[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 4265 Introduced in Senate (IS)]
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119th CONGRESS
2d Session
S. 4265
To require the Secretary of Housing and Urban Development to establish
a Freedom to Build designation for certain localities.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 26, 2026
Mr. Hagerty introduced the following bill; which was read twice and
referred to the Committee on Banking, Housing, and Urban Affairs
_______________________________________________________________________
A BILL
To require the Secretary of Housing and Urban Development to establish
a Freedom to Build designation for certain localities.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Freedom to Build Act''.
SEC. 2. FREEDOM TO BUILD DESIGNATION.
(a) Establishment.--
(1) In general.--Not later than 18 months after the date of
enactment of this Act, the Secretary of Housing and Urban
Development shall establish a ``Freedom to Build'' designation
for eligible localities that voluntarily qualify under
subsection (b) or subsection (c).
(2) List.--The Secretary of Housing and Urban Development
shall maintain and publish on a publicly accessible website a
list of all localities that have received a Freedom to Build
designation, updated not less frequently than annually.
(3) Duration.--A Freedom to Build designation shall be
effective for a 5-year period beginning on the date on which
the designation is made and shall be renewable upon a
demonstration of continued qualification under subsection (b)
or subsection (c).
(4) Rule of construction.--Nothing in this subsection shall
be construed to require any locality to apply for or obtain a
Freedom to Build designation.
(b) Qualification by Reform Adoption.--
(1) In general.--A locality may qualify for a Freedom to
Build designation by certifying to the Secretary of Housing and
Urban Development that the locality has adopted not fewer than
the minimum number of reforms specified by the Secretary under
paragraph (3) from each of the 3 categories described in
paragraph (2).
(2) Categories of reform.--The Secretary of Housing and
Urban Development shall, through notice-and-comment rulemaking,
identify specific reforms within each of the following
categories:
(A) Unleashing construction innovation.--Reforms
that remove regulatory barriers to the use of modern
construction technologies, materials, and methods,
including modular, pre-fabricated, panelized, and other
off-site construction techniques, by aligning local
requirements with nationally recognized standards and
prohibiting differential treatment based on mode of
construction. Such reforms may include--
(i) aligning local codes governing off-site
construction with nationally recognized
standards, including standards published by the
International Code Council;
(ii) permitting emerging construction
materials and methods without differential
treatment based on whether or how a dwelling is
fabricated; and
(iii) prohibiting local amendments to the
model building code that add cost beyond what
the nationally recognized code requires, unless
the locality demonstrates a specific safety
basis for such amendment.
(B) Fast-tracking the approval process.--Reforms
that reduce the time, cost, and uncertainty of the
development approval process and provide builders with
meaningful recourse when the process fails. Such
reforms may include--
(i) by-right approval for projects that
conform to applicable zoning and building
codes, without discretionary review;
(ii) binding maximum timelines for permit
decisions and inspections, with clear remedies
for the applicant, which may include deemed
approval or immediate administrative appeal,
when deadlines are not met;
(iii) full public disclosure of all
permits, approvals, inspections, and associated
fees that may be required, and prohibition of
undisclosed requirements or mid-process cost
increases;
(iv) limiting the impact fees and offsite
charges to costs with a reasonable nexus to the
specific development project;
(v) authorizing builders to use qualified
third-party inspectors for required inspections
and to select licensed professionals of their
choice for required studies;
(vi) protecting approved development plans
from the retroactive application of code
changes adopted after the date on which
approval was granted;
(vii) limiting standing to challenge an
approved development to parties who can
demonstrate that the development would create a
common-law nuisance or an immediate threat to
health, safety, or welfare; and
(viii) an expedited dispute resolution
process for denials and delays, under which the
jurisdiction bears the burden of demonstrating
that its action is necessary to protect
substantial public health, safety, or welfare
interests, and under which the builder may
recover costs and damages for unreasonable
delay.
(C) Defending property rights and family freedom.--
Reforms that eliminate government mandates that
restrict what may be built, how it may be built, who
may build it, what energy sources it may use, or what
owners and tenants may do with their property, where
such mandates exceed what is demonstrably required for
prevention of physical injury. Such reforms may
include--
(i) prohibiting rent control or rent
stabilization on dwelling units, which may
exempt existing dwellings, for which a
certificate of occupancy is first issued after
the date of designation;
(ii) protecting the ability of property
owners to promptly address nonpayment, lease
violations, fraud, and unauthorized occupancy;
(iii) prohibiting mandatory below-market
set-asides in new development unless the
requirement is fully offset by a density bonus,
fee waiver, or equivalent incentive voluntarily
accepted by the builder;
(iv) prohibiting wage, residency, or
workforce-composition mandates on housing
development projects beyond those imposed by
generally applicable State law;
(v) requiring that local building code
provisions be consistent with evidence-based
standards promulgated by the Secretary of
Commerce, the Secretary of Agriculture, the
Secretary of Housing and Urban Development, the
National Institute of Standards and Technology,
or any other Federal agency, and eliminating
non-safety-related local additions;
(vi) authorizing builders to comply with a
Federally recognized energy rating index as an
alternative to prescriptive energy efficiency
codes, and prohibiting mandates for electric-
vehicle charging infrastructure or on-site
renewable energy generation;
(vii) prohibiting local ordinances that ban
or effectively eliminate the choice of a
property owner of a residential energy source;
(viii) authorizing builders to design to
any version of the applicable building or
energy code adopted within a reasonable period,
as determined by the Secretary of Housing and
Urban Development, at the time of plan
submission, rather than only the most recently
adopted edition;
(ix) limiting regulatory layering,
including prohibiting State requirements that
add to project costs beyond applicable Federal
requirements, and prohibiting local
requirements that add to project costs beyond
applicable State requirements, unless justified
by documented jurisdiction-specific health or
safety characteristics;
(x) prohibiting growth moratoria,
construction caps, or geographic containment
boundaries that restrict where new housing may
be built; and
(xi) prohibiting rules or policies that
penalize or increase the cost of a housing
development on the basis that it is primarily
accessible by automobile.
