October 19, 2026 · HOUSING AND COMMUNITY DEVELOPMENT · 8,830 words · 6 speakers · 61 segments
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Good morning, I call this housing and community development committee info meeting to order Caroline, can you please take roll?
Chairman Markozek. Here. Representative Abney. On leave. Boyd. On leave. Brown. On leave. Cephas. On leave. Green. On leave. Krijuski. On leave. Madsen. On leave. Mays. On leave. Powell. On leave. Probst. On leave. Smith-Wadell. On leave. Tibercio. Here. Waxman. On leave. Chairman Irvin. Here. Representative Bashlein. Leave Jones leave McKenzie leave major leave Brazil leave Rossi leave Schaefer leave towards it leave the rubbish Walsh leave Leave
Thank You Caroline I would like to note there are a lot of it is a a busy day today here in the Capitol, so we should have folks coming in and out. So with that, I would like to bring up Kevin Bush, who is the Deputy Secretary. And Mr. Bush, please.
Thank you. Good morning, Chairman Markosik and Chairman Irvin and members of the committee. Thank you for inviting me here today to discuss Governor Josh Shapiro's housing action plan and opportunities to increase housing supply here in Pennsylvania. My name is Kevin Bush, and I'm honored to serve as Pennsylvania's first Deputy Secretary for Housing. And although I'm new to this role and new to the Commonwealth, I've spent nearly 20 years working with communities across the country on housing, disaster recovery, and community resilience. In my first four months here, I've met with more than 100 leaders across the Commonwealth in both urban and rural areas, and their message has been clear. The national housing crisis is being felt in every corner of the Commonwealth. Whether it's aging homes and blight or rising costs and limited options, housing is one of the most pressing challenges that we're facing today. Across the Commonwealth, housing costs are rising. Construction has not kept pace with demand. and much of our housing stock is old and difficult to maintain. Families everywhere are finding it harder than ever to secure safe, stable, and affordable housing. Recognizing this urgency, Governor Shapiro directed his administration to create the Commonwealth's first Housing Action Plan. It's a 10-year strategy to expand supply, preserve existing homes, strengthen pathways to housing stability, modernize development regulations and improve coordination among state and local leaders. National trends underscore why this work is essential. Nearly half of rental households nationwide are cost burdened, meaning they pay more than a third of their income on housing. Home prices remain well above pre-pandemic levels, and the supply of homes continues to lag behind need. In addition millions of subsidized housing units are at risk as affordability restrictions expire and new construction rarely meets the needs of median or lower families These pressures are prompting states across the country to act. And those same dynamics are being felt here in Pennsylvania. We're not building enough homes to keep up with demand. In fact, we We need more than 450,000 housing units by 2035, but at our current race of building, we'll be short by about 185,000 units. Over half of our housing stock was built before 1970, and nearly 1.5 million of those houses were built before 1940. More than 1.4 million households in Pennsylvania are cost-burdened. Again, that means they pay more than 30% of their income on housing. And in 2024, about 14,000 of our neighbors experienced homelessness, including 2,500 of those who were unsheltered. These challenges affect families, older adults, and employers who struggle to attract and retain workers. In fact, the Housing Action Plan came out of feedback that the administration received in the development of the economic strategy. But states have powerful tools to respond, and the evidence is clear. Meaningful progress requires both regulatory modernization and sustained public investment. Across the country, states are modernizing land use laws to enable more housing types and reduce barriers to development. Common reforms include expanding accessory dwelling units, supporting small-scale infill housing, allowing apartments in areas already served by infrastructure, updating dimensional standards to support smaller homes, expanding access to manufactured housing, and clarifying local development processes. Updates to the construction code, including modern mid-rise single-stair designs, are helping to reduce costs while maintaining safety. Other reforms include modernizing stormwater requirements, streamlining approvals for on-site solar, and better aligning transportation and land use planning to support walkable, transit-served communities. States across the political spectrum are demonstrating what is possible when regulation meets today's needs. But regulatory improvements alone will not solve this crisis. Public investment is essential to produce and preserve homes for lower-income households. Federal programs such as HOME, the National Housing Trust Fund, the Community Development Block Grant, the Emergency Solution Grants, Weatherization, Continuums of Care, and the Low-Income Housing Tax Credit remain foundational, but current levels are not enough to meet demand. In fact, in Pennsylvania, a recent Pennsylvania Housing Finance Agency and University of Pennsylvania analysis found that affordability restrictions for more than 43,000 homes in Pennsylvania will expire in the next decade, resulting in a net loss of affordable housing at our current level of support. So we will not be able to produce enough affordable subsidized housing to keep up with those that have expiring affordability restrictions. States, as a result, are stepping in with their own tax credits, incentives, grants, and loans. These tools support rehab, infill housing, adaptive reuse, home