What are Utah lawmakers doing to address Utah's housing market crisis?

SALT LAKE CITY — Before the Utah Legislature's 2023 general session began, Republican leaders promised action this year to address the affordable housing crisis, fueled by the state's persistent housing shortage and exacerbated to extraordinary levels by the pandemic housing frenzy.

Sure enough, there's been no shortage of bills grappling with housing issues this year, taking on everything from first-time homebuyer assistance to policy changes meant to break down regulatory barriers for housing development.

In the policy realm, Utah's Republican-controlled Legislature this year has largely favored a freer market approach — looking for means to get out of the way of developers so they can build more houses at more cost-effective price points, make somewhat of a dent on the housing shortage, and therefore eventually lead to more affordable homes.

That's the hope, at least, while also balancing cities' abilities to maintain local control and regulate development.

"The most important change we're making is to establish uniform standards for cities across the state to use when they're developing housing," said Sen. Lincoln Fillmore, R-South Jordan, a sponsor of one of the bills and co-chairman of the state's Commission on Housing Affordability.

"It strikes the right balance between protecting property rights and increasing housing supply and protecting the public's right to have input and a say," he said.

There have been some cases of upset local officials — take what happened with Summit County — a state lawmaker accused the county of violating state law for not adopting a housing and transit reinvestment zone at Kimball Junction. Also, the Utah League of Cities and Towns opposed a late-filed bill that would allow developers to create their own districts to finance infrastructure projects.

For the most part, however, local leaders have supported efforts in a trio of what legislators have called "consensus bills" that are nearing final legislative approval before the session ends Friday at midnight.

'Consensus bills'

The bills seek to help streamline and standardize regulations to help make development more "predictable" while balancing city needs. The legislation stemmed from months of work in the governor's Unified Economic Opportunity Commission, which tasked a subcommittee with finding affordable housing solutions statewide.

SB174, sponsored by Fillmore, would:

• "Streamline" cities' subdivision process, meaning cities would only hold one initial public hearing for an application to subdivide land. If the application complies with existing zoning requirements city officials would need to approve it. It would also make clear the implementation of an approved plan is an administrative function, and therefore not subject to subsequent public hearings.
• Implement penalties on cities and counties that haven't submitted their moderate income plans or if they've been rejected. The bill would allow a period of time for municipalities to come into compliance, but eventually be required to pay $250 each day they haven't complied into the state's Olene Walker Housing Loan Fund, which funds affordable housing projects. Starting in 2025, that fee would increase to $500 a day.

HB364, sponsored by Rep. Stephen Whyte, R-Mapleton, would:

• Build upon legislation passed in 2019 and in 2022 to encourage local officials to plan and zone for affordable housing, including requiring "station area plans" or housing development based around public transit.
• It clarifies "confusion and inconsistencies," Whyte said, and implements reporting requirements while also funneling more money into the state's Low-income Housing Tax Credit to incentivize developers to build low-income housing. Legislative leaders budgeted $53.4 million in new, ongoing funds for that tax credit.

HB406, also sponsored by Whyte, would:

• Focus on reducing regulatory barriers and standardizing rules around development agreements, annexations, moratoriums and development standards to provide more predictability and uniformity.
• For example, the bill prohibits a city to require a residential roadway to be wider than 32 feet except in certain circumstances.

As of Wednesday, the three bills were still waiting for final votes, though they're expected to advance to Gov. Spencer Cox by Friday at midnight.

Cameron Diehl, executive director of the Utah League of Cities and Towns, said the league has taken positions of support on those bills so long as they pass in their expected forms. The league negotiated with lawmakers throughout the session to play a part in housing solutions while also balancing cities responsibilities.

"We are collaborating with state leaders and other stakeholders to ensure the quality of life of today's and tomorrow's residents," Diehl said. "We've worked hard to find solutions around state and local infrastructure investment as well as local land use process improvements that will facilitate smart growth and tackle our housing challenges.

"Combined with last year's legislation to create station area plans around transit stops," Diehl added, "we think we've found meaningful solutions to tackle housing affordability and respect the role of cities and towns."

How much money for housing, homelessness?

Legislative leaders in charge of the budget have indeed prioritized funding for housing and homelessness initiatives in a big way this year — to the tune of over $198 million in new spending on various programs.

While it remains to be seen how much of an impact the new funding and policy changes will have on Utah's affordability crisis, housing advocates are expressing gratitude that lawmakers are putting their money where their mouth is and prioritizing the issue in a way they haven't before.

