The 21st Century ROAD to Housing Act is the culmination of years of advocacy to address the national affordable housing shortage. It passed with rare bipartisan support and became law when the President neither signed or vetoed the bill after it was sent to the White House. The law is designed to remove barriers within existing programs and to streamline and expedite affordable housing production.
While the legislative changes are significant, their real-world impact will depend heavily on implementation and rule-making, which could either limit or accelerate their effect. Some of the changes are incremental, and given the considerable time for affordable housing to go from planning to completed construction, it will be years before we know whether many of these provisions achieve their intended effect.
Read more for our summary on the key provisions:
- Speeds up unit inspections for housing rented to Housing Choice Voucher (HCV) holders.
- Expands the HUD Self-Sufficiency Program pilot, which helps families build household savings, up to 5,000 families living in up to 25 PHAs or receiving rental assistance.
- Allows states and localities receiving Emergency Solutions Grant (ESG) funding to request a waiver of the statutory 60% cap on spending for emergency shelter beds and street outreach.
- Eliminates the counting of disability benefits when determining eligibility for HUD-VASH housing assistance.
- Removes a HUD requirement that manufactured homes be constructed with a permanent chassis, lowering production costs and expanding design and location options.
- Increases the cap on the number of public housing agency (PHA) units that can undergo RAD conversions from 455,000 to 555,000. RAD allows PHAs to leverage Section 8 rental assistance contracts to access private capital for major physical improvements at public housing properties. When a property “converts” via RAD, it moves from the Section 9 public housing platform to the Section 8 platform, meaning it gets a long-term rental assistance contract while residents continue paying 30% of their income toward rent.
- Adds 25 PHAs to the Moving to Work (MTW) program, which currently includes 139 PHAs, allowing them to implement certain innovative policies, if approved by HUD. Existing MTW PHAs have adopted policies such as programs to equip residents for homeownership, mobility counseling, targeted support for underserved populations, and streamlining administrative procedures. The provisions include guardrails prohibiting policies like work requirements, time limits, or significant rent increases.
- Directs HUD to identify best practices in zoning and land use that increase housing supply, and to develop “state zoning frameworks” and “local zoning frameworks” to assist state and local governments. Reforms under consideration include steps California and many local governments have already taken, including reducing parking minimums, eliminating restrictions on accessory dwelling units (ADUs), expanding by-right approval for ,duplexes, triplexes, or quadruplexes, and encouraging transit-oriented development.
- Raises the statutory cap on bank “public welfare investments” from 15% to 20% of capital and surplus. These investments include affordable housing (including equity investments in Low-Income Housing Tax Credit developments), small businesses, technical assistance, financial literacy, and other community development activities.
- Expands the use of Community Development Block Grant (CDBG) funding for new affordable housing construction, currently allowed only in limited circumstances. CDBG recipients may now use up to 20% of their allocation for new construction.
- Creates a five-year, $200 million annual competitive grant program for a wide range of housing and community development. Housing built with these funds must be “attainable”, meaning it serves households earning up to 120% of area median income (AMI), provided the majority of units are affordable to households earning up to 60% of AM.
- Designates certain HUD projects as “special projects,” giving HUD authority to delegate and coordinate environmental reviews required by the National Environmental Policy Act (NEPA), and allows HUD to reclassify certain housing-related activities for NEPA review—both in the effort of streamlining and expediting environmental reviews.
- Establishes a competitive grant program within HUD for eligible entities—such as state governments, local governments, and regional planning agencies—to support planning and implementation activities for affordable housing and community development.
- Authorizes HUD to award grants to eligible entities to select “pre-reviewed designs”—construction plans already assessed and approved by localities for compliance with local codes and standards—for mixed-income housing structures with fewer than 25 units.
- Establishes a pilot grant program within the HOME Investment Partnerships Program for eligible entities to convert vacant and abandoned buildings—such as warehouses, strip malls, or other buildings—into “attainable” or “mixed-income housing.” Housing constructed with these funds must be “attainable”, using the same “attainable” definition described above. Ties some localities’ CDBG funding to housing production, providing bonuses for localities that improve their track record on increasing housing supply and small funding reductions for localities that fail to improve housing growth.
