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Home > Legal Research > HUD Resources

Provided by the HUD Office of Public Affairs

SECRETARY ANDREW CUOMO
FAIR HOUSING AUDIT NEWS CONFERENCE
MONDAY, NOVEMBER 16, 1998
UNITED STATES HOUSING & URBAN DEVELOPMENT
MS. PLAZA: Good afternoon. I am proud to serve as President Clinton's Assistant
Secretary for Fair Housing and Equal Opportunity. I am dedicated to furthering the

Department's mission to advance equal housing opportunity for all. And I consider it a privilege to work with Secretary whose commitment to the fair housing is brought to bear every day by his leadership and his actions. As many of you know, this is the 30th anniversary of Title 8 of the Civil Rights Act of 1968, the Federal Fair Housing law. Fair housing is a cornerstone of our nation's historic push to create what President Clinton has called one America. An America where opportunity and success are within reach of all citizens. Secretary Cuomo has vowed to crack down on all forms of housing discrimination. Under his leadership HUD has pledged to double the number of enforcement actions during President Clinton's second term. So far we have more than doubled the amount of funds obtained for individuals in discrimination complaints to 9.6 million from 4.4 million in a previous year. We are partnering with 67 non-profit housing groups to reduce discrimination, and we have entered into more than 100 best practices agreements with key leaders resulting in expanded opportunities for low income minority families. Together President Clinton and Secretary Cuomo have achieved a 33 percent increase in the fair housing budget from 30 million in 1998 to 40 million in 1999 to intensify our fight against housing discrimination. To many he is known as Housing Secretary Andrew Cuomo because he has put HUD back in the housing business. For many others he is the Secretary for Jobs Cuomo because of his commitment to economic development. And I am proud to give him a new title today, the Secretary for Fair Housing Cuomo. Ladies and gentleman, it gives me great pleasure to introduce our Secretary of HUD, Andrew Cuomo.

SECRETARY CUOMO: Thank you very much, Assistant Secretary Plaza. I like that, it has a certain ring to it, doesn't it? Secretary for Fair Housing Cuomo. First, let me thank the Assistant Secretary for all the work she does, not just in this specific initiative, but for all the great work her entire office does every day.

We've had an extraordinary two years at this Department in a number of areas. As the Assistant Secretary was eluding to, we're back in the housing business, we are doing more in urban development before, in urban development then ever before. We are doing more in management, management 20/20. But we have done extraordinary things in the area of Fair Housing and it wouldn't be without the good work of the entire operation that the Assistant Secretary has, as well as the other areas of the Department.

I think one of the reasons we've had the success we have had in fair housing is we brought the entire team to bear, to make fair housing a priority. It's not just a single narrow focus, every office in HUD is the Office of Fair Housing. If you are the Assistant Secretary of Community Planning and Development or you're in Housing, or you're in Public Housing, every office should work for fair housing. And I think that change in attitude really goes a long way towards our record on fair housing.

Let me also point out two people who are here today, among a number of others, but Mercedes Marquez who is Deputy General Counsel, focuses on civil rights and fair housing. And Acting Assistant Secretary for Policy Development and Research, Xavier Briggs who is, worked very hard on today's announcement.

The United States of America over the past few years has really made tremendous progress. You look at the list of accomplishments, the record of accomplishments, it's all positive, employment is up, the economy is up, crime is down, poverty is down, jobs are up, home ownership at it's highest rate in history. All the arrows going in the right direction. But at the same time we still have a long, long way to go before we can say we have reached the goals of social economic, and racial justice. We're not there yet.

In the area of housing and home ownership, highest homeownership rate, but you look at the internals of the rate, 72.5 percent of whites own their own home. Only 45.3 of African Americans, and 43.9 for Hispanics. So home ownership is at an all time high. But the disparity in home ownership is still very great.

Numerous studies from all sorts of different sources have documented that housing discrimination is still alive and well in America, the Harvard Joint Center Study. Jean Lowe (phonetic sp.) is here from the U.S. Conference of Mayors, they have done studies that show this. HUD's own report, State of the Cities documents this. Greater Washington Fair Housing Council has documented it. So we know that housing discrimination is still with us. The HUMDA Data, Home Mortgage Disclosure Act says that mortgage denial rates for minorities are two times what they are for white Americans, discrimination exists.

You look at the housing patterns across this nation and you see we tend to have neighborhoods of high racial concentration. You look at the different demographic breakdowns, areas of more than 30 percent minority. We tend to live in very segregated housing patterns. As the President says, we will never come together as a nation if we can't live together.