repair, preservation, and other strategic investments. States also empower communities through affordable housing trust funds and land banks that return blighted properties to productive use Here in Pennsylvania our Housing Action Plan brings these approaches together into a coordinated statewide strategy It calls for expanding and modifying grant and tax credit tools, strengthening support for small and aspiring developers, increasing investments in home repair. It recommends first-time homebuyer initiatives, common-sense tenant protections, and enhanced supports for older adults and Pennsylvanians with disabilities. It proposes sealing eviction records when residents are not legally evicted, leveraging federal Medicaid resources to promote housing stability, and protecting manufactured home community residents from unreasonable rent increases. It also, of course, highlights opportunities to modernize development laws and regulations to reduce costs without compromising safety or community character. Together, we've already made meaningful progress through sustained increases to PHFA's Fair Fund, new pilot programs, and improved tools for production and preservation. But meeting our housing needs will require continued partnership. Many of the most impactful opportunities identified in Pennsylvania's Housing Action Plan depend on collaboration with the General Assembly. And this committee has been proactive and instrumental in advancing legislation consistent with the Housing Action Plan, and I look forward to making more progress on our shared goals next session. Housing is foundational. It's the platform on which families build their lives, workers build their futures, and communities build their prosperity. Thank you for the opportunity to appear before you today, and I welcome your questions and look forward to
continued collaboration as we work together. Thank you very much, Secretary Bush. I will start off with a question. It's something that I hear back home. I have a town in my district that's small, and an out-of-state company came in and bought up pretty much this whole, probably about eight homes. And trying to track down that out-of-state buyer was quite the problem. And what happened was they came in, bought the homes, and then left. And those homes are now kind of falling, you know, and they're not in the best of shape. So that hurts not only the town, but it hurts the person that has their home that is on that street that then goes tries to sell that home. Now they can't sell their home because across the street it's oblited, it's falling down, it's in bad shape. So if you can maybe, because that's something that we've been trying to do here is, you know, how can we kind of tackle that issue? And if there's any other states that have been doing that where we can say to folks, hey, if you're going to come in and buy up eight homes on a street, you have to, you can't just up and leave. And I think that's something that I see back home, and I know I've heard it from different parts of the state as well. So if you can maybe just touch on that.
Sure, yeah. Thank you, Chairman. You know, I actually started working in housing. I'm a native Michigander in the city of Detroit. And one of the first jobs I did was I hired 30 people to drive every single street in the city of Detroit and mark down what condition single-family houses were in. At the time, this was before the 2008 housing crisis, and there was this idea that you could kind of turn off parts of the city to save money and deal with blight. and one of the things we found was that light was not necessarily concentrated in one specific area but scattered throughout And meeting with some of the residents in some of the relatively stable neighborhoods was fascinating because the minute one house became vacant, if it was just one, many of the residents would band together, continue to mow the lawn, even do facade repairs without knowing who the owner was. And that was able to kind of stabilize the block from what you were just speaking of, Chairman. But when that expands to two or three or four houses, it can often almost act as a contagion, kind of bringing down the property values for homeowners who have been building equity for 20, 30, or 40 years and have most of their net worth stored in that. And so I think one of the things that's important, even beyond just the data sharing aspect, is the need to have the ability to invest in this housing stock. You know, it's often said that the most affordable unit of housing to produce is the one that you already have. So that's one of the things the Housing Action Plan calls for is opportunities to invest further in our existing single-family housing and keep people in the homes they already have.
Thank you. Any other questions? Mr. Chairman?
Thank you. Thank you for being here today. I appreciate that. I almost feel like we could maybe get rid of a few tables here. But I appreciate, in fact, it's something that really has come to my attention over the last year with the housing action plan concerning the 43,000 federally supplemented low-income housing that's out there, and it's going to expire. Do you have your the administration or have you looked into any ways and working with the federal government and maybe extending any of this type of loan, like reinvestment of the federal government back into trying to keep some of the low income housing. housing, low-income housing, rather than once they would be sold or once the mortgage is due and paid off, what's going to happen, it is going to go right to your private equity and there will be no control over what rent is going to be charged on that or whether it be remodeled and become more of a higher-paid senior housing or something of that nature. So what's your thoughts on the federally mortgaged properties that we're going to be losing within the next 10 years here?
