The State and Local Housing Action Plan

Local Housing

Introduction

The United States is facing a profound housing crisis, marked by record homelessness, skyrocketing rents, and a historic shortage of affordable homes for both renters and buyers. In response, the National Housing Crisis Task Force a bipartisan coalition of mayors, governors, housing finance leaders, and private-sector innovators, has released the State and Local Housing Action Plan. This document is not another academic study. It is a practical, how-to guide for state and local governments, philanthropies, and private partners.

The central premise is powerful: State and local governments have more power, more capital, and more capacity than they realize. While federal policy remains stalled or uncertain, cities and states are already deploying innovative tools to boost housing supply, speed construction, and preserve affordability. The Action Plan profiles 15 specific, replicable tools across five key areas: Land, Capital, Construction, Regulation & Policy, and Governance.

Below is a detailed summary of the plan’s core arguments, its most promising tools, and a roadmap for local housing action.

The Core Philosophy: A Federated System with Local Leadership

The U.S. housing system is largely undergirded by federal agencies like HUD, the FHA, and the Treasury. However, the Task Force argues that the most sweeping changes are now happening at the state and local level. Faced with decades of federal inaction and a possible restructuring of housing policy, cities and states are looking to their own balance sheets, constitutional powers, and enabling legislation.

The Local Housing Action Plan is built on three key ideas:

  1. Complementarity: The tools are designed to work together across land, capital, construction, regulation, and governance. Implementing at least one tool from each category can have a catalytic impact.

  2. Connecting Silos: The plan brings together state HFAs, local governments, PHAs, philanthropies, private capital, and companies that traditionally do not coordinate.

  3. Replication: The tools are drawn from real-world innovations in places like Atlanta, Chattanooga, San Francisco, and Montgomery County, and are presented as models that can be scaled nationally.

The Task Force urges communities to assess existing tools, convene a local "Housing Strike Force," identify relevant innovations, and then pass policies that reduce costs and speed construction.

Land Interventions: Unlocking Public Property for Housing

One of the biggest underutilized assets is publicly owned land. The Lincoln Institute estimates that local agencies own over 230,000 acres of transit-accessible land, enough for nearly 6 million homes. However, this land is fragmented across school districts, transit authorities, local housing, and housing agencies that lack development expertise.

Tool 1: Public Asset Corporations

A Public Asset Corporation (PAC) is a dedicated public entity often a subsidiary of a public local housing authority, created to redevelop public land into mixed-income housing. Unlike traditional disposition processes that sell land for quick cash, PACs retain ownership, act as joint-venture partners, and use a full suite of tools:

Examples: Atlanta’s Urban Development Corporation (AUDC) and Invest Chattanooga. Both were created in the last two years as subsidiaries of their local housing authorities. They use a streamlined RFQ (Request for Qualifications) process instead of cumbersome RFPs, focusing on developer capacity first. The Port of Greater Cincinnati Development Authority is an older model using land banks and tax-exempt bonds to build mixed-income housing.

Tool 2: Municipal Property Advisors

Not every city can create a full PAC. The Municipal Property Advisor (MPA) model, pioneered in Austin, offers a scalable alternative. An MPA is a third-party intermediary hired via RFQ to identify, monetize, and redevelop underutilized public assets on behalf of the city. They manage the entire process from asset mapping to negotiating development agreements and are paid through transaction fees, minimizing upfront public cost. This model fills the capacity gap for most local governments that lack in-house real estate expertise.

Capital Interventions: New Ways to Finance Affordability

As traditional federal subsidies like LIHTC are oversubscribed and uncertain, local capital innovations are critical. The plan focuses on five powerful financing tools.

Tool 3: Right-Sizing Property Tax Incentives

Property tax abatements are common, but often either give away too much public value or offer too little incentive. The Task Force proposes a standardized Underwriting Model using three metrics:

Case studies include: Texas Public Facility Corporations (PFCs) which require 10% of units at 60% AMI and 40% at 80% AMI; Atlanta’s Private Enterprise Agreement (PEA) using ground leases for tax exemptions; and Chattanooga’s PILOT program offering a 2% premium on abated cash flows.

