Domestic violence survivor K, left, her name withheld for confidentiality, sits with her son for dinner in their new sparsely furnished apartment, Thursday, Aug. 13, 2015, in New York. After leaving her husband who beat and controlled her for years, she and her little boy spent the next three years homeless because she couldn’t afford New York City rents. (AP Photo/Bebeto Matthews)

New Hampshire state Rep. Ellen Read remembers how trapped she felt as an 18-year-old in her native Tennessee, enduring the physical and emotional toll of an abusive relationship.

The abuse Read suffered — which included being held captive in an apartment for days and hit by her abuser’s car — lasted years after she left the relationship, while her abuser stalked her.

In 2016, Read won election to the New Hampshire House of Representatives. That same year, she recalled to Stateline, her abuser died by suicide after 16 years of prolonged stalking.

Now, a bill authored by Read would allow victims of domestic and sexual violence — including stalking — to break their rental lease agreements early if they provide a police report or are in the process of obtaining documents such as a protective order following an incident.

“My hope is that this increases the boldness of people living in these abusive situations and that they know if they leave, there will be a path forward for them and they won’t be forced to stay with their abuser or at the home they were abused in,” said Read, a Democrat. The bill has been sent to Republican Gov. Chris Sununu after passing both chambers.

The pandemic lockdown that began in March 2020, coming alongside the nation’s worsening housing crisis, has prompted state lawmakers to help victims of assault who are struggling to move away from their alleged abusers. Domestic violence incidents in the United States increased by 8.1% in the months following the imposition of pandemic lockdown orders in 2020, according to a 2021 report released by the National Commission on COVID-19 and Criminal Justice, a group launched by the Council on Criminal Justice, a think tank.

More than a dozen states have passed measures in the past five years bolstering rental protections for survivors by allowing them to break their leases if they provide evidence of stalking, sexual assault or an abusive domestic relationship. Many of those laws, which were enacted or strengthened during the pandemic, give victims more leeway in how they can document the abuse.

Many cities and states are looking to help survivors with new housing in other ways, such as by obtaining grants to develop transitional housing or offering housing vouchers to victims.

“It is deeply traumatizing and harmful to force survivors to continue to live in the same home where the harm occurred,” said Kate Walz, associate director of litigation at the National Housing Law Project, an advocacy group that trains legal services organizations. “It can retraumatize and compound the harm over years, if not decades.”

Several states are addressing the issue this session. Efforts to add early lease termination laws for victims in Ohio, Pennsylvania and South Carolina have yet to either make it past committees or both chambers.

While Pennsylvania’s effort to pass these protections statewide has stalled, the Pittsburgh City Council approved a bill in October that requires landlords to allow domestic abuse victims to exit their leases without penalty, and also change a tenant’s locks upon request, though at the tenant’s expense.

Nicole Molinaro, president and CEO of the Women’s Center & Shelter of Greater Pittsburgh, one of the country’s first domestic violence shelters, called the legislation “monumental.”

Molinaro hopes the state will eventually enact similar protections. She said that the trauma of domestic and sexual violence can be “crippling,” and that some victims may need to leave their neighborhood or cities altogether if their abuser also has roots there.

“A driving factor for survivors of domestic violence is making sure that there is somewhere safe for them to go,” Molinaro told Stateline. “And that often means a survivor cannot move back to the neighborhood they were in if the abuser still has connections there.”

The post-separation journey

When New York City resident Stephanie Woodbine and her adolescent daughter left a two-year abusive relationship in 2017, she wasn’t sure where they were going to live.

Woodbine told Stateline that on top of emotional abuse, she also suffered economic abuse — a form of abuse that New York City last year officially recognized as domestic violence. She found housing, then was evicted after losing her job.

“I really didn’t have a lot of money to pay for housing because the mental trauma made it hard to live a normal life, keep a job,” Woodbine said.

She didn’t qualify for the domestic violence shelters because she wasn’t in an “active domestic violence situation,” she recalled, so she stayed in hotels and lived a life of “hidden homelessness” with her daughter.

“There are so many decisions that make leaving any abusive situation hard, but when you leave you find out just how hard it is to survive when you feel your options are limited,” said Woodbine, who eventually received an emergency housing voucher and has secured permanent housing.

“There’s a lot of post-separation abuse that is also contributing to survivors’ instability and their mental trauma,” added Woodbine, who now sits on the Mayor’s Office to End Domestic and Gender-Based Violence. “It’s why we want to expand protections for survivors post-separation, and that includes providing permanent housing.”

Intimate partner violence is a major driver of homelessness, and researchers have found that housing is among the most common needs for survivors. Currently, 10% of shelters and transitional housing are targeted to domestic violence victims and their families, according to the National Alliance to End Homelessness.

