Federal Builder's Remedy and Housing Supply Accountability Act

If a metro, county, or municipality refuses to legalize enough multi-family housing to meet its fair-share housing need, a federal builder’s remedy kicks in. While they’re out of compliance, they cannot block or down-zone qualifying multi-family projects that include a significant share of affordable housing—even if those projects violate local zoning caps on density, height, parking, etc.—subject only to narrow health, safety, and environmental limits.

This is explicitly modeled on California’s builder’s remedy, which removes local power to deny compliant projects in jurisdictions without a certified “housing element” and requires at least 20% low-income or 100% moderate-income units in qualifying projects.(YIMBY Law)

• Metropolitan areas, counties, and municipalities above a population threshold (100,000 residents OR within a statistical metropolitan area over 250,000).

• Any jurisdiction that:

  • Controls zoning for residential or mixed-use development, and

  • Receives federal housing / infrastructure funds (CDBG, HOME, surface transportation funds, water/sewer grants, etc.).

• HUD, in consultation with DOT and Treasury, sets 10-year Housing Capacity Targets for each metro/jurisdiction, analogous to California’s RHNA system:

  • Based on projected household growth, cost burdens, overcrowding, job growth, and existing under-production.

  • Broken down by income bands (extremely low, very low, low, moderate, market).

• A jurisdiction is deemed compliant if it has:

  1. A certified “Federal Housing Capacity Plan” (like a federal housing element) showing enough by-right zoned capacity to meet its Target, and

  2. Has not adopted exclusionary policies that nullify that capacity (e.g., excessive minimum lot sizes, bans on multi-family, parking mandates that make feasible projects impossible).

A jurisdiction is labeled “High-Cost Non-Compliant” if:

• HUD certifies that its Housing Capacity Plan is missing, expired, or inadequate OR

• Over a rolling 5-year window, the jurisdiction:

  • Has permitted or completed less than, say, 70% of its Targeted units, especially in low- and moderate-income bands, and

  • Median rent or home prices exceed a specified threshold relative to regional median and income (e.g., rent >35% of median renter income for most renter households).

Once designated non-compliant:

• The Federal Builder’s Remedy becomes available for qualifying projects.

• The jurisdiction may lose access to certain discretionary grants unless it comes back into compliance—giving additional leverage.

Qualifying projects

A “federal builder’s remedy project” could be defined as a housing development that:

1. Is multi-family or mixed-use with a majority share of residential units;

2. Is located in a non-compliant jurisdiction, in an area:

   • Served by or planned for public transit, or

   • Within a designated jobs-rich or high-opportunity area;

3. Meets affordability requirements, such as:

   • At least 20% of units affordable to low-income households, or

   • At least 10% very-low-income or 7% extremely-low-income (you can mirror AB 1893’s tiered options),(Santa Clara Planning)

   • Alternatively, 100% of units affordable to moderate-income households;

4. Meets basic federal siting criteria, for example:

   • Not in FEMA high-risk floodways, critical habitat, or incompatible airport safety zones (unless mitigated).

   • Not displacing irreplaceable critical infrastructure.

What’s preempted

In a non-compliant jurisdiction, for qualifying projects:

• Local governments may not deny or “condition approval so as to make infeasible” any qualifying project based on inconsistency with local land-use controls relating to:

  • Use (e.g., bans on multi-family in “single-family” zones),

  • Density or FAR limits below a federal minimum,

  • Height limits below a federal minimum,

  • Minimum lot sizes over a reasonable cap,

  • Parking minimums beyond a federal cap, especially near transit.

• Instead, the project must be evaluated only against:

  • Objective building and fire codes,

  • Objective environmental standards (NEPA, Clean Air Act, etc.),

  • Objective design standards adopted before the project’s application date (no ad-hoc design nitpicking).

Local governments retain the ability to deny only on narrow grounds:

• Specific, unmitigable adverse impacts on public health or safety, documented by substantial evidence (mirroring CA’s HAA standard). (Association of Bay Area Governments)

Density & form defaults

Because federal law has to supply something in place of local zoning, the Act can set default envelopes for builder’s-remedy projects, e.g.:

• Minimum allowable density:

  • At least 60 dwelling units per acre in transit-rich areas,

  • At least 30 units per acre elsewhere in urbanized areas.

• Minimum allowable height:

  • 6 stories (70–85 feet) near high-capacity transit,

  • 4 stories (55 feet) in other eligible urbanized areas.

• Parking maximums:

  • No more than 0.5 spaces per unit within ½ mile of high-capacity transit,

  • No more than 1 space per unit elsewhere (unless the developer wants more and can provide it on-site).

These become the federal minimums that preempt more restrictive local standards in non-compliant places.

Vesting

• Once a developer files a complete “federal builder’s remedy application”, the project’s rights are vested under the rules in effect on that filing date.

• If the jurisdiction later becomes compliant, it cannot retroactively apply its new plans to kill or downsize these vested projects—again mirroring how CA’s SB 330 interacts with builder’s remedy.(Hanson Bridgett LLP)

Private right of action

• Developers and eligible non-profit housing organizations may sue in federal court to:

  • Enjoin unlawful denials, delays, or down-zonings;

  • Compel approval under the builder’s remedy;

  • Recover attorney’s fees and damages for bad-faith obstruction.

Federal agency enforcement

• HUD (and possibly DOJ’s Civil Rights Division, tying to fair-housing concerns) may:

  • Bring enforcement actions;

  • Withhold or reprogram certain funds (CDBG, discretionary transportation grants, etc.);

  • Enter compliance agreements with jurisdictions that commit to reforms.

Anti-retaliation and “poison pill” prevention

• Prohibit jurisdictions from:

  • Down-zoning elsewhere in response;

  • Imposing special moratoria or fees only on builder’s-remedy projects;

  • Using permitting games (e.g., never deeming applications “complete”).

• Provide expedited judicial review (e.g., 90-day decision deadlines) to avoid death-by-delay.