Tool 4: Place-Based Philanthropy

Community foundations are moving beyond traditional grants into impact investing. The Community Foundation for Greater Atlanta (CFGA) launched the $100M GoATL fund (loans at 3-6.5%) and the $100M TogetherATL fund (0% interest loans for deep affordability). The San Diego Foundation aims to produce 10,000 units by 2034 via a Local Housing Housing Fund. The Chicago Community Trust created the 3C Initiative, offering 3.5% fixed-rate mortgages with no PMI in underserved West Side neighborhoods. These foundations act as conveners, pilot funders, and capital aggregators a role that could unlock billions from the $1.1 trillion in philanthropic assets nationwide.

Tool 5: Housing Ballot Measures

Voter-approved local funding streams are a powerful, untapped resource. In 2024, there were only 53 housing ballot measures vs. 120 transportation measures. Los Angeles County’s Measure A raises an estimated $1.1 billion annually for homeless services and affordable housing. San Antonio’s 2022 bond leveraged $67M into $644M in private and federal funds. The plan details how to design, campaign for, and implement these measures, including lessons from Denver’s failed 2R measure (too little community engagement, competing tax measures).

Tool 6: Public-Private Collaboration (Housing Accelerator Fund)

The San Francisco Housing Accelerator Fund (HAF) is a standalone CDFI and nonprofit that blends public, private, and philanthropic capital. The city provided a $20M subordinate, 0% interest loan, which HAF has leveraged 20:1 into over $450M in capital, funding 3,000+ homes. HAF’s innovation is underwriting loans to a future public sector takeout (committed permanent financing), turning real estate risk into public finance risk. This model is being replicated in Philadelphia, Austin, and Cleveland.

Tool 7: Public Investments in Starter Homes

To address the collapse of entry-level for-sale local housing, states are using creative finance. The Utah Homes Investment Program repurposed $300M from a transportation fund to provide developers below-market loans (federal funds rate +1.5%) for homes under $450,000. The subsidy cost per home is just $6,000. Washington County, WI’s Next Generation Housing Initiative uses ARPA funds for 0% predevelopment loans up to $20,000 per unit and permit fee reimbursements in exchange for homes sold below $420,000 with permanent owner-occupancy deed restrictions.

Tool 8: Mixed-Income Public Development (Housing Production Funds)

This model, pioneered by Montgomery County’s Housing Opportunities Commission (HOC), uses a revolving loan fund to provide 20% of construction costs at below-market rates. The public entity takes a majority ownership stake (51%+) in a joint venture with a private developer. At stabilization, the loan is repaid via low-cost permanent financing, often through HUD’s Section 542(c) Risk Share program and the Federal Financing Bank (FFB). This creates a virtuous cycle: the fund revolves, and the public sector retains long-term control over affordability. Atlanta ($38M), Chicago ($135M), and Chattanooga ($20M) have since launched similar funds.

Construction Interventions: Lowering the Cost to Build

Construction costs have grown at double the rate of inflation. The plan offers two disruptive solutions.

Tool 9: Pre-Purchasing to Increase Modular Capacity

Modular construction can cut costs by 20-30% and timelines by 30-50%, but requires upfront factory investment (typically $40-50M). Cleveland’s Site Readiness Fund issued an RFP to attract a modular factory, offering a guaranteed pipeline of 100-200 homes annually for ten years, plus 18,000 vacant lots and streamlined permitting. The Minneapolis Public Housing Authority used modular to deliver 84 units across 16 scattered sites 30% faster than conventional methods. A cooperative pre-purchasing agreement in the Boston area (MAPC) aims to pool demand from four cities to locate a modular facility within 50 miles.

