State Legislatures and Housing Reform – May 2024

This post is a part of Housing Affordability Institute’s ongoing State Legislatures and Housing Reform project. Throughout 2024, the Institute will monitor how state lawmakers are working to address their states’ housing challenges.

As more legislatures across the country begin to wrap up their work, Housing Affordability Institute provides a look at the work completed in 2024.

Arizona and Colorado Stage Comebacks

After falling short of enacting reforms in 2023, lawmakers returned to work in Arizona and Colorado this year determined to bring bills across the finish line in 2024. Despite some mid-session setbacks, both states were able to stage late-session comebacks that saw portions of their reform agendas cross the line.

Despite mid-session vetoes by Gov. Hobbs, reform advocates were able to get two major bills signed into law as the legislative session drew to a close:

HB 2720 legalized accessory dwelling units (ADUs). The shares the same bill number as the vetoed Arizona Starter Home Act which would have:

  • Prohibited municipalities from mandating the inclusion of luxury amenities as a condition of project approval. Mandating these amenities also necessitates the creation of a Home Owners Association;
  • Prevented municipalities from imposing square footage minimums or home dimension requirements, any minimum lot size
  • Banned architectural requirements and aesthetic mandates; and
  • Established setback guardrails.

HB 2721 allows for a wider range of housing options, including Missing Middle housing.

Another bill, HB2584, would have prevented municipalities from prohibiting the use of materials approved by the model building code and bans municipal prohibitions on prefabricated units and components. This bill passed the State House but failed to pass in the State Senate.

Colorado Gov. Jared Polis made housing a signature part of his legislative agenda in 2023 and the payoff came this year after the Colorado Legislature passed several bills:

  • HB24-1152: Legalizes ADUs in major cities provided they meet the established criteria.
  • HB24-1304: Initially a bill to eliminate parking mandates near transit in major cities, the final version of the bill eliminated parking mandates along major transit routes. The bill also includes a maximum of one parking space per unit if there is a demonstrated negative impact on the area without parking.
  • HB24-1313: Larger cities must establish a density target for zones adjacent to major transit lines, necessitating zoning regulations to accommodate an average of 40 housing units per acre. These cities are required to devise strategies to meet this target and furnish regular progress reports to the state.
California Presses On

Unlike most states, California’s legislative session stretches through August. Through May, here are several of the key bills progressing in 2024:

AB 1820: This bill requires local governments to provide a precise estimate of the fees required for a proposed development at the time of building permit application. AB 1820 passed the State Assembly without opposition and awaits action in the State Senate.

AB 2144: This bill requires greater transparency with local government impact fees has cleared two State Assembly committees and awaits action in a third committee.  

SB 450: A technical fix to 2021’s SB 9, this bill adds a 60-day review period max to all SB 9-related projects, provides guard rails to ensure lots can be split, and prohibits local governments from applying different standards of review for SB 9-related projects that do not already apply to single-family housing. The bill has cleared the State Senate and awaits a floor vote in the State Assembly.

SB 937: Delays payment of impact fees until the certificate of occupancy is issued. The bill passes the State Senate without opposition and is awaiting action in the State Assembly.

SB 1211: Builds on past ADU reforms in California by allowing up to eight detached ADUs on multifamily properties and prohibits local governments from requiring the replacement of surface parking spaces when an ADU is built. This bill has passed the State Senate and awaits action in the State Assembly.

SB 1470: This Condo Defect Reform bill is awaiting action in the State Senate.

Minnesota Sets Ambitious Goals, Does Not Leave Empty-Handed

After six years of discussions on housing reform, Minnesota lawmakers unveiled a large housing policy reform package backed by an even larger coalition.

The “People Over Parking Act” (SF 3573) was a bill that would have allowed the property owner to determine the number of parking spots by eliminating parking mandates statewide for all types of development. The bill was not heard in the House and had its only Senate hearing late in the session when the bill was amended to include prohibitions on mandating Home Owner’s Associations within new developments. The provision was not included in any larger bill.

HF 4009 / SF 3964 was a comprehensive reform bill to:

  • Establish separate density requirements for large and small communities.
  • Density bonuses for projects targeting specific income levels or for all-electric homes.
  • Small lots by right, with different sizes based on community classification and home types.
  • Administrative approvals on projects complying with the law.
  • Statewide framework for ADUs.
  • Guardrails on zoning to ensure municipal controls do not block missing middle housing.
  • Prohibit the use of aesthetic mandates.
  • Multifamily dwellings in commercial areas.

The bill sailed through both chambers’ Housing Committees but found opposition in the State and Local Government Committees. The multifamily in commercial zones provision was placed on a separate track and failed to clear either chamber’s State and Local Government Committee. Aesthetic mandate reform language was included in the final Senate Housing Policy Omnibus bill but was not adopted by the Transportation, Labor and Housing Policy Omnibus conference committee.

While major reforms fell short, two other provisions did get passed:

  • A bill to address environmental NIMBYism to exempt zoning changes and comprehensive plans from environmental reviews passed.
  • A bill that would have required the state’s Department of Labor and Industry to amend the state’s building code to allow for single-stair multifamily dwellings, was amended to create a study committee on the topic.
Utah Still at the Starting Line

Last year, it looked as if Utah was going to be the next Mountain-West state to take up state-level comprehensive housing policy reforms. Instead, a bill to enable new starter home construction, HB 306, appears destined to die in committee. Housing advocates hope to come back in 2025 with a similar agenda.

Virginia Sees First Reforms

After several attempts at passing reforms in Virginia, the first reform-minded bill was enacted. SB 195 created a stakeholder group to create a recommendation for single-stair R-2 occupancy dwellings.