HUD Event: How local governments are innovating to meet community housing needs Part 1
"...local governments big and small are innovating and experimenting with addressing their housing needs," said Lauren Lowery of the National League of Cities.
On Thursday, March 21, 2024, HUD’s Office of Policy Development & Research(PD&R) hosted a hybrid PD&R Quarterly Update on how local governments are innovating to meet community housing needs. As the crisis of affordable housing deepens in communities across the country, local leaders are taking innovative steps to increase the supply of affordable housing. From local housing production funds to the development of social housing agencies, these leaders are at the forefront of housing solutions. At this event, we hear from local leaders about the actions underway in their communities.
In Part 1 we hear opening remarks from Brian McCabe, the Deputy Assistant Secretary for Policy Development at the Department of Housing and Urban Development, and keynote remarks from Lauren Lowery, Director of Housing and Community Development, National League of Cities.
See Part 2 here and Part 3 here.
Brian McCabe: For the last three years, the Biden-Harris Administration has been focused on what the federal government can do to increase the supply of housing in America. Two years ago, we announced a far-reaching housing supply action plan. The plan outlined efforts to reduce barriers to building housing across communities. It sought to curtail restrictive zoning rules and expand financing opportunities for affordable climate-resilient housing. The plan highlights the importance of manufactured housing and the expansion of ADUs to meet our supply needs. We later put forward ideas to accelerate commercial to residential conversions meeting the moment in many American cities. Just today, a report from the White House is calling for additional federal action to drive down housing costs for American households.
In the annual economic report of the president, the White House proposes additional actions that would incentivize localities to change zoning rules that are obstructing the construction of new housing. And here at the Department of Housing and Urban Development, we've been working hand in hand with our fellow agencies to promote affordability and to increase supply. HUD launched the preservation and reinvestment initiative for community enhancement or price program to revitalize and preserve manufactured housing. We're working to make the home investment partnership program easier for communities to use. We're awarding money through the pathways to removing obstacles to housing or the pro housing NOFO (Notice of Funding Opportunity) to support communities that are working to remove barriers to affordable housing by changing outdated zoning and land use policies, improving infrastructure and combating natural disaster across the agency. From the Office of Community Planning and Development to the Office of Housing, my colleagues are deeply committed to the work of expanding housing supply to meet our housing needs.
To gather ideas for how to do this we've both looked abroad and we've looked closer to home. Last year, the deputy secretary traveled to the International Social Housing Festival in Barcelona to understand models of social housing being developed throughout Europe. Closer to home. My colleagues and I in the Office of Policy Development and research traveled just outside the city limits to Montgomery County, Maryland, where as you'll hear today, an innovative housing production fund is transforming the model of housing production. Our upcoming Innovative Housing Showcase scheduled for June on the National Mall will continue to raise awareness of new designs and technologies that can lower the cost and increase the supply of housing. Understanding and advancing these new innovative models to promote housing supply is an important priority for the Biden-Harris administration. To underscore that commitment, the president's budget includes $20 billion in mandatory funding to set up a new innovation fund for housing expansion.
If funded, this commitment would offer competitive grants to communities to develop plans to expand the supply of housing. But as we know, the powers of the federal government are limited with respect to housing supply, and they're particularly limited if Congress is unwilling to fund programs and policies that support this work. As such, we're relying on the ingenuity, innovativeness and fortitude of our partners across local government.
I'd like to invite Lauren Lowry, the Director of Housing and Community Development at the National League of Cities to present a keynote for today's talk. Before joining the National League of Cities, Lauren held several roles in local government, including her service as the executive assistant to the Mayor of Norfolk and the strategy and policy manager in the Department of Neighborhood Development.
Lauren Lowry: I would like to thank PDR and HUD's leadership for focusing on a topic that resonates more than ever with local governments working for the National League of Cities. There's not a room I go in with local leaders where housing does not come up. And in those discussions, local leaders are often asked questions such as, what housing policies or solutions should my city consider implementing? Which cities or local governments are doing this well? And why are these housing policies successful now more than ever, especially with the work of National League of Cities and the American Planning Association has done through the Housing Supply Accelerator, a partnership focused on locally driven housing supply solutions by aligning the efforts of public and private stakeholders to meet housing needs at the local level. It is important to keep in mind local governments often do not start from the same place where resources, tools, funding, or partnerships are readily available.
