In a move that has ignited national controversy, Washington State Governor Bob Ferguson signed House Bill 1696 into law, a race-based loan forgiveness, on April 22, 2025. This legislation expands the Covenant Homeownership Program (CHP), offering zero-interest, forgivable loans to first-time homebuyers, with eligibility criteria that prioritize race and ancestry. Specifically, the program targets individuals who are descendants of residents from certain racial groups who lived in Washington before April 11, 1968.
Race-Based Loan Forgiveness: A Slippery Slope
The expansion of the CHP under HB 1696 raises significant concerns about the constitutionality and fairness of race-based loan forgiveness. The program’s eligibility requirements are explicitly tied to race and ancestry, offering financial benefits to individuals based on their racial background and familial history.
Critics argue that this approach undermines the principle of equal treatment under the law. Senator Mike Lee (R-UT) condemned the legislation, stating, “The Fourteenth Amendment’s Equal Protection Clause prohibits this. It’s not even a close question. This is lawlessness.”
The Covenant Homeownership Program: Details and Implications
The CHP was initially launched in 2024 to address historical housing discrimination. Under the new law, the program provides:
- Zero-interest loans up to 20% of the home’s purchase price, capped at $150,000, plus closing costs.
- Loan forgiveness after five years for households earning 80% or less of the Area Median Income (AMI).
- Eligibility for individuals who are first-time homebuyers, have household incomes at or below 120% of the AMI, and can prove descent from residents of specific racial groups who lived in Washington before April 11, 1968.
While proponents argue that the program aims to rectify past injustices, the race-based criteria have sparked debate over the fairness and legality of such measures.
Legal and Ethical Concerns
The implementation of race-based loan forgiveness programs like the CHP raises several legal and ethical questions:
- Constitutionality: Does prioritizing individuals based on race violate the Equal Protection Clause of the Fourteenth Amendment?
- Precedent: Could this program set a precedent for other race-based financial assistance programs, potentially leading to further divisions?
- Impact on Social Cohesion: Does offering financial benefits based on race foster unity or exacerbate societal divisions?
These concerns highlight the complexity of addressing historical injustices without infringing upon the principles of equal treatment and non-discrimination.
Alternative Approaches
Addressing disparities in homeownership and wealth accumulation is a legitimate concern. However, solutions should focus on socioeconomic factors rather than race. Programs that provide assistance based on income, education, and other non-racial criteria can help those in need without resorting to potentially discriminatory practices.
By focusing on economic disadvantage rather than race, policymakers can create inclusive programs that assist all individuals facing financial hardships, regardless of their racial background. Another Democrat recently made news. Allison Dahle wants to put more government oversite on your children.
