St. Louis, it was found that an affirmative program had not been established.142

Under Title VI, the sanction of debarment also is available. The only instances which HUD pointed to in which recipients have been debarred have involved cases in which local public housing authorities have failed to submit acceptable tenant selection and assignment plans.143 As of February 1970 no debarment proceedings had taken place with respect to discriminatory practices in violation of Title

VI.144

h. Compliance Reviews and Reports

As noted earlier, there is confusion at HUD in determining who has responsibility for conducting Title VI compliance reviews. Mr. Simmons confirmed that, despite the fact that under HUD's organization he is responsible for administering Title VI, the Title VI regulations give the various Program Assistant Secretaries responsibility for conducting compliance reviews, adding that "they have not been conducting compliance reviews." 145

Equal Opportunity staff has conducted some compliance reviews, including 271 onsite investigations, more than two-thirds of which have involved low-rent public housing.146 In addition, 330 compliance reviews have been conducted through reviews of applications,147 contracts, or plans for aid. Altogether, 80 violations were revealed during the period November 8, 1968-August 7, 1969, for the most part most involving tenant selection and assignment to low-rent public housing units and employment by local housing authorities." Other than in the public housing programs,

148

142 Hearing before the U.S. Commission on Civil Rights, St. Louis, Mo., Jan. 14-17, 1970, at 143-146 (unpublished transcript).

143 Interview with Lawrence Pearl, supra note 135. Approximately 90 local public housing authorities have been debarred on this basis. In addition, the Dallas, Tex. Housing Authority has been suspended because of a pending suit by the Department of Justice. Nonetheless, public housing was approved in Dallas under the “Turnkey III” program, which involves construction by private builders and subsequent sale to local public housing authorities. Selection of tenants is by an entity other than the local housing authority.

14 Id.

where occupancy data by race are collected, no compliance reports are required of recipients. Neither Mr. Simmons nor the program Assistant Secretaries believe it is within their province to require such reports. Once the amended Title VI regulations are issued, pursuant to which Simmons will be delegated responsibility for administering Title VI requirements, he will presumably exercise this responsibility. According to Simmons, compliance review activities will then be intensified. Later in 1970 he plans to conduct 154 compliance reviews with respect to particular programs and 26 citywide compliance reviews.149

Also according to Mr. Simmons, when HUD's revised Title VI regulations are issued, his office will have full responsibility for compliance reviews, except for tenant selection. This will remain the responsibility of the program Assistant Secretaries, 150

i. Data Collection

The only HUD program for which racial or ethnic data currently are collected is the lowrent public housing program, which gathers data on occupancy by race. 151 In the past, however, these data were not used either by the Housing Assistance Administration or the Equal Opportunity Office to evaluate the civil rights compliance status of the various local housing authorities.

FHA, which has assisted millions of American families to become homeowners and which collects detailed data on the characteristics of these families, such as age, family income, and family size, never has systematically

149 Statement of Samuel J. Simmons, Assistant Secretary of Equal Opportunity, at a meeting with the members of the Committee on Compliance and Enforcement, Leadership Conference on Civil Rights, Apr. 7, 1970.

150 Id. HUD later reported that Equal Opportunity will have full responsibility for all compliance reviews without exception. In addition, all standards for tenant selection will be subject to concurrence by equal opportunity staff. Further, equal opportunity staff will retain the right to examine (routinely or at random) the selection plans of local authorities and to determine whether they are, in fact, complying with their stated plans. Romney letter, supra note 36.

151 FHA started to collect racial data on multifamily housing occupancy in 1968. According to HUD, however, the reliability of these data is highly suspect. Romney letter, supra note 36.

sought to collect racial or ethnic data. In 1959, it was estimated that less than 2 percent of the FHA-assisted homes built since 1946 had been available to minorities.152

In 1968, FHA conducted a one-time survey of the racial and ethnic occupancy of its insured subdivisions. The survey covered subdivision housing provided between the end of 1962 (following issuance of Executive Order 11063) and 1967. FHA found that only 3.5 percent of the housing had been sold to Negroes, 0.2 percent to American Indians, 2.0 percent to orientals, and 3.1 percent to Spanish surnamed Americans. In some communities the percentage of minority group purchasers was substantially lower than the national averages. In St. Louis, for example, fewer than 1 percent of the houses had been purchased by black families. 153 Moreover, 4,800 of the 8,500 reporting subdivisions in the Nation were all-white and 300 all-black-the latter containing 70 percent of the black purchasers.

