President Biden's Directive On June 1, 2021-the 100th anniversary of the Tulsa Race Massacre-President Biden announced he was launching an interagency initiative to combat bias in home appraisals. This initiative became the Interagency Task Force on Property Appraisal and Valuation Equity (PAVE). Co-chaired by Adrianne Todman, Deputy Secretary Performing the Delegable Duties of the Secretary and Domestic Policy Advisor Ambassador Susan Rice, the Task Force was directed to (i) evaluate the causes, extent, and consequences of appraisal bias and (ii) establish a transformative set of recommendations to root out racial and ethnic bias in home valuations.

Federal Agencies on Task Force

The PAVE Task Force is composed of thirteen federal agencies, including the White House Domestic Policy Council.

DPC White House Domestic Policy Council www.whitehouse.gov/dpc

HUD U.S. Department of Housing and Urban Development www.hud.gov

ASC/FFIEC Appraisal Subcommittee of the Federal Financial Institutions Examination Council www.asc.gov

THE FED Board of Governors of the Federal Reserve System www.federalreserve.gov

CFPB Consumer Financial Protection Bureau www.consumerfinance.gov

FDIC Federal Deposit Insurance Corporation www.fdic.gov

FHFA Federal Housing Finance Agency www.fhfa.gov

NCUA National Credit Union Administration www.ncua.gov

OCC Office of the Comptroller of the Currency www.occ.treas.gov

USDA U.S. Department of Agriculture www.usda.gov/

DOJ U.S. Department of Justice www.justice.gov

DOL U.S. Department of Labor www.dol.gov

VA U.S. Department of Veterans Affairs www.va.gov

Meet PAVE's Leaders

ADRIANNE TODMAN PAVE Task Force Co-Chair Deputy Secretary Performing the Delegable Duties of the Secretary

NEERA TANDEN PAVE Task Force Co-Chair Director, Domestic Policy Council www.whitehouse.gov/dpc/about-the-director-2

Meet the Task Force

In addition to HUD and the White House Domestic Policy Council, 11 other federal agencies are members of the Task Force. These principal agency leads serve in an advisory role-helping design federal interventions to advance valuation equity.

JIM PARK Executive Director Appraisal Subcommittee

MICHELLE BOWMAN Member of the Board of Governors Federal Reserve System

ROHIT CHOPRA Director Consumer Financial Protection Bureau

MARTIN GRUENBERG Chairman Federal Deposit Insurance Corporation

SANDRA THOMPSON Director Federal Housing Finance Agency

TODD HARPER Chairman National Credit Union Administration

MICHAEL HSU Acting Comptroller Office of the Comptroller of the Currency

TOM VILSACK Secretary U.S. Department of Agriculture

TBD Associate Attorney General U.S. Department of Justice

JULIE SU Acting Secretary U.S. Department of Labor www.dol.gov/agencies/osec

DENIS MCDONOUGH Secretary U.S. Department of Veterans Affairs

Read FAQs About PAVE

Q1. What is PAVE and why was the Task Force formed?

On June 1, 2021, the centennial of the Tulsa Race Massacre, President Biden announced the creation of an interagency initiative to combat bias in home valuations. President Biden directed the PAVE Task Force to (i) evaluate the causes, extent, and consequences of appraisal bias, and (ii) establish a transformative set of recommendations to root out racial and ethnic bias in home valuations.

PAVE is a first-of-its-kind interagency task force dedicated to ending discrimination in home valuations. The task force includes 13 federal agencies and offices and is chaired by Director of the Domestic Policy Council Ambassador Susan E. Rice and the Honorable Adrianne Todman, Senior Official Performing the Duties of the Secretary of HUD.

Q2. Why is the Task Force focused on home appraisals?

One of the main reasons that the Task Force is focused on home appraisals is because of how appraisals can impact the homeownership and wealth gaps. An appraisal is an important part of the homebuying process, as it establishes the value of the property for a home loan. Simply stated, fair and accurate appraisals directly impact national homeownership rates. More than 50 years since the Fair Housing Act's passage, the racial homeownership gap is wider than ever: in 2021, the Black homeownership rate reached only 44 percent, while the white homeownership rate reached 74 percent.

The Task Force believes that if the Federal Government advances equity in the appraisal process, it can also make substantial progress toward closing the racial homeownership and wealth gap.

Q3. How does the work of the Task Force affect me as a consumer?

The Task Force is focused on combatting racial and ethnic bias that can cause a low valuation during the homebuying or refinance process. During the homebuying process, a low valuation can cause the sale to fall through. This may harm both the buyer and the seller, as the buyer is unable to become a homeowner, and the seller is unable to realize potential gains from the sale A low valuation in a refinance transaction can result in the lender making credit-risk related price adjustments that lead to higher interest rates for the borrower. In some cases, it can result in the borrower not being eligible for the refinance. In the common case where borrowers are seeking to access some of their realized home equity wealth via a cash out refinance, a low valuation can reduce the amount of wealth available to the borrower.

Both occurrences can impact property values and the accumulated wealth of homeowners in that community. Ultimately, this can inhibit how families in that community leverage equity to pay for college, pay for repairs, or provide a buffer during financial hardship. Reduced property values can also diminish the property tax revenue that funds the maintenance and improvement of community schools and amenities.

Q4. What is the PAVE Action Plan?

The Action Plan is a document that outlines clear actions that federal agencies will take to root out appraisal bias. The Action Plan is part of an ongoing commitment from the Federal Government to expand homeownership rates for families and communities of color. This commitment will continue to be informed by data, members of industry, advocacy, fair housing, and academic organizations, and by the stories of all Americans who dream of homeownership.

Q5. What are some of the successes of PAVE to date?

The Task Force has made significant progress since its first meeting in August 2021. For example, the Appraisal Subcommittee (ASC) launched an independent review of the Uniform Standards of Professional Appraisal Practice (USPAP) and the qualification criteria for the appraiser industry to understand potential barriers to entry for underrepresented communities. Additionally, in November of 2021, FHA issued a Mortgagee Letter to clarify nondiscrimination requirements applicable to appraisers and lenders. The Action Plan includes a full list of successes to date.

Q6. How did the Task Force develop the Action Plan?

The Task Force pursued a collaborative and comprehensive approach toward identifying actions to address appraisal bias. This approach involved a thorough literature review and extensive consultation with subject matter experts and leaders across industry, academia, trade and civil rights groups, and government. In total, the Task Force engaged more than 150 independent appraisers, appraisal management companies, lenders, advocacy groups, and philanthropy organizations. Diverse stakeholder perspectives informed recommendations and the agency commitments contained in the Action Plan.

Q7. Now that the Action Plan is published, what are the next steps for the Task Force agencies?

The work of PAVE does not end with publication of the Action Plan. The Task Force member agencies have already started to implement actions outlined in the Action Plan. In the coming months, PAVE will update this website to share the progress of individual member agencies, and how PAVE has collectively worked to advance equity in the valuation process.