Democratic Attorneys General Sue HUD Over Fair Housing Curbs

The Fair Housing Act bars discrimination in housing sales, rentals and mortgage lending on seven federally protected grounds: race, color, national origin, religion, sex, disability and familial status. Since 1980, HUD’s Fair Housing Assistance Program, or FHAP, has funded and referred complaints to state and local agencies whose laws are deemed substantially equivalent. The dispute matters because many states protect additional classes, and a narrower federal test could curb their capacity to scrutinize mortgage lenders and other housing providers under state fair-lending and anti-discrimination rules.

California Attorney General Rob Bonta and Illinois Attorney General Kwame Raoul led 16 Democratic attorneys general in suing HUD in the U.S. District Court for the Northern District of California on March 16, 2026. They challenged September 2025 guidance that threatens decertification, lost referrals and funding for agencies enforcing protections beyond the federal list, including sexual orientation, gender identity, language, criminal records and source of income. The plaintiffs also say it unlawfully restricts disparate-impact claims. Their agencies received about $10.7 million through FHAP in fiscal 2024; Bonta said California alone could lose roughly $3 million.