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State And Local Governments Increasingly Looking To Build New Public Housing

The Robert C. Weaver Federal Building, home to the Department of Housing and Urban Development.

Local and state governments across the U.S. are looking to new models of funding and building public housing amid the country’s most severe housing crisis in decades.

Lawmakers in Colorado, Maryland, Hawaii and Rhode Island are pushing for new programs for local and state governments to develop public housing, Vox reports. Some have dubbed the efforts "social housing" to avoid the stigma related to public housing projects built last century that concentrated the lowest-income residents.

Rents and home prices are skyrocketing in cities all over the U.S. as high demand clashes with constrained supply. There are approximately 6.8 million fewer housing units than needed due to underproduction and the loss of existing units, according to one estimate prepared by Rosen Consulting Group for the National Association of Realtors.

When the Rhode Island Legislature approved the state’s budget in June, it included $10M for a new pilot program that plans to build mixed-income public housing, with development to be overseen by the state’s housing secretary, the Providence Journal reported at the time

"Housing authorities in Rhode Island are one of the best-kept secrets. They produce clean, affordable, low-income housing that are really well-maintained and high-quality,” Rhode Island State House Speaker K. Joseph Shekarchi told Vox. “So with this $10M, we want to see if there’s an appetite for incentivizing housing authorities to increase their housing stock.”

Other state governments are engaging in similar experiments.

Colorado Gov. Jared Polis signed a bill in early June authorizing the creation of a Middle Income Housing Authority that plans to deliver roughly 3,500 housing units for middle-class families over the next few years through a mix of private and government funding, Colorado Public Radio reported. The Hawaii Legislature also passed several housing bills to facilitate state construction of mixed-income condominiums with 99-year leases, Vox reported. 

In other states, proposals came close to passing and may reappear in the next legislative sessions. California fell one vote short of passing a bill in late June that would have allowed for the creation of social housing following a bill introduced by state Rep. Alex Lee in February.

It isn't solely state governments engaging with the idea of building public housing. A local public housing authority in Montgomery Country, Maryland, is early in the process of constructing almost 9,000 publicly owned, mixed-income apartment units over the next few years, Vox reported. Approximately 268 of the units are expected to deliver this year, financed via a revolving fund that uses public money for short-term construction.

“What I like about what we’re doing is all we have effectively done is commandeered the private American real estate model,” Montgomery County Housing Opportunity Commission Chief Real Estate Officer Zachary Marks told Vox. “We’re replacing the investor dudes from Wall Street, the big money from Dallas.”