Thank you, Chairman. And I agree that that report was sobering, right? And it's even just their initial analysis. The report actually came out of something that General Assembly put in the most recent budget to require PHFA to do an inventory of the problem. And they've come up with that preliminary finding, but they're continuing their work. I can tell you, having worked most of my career experience is actually in the federal government, working and overseeing many of these programs nationally. As a country, we have moved away from permanent affordable housing, think public housing, over the last 60, 70 years, to a model where we provide a grant, a loan, a tax credit to the private market. relies on the private market to find additional sources of capital and construct that affordable housing. While that subsidy comes with some degree of an affordability restriction, that expires. So that the housing itself, unlike public housing, is not owned by government. It's owned by private entities, some of them nonprofit, some of them for profit. But when that restriction changes, period expires, there's really very little that the state or the federal government can do to preserve it absent sending in a new influx of subsidy to bring the property back up to spec and extend that affordability restriction by the introduction of a new subsidy. That said, there are some promising reforms coming out of the federal government through the 21st Century Road to Housing Act, but many of the new programs that that bill created, well, actually, I believe nothing in that law was self-executing, so all of the new programs that that bill created were just created, but they haven't been funded yet. So there's not another new source of funding yet on the horizon from the federal government to offset that, unfortunately. Thank you.
And, you know, I look at it in two different ways. that, you know, the low-income housing can benefit a community, but it also can sometimes hurt a community as well. And I think that you get some influx of out-of-county individuals that would come in that also put the burden on your school districts, your local municipalities as well, whether it be police forces or anything of that nature. So I think it's important that we somewhat try to renew that. And is there a push that you're trying to – that we can do or push forward for the federal government to somewhat renew any of these? And how successful do you think we could be in that?
Well, we wouldn't be able to renew them. It would be about getting additional subsidies from the federal government, right? So, you know, like I said, there's about 20 or so new grant programs that were created through the 21st Century Road to Housing Act, but none of them were funded. So, you know, I do think there's an opportunity there for the federal government to step in and fund those programs, but, you know, that could be a very long tail.
To drill down into that point on the federal government a little bit further, you know, they created new programs, and they also called for a number of regulatory reforms. There's initially a lot of promise with the 21st Century Road to Housing Act. I don't have the roll call in front of me, but I believe there were six or seven no votes in the Senate. So truly a bipartisan piece of legislation. And it's almost as important just for what it represents, bipartisan action on housing at a time when that can be hard to come by. but I talked about the limitations with the funding programs on the regulatory side.
By one count, there are 29 regulatory actions that the Department of Housing and Urban Development needs to take to implement that law. On average, as a former HUD official myself, HUD does about six regulatory actions in any given year and in the last year, HUD saw a 30% reduction in staffing. So I think there's a very long tail on the promise of the 21st Century Road to Housing Act and federal reform still.
Thank you. I'll let some other members ask questions.
Thank you, Mr. Chairman. Representative Tepercio.
What are the most common concerns you're hearing from local housing leaders and how do they differ from the urban and rural, going back to your question that you just Thank you Representative You welcome You know one of the interesting things to me as I traveled around the state and you know I met with those post small and mid towns many of them in the Mon Valley
I've met with leaders in Pittsburgh and Philadelphia and in some pretty rural areas of the state as well. And one of the things that was actually most striking to me was how common many of the housing challenges were. Across the state, we have aging housing. It could be on a 10-acre lot surrounded by trees. It could also be on a quarter-acre lot surrounded by other houses. But the needs of that individual house still stand. Housing costs, construction costs have risen across the board. And so if you live in a house you've lived in for 40 years and you're coming up on the end of the useful life of your roof and you're on a fixed income, that roof is a heck of a lot more expensive to repair. So I've heard about the aging housing stock coupled with the high cost of repair and utilities. The mismatch, and this one is particularly common in rural areas, between the cost to construct new housing and what it would actually be able to be sold for and the private market. I heard this one in McConnellsburg. And then we talked about expiring affordability periods. And also, this one is particularly interesting to me as an urban planner, but the relationship between commercial corridor reinvestment and housing. Pennsylvania has a million, in my opinion, having, you know, I do a lot of motorcycle camping, so I go in and out of these small, mid-sized towns all the time in Pennsylvania that are bi-state forests. And we have some really cool, old, historic towns. Without a doubt, the second and third and fourth floor above that ground floor retail is almost always vacant when I pass through these towns. So there's really an interesting relationship that we could pick up on between commercial corridor revitalization and housing revitalization in those traditional downtowns.
And what are you able to work on now as far as the housing action plan? Like what's in the works now?