Despite this strong indication of a lack of compliance, FHA continued to decline to collect racial and ethnic data on a systematic basis. In June 1969, the agency informed the Commission that it had no plans to repeat the survey.154

In April 1970, however, Secretary Romney decided that HUD would begin collecting racial and ethnic data for all its programs.

The Assistant Secretary, Mr. Simmons, has been made chairman of a departmental task force to develop the means of carrying out the Secretary's directive.

Federal agency expressly provided with enforcement powers under Title VIII. Although the Department suffers from limitations of resources available to carry out its responsibilities, it has made strategic and effective use of those resources in enforcing the law.

A. Staffing and Organization Responsibility within the Department of Justice for enforcing Title VIII lies with the housing section of the Civil Rights Division. Its Chief is Frank Schwelb and his staff consists of 13 attorneys and two research analysts. For workload purposes, the section has divided the country into geographical areas and the attorneys are assigned to work in various cities within each area.156

B. Priorities

In light of the small number of attorneys available to the housing section, it has been essential to establish priorities so that their efforts can have maximum impact. Three broad priorities have been established: to focus on eliminating housing discrimination in metropolitan areas with large concentrations of black residents; develop case law under Title VIII and under section 1982 of title 42 of the U.S. Code; 157 and support the enforcement programs of other Federal agencies, especially HUD and the Department of Defense. 158

In 1968, the Civil Rights Division, preparing for enforcement of Title VIII when its second phase became effective on January 1, 1969, investigated more than 200 allegations of housing discrimination and began developing investigative and litigative techniques under the title. U.S. attorneys were informed

156

"In addition, the various U.S. attorney offices provide assistance by referring Title VIII cases to the Department.

157 This is the section of the 1866 civil rights law relied upon in Jones v. Mayer and Co., 392 U.S. 409 (1968).

158 Civil Rights Division program memorandum for fiscal year 1969. Other matters given priority are cases involving large real estate companies and cases involving alleged restriction on the rights of minorities by the exercise of the zoning power. Letter from Jerris Leonard, Assistant Attorney General, Civil Rights Division, Department of Justice, to Howard A. Glickstein, Staff Director, U.S. Commission on Civil Rights, Aug. 25, 1970 [hereinafter cited as Justice Letter].

of the new law and the Division worked with HUD in establishing regulations, procedures, and programs to carry out its Title VIII responsibilities.159 The Division foresaw a number of important legal issues that would have to be settled. Among these were: the constitutionality of Title VIII; the standard of proof necessary to establish a pattern or practice; determination of what constitutes a refusal to sell or negotiate; the kind of proof necessary to show the existence of "blockbusting," and establishment of the principle that the rights protected by Title VIII extend also to incidents of property ownership, such as full enjoyment of apartment house and subdivision facilities. 160

Under Mr. Schwelb the section's policy is to bring as many lawsuits as possible.161 The practical impossibility of filing actions in all instances of housing discrimination, however, has led the section to establish its own priorities. It has prepared a list of target cities, based on size and extent of minority group population. By concentrating on these cities and their surrounding suburbs, the section hopes to develop suits which will affect the largest number of people.162

C. Litigation

At the time the housing section was formed, in October 1969,163 the Civil Rights Division had filed 14 cases under Title VIII, had participated as amicus curiae in four other fair housing suits, and had intervened in one other.164 In the first 10 months following its formation, the section filed 40 additional actions.165 Many of the cases have several defendants. In all, 120 defendants have been sued. Twenty-two cases had been sucessfully completed as of August 1970, 19 by consent decrees, which usually include affirmative re

159 Id. 100 Id. 161 Interview with Frank Schwelb, Chief, housing section, Civil Rights Division, Nov. 13, 1969.

162 Cities with large Mexican American populations, such as San Antonio, Tex. and San Diego, Calif., although not originally among these target cities, were added in November 1969.