We have done a lot of work, as I mentioned, in these past two years in fair housing, terrible egregious cases. We announced cases in this very room. A case in New Orleans, private landlord, private apartment building, white person would walk in, ask for an apartment they would be referred to one side of the development. African American would walk in they would be referred to the other side. Two swimming pools, one for whites, one for blacks. We talked about a case in Missouri, Portuguese woman moved into a home, they planted a seven foot cross on her front lawn and then burned it for effect, why? She was Portuguese, they thought she was African American and it was a welcome or unwelcome sign to the new neighborhood. We talked about a woman from Buffalo, New York, Mrs. Ipolito who showed an apartment to an African American and they threatened to blow up the apartment because she showed it to an African American.

So we have the anecdotal experience and we have the ugliness of the anecdotal, what we call the 60's style of racism, the "in your face" obvious physical racism. But there is also another style of racism and discrimination, the 90's style, more sophisticated, less obvious but more insidious. It's the systemic institutional racism. It's when you show up for an apartment and they say, I'm sorry, there is no longer a vacancy here, just because they don't want to rent to the person given the color of their skin. It is discrimination in lending where you don't get the mortgage because of the color of your skin. Not loud, not flagrant, but just as damaging and devastating.

We know the anecdotal and we've worked on that ferociously. We've doubled the number of enforcement actions, we are now at twice the rate, double the enforcement rate for the Department of Housing and Urban Development. We do about 68 enforcement actions per month. That is twice the monthly rate. That was our promise, and that's what we're doing.

We had some of the largest settlements in history in the area of fair housing, 2.1 billion dollar AccuBank settlement, where AccuBank will make 2.1 billion dollars available for mortgages in settlement. Just a couple of weeks ago, 100 million dollar jury verdict by Nationwide in the city of Richmond by HUD funded tests, 100 million dollar jury verdict.

We do not have a good sense on the systemic or institutional discrimination that exists, and to what extent it is a reality on a quantitative basis. We have a lot of anecdotal, we have a lot of experiential, we do not have hard data on the systemic or the institutional.

Therefore today we announce the most comprehensive national study ever taken on housing discrimination. Thousands of tests will be taken nationwide. All aspects of the housing industry will be tested, brokers, bankers, owners, and agents. Testing will focus on native Americans, Asians/Pacific Islanders, Hispanics, and African Americans. We will test all regions of the nation. All different Governmental subdivisions, cities, states, counties, urban America and rural America. We'll find out whether there is more or less of a tendency to discriminate in different situations and with different groups.

It will give us a real basis to make decisions, to allocate resources, to advocate for new laws. It will tell us where to focus geographically. If there are variations what industries to focus on. It will tell us if there is more or less discrimination on certain categories of people. And where appropriate we will also use these tests for enforcement actions. We're going to contract for this test with an independent third party, so no one can say that the person who performed the test, the organization that performed the test was biased. It will be an independent agency which we will contract for through an RFP process. We estimate the cost of the study at 7.5 million dollars. It should be done within the year. And we will go out for bid on that test today.

In closing, this issue to me is the issue as we face the new millennium. Can we live together. It is the only challenge that is left for this nation. We've beaten everything else, we've beaten every other country. We've conquered every type of technology, now can we live together. Can we actually learn to take this discrimination and make it a thing of the past rather than a plague that we carry into the future. This is a nation that by 2050 will be a majority minority. The only thing that can defeat us is ourselves if we can't live together. This test will be a major step forward towards President Clinton's dream of one America. And I want to thank all the people who made it possible today. Thank you.

Questions we'll take at this time. I may ask the Assistant Secretary for Fair Housing, Eva Plaza, or Acting Assistant Secretary Xav Briggs from PD&R for assistance.

QUESTIONS & ANSWERS

QUESTION: (Indiscernible)?

SECRETARY CUOMO: Both. But when you say "a report", Judy, I think it suggests a minimal outcome because we get a lot of reports here at HUD. We have plenty of anecdotal information, but we do not have data that informs our decisions or informs this nation's debate as to what I believe are very relevant inquiries. What parts of the country are worse than other parts? Is there more discrimination in cities or in counties? Is there more discrimination in higher income places or lower income places? Is there more discrimination against Hispanics or African Americans, or Native Americans, or women? Who do you think is doing the most discrimination, brokers, bankers, owners? What is the real problem in the system? Is it steering, or is it mortgage lending, that people could actually find the homes but the banks won't give them the mortgages, we don't really know.

Systemically, institutionally, we can tell you anecdotally what we found, but we can't use that to inform the legal process. I can't go to the Congress of the United States and say, here is the problem, focus on this, if you just take care of this then we can make a difference. Take this, we just advocated for a large increase in the fair housing budget, 33 percent. But we don't have it targeted to any one place in the nation or any one particular group. We know it is a problem every where and that it's a problem for all groups, but we can't tell you beyond that. And you cannot solve a problem you don't understand. We need more information to fully understand this problem.

