Throughout 2026, Housing Affordability Institute will be tracking housing policy reforms working through state legislatures across the United States. There has been a lot of movement since last month’s update, including more governors making reform a priority, exaction reform in Arizona, and Indiana’s reform bill clears its first Senate committee.

Illinois, Pennsylvania Governors Lean In On Reforms  

In Illinois, Governor J.B. Pritzker proposed statewide zoning changes that would limit local control, allow more multi-unit housing and accessory dwelling units, and pair those reforms with infrastructure funding to accelerate homebuilding. In Pennsylvania, Governor Josh Shapiro unveiled a broad housing strategy aimed at boosting construction and reversing the state’s lagging housing production so that Pennsylvania can become a national leader in homebuilding.

Arizona Advocates Go After Exaction Reforms

The Central Phoenix Homebuilders Association, Arizona Neighborhood Project, and Pacific Legal Foundation are working with state lawmakers on codifying Sheetz v. El Dorado in state law. SB1787, which cleared the Senate Regulatory Affairs and Government Efficiency Committee on Feb. 18, would require individual determinations of all exactions.

Indiana Reforms Progress

After a 76-15 win in the lower chamber, HB1001 cleared its first Senate committee hearing on Feb. 19. The bill expands housing by making single-family homes, duplexes, in-home accessory dwelling units, and certain affordable housing projects permitted uses without a public hearing, while also requiring mixed-use and multifamily housing to be allowed in commercial zones if local governments do not opt out. It limits local zoning and design controls by capping parking requirements, prohibiting regulation of residential design elements, restricting lot size, density, setback, and bulk standards on certain parcels, and easing elevator requirements for smaller multifamily buildings. The bill also constrains local fees and permitting practices, sets deadlines for zoning updates tied to comprehensive plans, and requires annual housing reporting to the state beginning in 2027.