What's in the works now? Sorry, I couldn't quite hear you. There are a couple things that we're able to deliver with the tools and resources we have now that are exciting to me. Some of them are, frankly, a little minor in administrative but exciting nonetheless. There's no single housing website for the state of Pennsylvania, right? We have a number of agencies that have tools or resources that touch housing in some way or the other, and they all have their own websites for those. So it can be pretty difficult to navigate those resources. So one of the things that we'll be doing is creating a housing one-stop shop, practically speaking, pa.gov slash housing. That makes it a little bit easier to navigate government. Another one that I think has the potential to be even more impactful is the Housing Ready Communities designation that's called for in the Housing Action Plan. This is modeled after similar initiatives in other states where we would create a set of pro-housing best practices that municipalities could adopt. They could come to us, get that designation. Ultimately, we'd like it to be something more than just a bird town or pollinator-friendly thing by tying it to incentives in our discretionary funding programs. So if you're taking steps to rezone your community, establish your own local sources of funding, et cetera, well, that could be recognized through incentives for competitive funding from across the state.
Thank you.
Thank you.
Next we have Representative Verrobisch Make sure I Sure So I think actually falling a little bit off of rep to Bercio question there Since this is a brand new created position and this action plan was in place before you came into office Can you give me some ideas of your priorities and how we are going to be able to measure the impact of your role?
Oh, that's a great question. So you're right the plan was created before I started but I did have the opportunity to read it, you know, considering before I came here. And one of the nice things about the plan, and I say this as someone who's, you know, written similar plans for, you know, cities, for the federal government even in a couple states, it does have concrete metrics, right? If you look, I think it's in the front of the plan, you know, there's things like Pennsylvania wants to be fourth or fifth in this or that other thing. So while I wasn't here to create the plan, you know, there are very specific outcome measures that are externally measured in the plan. And I would say, you know, judge me by those. As a, well, kind of a bureaucratic nerd and project manager, one of the first things I did was I took everything that sounded like a commitment in the housing action plan and I put it into a spreadsheet, right? And I'm now treating that as a PMO, right? And so first went looking for dependencies. A big chunk of that housing action plan is dependent on legislative action. And again, thank you to this committee for advancing so many bills that were aligned with that. And now what I'm focused on is or are those actions that are not legislatively dependent. I mentioned the housing one-stop shop, the Housing Ready Communities designation. There's a few others that are technical assistance, capacity support for counties and municipalities studies on things like homeless encampments, weaving together funding sources. Those are the things that I'm going to be focused on now because I have the tools and resources to implement them. Thank you very much.
Representative Ben Waxman.
Thank you, Chairman. I'm just curious if there is more that you might say about the implications of this University of Pennsylvania study that you've referenced a few times. 43,000 units is a lot of units, and it just seems to me their ramifications might extend to many different places.
Yeah, and one of the most interesting facts from that study actually was the geographic breadth of those units. So you might think, oh, you know, that's a Philadelphia or a Pittsburgh problem, right? But we have federally subsidized housing in every county of the state, And those 43,000 units are scattered all across. In fact, 17 counties, both urban and rural, have expiring units that represent a third of those 43,000, right? So it really is scattered throughout. The other thing, you know, we were talking about with Chairman Irvin as well is just how difficult it can be to replace those units or even extend them. And you see this in applications for the low-income housing tax credit that PHFA receives, where there are a number of developers that come in looking for new subsidy to preserve and extend the buildings they already have. You've got to renovate a building that's 40 years old. When you bring that new subsidy in, it extends the affordability period. But at the same time, we also need to renovate and create new housing. So I think that tension between preservation and new construction is only going to become more pronounced as the scale of need grows.
Can I do one more? Is that okay? I also wanted to take a second and just ask you a little bit about some of these federal grants or opportunities that may have been as a result of some of the legislation In particular Does the administration have a plan to respond to there being a federal home homes repair funding opportunity It one of the new
programs that's been very popular here in the state. Yeah, that's a great program to come out of the 21st Century Road to Housing Act and in fact was modeled after the state of Pennsylvania's whole home repair program as well. So although that is exciting to see something that this state created show up at a national level. It is one of those programs that didn't come with any funding attached to it. So right now it exists as a paper program that HUD will need to create rules on, but still Congress will need to appropriate funds before we can even apply for it. In addition, the amount that they authorized through the bill, I can't remember the exact amount, but it's less than what Pennsylvania had been investing through the whole home repairs program. So it is certainly on my radar as the 21st century road housing programs are stood up to apply for them and get as much of those federal resources as we possibly can to this state. And I can tell you, as someone who reviewed a lot of grants at HUD and wrote grant applications for other states, I'm really good at grant writing, so I will go after those very hard. But it's still a promise yet to be delivered as those programs haven't been funded. Thank you.
Representative Rossi.