As the U.S. Supreme Court considers the constitutionality of homeless camping and outdoor sleeping bans, cities that have passed bans argue that outside encampments are dangerous not just for the public, but also for people staying there.

But Walz, of the National Housing Law Project, fears that if these bans are deemed constitutional, they’ll have a major impact on women and children fleeing domestic violence situations.

“Gender-based violence is both the cause and consequence of housing instability. Housing instability increases your risk of it, and housing instability comes as a result of it,” said Walz. “If we don’t recognize that and craft our policies to be responsive to it, we are guaranteeing continued violence and increase of it.”

More cities are working to include housing as a key service for survivors.

Woodbine credited city-based nonprofits for navigating her through the emergency voucher process — an intimidating process for those in need of housing.

New York City is hoping to provide such protections and, most importantly, housing through a pilot program funded with a $300,000 grant — from the NYC Fund to End Youth & Family Homelessness — that aims to help 100 families affected by domestic violence find homes.

Saloni Sethi, acting commissioner of the Mayor’s Office to End Domestic and Gender-Based Violence, told Stateline that the pilot program addresses the need for safe and stable housing for survivors in a place where secure housing can be scarce.

“Survivors are often sort of faced with this really impossible choice of, ‘do I give up my own safety or do I destabilize myself and my entire family by leaving home?’ … We anticipate this pilot can finally provide that stable, fresh start,” Sethi said.

Many cities and states have become more intentional about building or reserving housing for survivors, with increasing support from the federal government. Last year, the U.S. Department of Justice’s Office on Violence Against Women awarded 81 grants, worth $43 million, to programs offering housing for six to 24 months for survivors.

Breaking the lease

If Read’s bill is signed by Sununu, New Hampshire would become one of 40 states to have early rental lease termination protections for victims of domestic or sexual abuse.

In post-lockdown years, Oklahoma passed early termination laws for domestic violence victims. Utah amended its early termination law in 2023, reducing the termination fee from 45 days of rent — one of the highest in the nation at the time — to a month’s rent.

Read’s bill, which she based on a similar one in Tennessee, stalled in committee when she first introduced it last year.

During early debate, New Hampshire landlord groups raised concerns about the financial burden they carry when tenants break their lease early — a position that irritated Read.

“Nobody will say in today’s society here that they are in favor of domestic violence,” Read said. “But put your money where your mouth is when it comes to allowing them to make that decision to exit their lease early even at a financial loss, or else it’s just lip service.”

But every time a new tenant comes in, it costs money to clean up and turn over the home, said Nick Norman, a real estate owner who serves as government affairs chair for the Apartment Association of New Hampshire. The bill’s original language also could have left a landlord responsible for things left behind, including damages.

The legislation now on Sununu’s desk is “drastically different,” Norman said. “The housing provider advocates and tenant advocates came together as we usually do to find a solution that works best for both parties.”

Read likewise credited the Senate for adding measures that would make qualifying for an early termination lease easier.

Some states, including Kansas, North Dakota and Utah, may allow landlords to charge fees or forward payment of rent for breaking the lease early in cases of intimate partner violence. And many states require documents from an outside source, such as a police report or court protective order.

Many landlords see such requirements as a necessary step in good faith to break a lease early. However, Walz thinks that these requirements are a barrier for survivors, given how underreported domestic and sexual violence is and how hard it can be for victims to obtain a report without escalating violence from their abuser.

“First and foremost, we must believe survivors. This means in action taking their own stories and experiences to be true and not requiring any form of third-party proof,” Walz said.

“Assumptions, stereotypes and bias — towards not believing survivors and perceiving that it could be made up in order to exit a lease — play into state policy responses and often result in a litany of requirements, including orders of protection, police reports, third-party statements,” she said.

Stateline is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Stateline maintains editorial independence. Contact Editor Scott S. Greenberger for questions: info@stateline.org. Follow Stateline on Facebook and Twitter.

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In this March 30, 2020, file photo, resident Marie Salas, left, sets a banner on her home fence reading "Squatting is not the Answer," across the street of a formerly vacant home that was recently taken by a group of homeless mothers in the El Sereno neighborhood of Los Angeles. A new group of homeless people who had taken over several empty, state-owned houses in Los Angeles was forcefully removed by California Highway Patrol officers hours later amid protests by dozens of community activists. (AP Photo/Damian Dovarganes, File)

Across various news channels and outlets, a visceral fear of some property owners — that an unwanted guest could move into their vacant home, refuse to leave, and then claim ownership — has been a trending story.

