIPOC and low-income renters are facing the consequences. It’s time for Congress to act.



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