Beyond Redacting Discriminatory Restrictive Covenants
Over the past several years, there have been a number of initiatives aimed at removing discriminatory restrictive covenants from land records. While these covenants aren’t enforceable, they are painful and often surprising reminders that can come up during the home buying process. The different projects being worked on vary from statewide mandates to redact the language to groups of volunteers in specific counties searching for covenants on their own time.
There are numerous approaches for how to handle existing covenants, but the vast majority of the projects involve either individual homeowners/buyers requesting that a covenant be removed or a group of volunteers/professionals searching the totality of records in an area.
While most people understand the need for this language to be removed from records, there has been some back and forth regarding the approach. A law like California’s, mandating counties to set up a redaction plan, will ensure that every land record is examined and that the discriminatory covenants are removed in a short time period. The work is being funded by a recording fee. Areas that are using volunteers will obviously see no impact to their fees, but the pace of finding the covenants is significantly slower.
Each jurisdiction will need to carve its own path, particularly on the subject of funding. In Washington state, a new recording fee is being collected, but it isn’t funding the removal or mapping of discriminatory restrictive covenants as that work is being completed by volunteers at the University of Washington. The new fee creates a program that started at the beginning of July to
Washington House Bill 1474 required a fee of $100 to be collected when a document is recorded starting on January 1st of this year. The collected funds are to be specifically used, “to design, develop, implement, and evaluate one or more special purpose credit programs to reduce racial disparities in homeownership in the state by providing down payment and closing cost assistance.”
A small portion of the funds (<1%) has been reserved for outreach and administrative costs. The law also calls for a home ownership study to be completed every five years to assess inequality and the necessity and impact of programs like this. Currently, those eligible to participate in the program need to be first-time homebuyers who lived in Washington state before the Fair Housing Act was passed in 1968 and would have been excluded from homeownership due to discriminatory covenants.
While this is a small number of people relative to the population of a state like Washington, the law is tailored in a way that it helps those who have received direct harm. This also ensures that those who are eligible will be able to receive their benefits. California’s more broad assistance program that targets low-income first-time homebuyers exhausted its funds in less than two weeks.
Regardless of strategy, it’s encouraging to see those that have undergone injustices see some direct resolution. Extract is currently providing automated identification and redaction services for discriminatory restrictive covenants for counties in California and beyond. Should your office need a solution, please take a look at our offerings here.