Tool 10: Building for Insurability, Resilience & Efficiency

Climate change is driving up insurance premiums and utility costs, undermining long-term affordability. The plan recommends:

Regulation & Policy: Removing Barriers to Production

Even with financing, regulatory barriers slow or stop local housing. The plan tackles land use, permitting, and building codes.

Tool 11: Land Use, Permitting & Building Code Reform

The plan summarizes a decade of progress, noting that states as diverse as California, Montana, and Florida have passed zoning reforms. Key actions include:

The plan emphasizes that reform requires strong leadership, broad coalitions, and iterative progress—not one omnibus bill.

Tool 12: Industrialized Housing Delivery (IHD)

IHD goes beyond modular to treat local housing as a manufactured product. The plan recommends two simultaneous actions:

  1. Regulatory reform: Harmonize building codes across jurisdictions and shift from prescriptive codes (dictating materials) to performance-based codes (focusing on outcomes like fire safety). Virginia is a leader, having adopted ICC/MBI 1200 standards for offsite construction.

  2. Demand aggregation: Public housing agencies and state HFAs should revise award criteria to prioritize total project cost, speed, and consistency areas where IHD excels. The Minnesota Construction Revolution used this approach to launch Rise Modular and a 84-unit MPHA project.

Governance: Building Capacity for Scale

The final set of tools focuses on how to organize for success.

Tool 13: Housing Command Centers (Homelessness)

Inspired by disaster response, Housing Command Centers (HCCs) apply emergency management to homelessness. Houston reduced wait time for local housing from 720 days to 32 days. Denver’s House1000 housed 1,034 people in six months using a HCC led by a senior mayoral advisor, with dedicated unit acquisition teams and daily case conferencing. Cleveland’s A Home for Every Neighbor housed 155 chronically homeless individuals in eight months, with an average of 11.5 days from intake to move-in. Key components: real-time by-name data, a flexible fund for small needs (e.g., $500 for record clearance), and strong landlord incentives.

Tool 14: Atlanta’s Housing Strike Force

Mayor Andre Dickens convened a Strike Force of senior executives from every public agency that touches housing or land (schools, transit, housing authority, land bank). They meet quarterly to track progress toward 20,000 affordable units. Key lessons: set a clear “north star” goal, leverage public land, reset the toolbox (borrowed Montgomery County’s loan fund), use overlooked legal powers (1937 Georgia Housing Authorities Law), secure early wins (a 40-unit modular project in four months), and increase public sector risk tolerance (city bought a 41-story vacant office building to catalyze conversion).

Tool 15: Organizing Tax-Advantaged Capital (Opportunity Alabama)

Opportunity Alabama (OPAL) is a best-in-class intermediary that mobilized Opportunity Zone (OZ) capital. Alabama ranks top 10 nationally in OZ investment. OPAL evolved from a “connector” to a capital allocator, creating its own investment infrastructure. It also offers a Property Development Assistance Program (PDAP) that provides wraparound technical assistance (pro formas, design, capital stacking) to local developers especially in rural areas. Key lesson: OZs were the “hook” to build an ecosystem, but the real impact came from aggregating local capital and providing deep technical assistance.

Conclusion: A Living Roadmap

The State and Local Housing Action Plan is a living document. The Task Force will continue to update it as new innovations emerge, particularly in response to federal changes. The Mayors’ Implementation Committee, co-chaired by Mayor Kate Gallego (Phoenix) and Mayor Quinton Lucas (Kansas City), will test these tools on the ground.

The message is clear: the power to solve the housing crisis lies increasingly in state capitals, city halls, county commissions, and community foundations. By using the 15 tools in this plan from Public Asset Corporations and Housing Production Funds to Housing Command Centers and pre-purchased modular factories, local leaders can produce and preserve housing at lower cost and greater speed. The crisis is urgent, but the solutions are already here. The task now is to scale them.

Also Read: “The New Poverty Line in Urban Sri Lanka: What It Means for Affordable Housing Design”