Biden Wants to Incentivize Inclusionary Zoning

Although zoning has traditionally been left up to local jurisdictions, the housing crisis has prompted the federal government to join states in pushing for zoning reform that would loosen restrictions in single-family neighborhoods and create more desperately needed housing. According to Kery Murakami, “[President] Biden in his March 26 budget request for the next fiscal year called for creating a $10 billion state and local grant program meant to encourage and support zoning changes that would allow more kinds of housing to go up in what are often largely white and wealthier neighborhoods.”

In another shift from the earlier domestic spending legislation, Biden’s new proposal would pump federal funding for affordable housing, road, water and sewer improvements to those communities willing to revamp zoning codes. Money would also be available for costs like research and technical assistance to help places working on changes.

The proposals require approval from Congress, where support is mixed and “[t]he prospect of the federal government using tax dollars to try to influence local decisions that would change the nature of neighborhoods is controversial.” But “At a time when states and localities are struggling with a lack of affordable housing, the lure of more federal dollars could be enough to nudge governments towards zoning changes.” This “carrot” approach to promoting more inclusionary zoning stands in contrast to recently passed state laws that require cities to loosen zoning restrictions and approve higher-density developments to meet their housing needs.