This FAQ Fact Sheet is part of the 21st Century ROAD to Housing Act Resource Collection.
Passed with overwhelming bipartisan support, the historic 21st Century ROAD to Housing Act is meant to tackle the nation’s housing challenges by boosting housing supply, unlocking private capital, providing updates to grant programs and streamlining federal regulations to speed up construction.
The National League of Cities has identified frequently asked questions about the 21st Century ROAD to Housing Act. These answers will be updated as additional information becomes available. Click on the links below to jump to the answers to your questions, or scroll down to browse the full set of FAQs.
- What is the 21st Century ROAD to Housing Act?
- How is the 21st Century ROAD to Housing Act different from recent housing programs set up under the American Rescue Plan Act?
- What provisions in 21st Century ROAD to Housing Act did National League of Cities advocate for?
- What are other provisions in the 21st Century ROAD to Housing Act relevant to local governments?
- What provisions provide direct funding to cities, towns and villages to further accelerate housing production and housing preservation in their communities?
- What provisions provide capacity and technical assistance to help local government staff tasked with making zoning, building and land use reform to make housing more attainable?
- What federal regulations have been streamlined or eliminated, including National Environmental Policy Act (NEPA) reviews?
- What provisions in 21st Century ROAD to Housing Act will benefit small and rural communities?
- Are there any provisions in the 21st Century ROAD to Housing Act that impact local authority for cities, towns, and villages?
- Are there any provisions in the 21st Century ROAD to Housing Act that may cause concern for cities, towns, and villages?
- What agency or agencies are responsible for enacting all the provisions of the 21st Century ROAD Housing Act?
- When will federal agencies propose new rules for new or amended programs under the 21st Century ROAD to Housing Act?
- What provisions are helpful to the private sector partners of cities, towns and villages for housing development and/or preservation?
- When do all the provisions in the 21st Century ROAD to Housing Act go into effect?
- How can cities, towns and villages be helpful in ensuring that provisions in 21st Century ROAD to Housing Act are implemented?
- How can cities, towns and villages be helpful in ensuring funding is appropriated to the provisions in the 21st Century ROAD to Housing Act?
- How is the National League of Cities thinking about helping cities, towns and villages to prepare for provisions being implemented in the 21st Century ROAD to Housing Act?
- How can I stay updated on the implementation of the 21st Century ROAD to Housing Act?
Frequently Asked Questions
1. What is the 21st Century ROAD to Housing Act?
The 21st Century ROAD to Housing Act (PDF) is a comprehensive, bipartisan federal housing bill enacted on July 11, 2026. The bill, which passed with overwhelming bipartisan support in the Senate (85-5) and House (358-32), aims to boost housing supply through improvements to existing programs, unlocking private capital and reducing federal regulatory barriers.
2. How is the 21st Century ROAD to Housing Act different from recent housing programs set up under the American Rescue Plan Act?
The 21st Century ROAD to Housing Act is primarily a policy bill, and not a new funding bill. Instead, this bill is budget-neutral, and the programs it authorizes are not expected to increase the federal budget. That means NLC advocacy will be necessary to urge the Appropriations Committees in the House and Senate to provide funding for all local government grant programs authorized or amended in the bill.
The most recent federal housing bills passed prior to the 21st Century ROAD to Housing Act were those enacted in response to the COVID-19 emergency and included emergency funding alongside program authorization. Programs, including Emergency Rental Assistance and State and Local Fiscal Recovery Funds, were allocated directly to cities and towns, with the amount determined by a formula. Under the 21st Century ROAD to Housing Act, with the expectation of Community Development Block Grants and HOME Investment Partnership programs, local governments will have to apply competitively for funding for newly authorized programs.
3. What provisions in 21st Century ROAD to Housing Act did National League of Cities advocate for?
The provisions thatthe National League of Cities directly championed were:
- Streamline or waive federal requirements around environmental review and federal approvals.
- Enhance flexibility in grant programs such as CDBG and HOME that are allocated directly to local governments.
- CDBG-eligible expenditures will now include new construction, and HOME-eligible expenditures will include workforce housing and, in certain conditions, housing-related infrastructure.
- Provide other new resources to address the infrastructure required to permit additional housing.
- Provide new capacity assistance to local governments seeking to evaluate and amend local ordinances to make housing more attainable. Such resources could reduce costs to local governments that would otherwise bring in consultants or other costly specialists to undertake such activities. Among other things, this includes new grants to aid cities interested in pre-approved housing designs, model building codes for single-stair multifamily residential designs, and an innovation fund.