163 Previously, the Division was not organized along subject area lines.

164 Schwelb interview, supra note 161. 165 Justice letter, supra note 158.

lief as well as a prohibition against discrimination. 166

The section has been attempting to publicize the lawsuits it files to make certain that people are informed of their rights under Title VIII. In addition, attorneys have been encouraged to speak to local organizations when they are in the field. The section is attempting to bring a variety of Title VIII actions in order to obtain rulings on as many provisions of the law as possible. It is, however, somewhat limited in this effort by the nature of the complaints it receives."

167

In addition to cases involving refusals to sell or negotiate, the housing section has instituted litigation concerning the "blockbusting" provision of Title VIII,168 and filed an amicus curiae brief in the Supreme Court in a case involving the effect of zoning ordinances on residential patterns.169 The housing section also has achieved significant results regarding the practices of title insurance companies. The section negotiated a signed agreement with the Richmond [Virginia] title insurance company under which the company no longer will insure titles to property carrying racially restrictive covenants. The Civil Rights Division subsequently wrote to more than 17 of the Nation's largest title insurance companies advising them to cease insuring such titles.170

VIII. A consent order was entered on February 5, 1970, under which defendants, without admitting any illegal practices, agreed to undertake an affirmative program to obtain black purchasers.172 Defendants also are required to make quarterly reports to the Court detailing the action they have taken pursuant to the order. 173 The Lake Caroline case is particularly significant in that it sets an important precedent for affirmative action in the fair housing area. The housing section has been placed in an awkward position in litigation against the Federal Government. Lawsuits have been brought against HUD concerning its involvement in segregated public housing in Bogalusa, La., and Chicago, Ill.175 In both cases, the Department of Justice, as the attorney for HUD, as well as for most Government agencies, represented the Department. Initially the Bogalusa case was assigned to the Civil Rights Division, but it was later reassigned to the Civil Division. As of March 1970 a decision had not yet been made as to whether the Civil Rights Division or the Civil Division would handle the Chicago case. The housing section would much prefer to have the Civil Division handle the matter.176

D. Liaison with Other Departments

The housing section has worked closely with HUD on a number of matters. Attorneys from the housing section and from the coordination and special appeals section of the Civil Rights Division are participating in joint committees with HUD to consider problems of site selection and tenant selection in public housing. Liaison with HUD is primarily with its Office of General Counsel, but Mr. Schwelb also deals with staff members of the Office of Equal Opportunity. As of March 1970, the housing

172 Defendants agreed to advertise in newspapers with predominantly black readers, to instruct subsidiaries not to discriminate, and to indicate in all advertising that it welcomes black people. Similar consent decrees have been secured against Chanita and Colony Developers. Justice letter, supra note 158.

173 Schwelb interview, supra note 170. In the 3-month reporting period prior to August 1970, 59 of some 500 sales were to blacks. Justice letter, supra note 118.

114 Hicks v. Weaver, 302 F. Supp. 619 (E.D. La. 1969). 175 Gautreaux v. Weaver, 296 F. Supp. 907 (N.D. Ill. 1969).

176 Schwelb interview, supra note 161.

section was in process of trying to develop more systematic coordination with HUD. The two Departments exchange weekly lists of pending matters and the housing section sends copies of all major pleadings and related papers to the Title VIII office and the Office of General Counsel of HUD.

