One Big Beautiful Housing Supply Bill
Happy Tuesday, and welcome to another edition of Rent Free.
They say all politics is local, and that’s particularly true of housing politics—where localities and (increasingly) states are the main policy-setting jurisdictions.
Nevertheless, the federal government does influence housing policy and housing outcomes through any number of regulatory and spending programs.
We got a reminder of that this past week with the release of two major federal housing initiatives.
In Congress, the Sens. Tim Scott (R–S.C.) and Elizabeth Warren (D–Mass.) announced a surprise, and surprisingly bipartisan, blockbuster bill in the Senate Banking Committee. It includes a long list of tweaks and reforms aimed at boosting housing supply.
The same day that that bill was proposed, the White House issued a new executive order on homelessness that aims to shift federal policy and federal funding from a “housing first” approach toward one focused primarily on guaranteeing public order.
This week’s newsletter takes a closer look at both proposals and what they might mean for housing costs and the number of people sleeping on the streets.
One Big Beautiful Housing Supply Bill
On Thursday night, Scott and Warren, respectively the chair and ranking member of the Senate Banking Committee, released the text of their ROAD to Housing Act of 2025, which includes a raft of new policies aimed at boosting housing supply.
Unlike past Democratic housing bills, including some authored by Warren, the legislation does not include billions of additional dollars for housing subsidies. It also excludes some controversial supply-side ideas favored by conservatives, like opening up federal lands for housing development.
Instead, the Scott-Warren bill is a 315-page amalgam of proposals from Democrats and Republicans on the Banking Committee that largely tweaks existing federal grant programs, loan programs, and regulations—with many of those changes aimed at increasing housing production.
Like an ensemble cast in a superhero movie, the bill includes a lot of familiar policy proposals that have been perennially proposed by housing supply boosters, plus a host of new ideas being audience-tested for the first time.
“Individually, some of these [policies] may seem very technical and narrowly scoped. Taken together, collectively in this package, they can make pretty meaningful progress on housing supply,” says David Garcia, the policy director for Up For Growth.
More Housing Near Transit
One common theme in the bill is reforming federal transportation and housing grants to direct more money to jurisdictions that have more liberal zoning rules and are building more housing as a result.
The bill incorporates the Build More Housing Near Transit Act, which would prioritize transit funding for projects in jurisdictions that have adopted “pro-housing policies” along proposed transit routes.
The bill defines pro-housing policies as “any adopted State or local policy that will remove regulatory barriers to the construction or preservation of housing units, including affordable housing units.”
It also lists a number of specific pro-housing policies that would make jurisdictions’ transit grant applications more competitive, including the elimination of minimum parking requirements, the adoption of by-right approval of development (meaning local bureaucrats don’t have discretion to condition or deny building permits), the reduction of minimum lot sizes, and the elimination or easing of height and density limits.
The bill was first introduced in 2019 by Rep. Scott Peters (D–Calif.). It was also introduced as a stand-alone bill this Congress by Sens. Brian Schatz (D–Hawaii) and Jim Banks (R–Ind.).
“Our bipartisan bill incentivizes cities and towns to build housing when they expand or redevelop their public transit systems. This will help put more families in homes, grow local economies, and cut carbon pollution,” said Schatz in a press release announcing the stand-alone bill.
Salim Furth, a housing policy researcher at George Mason University’s Mercatus Center, says that the bill rationalizes the award of federal transit dollars to projects in areas where local laws allow for more housing, and therefore where transit ridership will be higher.
While existing transit grant formulas do account for the influence of land use policy on ridership, land use regulation “wasn’t given enough weight. There was a bunch of things but they’re given the same weight,” says Furth.
The Build More Housing Near Transit Act places a more appropriate weight on land use laws and awards jurisdictions for actually adopting “pro-housing” policies, not just planning on adopting those policies, he says.
Refocusing Community Development Block Grants on Growth
Also included in the bill is the Build Now Act, which would redistribute some Community Development Block Grant (CDBG) money from high-cost localities building less housing to those who are building more.
The CDBG program distributes roughly $3.5 billion each year to localities and states with the primary goal of boosting economic development in poorer communities.
The lack of strings attached to CDGB funds has long made it a target for conservatives and fiscal hawks who consider it a wasteful subsidy of purely local activities. The White House’s latest budget request calls for eliminating the program.
More modest critics argue the program’s funding formula—which factors in population, poverty
Article from Reason.com
The Reason Magazine website is a go-to destination for libertarians seeking cogent analysis, investigative reporting, and thought-provoking commentary. Championing the principles of individual freedom, limited government, and free markets, the site offers a diverse range of articles, videos, and podcasts that challenge conventional wisdom and advocate for libertarian solutions. Whether you’re interested in politics, culture, or technology, Reason provides a unique lens that prioritizes liberty and rational discourse. It’s an essential resource for those who value critical thinking and nuanced debate in the pursuit of a freer society.