- Increase sources of private capital for housing development.
- Establish annual funding and standardize rules for the CDBG-Disaster Recovery Program.
- By design, the 21st Century ROAD to Housing Act does not preempt local or state zoning.
4. What are other provisions in the 21st Century ROAD to Housing Act relevant to local governments?
Sec. 101 – Reforms to Housing Counseling and Financial Literacy Programs
This section allows HUD to review the performance of housing counseling agencies and counselors. If a counselor’s performance falls short, HUD may require additional training and provide opportunities to demonstrate improvement. Counselors found to be consistently out of compliance may be subject to enhanced oversight or lose their certification.
Sec. 104 – Database of Publicly Owned Land
Requires Community Development Block Grant (CDBG) grantees to maintain a publicly accessible, searchable database identifying undeveloped land owned by the jurisdiction. CDBG grantees may use CDBG funding to set up and/or maintain the database.
Sec. 106 – Temperature Sensor Pilot Program
Establishes a HUD pilot program to award grants to public housing agencies and owners of federally assisted rental housing to install temperature sensors in dwelling units, with the written permission of tenants, to ensure compliance with temperature-related housing quality standards.
Sec. 201 – Increasing Housing in Opportunity Zones
This section enables the HUD Secretary to give additional weight to applicants for competitive HUD grants that are located in, or primarily serve, designated Opportunity Zones to support housing preservation and construction.
Sec. 601 – Military Service Question
Adds a disclosure to Fannie Mae and Freddie Mac’s uniform residential loan application form to ensure that veterans are made aware of their home loan benefits through the Department of Veterans Affairs (VA), which may provide a more affordable lending option
Sec. 704 – Appraisal Modernization Act
This section requires mortgage lenders to maintain procedures that allow for consumer-initiated requests for second appraisals or reconsiderations of value when they believe there may be an issue with their appraised home value.
Sec. 803 – Improving Self-Sufficiency of Families in HUD-Subsidized Housing
This section directs HUD to conduct a study on the implementation of work requirements by public housing agencies, with an assessment of the challenges and benefits of work requirements on public housing agencies and families, including the effects on homelessness, poverty, asset building, job attainment, and public housing agency administrative capacity.
Sec. 805 – Improving Public Housing Agency Accountability
Subjects public housing agencies (PHAs) to additional disclosure and oversight requirements, including enhanced reporting requirements for PHAs that are in receivership or subject to a monitor. It also adds certain requirements for the HUD Inspector General related to PHA oversight.
Sec. 908 – Promoting New Bank Formation
Creates a two-year phase-in pilot for de novo financial institutions to meet Federal capital requirements. Promotes growth in the number of community banks at the local level.
5. What provisions provide direct funding to cities, towns and villages to further accelerate housing production and housing preservation in their communities?
This does not provide new direct formula funding to cities, towns and villages. New grant programs authorized for local governments under the bill provide direct competitive funding. These include:
- Regional Housing Planning Grants: Award funds to regional agencies and local governments to plan for housing supply expansion and regional growth.
- Innovation Fund for highly flexible grants to award to localities that demonstrate improvement in housing.
- Pattern Book / Pre-Approved Design Grants for development and implementation.
- Whole-Home Repair program to preserve existing affordable housing.
- Reside Grants for the conversion of vacant office buildings or hotels to residential housing.
Cities, towns and villages will have to competitively apply to the new pilot and competitive grant programs enacted by the 21st Century ROAD to Housing Act. The earliest possible availability for funding through the new programs is Fiscal Year 2027 appropriations. However, without strong advocacy, Congressional Appropriators may choose to fund only some, or none, of the new programs in FY2027, delaying their availability until later years.
6. What provisions provide capacity and technical assistance to help local government staff tasked with making zoning, building and land use reform to make housing more attainable?
Provisions that can help local government staff tasked with making zoning, building and land use reform to make housing more attainable include:
- Changes to federal environmental reviews for targeted housing projects
- New Opportunity Zone incentives
- Local planning capacity and innovation grants
- Code innovation (single-stair permitting guidelines)
- New tools for a faster housing development process (pre-approved plans and pattern books)
- Modular and manufactured housing reforms
- Pilot program for commercial-to-residential conversions and adaptive reuse
7. What federal regulations have been streamlined or eliminated, including National Environmental Policy Act (NEPA) reviews?
Prior to the 21st Century ROAD to Housing Act, housing developments that received federal money had to pass a NEPA review to proceed. This process can cause costly building delays and could be wielded unfairly by interest groups to delay approved housing developments from moving forward.
