House introduces the Housing for the 21st Century Act

Key Takeaways

On December 11, House Committee on Financial Services Chair French Hill (R-Ark.), Ranking Member Maxine Waters (D-Calif.), Subcommittee on Housing and Insurance Chair Mike Flood (R-Neb.) and Ranking Member Emanuel Cleaver (D-Mo.), released the bipartisan Housing for the 21st Century Act. The package introduces reforms intended to streamline housing production, modernize existing programs and give counties more flexibility to meet local needs.

What's in the bill?

The bill would modernize key federal housing programs while streamlining regulations and expanding local flexibility for counties. Specifically, if enacted, the bill would:

• Expand eligible uses and modernize the Home Investment Partnerships (HOME) program: The bill expands HOME eligibility to include housing developments for workforce-income households. To reduce administrative barriers for HOME funded developments, the bill exempts projects from the requirements of the Build America, Buy America (BABA) Act, as well as certain infill and rehabilitation projects from National Environmental Policy Act (NEPA) environmental impact reviews. It also allows grantees that do not also receive CDBG entitlement funds to use HOME funds for housing-adjacent infrastructure. Unlike its Senate companion, as well as the standalone HOME Reform Act, the bill makes no changes to the threshold triggering Davis-Bacon Act prevailing wage requirements.
• Expand eligible uses and increase annual reporting of the Community Development Block Grant (CDBG): The bill expands the eligible uses of CDBG funds to include new construction. Additionally, CDBG entitlement communities will be required to submit non-binding reports of adopted or planned zoning regulations that promote housing growth, as well as publish a database of undeveloped land owned by the jurisdiction.
  • Unlike the Senate’s Road to Housing proposal, this bill does not tie CDBG allocations to local housing production levels, preserving existing funding formulas and avoiding performance-based penalties.
• Modernize codes to promote housing development: The bill establishes planning and implementation grants for regional planning agencies looking to review and update local codes to promote housing growth, and also provides funds for local “pattern books” of pre-approved home designs that can help counties accelerate permitting.
  • The package, like its Senate counterpart, also directs the U.S. Department of Housing and Urban Development to generate model zoning frameworks for state and local governments to stimulate housing growth. It is important to note: while this will provide a valuable resource for counties looking to promote housing, it may also encourage states to adopt a uniform code, potentially preempting local zoning policies.
• Explore a potential federal building code: The bill directs the U.S. Comptroller General and the Government Accountability Office to conduct a study exploring the viability of a uniform federal building code, with a focus on construction timelines and cost.
• Streamline unit inspection requirements for HUD programs: Units recently inspected for existing federal housing programs would automatically meet Section 8 inspection requirements, rather than requiring duplicative inspections.
• Increase access to rural housing tools: The bill further supports rural housing needs by expanding access to the U.S. Department of Agriculture's (USDA's) Section 504 Home Repair program, shortening USDA processing timelines and conducting a comprehensive review of the Department’s existing technology and the relative cost of modernizing their systems.
• Reduce barriers to manufactured housing: The bill revokes the current HUD certification requirement that manufactured homes include a permanent chassis. It also establishes HUD as the primary federal authority for manufactured housing construction and safety standards. The bill requires the U.S. Federal Housing Administration (FHA) to evaluate ways to expand the availability of loans under $100,000 that are especially important in rural counties and lower-cost markets.
• Improve protections for veterans, renters and assisted families: The bill strengthens protections for veterans by excluding disability benefits from income determinations under the Veterans Affairs Supportive Housing (VASH) program, similar to HUD formula programs. It also directs lenders to include a disclosure reminding veterans of their potential VA home loan eligibility. To improve coordination and family stability, the bill requires collaboration between HUD, USDA and the U.S. Department of Veterans Affairs (VA) on housing-related research and creates a pilot that allows assisted families to build savings through rent-based escrow accounts. Additional provisions enhance tenant protections by increasing oversight of HUD-funded housing counselors, establishing a federal eviction assistance helpline and piloting temperature sensors in assisted units to ensure compliance with housing quality standards. 

County leaders have long identified regulatory hurdles and program constraints as obstacles to increasing housing supply. The Housing for the 21st Century Act would streamline federal reviews, modernize housing programs that counties administer and expand local tools for affordable and workforce housing. If enacted, counties could see new opportunities for local planning, greater flexibility in funding use and improved coordination with federal partners. NACo will continue to monitor the bill’s progress and advocate for county priorities as the legislative process moves forward.