Dive Brief:
- The U.S. Department of Housing and Urban Development’s Office of Fair Housing and Equal Opportunity has launched an investigation into the city of Minneapolis’ housing plans, practices and policies, which it said in a Jan. 15 letter may violate the Fair Housing Act and Title VI of the Civil Rights Act of 1964.
- Minneapolis Mayor Jacob Frey’s government “may be engaging in unlawful discrimination by prioritizing Minneapolis residents for housing based on race and national origin rather than need,” FHEO Assistant Secretary Craig Trainor said in a Jan. 16 release. Frey’s office did not respond to a request for comment by publication time.
- “Minneapolis is proud of its record on housing,” a city spokesperson told Multifamily Dive in an email in response to the investigation. “In fact, we have award-winning affordable housing programs, and our work is a model for cities around the country. This investigation appears to be about politics, not affordable housing.”
Dive Insight:
HUD Secretary Scott Turner called the state of Minnesota “ground zero for fraud and corruption,” and said in the release that the agency “will not stand for illegal racial and ethnic preferences that deny Americans their right to equal protection under the law.” HUD’s letter cites “Somali fraud” and alleges a “rise of racial and ethnic favoritism within Minnesota’s government” that appears to extend to the city’s housing policy.
“For example, your Community Planning and Economic Development department will prioritize ‘rental housing for Black, Indigenous, People of Color and Immigrant communities’ by ‘leveraging [its] rental licensing authority.’ That is not going to fly,” HUD’s letter reads.
The letter also names as racially discriminatory the Minneapolis 2040 plan’s support of cultural districts, which the city bills as “a contiguous area with a rich sense of cultural and/or linguistic identity rooted in communities significantly populated by people of color, Indigenous people, and/or immigrants.”
This is not the first time the Trump administration has probed a Democratic mayor’s housing plans.
In December 2025, HUD’s Fair Housing office launched an investigation into Boston’s housing practices, which it said it believes violate civil rights protections of White people under the Fair Housing Act and Title VI. The office argued that under Boston Mayor Michelle Wu, officials have tried to “smuggle” racial equity into the city’s operations and intend to implement discriminatory housing policies.
Recently, the Trump administration has turned its sights to the Land of 10,000 Lakes. Earlier this month, the federal government froze child care payments to Minnesota and four other Democratic-run states following a viral video posted in December that purported to show fraud at Somali-run child care centers in Minneapolis.
Then on Jan. 6, the administration launched a major federal immigration enforcement operation in Minneapolis and St. Paul, Minnesota, called Operation Metro Surge, tied in part to allegations of fraud involving Somali residents. The next day, an Immigrations and Customs Enforcement agent shot and killed Renée Good in Minneapolis, sparking protests locally and around the country, and Trump has promised further crackdowns on the city.
Last week, HUD proposed eliminating its disparate impact rule, one of the most impactful tools to fight housing and lending discrimination. Currently, it considers a housing policy illegal if it disproportionately harms protected groups, even without discriminatory intent. The move is part of the Trump administration’s broader rollback of disparate impact regulations across the federal government.
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