The Role of the Federal Government




The U.S. Department of Housing and Urban Development provides mortgage insurance on Federal Housing Administration (FHA)-approved loans. During the 1950s and 1960s, FHA loans contributed to residential segregation through discriminatory practices such as redlining. Redlining describes the denial of mortgages to residents who live in a neighborhood considered to be a higher financial risk; these neighborhoods were disproportionately composed of low-income and minority residents. While housing de jure segregation was prohibited by the passage of the 1968 Fair Housing Act, redlining and other discriminatory practices continued as federal policies and funds were effectively used to maintain de facto segregation. Additionally, the City of Atlanta was criticized for failing to provide adequate housing protections for Black residents. In particular, the Atlanta Housing Authority violated the Department of Housing and Urban Development’s fair housing policies. Georgia state senator Leroy Johnson and NAACP representative Dr. A. M. Davis claimed that the Atlanta Housing Authority continued discriminatory practices by building new public housing units primarily in segregated areas. The 1968 Report of the National Advisory Commission on Civil Disorders, better known as the Kerner Report, found that both federal and local initiatives failed to effectively address the issues of inadequate housing and municipal services, as well as discriminatory consumer and credit practices.