Local land use and zoning requirements, and related entitlement and development review and approval processes, are a key factor behind the housing affordability challenge since these requirements have the effect of limiting housing production (or production of certain types of lower-cost housing) and/or make it more expensive to build housing. As economist Edward Gaeser has noted, there is broad agreement from people all along the idealogical spectrum that local land use controls limits housing supply and makes it harder for lower-income residents to find housing they can afford.
Land use policy and zoning regulations are developed and administered almost entirely at the local level. Historically, there has been little direction or interference from the federal or state government in setting land use regulations. However, as housing affordability challenges persist, there has been dialogue at the federal and state level to address local land use regulations that limit housing availability.
This month, New Jersey Booker introduced legislation—the Housing, Opportunity, Mobility and Equity (HOME) Act—require local communities to develop more inclusive zoning policies to create more affordable housing options and less segregated neighborhoods. Under Booker’s proposal, communities receiving CDBG funding would be required to make changes to land use and zoning to expand housing options.
Federal legislation related to local land use and zoning would be an uphill battle to say the least. At the state level, however, there are several examples of state incentives and requirements that have had an impact on local land use and zoning regulations and have helped supply housing availability and housing affordability.
Last year, I co-authored an Urban Land Institute report on state housing policy that outlined five types of opportunities for states to help local municipalities expand housing choice and opportunity primarily through their land use powers.
One state-level initiative is Connecticut’s Incentive Housing Zones (IHZ) program provides municipalities with technical assistance and financial incentives to create zoning districts that can accommodate additional housing. While the program is voluntary, cities and towns that have adopted new zoning districts under the program have developed around 1,700 housing units that might not otherwise have been built.
In California, the state has taken several measures to attempt to promote housing production. In 2015, the state legislature passed a law that directs localities to reduce parking requirements for affordable housing developments located near transit. The parking reduction is automatic as long as the project meets the requirements. Local communities can only set higher parking standards if they conduct a parking study. Parking reductions can be an important component of reducing development costs, making it easier for developers to provide below-market-rate units.
We continue to track other initiatives at all levels of government that target land use and zoning regulations that could be amended to promote housing options. We’d love to hear what you think!