QUESTION: You talked about the third party who is going to do this survey, is it going to be a non-profit, a community group, trade association, what kind of organization are you thinking about?

SECRETARY CUOMO: I am thinking about, we're going to post, we're going to advertise for a contractor starting today. It is an independent qualified credible third party. It could be a not-for-profit, could be a for-profit, that's what we're going to find out from the applicants.

QUESTION: Are you going to seek a different organization in every area that you're testing, or is it just going to be one group (indiscernible)?

SECRETARY CUOMO: We want one group responsible for the test. That one group could theoretically as an option turn around and subcontract with a number of other groups, but that would be their call, not ours. Mr. Janofsky.

QUESTION: Secretary, can you tell me (indiscernible) why now, or your colleagues, (indiscernible). Is there some, is there something you want (indiscernible)?

SECRETARY CUOMO: No, we've been working on this, Michael, for a number of months. I think it is the natural evolution in this area. First we focused on processing those complaints that come to us better. In other words, we get a lot of complaints from private citizens. And we focused on processing those complaints better, faster, more efficiently, more effectively. We then focused on getting the word out that this nation takes housing discrimination seriously. We have the fair housing laws. Martin Luther King died so that we have the fair housing laws. Under President Clinton think twice before discriminate because we will not hesitate to enforce the law. We made that statement loud and clear. We also said and if you're a large organization don't think you're immune from the law, that's what AccuBank and Nationwide speak to, we're serious.

The next, the natural evolution now, Michael, is more sophistication, more information, more intelligence, more targeting, okay? You're fighting discrimination across the entire nation, I understand. How do you now make a real difference with targeted efforts, where is it worse? Your a nation that is facing this as one of the major obstacles in your future, in your path, and you know so very little about it. You have a President that, thank God, has brought it to the national agenda and said I demand on one American we're going to have a dialogue to make sure we understand the issue and its nuances and it's subtleties are on an inter-personal relationship. But we are the Department charged with enforcing the law and really can't tell you today whether it's worse in the northeast or the west, worse in the city, or state, or county, worse for African Americans or for Hispanics. So we're battling it everywhere, against everyone. I want to get more information so we can target and focus and find out where the real challenges lie. I'm sorry, Michael, that's not -

QUESTION: (Indiscernible)?

SECRETARY CUOMO: I would not answer that question based on the anecdotal. See it is capable because we have brought attention to it we may be inviting more complaints. See I have a lot of people who say, oh, I don't even bother complaining about this because I don't think anyone is going to take me seriously. I don't even bother complaining about what happened to me before the bank because no one is really going to take the bank on. But, Michael, you look at the concentration patterns across the country. Look at the concentration of minorities in the nation, the furthest to my left, more than 30 percent minority. Is it a coincidence that you have that concentration. Is it just that all the minority choose to live together, or is something else at work. You look at the second from the left, this is a city which shall go nameless. But is it a coincidence that more than 80 percent of the minorities happen to live in those census tracks and everything else is white in the metropolitan region. Is that a coincidence, I don't think so. I don't believe in coincidences as a rule. Well, then what is at work and how do we get at it? And this is the issue, ladies and gentleman. If we don't solve this issue, this nation long term is in trouble, I'm convinced of it.

QUESTION: Congress has directed HUD to examine whether lenders are steering minorities to FHA mortgages, is this study that you are contracting out for going to deal with that or is that going to be a separate study?

SECRETARY CUOMO: We may also deal with that separately, but we'll have lenders included in this study also. We do numerous studies at HUD in fair housing, policy development and research, PD&R. So we are testing that concept on a number of fronts, but will also be included in this survey.

QUESTION: Are you going to look at discrimination based on age, religion, sexual orientation?

SECRETARY CUOMO: No, not in this one.

QUESTION: Just race?

SECRETARY CUOMO: And ethnical origin.

QUESTION: (indiscernible) participation in this audit, (indiscernible) third party (indiscernible)?

SECRETARY CUOMO: We will, we will provide guidelines, and goals, and objectives. It will be up to them to come up with the actual methodology for conducting the survey. I want to be able to stand up about a year from today with the results of the organization, with the results of the test and for it to be an independent objective test. So that when you ask the person who is standing next to me who conducted the test, what did HUD tell you what to find, I thought you would ask such a question, but somebody over hear might as that question. The person would say, no, HUD did not tell me what to find, HUD told me to go out and conduct an independent objective test for the following criteria, and that organization designed the survey, designed the research methodology, designed the testing protocol, and we just reviewed the results.

QUESTION: (Indiscernible)?

