Washington state launches reparations plan to combat historical discrimination against some minority groups

Last week, the state launched the Covenant Homeownership Program, which offers homebuying assistance to Washingtonians who faced housing discrimination in the early to mid-20th century and their descendants. Qualifying homebuyers can apply for zero-interest loans to help fund down payments and closing costs, and the loans do not need to be repaid until the homeowner sells or refinances the property.

The assistance is open to some of the people who were victims of racially restrictive covenants, such as redlining, that was used in housing discrimination in the US in the early 1900s. The restrictions were often used against minority groups and Jews. Washingtonians can apply for the program if they can demonstrate that they lived in the state when the Fair Housing Act outlawed housing discrimination before April 1968, or that they are the descendants of a parent or grandparent who lived in the state during the practice.

According to a state-commissioned study whose findings were the basis of the program, various minority groups, including Jews, experienced “well-documented, egregious acts of discrimination.” However, many of the groups mentioned in the study who were discriminated against, including Jews and those of Chinese descent, are not eligible for the program.

According to state guidelines, homebuyers only qualify if they are Black, Hispanic, Native American, Alaska Native, Native Hawaiian, or other Pacific Islander, Korean, or Asian Indian as lawmakers claim those groups are still “being impacted most deeply” or face homeownership gaps. The program is funded by a new $100 fee on recorded documents, which means that the fees paid by Washingtonians, including the excluded minority groups, are funding the program.

Lawmakers in the Democratic-controlled state legislature approved the discriminatory program backed by Rep. Jamila Taylor, Sen. John Lovick, and Rep. Frank Chopp when they passed House Bill 1474 in 2023. The majority of Republicans voted no to the discriminatory program.

Prospective homebuyers must earn the area median income in their county or less, cannot have owned a home in at least three years, have only owned a mobile home, or are single parents who only owned a home while married to a former spouse. The program will offer loans of up to $150,000 to help fund down payments on mortgages. $20 million has been raised so far through the fees. However, that may not be enough to keep up with demand.

A similar program in California exhausted its $300 million in funding within the first 11 days of opening applications. Those behind the Washington program recognize its shortfalls and sources told The Ari Hoffman Show on Talk Radio 570 KVI that officials expect legal challenges.