Due to the passage to the 21st Century ROAD to Housing Act, several provisions in the bill reduce NEPA compliance burdens or exempt certain developments from the process. The bill brings the U.S. Department of Housing and Development’s (HUD) NEPA review standards in alignment with other agencies and gives HUD more authority to designate housing developments relying on federal funds as “special project funds” that grant simplified and streamlined compliance requirements.
In some cases, small-scale housing construction, including infill development, may be exempted from NEPA requirements. The bill also exempts most Rural Housing Service (RHS)-funded projects from NEPA requirements when the project is located on an infill site.
8. What provisions in 21st Century ROAD to Housing Act will benefit small and rural communities?
The 21st Century Road to Housing Act includes a number of provisions and set-asides directed to small and rural places:
- The bill authorizes a pilot to offer small-dollar mortgages with original principal balances of $100,000 or less.
- Ten (10) percent of funds under the pre-approved design grants are set aside for small and rural communities.
- U.S. Department of Housing and Community Development and the U.S. Department of Agriculture are directed to coordinate and streamline the implementation of their respective housing programs
- The bill exempts most Rural Housing Service (RHS)-funded projects from NEPA requirements regarding the construction or modification of residential housing located on an infill site.
9. Are there any provisions in the 21st Century ROAD to Housing Act that impact local authority for cities, towns, and villages?
By design, the 21st Century ROAD to Housing Act does not preempt local and state zoning. The intent of many new programs and resources is aimed at incentivizing and assisting local governments to rethink and reform local land use ordinances in the belief that such federal-local partnerships will produce more attainable housing more quickly than pre-emptions or mandates.
10. Are there any provisions in the 21st Century ROAD to Housing Act that may cause concern for cities, towns, and villages?
Although the 21st Century ROAD to Housing Act is a major win for local governments, a small number of provisions nonetheless have raised concerns that NLC has communicated to Members of the U.S. Congress. Those provisions include:
Sec. 107 – Housing Supply Frameworks
This section directs HUD to develop best practice frameworks for zoning and land-use policies, which the sponsors view as helpful resources for communities seeking to identify and overcome barriers to housing development. Although the federal program includes strong guardrails preventing HUD from taking any adverse action at the federal level on a locality on the basis of whether they utilize a framework or not, local governments advocating in opposition to state-level preemptions on local housing ordinances may be concerned about the possibility of state mandates or preemptions based on the best practices developed as zoning frameworks.
- HUD is directed to publish proposed frameworks for public comment within two years of the date of the bill’s enactment, and finalize frameworks within three years.,
- HUD must establish a task force to advise the Secretary on frameworks for zoning and land-use, including “members of local zoning and planning boards and local and regional transportation planning organizations.”
Sec. 213 – Build Now Act
This section creates a pilot program to incentivize housing development of all kinds in Community Development Block Grant (CDBG) participating jurisdictions. For the approximately 1,250 entitlement communities that receive CDBG grants annually, HUD is required under this provision to measure the growth of housing units (Housing Growth Improvement) in a grantee’s jurisdiction over a five-year period. The calculation is solely based on the housing units in the grantee’s own jurisdiction
- Grantees that achieve a Housing Growth Improvement Rate above the median growth rate of all CDBG grantees will be eligible for bonus CDBG funding for the year, for an amount up to 10% of the grantee’s total CDBG allocation. High housing growth CDBG grantees will be excluded from the median calculation to prevent an artificially high median,
- Grantees that perform below the median Housing Growth Improvement Rate will have their annual CDBG allocation ”modestly decreased” for the year, with decreases limited to 10% or less of CDBG grant funds. The funds captured by any decrease are the source of funds for bonuses to the above median cities.
- Grantees within range of the national median will receive neither a reduction nor a bonus.
Certain criteria would exempt grantees with growth rates below the median from the reduction in funds. The criteria are mostly aimed at excusing grantees where housing demand is not naturally high. These include:
- The grantee’s Small Area Fair Market Rent is below the 60th percentile of the median of all grantees,
- The annual rental vacancy rate is higher than the national annual natural rental vacancy rate.
- The grantee was subject to a natural disaster or a federal emergency declaration during the prior year.
- The grantee is prohibited by state law from adopting or amending relevant zoning or permitting ordinances.
Under the provision, there will be no overall decrease in CDBG funding allocated to local governments by formula. This makes the provision distinct from other CDBG tampering NLC has successfully opposed in the past, such as bills that would withhold CDBG funds from cities for unrelated policy choices without reallocation to other local government grantees. Unlike proposals that would withhold CDBG grant funding for various reasons, this provision would not jeopardize any grantees’ eligibility for a CDBG grant.
