Prosecutors say the 2023 incident started when Worden Butler, 31, posted racially motivated threats towards his neighbors on social media.
South Carolina is one of two states in the country without a hate crime law. State prosecutors charged him with harassment, to which he pleaded guilty last year.
Butler has since been federally indicted by a grand jury.
The U.S. District Attorney’s Office said he was taken into custody in California and was extradited back to South Carolina for his Wednesday arraignment hearing.
If found guilty of interfering with the housing rights of his neighbors and using fire to commit a federal felony, Butler could spend 10 years in prison. He has a detention hearing set for May 12.
