The revised rule is in response to amendments to the FHIP in Section 905 of the Housing and Community Development Act (HCDA) of 1992 which established FHIP on a permanent basis and removed the requirement for testing guidelines as part of FHIP's P rivate Enforcement Initiative program.
The new rule eliminates testing guidelines, including the previous requirement that testing be in response to bonafide allegations of housing discrimination. HUD said that it did not want to keep that portion of the rule because the regulation sh ould be flexible enough for private fair housing groups to be able to identify new forms of discrimination as they emerge in the housing marketplace.
The regulation does add a requirement that testers cannot have been convicted of a felony or of any crime involving fraud or perjury. The regulation also retains a rule that testers be trained in testing procedures or have experience in testing techniques.
Although some fair housing groups had called for HUD to change FHIP to an entitlement program, HUD decided to continue to award FHIP grants on a competitive basis. HUD also refused to adopt an allocation formula for FHIP grants. To receive funds from FHIP's Private Enforcement Initiative, fair housing organizations must be engaged in complaint intake, complaint investigations, testing for fair housing violations, and enforcement of "meritorious claims." The new rule defines meritorious claims as "enforcement activities that result in lawsuits, consent decrees, settlements, or conciliations with the outcome of monetary awards for compensatory and/or punitive damages to plaintiffs or complaining parties, or other affirmative relief, includ ing the provision of housing."