Safeguards include a two-year grace period for grantees at risk of a decrease in grant funds to enact modifications to bring their housing development metrics into range of the national median.
Communities that HUD notifies are at risk of a decrease in CDBG funding will have access to HUD guidance on how to improve their performance.
11. What agency or agencies are responsible for enacting all the provisions of the 21st Century ROAD Housing Act?
For each provision in the bill, a federal agency must take action to implement the program or regulatory change. The U.S. Department of Housing and Urban Development has the most implementing actions required by the bill, but other agencies required to act include:
- U.S. Department of Agriculture
- U.S. Government Accountability Office
- Federal Financial Institution Examination Council
- U.S. Department of Treasury
- Consumer Financial Protection Bureau
- Federal Housing Finance Agency
- United States Interagency Council on Homelessness
- U.S. Department of Veteran Affairs
12. When will federal agencies propose new rules for new or amended programs under the 21st Century ROAD to Housing Act?
Agencies will need time to stand up new programs, put regulatory changes through the public comment process and identify funds to support the changes. Many of the provisions give agencies 12 to 24 months to carry out their roles under the 21st Century ROAD TO Housing Act.
Although improvements in the bill won’t be immediately available, local governments can start thinking about how they would take advantage of new programs and resources now and incorporate that thinking into long-range housing plans. Until then, local governments can expect many opportunities to weigh in on program implementation as proposed rules are made public.
13. What provisions are helpful to the private sector partners of cities, towns and villages for housing development and/or preservation?
Among provisions aimed at unlocking more private capital for attainable housing, one of the biggest is an increase in the Public Welfare Investment cap that limits banks’ investments in community development projects from 15 percent to 20 percent, which opens additional funds for affordable housing.
In addition, in the 21st Century ROAD to Housing Act there are several community banking enhancements that should lead to growth in community banks serving as local stakeholders in urban and rural communities.
14. When do all the provisions in the 21st Century ROAD to Housing Act go into effect?
Agencies will need time to stand up new programs, put regulatory changes through the public comment process and identify funds to support the changes. Many of the provisions give agencies 12 to 24 months to carry out their roles under the 21st Century ROAD TO Housing Act.
Although improvements in the bill won’t be immediately available, local governments can start thinking about how they would take advantage of new programs and resources now and incorporate that thinking into long-range housing plans. Until then, local governments can expect many opportunities to weigh in on program implementation as proposed rules are made public.
15. How can cities, towns and villages be helpful in ensuring that provisions in 21st Century ROAD to Housing Act are implemented?
NLC will monitor the implementation of programs supporting cities and towns and call for advocacy action if necessary. Local governments will also have multiple opportunities to provide public comment on proposed rules for new or existing programs. Proposed rules are published on www.regulations.gov.
16. How can cities, towns and villages be helpful in ensuring funding is appropriated to the provisions in the 21st Century ROAD to Housing Act?
NLC is urging the Appropriations Committees in the House and Senate to provide a program-enabling level of funding for all new programs in FY2027. Local governments likely to apply for new funding can advocate for funding those programs now.
17. How is the National League of Cities thinking about helping cities, towns and villages to prepare for provisions being implemented in the 21st Century ROAD to Housing Act?
Over the next year, National League of Cities will be rolling out a number of resources, including a webinar and blog series, a dashboard, toolkits, podcasts, and more, to assist cities, towns and villages with building competitive grant applications as well as assisting cities with taking advantage of the new regulatory flexibilities featured in the 21st Century ROAD to Housing Act.
18. How can I stay updated on the implementation of the 21st Century ROAD to Housing Act?
Sign up for NLC’s 21st Century ROAD to Housing updates for the latest news related to the implementation of the 21st Century ROAD to Housing Act.
NLC will regularly update this FAQ as the implementation of new programs and rule changes proceed.
Browse the Resource Collection
NLC is your source for information about the 21st Century ROAD to Housing Act and what it means for cities, towns and villages. Explore the resource collection to learn more.
From Data to Decisions: Turning ACS Data into a Living Housing Strategy in Poulsbo
- CitiesSpeak Guest
CitiesSpeak Podcast: Evaluating the Recent Supreme Court Term with Amanda Karras
CitiesSpeak Offers Local Leaders a Guide to Making the Most of Congressional August Recess
CitiesSpeak Podcast: NLC’s Guide for Making the Most of August Recess
Where to Start Now That the 21st Century ROAD to Housing Act Has Passed
- Lauren Lowery
