The Impact of the ROAD to Housing Act on Rural Communities

Throughout the rural Midwest, communities have frustrating shortages. Local businesses are hurting for workers. The challenge isn’t the lack of opportunity. It isn’t a lack of jobs. The growing issue is the lack of safe, sanitary, and decent housing.

Housing is Economic Development

For decades, housing was often viewed as a separate issue from economic development. Communities focused on business recruitment, infrastructure improvements, and downtown revitalization while assuming the housing market would take care of itself if everything else fell into place.

But housing has become intertwined with economic development as communities have realized that new employers cannot expand without workers. The ROAD to Housing Act recognizes this reality by looking for ways to modernize housing programs, reduce barriers, and encourage more housing production across the country, including in rural communities.

More Help for Small Projects

Small towns rarely undertake large federally funded housing projects. This is in part due to the massive demand for housing. But it is also due to the hoops these communities have to jump through with the federal process. Now help is on the way with the ROAD to Housing Act.

Throughout the bill, there are a number of provisions that reduce requirements for NEPA compliance, even exempting some projects entirely. The bill gives HUD more authority to designate housing developments that receive federal funds as “special project funds”, granting simplified and streamlined compliance standards. Some projects, including small-scale housing construction, like infill development, may be exempted entirely from NEPA requirements.

Additionally, the bill exempts most projects funded by the Rural Housing Service (RHS) from NEPA requirements when the project is located on an infill site. This is a significant boost as it will save many small infill projects time and money.

More Tools for Rural Communities

The Road to Housing Act also provides rural communities with a variety of other tools that make financing, repair, and new construction easier. These include, but are not limited to:

• A pilot program that will offer small-dollar mortgages with original principal balances of $100,00 or less.
• A 10 percent set-aside under the pre-approved design grants for small and rural communities to help them build pattern books that help streamline local home construction.
• Exempts most Rural Housing Service (RHS)-funded projects from NEPA requirements regarding the construction or modification of residential housing that is located on an infill site.
• The bill directs HUD and USDA to coordinate and streamline implementation of their housing programs.

Keep Your Eyes Peeled

Assistance from the ROAD to Housing Act is likely to take a while to be enacted. The agencies affected by this bill will need time to develop the new programs, enact regulatory changes, and identify the funds necessary to support the changes. This isn’t a simple undertaking; many of the provisions give agencies 12 to 24 months to carry out the changes and create entirely new programs.

Although the improvements in the bill won’t be available soon, local governments can start thinking about how they could utilize the new programs and resources in the future. They can then, in turn, incorporate the planned use of the new programs within long-range housing plans. Communities can also expect opportunities along the route to implementation to weigh in on the proposed rules as they are made public over time.

So keep your eyes peeled, there’s more to come in regard to this groundbreaking new legislation.