Thank you, Mr. Chairman. I just want to touch a little bit on why I think those units that are above stores in cities aren't being utilized. And one of the big things I see is we put money into the roofs and the windows, but not the sound barrier. So a lot of the HUD housing, the folks are home during the day. They're not at work. They're there, you know, and so what is happening is I would say even in my district office, the person is up there gambling and they're swearing, and I have people sitting there going, excuse me, I'm so sorry. We also see a lot of loud music during the day or they're exercising, so the floor is going boom, boom, boom. And so the store owners, you know, they're going to be there and be respectful, but they don't want that. So they complain constantly to the landlord. So has there been any studies looking into what we could do to maybe put a barrier there so that we could have tenants above and utilize that space? Because that is really a problem for business owners because it does affect them. If they hear the things that I'm hearing and that other people are hearing, they don't want a tenant above there. Sometimes it's pets and the pets are barking or, you know, You know, sometimes you can smell the letterbox hasn't been changed. We can hear things through the ventilation system. So those are all issues that I would like to bring up, that I would like to look into, because I think we could utilize that space, but are there any kind of grants or things for sound barriers?
I'm not aware of any specific studies on, you know, sound dampening opportunities, but I am certain there are many, and I'm happy to ask the team to come back and compile them and send them to you. On the issue you brought up more broadly, you know, I live near Phoenixville, Pennsylvania, if you're familiar with it. Part of the reason we moved to that area was because it has a thriving downtown where there are restaurants and bars and shops on the first floor and lots and lots of apartments above them. and I think if you talked to you know those shop owners, and there are studies on this issue, including from groups like Strong Towns and Main Street Matters, where they're thankful for the additional customers. Many of those businesses, those restaurants in particular, are now thriving because people live within walking distance to them or even a short stair ride or elevator down. So while you're right, I think there certainly are sound issues that could be ameliorated through, you know, like acoustical sealants and that sort of a thing. The additional customer base that exists when you revitalize the second and third floor above a shop can often result in tremendous economic revitalization of the storefronts below. Thank you so much.
What comes to mind with me is I went to look at a site and the store owner took a broom and slammed the ceiling because a woman was watching her grandchildren and they were jumping off the couch, and he was so annoyed because his customers were all complaining. So he took a broom, and then there were divots all through the ceiling. And then, you know, it just seemed like that could have been alleviated if we would have put something, some type of insulation or just something so simple that it wouldn't have been quite as loud. Thank you so much.
Thank you. Thank you. Representative Brick.
Kraszewski. Thank you, Chair. Thank you, Secretary. Very excited to see you in this role and excited that our Commonwealth is taking initiative on housing. I had a couple questions around affordable housing in particular, given that one of the challenges around housing being something that is essential to people but also is something that is a market commodity. You create challenges where affordable housing in particular gets impacted by this, and I think having you in this role and having our Commonwealth take an initiative on addressing that is super important. So a couple questions I had. One is I was curious about your thoughts. You know, there's been other states that have done things like using loans as upfront financing for affordable housing projects or at least for having some requirements of some part of a project being affordable. I'm curious about, you know, if there are any states where you've seen models that you particularly like or impressed by and your thoughts on if we could use that here in Pennsylvania and what would it mean to scaffold up a program like that?
That's a great question. Thank you, Representative. And I think you're right. There are state-level reforms that need to be done on the regulatory side, but they will fall short of the needs of those low-income, let alone median-income households, because you could do all the regulatory reforms in the world, but it's still going to be out of reach for some folks. On the subsidy side and the public investment side, there are increasing number of states that are creating trust funds, which have a revolving component, as you alluded to, where a below-interest loan or a forgivable loan will go toward filling a gap left by the low-income housing tax credit and other federal programs. And those trust funds, as they're created, are averaging anywhere between $50 million and $400 million a year, kind of depending on the size of you have Vermont and you have Texas, right? But, yeah, there are a number of states that are looking at that. If I had to pick one, I think I'll have to get back to you on that one in particular, but the ones that do seem to succeed acknowledge the complex federal programs we already have and fill in the gaps in between them. I thinking of the Department of Energy weatherization program It been around for 50 years In many cases it the only game in town for a low weatherization And as utility costs have increasingly risen it's very important. It is not an easy program to implement. Part of that is the amount of cap it creates per unit. So if you go into a house and you discover you want to update their light bulbs or their wiring, but you realize there's knob and tube wiring, suddenly that cost has increased dramatically. So the programs that succeed don't abandon the federal programs, but they are additive to them and help them go further. Yeah, absolutely.
Which is something that we hear from affordable housing developers is how do we add to options that already exist. You mentioned a range of anywhere from like $50 million to $400 million for these kinds of funds. If you just had to guesstimate what you think the size of an appropriate fund would be for Pennsylvania, what would you say?
I don't know that I'm prepared to have an answer on that one for you, but I'm happy to get back with you. Okay. One other quick question.
