Suit alleges homes law in Newark targets poor

A ban on mobile homes based on price rather than livability discriminates against poor people at a time when housing options are limited, a federal lawsuit filed against the city of Newark says.

The lawsuit filed last week by an advocacy group on behalf of five Independence County residents says a Newark ordinance that bans cheaper mobile homes is aimed at keeping out people who have lower incomes.

The 2015 ordinance in question prohibits the construction of single-wides

under $25,000 and double-wides under $35,000. Advocates say such bans diminish the housing supply during a time when affordable units are scarce.

Equal Justice Under Law, a Washington, D.C.-based nonprofit that provides legal support for “those most in need,” is representing the plaintiffs. The group filed a similar suit in McCrory last year.

McCrory’s ordinance, which prohibited mobile homes worth less than $7,500, was repealed, and the case was settled for about $20,000, the Arkansas Democrat-Gazette previously reported.

Phil Telfeyan, the nonprofit’s executive director, said he thinks this type of discrimination is occurring in more parts of the country, but both of the lawsuits his group has initiated have been in Arkansas.

The Newark lawsuit, filed in the U.S. District Court for the Eastern District of Arkansas, argues that the ordinance doesn’t take into account health or safety standards for rental homes. It alleges that the ordinance is about wealth and that it targets people who make less money, Telfeyan said.

“Does it discriminate? Does it treat people differently based on wealth status? Well, this one obviously does,” Telfeyan said. “This one is right in the statute. It puts a dollar value on it.”

That dollar value must be determined by a certified appraiser. Violation of the ban involves fines between $50 and $500 per day, according to the ordinance. It also details requirements for mobile homes, such as that they be in mobile parks or lots, have their own water and sewage connections, and are not within 20 feet of a property line.

The issue, Telfeyan said, stretches beyond housing discrimination and into a broader discussion about a lack of housing at the state and national levels.

The National Low Income Housing Coalition released a study earlier this year that stated that the country is short about 7.2 million rental homes that low-income people can afford. The coalition is a nonprofit that works to “ensure decent, affordable housing for everyone,” according to its website.

Arkansas has a deficit of 59,445 homes that are at or below affordability for households that are below the federal poverty level or at 30 percent of the area’s median income, according to the study. A unit is considered affordable if renters are spending 30 percent or less of their incomes on housing.

The median rent in Independence County was $582 in 2016, and 1,644 of the households in the county — or about half of those that rent — were spending 30 percent or more of their incomes on rent, according to the most recent data from the U.S. Census Bureau.

The National Housing Trust Fund gives out grants to states to rehabilitate and create low-income housing. For 2018, the Arkansas Development Finance Authority received $6 million from the U.S. Department of Housing and Urban Development’s fund, and is accepting applications from local groups for money through Oct. 15.

The priority this year is for projects that help veterans and their families, according to a news release.

Members of the Arkansas Coalition of Housing & Neighborhood Growth for Empowerment are advocating for a state-level version of the federal fund. In 2009, the Arkansas Legislature passed a bill creating the Arkansas Housing Trust Fund to construct more housing.

Arkansas legislators put $500,000 in the fund in 2013, and it was spent on projects in Harrison, Little Rock and Fort Smith. It has been empty ever since.

“Affordable housing is still a major issue here in this state that is not being properly addressed, based upon the need,” said Martie North, the coalition president. “There is this gap between need and availability, and it’s huge. It’s not getting better.”

Telfeyan said that banning housing based on price can drive up rent costs.

“What’s happening in Newark is effectively prohibiting lower income folks from living there,” he said.

Mayor Jim Cunningham, who is named in the lawsuit alongside city recorder Joanne Langston, said he hadn’t had time to examine the lawsuit in its entirety.

“We don’t have anything to comment on at this point,” Cunningham said.

Veneda Marshall, 61, said she called Equal Justice a few months ago, but met with Cunningham beforehand to discuss the problems she had with the ordinance.

She and her husband, Robert Marshall, rent out four mobile homes in Newark. The couple buys mobile homes, renovates them and then rents them at low prices, she said. Both are listed as plaintiffs in the suit.

One of the homes is used as Section 8 housing under the Department of Housing and Urban Development program that pays landlords for providing housing to renters with vouchers, according to the suit.

The Marshalls sought to add another unit, but it didn’t meet the ordinance’s minimum price requirement. The lawsuit states that no one from the city asked about the condition of the home, only the price.

Veneda Marshall used to work in a factory job, but overwhelming social anxiety caused her to quit, she said. She then started renting out the homes to supplement her husband’s Social Security income, she said. The rent is $450 a month for each of her units, according to the lawsuit.

“We have enough to get by,” she said. “This has been a godsend since 2012 because even though I have to interact with people, I have no problem because it’s just a few people.”

The other plaintiffs are either Newark landlords or potential renters: a woman who started renting out mobile homes to support her children after an injury left her unable to work, a man who tried to move to Newark from Batesville, and a 63-year-old woman on a fixed income who wants to move closer to her friends as they age.

“It’s affecting a lot of low-income people who want to make Newark their home, and effectively creating a banishment zone,” Telfeyan said.

The city has a separate ordinance, passed this year, that outlines required health and safety standards for mobile homes, but Telfeyan said it doesn’t negate the previous law.

“In our view it’s irrelevant,” he said. “The value provision is still in place.”

Arkansas Democrat-Gazette