SECRETARY CUOMO: This is, this is obviously something different then our advertising. Our advertising, you have to separate two different things. Using less minority advertisement and using less advertisement period, we have been using, I believe, I have to check this, but I believe we have done less advertising period over the past year. We just cut back our advertising budget. And if we cut back our advertising budget then we are doing less minority advertising, we're also doing less non-minority advertising, because we're just doing less advertising period.

QUESTION: To go along with that (indiscernible) the third party (indiscernible) any type of special recognition being the third party (indiscernible) minority subcontracting?

SECRETARY CUOMO: I do not know, it's an interesting question, I don't know. You have certain procurement rules and you have, it's very important that this be an independent organization without any vested interest in an outcome. A lot of times what happens when you do surveys like this is they're dismissed because people say, oh, well, that was conducted by this organization which had a vested interest in providing that point, because they happen to be a fair housing organization. Of course, they're going to find discrimination, that's what they do for a living. And we've had a lot of good studies, in my opinion, that have not had the impact they should have had because people who found it to suit their needs were able to discredit the sponsoring organization. I want to make sure that doesn't happen here. But we'll then follow the normal procurement rules and whatever those procurement rules have for minority bidders we'll follow.

QUESTION: Secretary, are you going to target specific cities, I mean, do you have a list of cities that you are going to try or areas to target?

SECRETARY CUOMO: No.

QUESTION: Based on the chart here that shows where minorities live, are we safe to assume that the south will be the major focus of this?

SECRETARY CUOMO: No. We have no list of cities, trust me, we have no list of cities in this Department.

QUESTION: What practice then will -

SECRETARY CUOMO: That was a private joke (indiscernible).

QUESTION: What focus then will you be looking at (indiscernible)?

SECRETARY CUOMO: We're going to go to the independent qualified organization and say you tell us what the best there is to sample. We want an accurate reflection of the nation, and all the areas within the nation, and all the regions within the nation. Let them decide -- design the protocol. Do they do it by the number of homeowners? Do they do it by the number of mortgage applicants? Do they do it by the volume to a real estate owner? That's, that we're going to leave to them. Now I believe that if the independent organization does their job right they will, of course, talk to a lot of people who have experience in this field to get advice on it. There is a whole world of expertise and fair housing violations. This Department has done this for the past 20 years and literally has developed an entire field of testing and fair housing testing, and how you do this. So there is a very well informed body of knowledge, and there are groups that do this superbly well, fair housing groups that do this superbly well. It is, however, important to me that you can't throw out the product for the agenda of the sponsoring organization. And that's why I'm emphasizing the independence of the award winner.

QUESTION: (indiscernible) I realize that there are a lot of (indiscernible) complaints and (indiscernible) sometimes changes the number, but have the number of complaints been going up or going down?

SECRETARY CUOMO: We are processing more, Judge, our, we are processing about double the number, we're taking twice the enforcement actions. About 68 enforcement actions per month. I don't know if the number of complaints coming in is increasing. Would you know, Eva?

MS. PLAZA: It certainly is.

QUESTION: By a large amount or by little bit?

MS. PLAZA: About (indiscernible) percent.

SECRETARY CUOMO: Now again, Judy, what is causing the increase, again, it's one of those cases where we don't know. Maybe there is a lot more discrimination out there, or maybe because we have now done such a good job, if you will, of getting out the word that says you may be discriminated against, people are actually realizing that they were discriminated against and are contacting us. Michael.

QUESTION: (Indiscernible)?

MS. PLAZA: We would be happy to do that after the conference.

SECRETARY CUOMO: Okay.

QUESTION: Mr. Secretary, when you talk about enforcement action, you're not talking about just complaints, you're talking about actions that the Department has taken?

SECRETARY CUOMO: Yes sir.

QUESTION: In response to a complaint?

SECRETARY CUOMO: Yes sir, two different concepts.

QUESTION: And that can take the form of a fine, a lawsuit or -

SECRETARY CUOMO: Yes sir.

QUESTION: Any number of -

SECRETARY CUOMO: Yes sir, that's exactly right. Two different concepts, the number of complaints that come in the door versus the number of actions we take on those complaints which we call enforcement actions. What the Assistant Secretary is saying is the number of complaints has gone way up. We had as a goal to do two times the rate of enforcement actions. Which is now about 68 a month compared to roughly 34 per month.

QUESTION: Do we have any idea what percent of complaints result in action?

SECRETARY CUOMO: We can get that for you.

QUESTION: Can you tell me like the percentage of the 68 enforcement actions a month, how many of those are against lenders as opposed to landlords?

SECRETARY CUOMO: I don't know that we can get you that, but if you ask the Assistant Secretary afterwards she'll give whatever cuts we do have. Okeydoke, thank you very much. Thank you.

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