This week, Democratic Governor Bob Ferguson of Washington state signed into law House Bill 1696, a significant expansion of the Covenant Homeownership Program, which aims to address racial disparities in homeownership.
The legislation specifically prioritizes down payment and closing cost assistance for Black, Indigenous, and people of color (BIPOC) communities, asserting that these groups have historically faced barriers to homeownership due to racism and discriminatory practices in the real estate market.
Rep. Jamila Taylor, the bill’s sponsor, emphasized the importance of homeownership for building generational wealth, stating, “Homeownership is a gateway to building generational wealth, and it was largely closed to Black Americans and people of color for most of our country’s history. Buying a home is tough right now. Bringing more diversity into the pool of homeownership builds stronger communities and is another solution in solving the current housing crisis in our state.”
The amended bill increases the area median income (AMI) threshold for eligibility to 120% and offers complete loan forgiveness after five years for borrowers earning 80% or less of the AMI. Individuals who can trace their lineage to residents of Washington state before 1968 and who have been negatively impacted by discriminatory housing practices are also eligible for the program.
Critics of the legislation have raised concerns about its implications. Utah GOP Senator Mike Lee termed the program “lawlessness,” arguing that it violates the Fourteenth Amendment’s Equal Protection Clause.
In a statement about the new law, Governor Ferguson highlighted the need to address the impacts of racial redlining, saying, “Lawmakers create a program to address the disproportionate impacts of racial redlining in Washington state. House Bill 1696 modifies the program by adjusting the area median income threshold for program eligibility, introducing loan forgiveness, and modifying the oversight committee membership. This modification will create more opportunities to close the racial home ownership gap, which is a very important goal for all of us here in Washington state.”
The Covenant Homeownership Program, which the 2023 legislature initially established, is positioned as a response to injustices faced by marginalized communities in the housing market prior to the Fair Housing Act of 1968.
Supporters argue that the program is a necessary move towards rectifying historical injustices within the housing sector. The bill purports to assist those who, due to systemic inequality, were historically marginalized in the realm of homeownership, with hopes of fostering a more equitable community.
However, legal and ethical questions have surfaced regarding the program’s framework. As critics continue to voice opposition, they raise important discussions on how best to address long-standing economic disparities while navigating constitutional protections.
In a social media post reflecting on the implications of the bill, Senator Lee reiterated his concerns, stating, “The Fourteenth Amendment’s Equal Protection Clause prohibits this. It’s not even a close question. This is lawlessness.”
The legislation ignites a larger discussion on racial equity and justice in housing, balancing the goals of equity with the principles of equal protection under the law.
As the program rolls out, it remains to be seen how both its implementation and the ongoing dialogue around it will shape the future landscape of homeownership in Washington state, particularly among BIPOC communities facing historical disadvantages in accessing property ownership.
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