I think another topic that I think has gained some traction and discussion on the role of the public and government in stepping in and helping around housing is even the idea of social housing developers. So having housing agencies take more initiative around just developing social housing. I'm curious about your thoughts on that generally, and is there a role for the state on that level? And, again, are there any examples of states investing more in social housing development that you think are ones we should be looking at here in Pennsylvania?
I don't know of any states in particular, but I'm happy to get back with you, that are investing in social housing. On the role of housing authorities, I do think that remains essential. There are a lot of them throughout the country, and they range from, I think, Mankato over in Wisconsin might be the smallest. I haven't been at HUD in a while, but I think they own one building, up to New York City Housing Authority, which houses like 1 in 12 New Yorkers or something like that. And although the initial model that created them, where we're creating a piece of permanent affordable housing and we're providing enough operating subsidy to sustain it really no longer exists. They are essential and are participating more with the private market to develop new sources of affordable housing. And, in fact, many housing authorities in the state compete for and win low-income housing tax credits, which is still our largest tool of affordable housing. So I do think that the role of housing authorities remains incredibly important, and as many of them are looking at increasingly old public housing programs, they're looking at ways to sustain them through things like adding in private capital and low-income housing tax credits. On social housing in particular, I'll have to get back to you there. Thank you.
Thank you, Chair.
Thank you. Chairman Irvin.
Thank you, Chairman. Another follow-up question. We're a commonwealth, and we like to keep the government at the most local level. And a lot of our rules and regulations sort of follow, goes right back to your township supervisors and your borough councils and your cities for implementation. I know this committee and I commend this committee for the fact that we sort of had some controversial bills that some of your local governments didn always like One being you had mentioned the accessory dwelling units We had the Golden Girls bill that actually went through here. And that's something I think we're doing at the state level that we're trying to help alleviate some of the, but that, alleviate the housing issues. But You had mentioned some of the, I guess, issues that maybe you have identified with, or could you mention some of the issues you have identified that could be addressed with building codes that would make it, I guess, more attractive for your private sector builders to come in and alleviate some of the loopholes and everything they have to jump through with the building code that may have been identified as of yet.
Sure. Yeah, and that was one of the more surprising things coming to work for the state was the sheer amount of municipalities we have, I think second only to Illinois, if I'm not mistaken. You are correct that there are a lot of states that are looking at, you know, so-called supply-side reforms, right? Those zoning or land use changes that they either incentivize the local governments to do through programs like I mentioned earlier, or they pass legislation taking care of it at the state level. On the zoning and land use changes, I know that 22 states who brought up ADUs have legalized ADUs in some or all single-family housing types. Many of those states might surprise you. Some of the leaders in the 2025 legislative session, this is from a Pew report, included Texas, Montana, Utah, passing a number of zoning reforms. On building codes in particular, what most people have focused on is how hard it can be to pencil out a small or mid-rise apartment building because once you go above a certain number of units, you get essentially all the requirements that you would have to build a 500-unit multifamily building in a 10-unit multifamily building. And that can make it really hard to make that development pro forma pencil out. And so this is where conversations around single stair come into play. And in fact, 18 states have taken some action on single stair, either legislating single stair buildings in four or five or six stories. That's eight states. Authorizing their localities to do so, that's two states. Or in the midst of an administrative process like we do here to do so, that's three states. So I think this challenge that exists through the code to build these smaller, mid-rise apartment buildings is something that people are pointing to the construction code more often as a barrier to.
Representative McKenna.
Thank you very much for your testimony. I think there's another issue coming up in the area where I live in the Lehigh Valley. In Northampton County, our property taxes are being proposed to go up 43%. And in Lehigh County, the neighboring county, it's going up 17%. And then in my local township where I live, those property taxes are going up 30%. So this excessive tax burden that's coming on the people that live there is going to create a lot of shifting. People are all over the media saying they going to move out So there going to be some available housing I guess But I think that the more taxation that comes on the lower level the harder it is for people to maintain a relatively secure housing position. So do you have any answers for that, or what could people do? Because if we have people leaving, and I also represent Montgomery County, So that's kind of a different thing, and I haven't followed that as closely because it's not in my local news. But these extreme, you know, increases in taxing does nothing for affordability for people to even live in our county. So, you know, these are relatively new, newly elected county executives. They're all Democrats in that area. But the first thing they're doing is putting these extremely high taxes, and I think that's going to really affect the housing in our area, and I'm very worried about that. Thank you.
