HUD Probes Islamic North Texas Development

A planned 402-acre Islamic-centered community northeast of Dallas is drawing fresh federal and state scrutiny, threatening to complicate one of the region’s most ambitious master-planned projects.

The U.S. Department of Housing and Urban Development said Friday its Office of Fair Housing and Equal Opportunity launched an investigation into EPIC Real Properties and Community Capital Partners over potential violations of the Fair Housing Act, including alleged religious and national origin discrimination tied to The Meadow, formerly branded as EPIC City, the Dallas Morning News reported. EPIC stands for the East Plano Islamic Center.

HUD said it received a complaint from the Texas Workforce Commission detailing a “large-scale pattern of religious discriminatory conduct.” Among the allegations: marketing materials promoting the project as an exclusively Muslim community and “the epicenter of Islam in America,” financial terms requiring lot owners to subsidize a mosque and Islamic educational centers, as well as a two-tier lottery system for lot sales that favored certain buyers, according to the outlet.

HUD Secretary Scott Turner said the agency would ensure a “thorough investigation so that this community is open to all Texans.”

Community Capital Partners, a for-profit development arm formed by members of the East Plano Islamic Center, denied discrimination claims and said it remains committed to complying with state and federal housing laws. The group argues many of the issues raised were addressed in a prior settlement with the Texas Workforce Commission.

The development envisions more than 1,000 homes, a K-12 faith-based school, mosque, senior housing, apartments, retail and sports fields across land in Collin and Hunt counties, roughly 40 miles from downtown Dallas.

At the same time, Texas Attorney General Ken Paxton filed a separate lawsuit in Collin County, his agency announced Monday, targeting Double R Municipal Utility District No. 2A, accusing board members of improperly expanding the district’s boundaries to support what he called the “illegal” EPIC project.

Municipal utility districts, authorized by the Texas Commission on Environmental Quality, are critical to financing infrastructure for large-scale residential developments. Developers front the costs, then recoup them through bond issuances repaid by property taxes within the district.

Paxton alleges that in September, the Double R board was replaced at a rural meeting and quickly approved a petition to annex roughly 400 acres tied to The Meadow — despite questions about whether the new directors met statutory qualifications or even resided within the district. His office is seeking to block further district action and strip the project land from its boundaries.

The developer’s attorney, Eric Hudson, called the suit the latest escalation in “lawfare” by Paxton and Gov. Greg Abbott, arguing the district process has been handled by Texas law firm Winstead for 18 months and that technical issues will be resolved in court.

The project has already weathered a securities lawsuit from Paxton as well as a now-closed civil rights inquiry by the Justice Department.

— Eric Weilbacher