By Kriston Capps
On the campaign trail, Joe Biden pledged his support for local governments struggling under stifling exclusionary zoning codes that prevent new housing construction. As president, he he may find a bill addressing that very issue on his desk.
On March 23, Minnesota Senator Amy Klobuchar, with fellow Democratic Senator Tim Kaine of Virginia and Republican Senator Rob Portman of Ohio, will introduce the Housing Supply and Affordability Act. The bipartisan bill would authorize $1.5 billion for federal grants to local governments that commit to increase their supply of local housing, to be distributed over the next five years.
The legislation aims to address the U.S. affordable housing crisis by giving local leaders resources to overcome obstacles to new construction, such as density-unfriendly or discriminatory zoning regulations. Eligible local governments, including regional coalitions, will be able to apply for grants to build out “housing policy plans” — local roadmaps that, taken together, promise a way out of the nation’s housing crisis.
“All Americans deserve access to an affordable home, but unfortunately the nationwide housing shortage has created an affordability crisis for far too many,” Klobuchar said in a statement. “These grants will help communities identify their housing challenges, improve affordability and implement unique solutions to expand their housing supply.”
The bill could eventually wind its way into the massive $3 trillion infrastructure bill currently being assembled by the White House. That package may include as much as $200 billion for housing infrastructure, including $100 billion for low-income housing. Yet the Housing Supply and Affordability Act could stand up on its own, thanks to its bipartisan support. The idea dates back to an Obama-era proposal that resurfaced in the Biden campaign’s housing plan, but it speaks to problems that hamper blue cities and red states alike.
To compete for these local housing policy grants, localities will need to come to the table with a yes-in-my-backyard attitude. The grants are for cities and counties that commit to removing barriers to construction while avoiding the displacement of current residents by new developments. Local governments don’t need to have such a plan in place already, though — that’s what the bill is for. The grants come in two stripes: planning grants to help local leaders design their housing policy plans, and implementation grants to help them put these plans into action.
Housing Supply and Affordability Act grants will be be awarded by the U.S. Department of Housing and Urban Development, which will determine the criteria for scoring applications. Applicants that pledge to increase housing near jobs and transit will take priority, for example. Under the bill, HUD will also issue guidance with recommended reforms and strategies for cities that are starting from scratch. The bill broadly falls in line with the goals of Housing Secretary Marcia Fudge, who identified barriers to housing as one of her top targets, telling senators at her January confirmation hearing, “We have to get rid of this notion of not-in-my-backyard.”
Klobuchar’s bill is designed to help smaller cities and legacy cities that struggle with different housing problems than high-cost coastal hubs. Rural areas, too: At least 10% of Housing Supply and Affordability Act funds must go to entities in rural areas, a reflection of the senator’s longtime interest in rural housing needs. Reporting requirements in the legislation will also contribute to a nationwide “learning network” — a federal platform for local leaders to share the best practices enacted by their respective laboratories of democracy.
One model for the Housing Supply and Affordability Act came in 2019, through a program implemented by Washington State, and it could point to how cities and counties are likely to respond to the federal solicitation. This state-level program authorized $5 million in local grants to help cities draft housing needs assessments. Of the 40 or so eligible cities in Washington with a population of 20,000 or more, about 70% applied for and received grants. “We were pleasantly surprised by the number of cities who took strong action,” said Washington State Representative Joe Fitzgibbon, the author of the bill behind the state program, in an email. “This policy has been effective in unlocking access to planning grants that aren’t available to cities in any other way.”
The Housing Supply and Affordability Act has the backing of a number of national organizations and industry associations, including the American Institute of Architects, Mortgage Bankers Association and National Apartment Association. A diverse assortment of state and local organizations are getting behind the bill, too, including San Francisco’s Tenderloin Housing Clinic, Houston’s Tejano Center for Community Concern and Baltimore’s Neighborhood Housing Services. In a March 23 letter to members of Congress, a consortium of 29 national groups and 81 state and local organizations — chambers of commerce alongside environmental shops and equity groups — pledged their support.
But even a generous federal grant program is unlikely to be enough to entice some of the country’s most exclusive communities to allow more housing, says Jenny Schuetz, senior fellow for the Metropolitan Policy Program at the Brookings Institution, in an email: “The deliberately exclusionary places are unlikely to bite at fiscal carrots.”
Still, says Schuetz, that doesn’t mean that a program that offers YIMBY dollars won’t work, because there are many more communities that find themselves lacking low-income options and “missing middle housing,” and they don’t know where to start. “There are also localities that in good faith would like to expand housing options for low- and moderate-income households, but they’re not sure how to do that,” she says. “This includes a bunch of small-population and resource-constrained communities that don't have the time, capacity, or expertise to figure out what in their zoning, building code, environmental regs, etc., needs to be changed.”
All the steps involved with long-term planning take time and money: assessing housing stock, analyzing employment trends, streamlining approvals and combating discrimination, to name just a few. But there are no federal funding streams for this work, according to Mike Kingsella, executive director for Up for Growth Action, a federal legislative advocacy campaign. He says that the Housing Supply and Affordability Act will fulfill an unmet need.
“Especially now, coming out of the Covid pandemic, cities are strapped for resources,” Kingsella says. “There are no dedicated resources through HUD for land-use housing policy design and implementation. More than being a carrot, the grant program is really an accelerator to put forward housing policies.”
Local housing policy grants could pair with other federal solutions to the housing affordability crisis. New Jersey Senator Cory Booker and House Majority Whip Jim Clyburn have proposed a bill to tie Community Development Block Grants (CDBGs) and federal transportation dollars to local efforts to reduce barriers to housing construction, for example. In 2019, Indiana Senator Todd Young, a Republican, introduced a Yes In My Backyard Act that would add 20 different land-use reforms as considerations for CDBG dollars. Withholding federal dollars from housing-resistant communities only goes so far, though, especially if those communities lack the technical knowledge or planning capacity to change course.
Housing affordability is a bipartisan issue that cuts across geographic divides and draws its own political coalitions. It’s the kind of thorny local crisis whose solutions seem to incur acute short-term political costs, with only diffuse long-term economic benefits. From West Hollywood in Los Angeles to the suburbs of Dallas to downtown Queens in New York, and everywhere in between, communities that are trying to navigate the housing crisis have so far met only limited success. Local housing policy grants could give them a map through it.
“To truly address the issue of housing affordability, we need to look closely at what’s happening at the local level, and that is exactly what this bill does,” Portman said in a statement. “This bipartisan piece of legislation will provide localities and municipalities with resources to expand the supply of housing and increase affordability. As we turn the corner on the coronavirus pandemic, let’s make sure that housing affordability and availability is at the center of our economic recovery efforts.”
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