Housing is top of mind for legislators, with bills to address affordability, zoning, rent control, and natural gas usage taking shape in states across the country. Lily Weatherby, director of state and local affairs for the NAHB, says housing is emerging as a top issue for community leaders, elected officials, and employers.
“We’re not really the bad guys anymore,” says Karl Eckhart, vice president of state and local government affairs for the NAHB. “Elected officials see housing as a need, and they are looking to the industry, to the builders, [and] to the skilled craftsmen and women. Everyone is sitting in the same room now.”
After several legislative housing ideas were introduced in the past two years, Eckhart says a climate exists in 2024 where state legislators are feeling there is the ability to pass housing legislation that “will have a real impact.”
Legislative Wins
Utah, Eckhart says, is the “shining star for the 2024 legislative session” from a housing perspective. Lawmakers in the state recently gave final approval to a loan program that aims to bring back starter homes. H.B. 572 State Treasurer Investment Amendments, which was signed by Gov. Spencer Cox on March 28, creates the Utah Homes Investment Program. Under the bill, the state Treasury would invest in low-cost loans that developers would use to build homes priced at attainable levels, ideally around $350,000.
“They are really going to push the boundaries of where you can build, how you can build, [and work to] make it so nurses, teachers, [and] everybody can actually have a house now,” Eckhart says.
Similarly, in Oregon, a $369 million package was approved to help ease the state’s housing crisis by spurring the development of new homes. The package will allocate $75 million to subsidize the construction of moderate-income housing, $89 million for infrastructure projects such as the extension of sewer systems, and $106 million to operate shelters and prevent evictions.
New Mexico lawmakers approved nearly $200 million to fund low- and middle-income housing development, infrastructure, and homelessness programs. Washington state lawmakers also approved $127 million for the state’s housing trust fund.
Eckhart says while legislative efforts occur locally, successes can be shared and allow for future momentum for housing industry advocates across the country.
“In Indiana, two years ago, they passed legislation for more infrastructure spending from the state. That translated to Wisconsin, Montana, and Washington,” Eckhart says. “I think those ideas do move around.”
Eckhart and Weatherby also highlighted legislative wins for housing in New Castle County, Delaware, where the county council elected to adopt an updated international building code without a provision mandating sprinkler systems in new residential homes. To date, sprinklers are mandated in only two states—California and Maryland—while Massachusetts and New York have partial mandates. Additionally, a sales and use tax effort that would have taxed real estate and materials services in Maryland that the NAHB opposed also did not move forward.
Legislative Setbacks
Eckhart says the biggest legislative setback for housing advocates occurred in Arizona. Arizona Gov. Katie Hobbs vetoed H.B. 2750, a bill aimed at tackling the affordable housing crisis in the state. The bill, which passed the state House and Senate with bipartisan support, was opposed by the League of Cities and Towns because of provisions that would have “stripped local jurisdictions of their zoning power and local autonomy.”
“Maybe with some time, in the next session, there could be some compromise [on the package],” Eckhart says. “But that is a really hard one because Arizona is growing, but it will stop growing if there can’t be more houses built.”
Eckhart and Weatherby say efforts to ban natural gas, which originated with legislative efforts in Berkeley, California, and Berkley, Massachusetts, are also concerning for the NAHB. Eckhart says the NAHB’s stance is not a pro-gas one, but instead one grounded in the belief that consumers should have choices regarding gas and electric options.
“[Earlier this week], Berkeley, California, decided to get rid of its band natural gas because it was deemed illegal, but also not practical,” Eckhart says.
States to Watch
The NAHB believes New York is an important state to watch regarding natural gas in the year ahead as it is working on a natural gas energy bill. However, the NAHB helped the New York State Builders Association write a provision that would grandfather in existing developments should a ban on natural gas go through in the state.
“Nevada, Colorado, and Arizona [are also states to watch related to] water,” Eckhart says. “How they decide who gets water, that will really dictate where things are going to be built out West."
While there has not been much legislation passed related to rent control, Eckhart says the issue is generating a lot of discussions on the state level. Additionally, zoning is becoming an important legislative issue, with bills passed in recent years in Minneapolis, promoting duplex development where previously only single-family zoning was permitted, and in Spokane, Washington, permitting sixplex zoning.
“There is more push to allow density. Almost every state that [tackled] housing, they are now saying a single-family lot can be a duplex or a triplex. That is a huge win for affordability,” Eckhart says.
Federal Developments
While it may be unlikely to see many federal items pass in an election year, the NAHB says it was encouraging to have home building and housing feature so prominently in the State of the Union address.
“We did have a win in the funding package that passed to keep the government running. They funded Job Corps, which has a lot of workforce training money in it, so that was essential,” Eckhart says. “Going forward, we are going to make sure more money goes into the training of people to become carpenters or plumbers or welders.”
There are additional federal efforts to “pare back” efforts to force new construction to adopt the 2021 International Energy Conservation Code. The NAHB believes such efforts would be a blow to housing affordability.