"They are finally on the right track of investing money in the way it needs to be invested in homelessness," Tara Rollins, executive director of the advocacy group Utah Housing Coalition, told the Deseret News in an interview Feb. 28.

While lawmakers didn't fund everything Rollins' group has asked for and didn't exactly follow the governor's budget recommendations, she credited lawmakers for funding programs to help low- and moderate-income Utahns, as well as people who need deeply affordable housing.

In addition to $53.4 million in ongoing funds for the Utah Low-income Housing Tax Credit, the Legislature is also poised to fund $50 million for deeply affordable housing, $12 million for homeless services, $10 million for the Utah Housing Preservation Fund, and $50 million for first-time homebuyer assistance.

Rollins said she wished, however, more money was put into the Olene Walker Housing Loan Fund.

"Overall, I'm pleased that my members and partners are going to be able to get new tools, resources to be able to meet their mission to increase housing that people can afford," she said. "It's a great day for that."

Unlike past years, housing advocates can walk away from this legislative session without feeling shortchanged, Rollins said.

"Housing definitely has been in the limelight," she said. "It's been exciting to see people starting to really understand the importance of people being stable in their housing."

Is the Utah Legislature doing too much for developers?

It's no secret that legislative leaders have ties to the housing development community. For example, both Senate President Stuart Adams, R-Layton, and House Speaker Brad Wilson, R-Kaysville, have worked in real estate.

But if you ask Fillmore, this year's efforts around housing haven't been favoring developers over city needs or citizen input — it's more about "balancing" all of those needs together to help find solutions in a system that's so far resulted in unsustainable price increases.

To critics who say lawmakers are too developer friendly, Fillmore said, "you should judge the Legislature on the Legislature's actions, not the proposal of a single legislator."

Another bill that's also making its way through the process is SB199, a bill to block voters from challenging local legislative land-use decisions if they're approved with a supermajority vote. That's one bill Fillmore said he didn't support because he thought it was "unconstitutional and tilted too far away from public involvement, where I'm trying to strike a balance."

"This is a statewide issue, and we want to strike the right balance to protect the ability of local cities to control land use, but to the degree that cities are not willing to be apart of solving this statewide problem, I just don't think cities ought to be able to count on state support," Fillmore said, pointing to penalties in his bill, SB174, for cities who don't follow requirements regarding their moderate income housing plans.

'It's not just Utah'

What "keeps me up at night," Fillmore said, "is wondering if my 8-year-old is going to be able to buy a house in 20 years. I really want the answer to that question to be yes, so I'm working toward that end."

Fillmore said "neither I nor the Legislature has the power to just will that to happen. But we can craft good policies that strike a right balance that protect property rights, that protect the public's right to have a say."

However, "it's not just Utah" struggling with housing. "This is a nationwide issue. It's almost a worldwide issue."

Chris Gamvroulas, president of Ivory Development with Ivory Homes, Utah's largest homebuilder, and also a member of the state's Commission on Housing Affordability, applauded the Legislature's efforts this year. He said if the development community actually "got everything we wanted, the bills would look a lot different, I promise you."

Still, "these are all going to make a difference," Gamvroulas said of Fillmore and Whyte's bills. "As much as I wish they went further, I am acknowledging that we are making progress."

'Developer versus city'

Gamvroulas said any criticisms that the Legislature is too developer friendly "comes from a mindset of NIMBYism. It is government should shut down developers, government should should take from developers" rather than acknowledging individual property rights.

Gamvroulas argued the conversation shouldn't be focused on "developer versus city" or "David versus Goliath" discussion, "but rather people coming together and the development community engaging in good faith negotiations with these local land use officials for the betterment of our state."

Instead, the focus should be on, "How do we grow in a sustainable and affordable way?" he said.

"Around the country, candidly, the gatekeepers have been too good at their perceived jobs," Gamvroulas said. "States all over the country are grappling as we are with housing shortages and looking at the levers they can pull. And as a state lawmaker what are the levels they can pull?"

One of those "levers" he said, is the "regulatory environment."

"So you can't throw public money at this and appreciably move the needle if you don't get the regulators out of the way," Gamvroulas said. "And this isn't about moving them out of the conversation, it is about changing the conversation to permit moderate income housing throughout the state."

Rollins said she agrees "there needs to be some policy changes there, but there also needs to be some checks and balances especially when it comes to taking care of the citizens of the community."

She said she's not sure if lawmakers are striking that balance. "I don't know. I mean ... not all of it feels good."

It all comes down to what ultimately happens by the end of the session Friday night and what bills pass or fail.

"We'll see at midnight," she said.

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