The National Apartment Association (NAA) funded a study conducted by the Terner Center for Housing Innovation to identify and examine state-level programs that encourage cities to adopt policies that would facilitate increased housing development.
Highlights from State Pro-Housing Programs
- Pro-housing designation programs can help incentivize local governments to reform zoning laws and streamline approval processes, which in turn can help accelerate housing production.
- States offering exclusive access to grants and funding opportunities for infrastructure, transportation and housing development can incentivize local participation and policy adoption.
- Programs that allow localities to choose from a menu of reforms can drive change by letting cities implement policies that best fit their unique housing needs.
- All the profiled programs emphasize zoning changes as a primary method to increase housing supply, with policies like upzoning and eliminating single-family zoning being key to success.
- Incentives, or carrots can help drive local government action. Rewarding cities for housing production and policy adoption can be an important complement to state-level housing requirements.
- States are strengthening data collection and monitoring systems to track local housing production and policy implementation, helping to ensure that reforms translate into tangible results.
- The programs profiled emphasize policies that support affordable housing development, particularly for households earning 80% or less of AMI.
- Successful programs were built through early stakeholder engagement, including locally elected city officials, developers, housing advocates and residents, ensuring broad political support.
- While most of the programs examined are in the early stages, ongoing monitoring and evaluation will be essential to measure impact on housing production and affordability over time.
- The findings from this study highlight the need for scalable housing solutions that can be adapted across different local circumstances, especially in states struggling with housing affordability and availability.
State Pro-Housing Programs Profiled
1. Housing Choice Community Designation – Massachusetts (2017): Voluntary program that incentivizes housing production by offering municipalities exclusive access to state funds. To qualify, communities must either meet housing production benchmarks or adopt seven state-approved best practices, including zoning reforms and affordability measures. Housing Choice Communities are eligible for grants of up to $500,000, as well as priority consideration for other state funding programs. Since its launch, 109 communities have been designated as Housing Choice Communities. The program has awarded $27 million in grants and helped Massachusetts align its housing policies with local priorities.
2. Pro-housing Designation Program – California (2019): A points-based program that encourages localities to adopt policies that remove barriers to housing production, including zoning reforms, streamlining approval processes and reducing construction costs. Jurisdictions that receive the designation gain access to significant state funds and priority processing for other grants. As of August 2024, 50 jurisdictions have received the Pro-housing Designation. The program’s flexibility in allowing jurisdictions to choose from a wide range of policy options has been key to its success.
3. Moderate Income Housing Plan – Utah (1996, Updated in 2022): Required for certain municipalities, this program mandates the adoption of three to five state-provided housing strategies. Noncompliance results in the loss of transportation funds, while compliance offers priority access to state infrastructure funds. To date, 83 cities and several counties have submitted MIHPs, with varying levels of compliance. Starting in 2024, noncompliant cities face daily penalties, adding an enforcement component to the program.
4. Pro-Housing Community Program – New York (2023): Offers municipalities access to $650 million in state funding by certifying them as pro-housing. Localities can qualify by increasing their housing stock or passing a pro-housing resolution. Certification is now a prerequisite for accessing key state funding programs, incentivizing municipalities to adopt pro-housing policies. Since its launch in September 2023, 180 jurisdictions have been certified, with many others in the process of applying.
5. Land Use Planning Act – Montana (2023): Requires larger municipalities to establish long-term land use plans and adopt zoning regulations that include at least five pro-housing strategies. It aims to streamline development by shifting public participation to the early stages of planning and simplifying zoning approvals. The program is in its early stages, with cities having up to five years to comply. There are no formal enforcement mechanisms in place, but the program has fostered significant local engagement. However, the law faces legal challenges, including a lawsuit from a homeowner group contesting changes to public participation requirements.
6. Housing Champion Program – New Hampshire (2023): An incentive-based program that rewards municipalities for adopting policies that promote workforce housing. Localities earn points based on their adoption of zoning reforms, infrastructure upgrades and other pro-housing policies, with certified jurisdictions gaining access to state resources and funding. The program is set to launch in late 2024, with formal rules adopted in August. It is expected to play a key role in addressing New Hampshire’s workforce housing shortage, with nearly 90,000 units targeted for development by 2040.
Pro-housing designation programs represent a promising approach to facing the nation's housing affordability crisis. By fostering state-local partnerships and offering incentives for local policy change, these initiatives hold the potential to enhance housing affordability and production.
Read the full report to learn more about how states are incentivizing local pro-housing reforms.