Thank you, Representative. And I've had the opportunity to spend a decent amount of time in the Lehigh Valley learning about their unique housing challenges since I've been here. In fact, right now the Pennsylvania chapter of the American Planning Association is meeting for their annual conference in the Lehigh Valley. And I was there yesterday for a panel with a representative from the city of Allentown and from the Lehigh Valley Regional Planning Commission talking about housing. And the Planning Commission has done some really, really impressive work looking at housing affordability in the region. They just released their own housing strategy and dashboard a month or two ago, I believe. and one of the things you can do with the dashboard is say, drill down to a specific municipality or county in the region and look at essentially median income and median housing costs by either ownership or renting. And in most of the communities in the valley, it is increasingly unaffordable to live and stay there. Now that is in large part because of a good problem you have. The economy in that area has been growing and people see the communities there as a great place to live, work, and raise a family. And as a result they're moving in. And we don't have the ability to create a wall around our communities and keep people from moving in. And so they're moving in and that creates a pressure that we have to then deal with through some of these regulatory reforms. and I applaud Allentown for recently doing some rezoning, including on ADUs, to try to increase the supply and address that demand, and also creating some of their own subsidy programs to help keep housing overall more affordable. But it's tricky because your opportunity is also the primary driver of the challenge, right? People want to live in the Lehigh Valley because you have great communities, and that's increasing taxes. It's increasing the cost of housing to rent and owned. And it takes some of the zoning reforms like Allentown is doing, and I believe Bethlehem also just recently is in the middle of a rezoning as well, to meet that demand and lower the overall cost of housing.
Okay. Well, the city of Allentown is raising theirs 4% this year. And, you know, we're always so concerned about affordable housing. What is affordable housing? You're going to be pushing all of the middle class and lower class people out, and it'll be this gentrification and only... Only rich people will live there, and that doesn't seem quite fair to the people who have lived their whole lives there and paid taxes, and now they're being pushed out by all this extreme taxation that's being levied at this time. So I think it's a problem. And we are blessed in the Lehigh Valley because we've had a lot of economic growth, and those are all high-paying jobs. So that's going to go to the high housing. People will be able to afford million-dollar houses with no problem. But I am concerned about the lower and middle-class people because I think that they – I'm an eighth-generation Pennsylvania who has lived in the Lehigh Valley all my life, and I hate to see people, you know, my age and my parents' friends and, you know, even the kids who want to live there but are just starting out. It's becoming extremely unaffordable for them. So that's a problem.
Yeah, and one of the interesting things that Allentown has done with their rezoning is accessory dwelling units. And many of the reasons you cite are exactly why the AARP of all organizations promotes ADUs, because it allows folks that have lived in their home for most of their life to bring in a new source of income. And I think in Allentown they call them alley houses or something like that in the commercial core. But it's that infill housing which also has the added benefit of not adding infrastructure because it's already served by electric, by water, by road, which helps keep the cost on taxes down from bringing in new housing.
Well, in Bethlehem, they didn't want it because it's a historic city and the streets are so narrow that no fire truck or ambulance can get to the alley houses. So they have voted against that. So no community is identical to another community. So that has to go to local control and allow them to say what kind of housing they can bear because you don't want an elderly parent living in an alley and having a heart attack and the ambulance can't get there. So I think it's extremely troubling. And I'm grateful for the good, but I am worried about the downside of some of these implications. Thank you.
Representative Powell.
Thank you so much, chairs, for holding this hearing. Good to see you. Apologies if this question has been asked already, but I had a few questions about financing, both on the developer side but also individual financing for first-time home buyers. One of the things that I'm deeply concerned about, as I'm sure many people on this committee are, is the dwindling amount of federal dollars that are going towards housing. We're seeing fewer CDBG dollars, home dollars, and I think it's right now incumbent upon states to think about other ways that we can fund housing. At one point we were talking about a housing bond that would go towards as like a revolving kind of loan fund to fund housing. Have you seen any other responsible solutions that other states have taken to generate more revenue in place I know not fully in place but in place of some of the federal housing dollars that are continuing to decline.
Thank you, Representative. Good to see you as well. You are 100% correct on the federal programs, and it pains me because I spent most of my career working with them. they are not adequate to meet the need. And indeed, and we were talking about workforce housing a second ago, none of the programs really are designed to meet the need of even median or moderate income families, which find it increasingly difficult to purchase a starter home or even continue to rent in the neighborhood that they lived in. And so while those programs at the federal level have either remained stable or lowered, many of the affordability restrictions that were created through the same programs 20 or 30 years ago are starting to expire. And so we have that, you know, existing baseline need, which is unmet, right? The waiting lists for many of these properties of folks that would qualify to benefit from them are often 11 to 1. right? That need is only going to increase as our existing affordable housing stock expires. So states are stepping up, creating their own state grant programs, tax credits, loan programs, et cetera. And as the housing action plan identified, that's something that we can focus on here too. Then a second question, if I may. Maybe a little bit more rambling, so I apologize.
