The Foundation Against Intolerance and Racism (FAIR) submitted a complaint on Tuesday against the Washington State Housing Finance Commission (WSHFC) for its Covenant Homeownership Program, which explicitly bars certain applicants from eligibility on the basis of race. The commission cites the 2024 Covenant Homeownership Program Study as empirically justifying its "race-conscious" special purpose credit program, but it's unlikely to pass strict scrutiny.
The Washington State Legislature passed the Covenant Homeownership Act in May 2023 to remedy "past and ongoing discrimination and its impacts on access to credit and homeownership for black, indigenous, and people of color." Past discrimination includes 50,000 clauses in home deeds and homeowners associations that were used "between the 1920's and 1960's throughout Washington state to restrict housing based on race, religion, and ethnicity," according to the commission. The Covenant Homeownership's special purpose credit program offers certain first-time homebuyers a zero-interest rate loan for downpayment and closing cost assistance to address discrimination and reduce the racial disparity in homeownership.