This is important to keep in mind because innovation comes from a place of wanting to or having to address the challenge. And for local governments, the challenge is ensuring that every resident has a place to call home. Because at this point in time, local governments are faced with a housing supply shortage that is being keenly felt by its residents and constituents. But before we can innovate, we must understand the obstacles and barriers that local governments face. And there are many of them. From January to February, 2003, national League of Cities conducted a survey to learn more about the challenges that cities face regarding housing supply and to gauge their responsiveness to policy pathways and solution. More than 300 cities responded to our survey. The findings revealed that expanding or diversifying local housing supply stands out as a high priority for local leaders. However, despite the urgency of this priority, local leaders across diverse geographies encounter substantial hurdles.
These include a shortage of developers or laborers for construction limitation in finance and new construction and renovations, difficulty accessing grants, regulatory obstacles, community opposition and state policy, as well as costly infrastructure needs associated with increased housing. And despite these challenges, the majority of local governments view themselves as primary responsible for expanding housing supply through strategies such as preserving existing housing stock, developing new housing, and making land use and zoning decisions. I cannot emphasize this enough when I say local governments big and small are innovating and experimenting with addressing their housing needs. Innovation at the local level can be as simple as a slight tweak of a policy or program such as using city owned land strategically for housing development, or it could be the creation of a cutting edge policy or program such as social housing. Both types of innovation have a place in local government.
In Waterloo, Iowa, the city council partnered with the Hawkeye Community College to facilitate hands-on learning for students enrolled in its sustainable construction and design program by selling vacant lots for a dollar and allocating funds for labor and material. The city council enables students to gain practical experience while addressing the shortage of affordable housing and rebuilding the community. The sale of these vacant lots also works to eliminate blight, invest into older neighborhoods and train the future workforce
For housing info projects in Tempe, Arizona, the city council established the Tempe Hometown for all initiative. While private developers play a crucial role in Tempe Landscape hometown for all facilitates the creation of new affordable housing units. A key feature of the program is its unique funding mechanism. 50% of certain permanent fees are earmarked for affordable and workforce housing projects. In addition, this initiative provides an avenue for voluntary donations from developers to support the city work. The initiative has resulted in $6.7 million in city investment and $3.7 million in donations to create the next generation of housing opportunities.
In Chicago, Illinois, the city went to market in early 2003 with $160 million in Chicago social bonds. The bond support various projects including the construction of over 2000 units of affordable housing, the establishment of safe emergency shelters for the homeless and the revitalization and sale of vacant city lots. To name a few to prioritize community involvement, the city offered bonds to Chicago residents and individual investors as opposed to large financial institutions.
I decided to uplift these examples on how local governments are meeting their community housing needs through innovation for a number of reasons. Each of these examples demonstrate that both big I innovation and little I innovation have a place in helping local governments to meet their community housing needs. These examples also demonstrated that along with innovation, partnerships with community-based organizations, anchor institutions, local businesses, and residents are core to furthering impact with addressing community housing needs.
Lastly, these examples demonstrate that leveraging resources such as land funding, relationship time, and talent can further spur innovation to allow for increases in affordability and increases in the supply of housing. Before I conclude my remarks, I would like to challenge our panelists and each of you with some questions to grapple with to ensure innovation happens and continues to happen at the local level.
My first question, “How can we invest in local government's capacity to continue innovating to meet housing needs now in the future?” My next question, “How can each decision maker, both public and private in the housing supply ecosystem work together to be aligned to meet housing needs with an actionable level of consensus?” My final question, “What will it take to recognize and embrace the complexity of meeting housing needs and developing a multi-layer solutions tailored to the unique challenges in each locality?”
Thank you for your time.