According to Mr. Schwelb, his section has had some dealings with a number of military bases concerning the Department of Defense's off-base housing program, but does not maintain direct liaison with the Department of Defense. Military bases have been requested to refer cases of discrimination in off-base housing to the Civil Rights Division. The housing section has obtained lists of housing declared "off limits" because of discriminatory practices, and has filed two lawsuits based on information derived from these lists.177

IV. VETERANS ADMINISTRATION

The principal housing program administered by the Veterans Administration (VA) is the loan guaranty program, aimed at assisting veterans to purchase houses under favorable terms.178 Like the FHA mortgage insurance program, the VA loan guaranty program utilizes the ordinary channels of the private housing market-private builders and private lending institutions. The program, through its Government guaranty against loss, provides an incentive for private lending institutions to participate and is of help to private builders by facilitating mortgage credit both for construction and for sales to individual home buyers.

Although VA's share of the housing market has declined substantially over recent years, it is still considerable. During 1969, for example, the agency guaranteed loans amounting to more than $4 billion.179

Housing provided through FHA and VA programs both are subject to the nondiscrimi

nation requirements of Executive Order 11063 and Title VIII of the Civil Rights Act of 1968. The two agencies have worked closely together over the years and generally have adopted identical policies to carry out their equal housing opportunity opportunity responsibilities. For example, it was determined shortly after the Executive order was issued that any builder barred because of discrimination from participation in the programs of one agency would also be barred by the other agency. Similarly, both agencies originally exempted from coverage under the Executive order one- and twofamily owner-occupied houses. At the same time, neither FHA nor VA requires that housing provided under its programs be advertised as "open occupancy" or that aided builders undertake marketing practices aimed at attracting minority purchasers.

The two agencies, however, do not always adopt identical or even similar policies. In some cases their policies have differed substantially.

A. Racially Restrictive Covenants

As noted above, shortly after the issuance of Executive Order 11063, FHA changed its policy of a blanket refusal to insure loans on property carrying racially restrictive covenants filed of record after February 15, 1950, to provide an exception if the loan applicant were a member of a minority group excluded by the covenant. VA also changed its policy, but somewhat differently. VA announced that it would grant an exception for any veteran if the facts warranted it. The standards for determining whether the facts warranted an exception were as follows:

1. Persons in the class prohibited by the covenant were able to purchase homes in the area; and

2. One or more of such persons have in fact bought homes in the area.180

In short, VA announced it would grant an exception to its policy only if the area already was in the process of racial or ethnic change. Thus, according to VA policy, a Negro veteran who was successful in purchasing a home

180 Letter from Fred B. Rhodes, Acting Administrator, Veterans Administration, to Howard A. Glickstein, Acting Staff Director, U.S. Commission on Civil Rights, June 16, 1969.

carrying a racially restrictive covenant could not obtain VA financing unless at least one other Negro had already purchased a house in the area, presumably through a mortgage loan other than one that VA had guaranteed.

In 1969, FHA and VA made additional changes in their policies concerning racially restrictive covenants. Again, the changes adopted by the two agencies were different. According to current FHA policy, the agency will insure loans regardless of whether the property carries a racially restrictive covenant. FHA requires, however, that the purchaser certify that he will not subsequently refuse to sell the home because of the race, color, creed, or national origin of the prospective buyer. FHA also requires that the buyer expressly recognize that the racially restrictive covenant is illegal and void and that he specifically disclaim it. VA's current policy also is to grant loans regardless of whether the property carries a racially restrictive covenant. Unlike FHA, however, VA does not require certification by the buyer that he will not discriminate in any resale, nor does VA require a recognition of the illegality and voidness of the covenant or a specific disclaimer from the buyer. 181

B. Exemption of One- and Two-Family Owner-Occupied Housing

It will be recalled that in June 1969 FHA, in light of the enactment of Title VIII of the Civil Rights Act of 1968 and the Supreme Court's decision in Jones v. Mayer & Co., prohibiting racial discrimination in all housing, eliminated the exception of one- and twofamily owner-occupied housing from coverage of Executive Order 11063. Under current FHA policy, homeowners are required to certify that they will not discriminate in any subsequent resale of the housing. As of April 1970 VA retained the exception of one- and two-family owner-occupied housing. Thus, while Federal laws clearly prohibit discrimination in such