(3) Minimum thresholds.--The Secretary of Housing and Urban
Development shall, through notice-and-comment rulemaking,
establish the minimum number of reforms from each category
described in paragraph (2) that a locality must adopt to
qualify for a Freedom to Build designation. The minimum number
shall be not fewer than 3 reforms from each category.
(c) Qualification by Housing Supply Outcomes.--
(1) In general.--As an alternative to qualification under
subsection (b), a locality may qualify for a Freedom to Build
designation by demonstrating sustained housing supply growth
meeting an affordability-adjusted target established by the
Secretary of Housing and Urban Development under this
subsection.
(2) Affordability-adjusted target.--The Secretary of
Housing and Urban Development shall, through notice-and-comment
rulemaking, establish a formula for determining the supply
growth target applicable to each locality. The formula shall--
(A) set a higher supply growth target for
localities in housing markets in which housing costs
are high and rising, and a lower target, which may be
zero, for localities in housing markets in which
housing costs are affordable and stable;
(B) account for both the level of housing costs,
such as the ratio of median home price to median
household income, and the trajectory of housing costs,
such as the rate of home price or rent appreciation;
(C) measure housing costs at the level of the
metropolitan statistical area or the housing market
area defined by the Secretary, rather than at the level
of the individual locality, to prevent a locality from
avoiding a supply growth target applicable to its
region;
(D) measure supply growth relative to the
affordability-adjusted target rather than by raw
production volume; and
(E) permit the supply growth target to be met by an
individual locality or through documented participation
by the locality in a regional housing production
compact with one or more other localities.
(3) Data sources.--In establishing the formula under
paragraph (2), the Secretary of Housing and Urban Development
shall use existing, publicly available data, which may include
the House Price Index published by the Federal Housing Finance
Agency, the American Community Survey of the Bureau of the
Census, Fair Market Rents published by the Department of
Housing and Urban Development, and housing unit counts from the
decennial census or the American Community Survey.
(d) Periodic Review.--The Secretary of Housing and Urban
Development shall review, and if appropriate update through notice-and-
comment rulemaking, the specific reforms identified under subsection
(b)(2) and the formula established under subsection (c)(2) not less
than once every 5 years after the date on which the regulations are
promulgated.
(e) Revocation.--
(1) In general.--The Secretary of Housing and Urban
Development may revoke the Freedom to Build designation of a
locality upon a finding that the locality has--
(A) materially reversed 1 or more qualifying
reforms adopted under subsection (b); or
(B) ceased to meet the supply growth target under
subsection (c), as applicable.
(2) Notice.--Before revoking a designation under paragraph
(1), the Secretary of Housing and Urban Development shall
provide the locality with written notice and a period of not
less than 180 days to cure the deficiency.
SEC. 3. PRIORITIZATION OF FREEDOM TO BUILD DESIGNATED LOCALITIES IN
COMPETITIVE GRANTS.
(a) Findings.--Congress finds the following:
(1) Local regulatory barriers, including restrictive
zoning, burdensome permitting processes, and cost-increasing
mandates, are a significant contributor to housing-supply
constraints and rising housing costs across the United States.
(2) Federal investments in infrastructure, transportation,
and community development generate greater public benefit when
the surrounding regulatory environment permits the construction
of housing in response to improved accessibility and economic
opportunity.
(3) Communities that remove regulatory barriers to
homebuilding serve national economic, workforce development,
and housing affordability objectives.
(4) Federal tax incentives for housing production and
investment, including the low-income housing tax credit under
section 42 of the Internal Revenue Code of 1986, qualified
opportunity zone incentives under section 1400Z-2 of such Code,
and the new markets tax credit under section 45D of such Code,
generate greater returns for taxpayers and produce more housing
when deployed in communities with pro-building regulatory
environments.
(5) Federal housing, transportation, and community
development funds achieve greater impact when directed to
communities where the regulatory environment enables those
investments to produce their intended results. Directing such
funds to communities that simultaneously maintain regulatory
barriers to the construction those programs are designed to
support diminishes the effectiveness and return on the Federal
investment.
(6) An adequate and growing supply of housing allows demand
growth from rising incomes and declining interest rates to
result in expanded homeownership rather than higher home
prices, property taxes, and homeowner insurance premiums,
thereby protecting the affordability and value of homeownership
for current and prospective homeowners.
(7) The Freedom to Build designation established under
section 2 provides a reliable and verifiable indicator that a
community has committed to a regulatory environment supportive
of housing supply growth.
(b) Priority for Freedom To Build Communities.--The Secretary of
Housing and Urban Development shall prioritize applicants that are
located in or primarily serve communities with a current Freedom to
Build designation under section 2 for any competitive grant
administered by the Department of Housing and Urban Development that
relates to housing development, community development, or any other
competitive grant relating to the construction, modification,
rehabilitation, or preservation of housing.
(c) Sense of Congress.--It is the sense of Congress that Federal
agencies administering competitive grant programs for infrastructure,
transportation, and community development, including the Department of
Transportation, the Environmental Protection Agency, and the Department
of Agriculture, should consider whether an applicant is located in a
locality with a current Freedom to Build designation under section 2 as
a positive factor in evaluating applications for such grants where
housing supply or community development is relevant to the objectives
of the program.
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