One of the difficulties, as you know, for first-time homebuyers is capital, being able to put up the money to purchase a home. And one of the frustrations that I often think about is for renters who have consistently paid their bills for 10 years in an apartment, paid their rent on time, paid their utilities on time, show that they are a responsible tenant, there are not as many programs to flip those folks who may not be able to amass $10,000, $15,000, $20,000, but will be someone who theoretically will pay their mortgage on time because they pay their rent on time. Maybe a little pushing back on banking and financing, but do you see opportunities from your role or from our role as a collective to think about different ways that we can encourage first-time homeowners or first-time homebuyers to buy those homes. What are the different types of financing programs that we should be advocating for that make it easier for people who are responsible, who would be responsible homeowners to get in that role? The way that we lend hasn't changed in however many years, And I think it's a point of frustration for so many would-be homebuyers who would be, again, fantastic homeowners, but just can't amass the capital up front. A little bit of a rambling question but something that I think that if we were able to think of programs think through programs that would address that tension would unlock so many new homebuyers specifically in Pennsylvania
An important question, though. And I think there's two ways that that problem could be addressed. One, I don't want to, I know we talked about subsidy primarily, but I don't want to discount the regulatory role here, right? The minimum lot sizes and dimensional standards that many communities require make it nearly impossible for a developer to pencil anything out other than a large lot, you know, 3,000 square foot development, which is not a starter home, right? And so I think that there are regulatory changes that we can make, that communities can make that would make the price more affordable and to also increase the supply of starter homes that we have in the state. On the subsidy side, median home prices have gone gangbusters over the last few years, right? And at the same time, so have interest rates. And so that means the more even important than just the individual sales price, that monthly mortgage payment has ballooned because it's getting hit both ways. We can't do anything about the interest rates. We're not the Fed. We don't control the bond market. But as the Housing Action Plan is called for, there is certainly a role for things like down payment assistance, et cetera, that can help get that person even qualified to purchase a home. So I think it's both a regulatory side where we can make the overall cost of housing less expensive by increasing the diversity of housing types that are available, particularly in that starter home segment. but there's also a role for subsidy programs that target that first-time homebuyer beyond just low-income renters as well.
Thank you, Rep Powell. One last question. Chairman Irwin.
Thank you. Thank you, Chairman. I know we're running up on the witching hour here. We need to finish up, but I appreciate your question, Representative Powell, And I appreciate the talk on starter homes and the fact that, you know, you used to be able to buy a starter home for $47,000 or something like that, put some money into it. I know. That's when I'm dating myself, I guess, a little bit. But the idea is that we were just out in Pittsburgh for an informational, you know, tour and meeting. And one of the big issues, back to even property tax issues, was the fact that there's a lot of bladed and vacant properties that are in the cities and even rural areas and urban areas and suburban areas. They're not cost effective to fix up. But the utilities are there. They're already, you know, they could be utilized and, you know, help with that starter home and facilitate some of that. Not that we don have a housing crisis across the board whether it be you know high low workforce senior low You know there all kinds of housing demands It needed And to put a thumb on any of it and to solve the problem it just not possible I think we sort of demonstrated that here today. But those blighted properties, is there anything that could be identified legislatively to help maybe bring those starter homes that could very well be a reasonable, price to get them back on the tax rolls and also an individual would want to buy something that needs a fixer-upper and they could live in it and still be able to put some money into it. Is there anything that you can identify or even think of that might help you legislatively to do that? It's a great focus area because as you
pointed out, you're not just solving the housing issue but you're also helping with the economic revitalization of the communities. And those houses are already in areas that are probably walkable, close to jobs, etc. So you can hit multiple objectives at once. I would say home repair and revitalization programs and land banks are two tools that were particularly called out in the Housing Action Plan that would be really beneficial for that problem.
Thank you, Mr. Chairman.
Just one final comment. I would like to personally say thank you to both sides of the aisle. This session, we passed 30 bills out of this committee, 23 out of the full House. And of those 23, 22 passed with a bipartisan vote. I take a lot of pride in that myself, Chairman Irvin. And that just shows that this committee is taking this very – I'm taking this – I'm very – I'm serious. And it's something that I think in past sessions was not taken serious. And when I became chairman this session, we were going to take that and we were going to turn it. And I think we've done that. And so I just want to say thank you. And one final note, I would just like to thank both members. As everyone knows, I talk with A, I'm stutter, so I just want to say thank you for your patience with my speech. And I just want to say thank you as well. And so, Mr. Chairman, any final comments? And with that, this will probably be our, I should say, this will be our final time together this session. So just want to say thank you and with that we are adjourned. Thank you
Thank you.