These squatter horror stories have reached a fever pitch in the past month after a migrant TikTok influencer, Venezuelan national Leonel Moreno, encouraged people to squat in homes across the United States. Moreno was arrested in Ohio in late March by federal Immigration and Customs Enforcement officers.

So far, lawmakers in at least 10 states have floated legislation this year that would address squatting by revoking tenancy rights, making it easier for police to remove squatters or making squatting a criminal offense. Several have quickly enacted new laws.

The bills, typically sponsored by Republicans but often garnering bipartisan support, come at a time of heightened housing anxiety: The shortage of housing is worse than ever, with affordability at a new low. Meanwhile, migrant encounters at the U.S.-Mexico border reached a new monthly high in December, and nearly 80% of Americans think that situation is either a “major problem” or a “crisis.”

Oklahoma state Rep. Ross Ford, whose legislation advanced days after Moreno posted his TikTok video, said he began thinking about the issue several years ago after hearing of incidences in rural areas of the state.

But Ford, a Republican, also told Stateline the recent wave of bills across the country is likely in response to Moreno’s video.

“For me, I heard complaints about squatting from property owners … accounts of individuals scouring newspapers for death notices in search of a place to occupy,” said Ford. “But when that came out, I think it really blew this whole issue up for lawmakers in other states.”

For the most part, squatting — when someone moves into a vacant building or onto uninhabited land — is considered a civil matter, so police officers aren’t empowered to remove someone at an owner’s request. Homeowners can file eviction notices through the courts to remove an unwanted squatter, a process that can take weeks or months.

So far, Florida and West Virginia have enacted laws that classify squatting as a criminal act. Florida’s law creates a process for sheriffs to remove squatters. Georgia Republican Gov. Brian Kemp this week signed a similar bill into law.

Several other states — including Alabama, New Jersey, Ohio, Pennsylvania and South Carolina — have pending legislation. The anti-squatter fervor also has spread to Capitol Hill, where a U.S. House bill would make squatting a deportable offense.

Proponents of these bills have singled out migrants and immigrants in the country without authorization as squatters, frequently referring to Moreno’s video but otherwise presenting scant data to show that it is a widespread problem.

“After video evidence of their plan to take over homes emerged, we’re ensuring Floridians are protected from this egregious and brazen scheme,” said Florida Republican Attorney General Ashley Moody in a news release when that state’s bill became law. She criticized President Joe Biden’s border policy in the same release.

In Oklahoma, Ford’s bill would allow county sheriffs to immediately remove an alleged squatter from private property.

“When this happens in Oklahoma, the process to get an unwanted person off your property gets bogged down in civil courts for evictions and it may be months to get that person out of your house,” said Ford. “I’m hoping we can make this process of removal quicker and cheaper for the landowner.”

The Oklahoma House approved the bill earlier this month; it is now being considered in the Senate.

‘Manufactured crisis’?

But Eric Dunn, director of litigation at the National Housing Law Project, which advocates for tenants’ rights, called the anti-squatting bills a “manufactured crisis” that exhibits the power of the landlord lobby in U.S. statehouses.

“This TikTok video gave some landlords cause to say, ‘We have a squatting crisis,’ without any data or evidence, or cause for there to be legislation to address a matter that’s already handled by an eviction court,” Dunn said. “It’s indicative of how well organized and connected landlords are in political circles, and how effective they are in getting lawmakers to act on their behalf.”

Kris, a transgender woman from Florida, said in an interview with Stateline that her parents kicked her out of their home in 2022. She found a community of squatters online and has been on the road ever since. Recent news coverage has been reckless and could embolden a property owner to hurt someone, said Kris, who asked that her last name not be used out of concern for her safety.

Traveling through states — including Tennessee and Texas — on her way to the Southwest, Kris said she usually holes up in vacant buildings, never a home that appears occupied, for up to three months at a time. She doesn’t feel like she’s a threat.

“I’m reading stuff on some sites saying the homeowners need to protect their homes and that squatters are just violent vagrants that need to be dealt with,” she said. “It creates a dangerous environment, where a majority of us who are only trying to find shelter in abandoned buildings are now enemies of paranoid homeowners.”

In most states, Republicans are leading the charge on anti-squatting legislation, but in at least one state, New York, Democrats are at the forefront.

New York Democratic state Sen. Jessica Scarcella-Spanton, who represents Staten Island and southern Brooklyn, acknowledged there is little data to support claims that squatting is on the rise, or even that it happens that often.

But Scarcella-Spanton told Stateline that “once is enough” and that there needs to be a quicker way to remove squatters.

Her proposal, which made it into the state’s 2025 budget signed by Democratic Gov. Kathy Hochul, spells out clearly that squatters don’t have tenants’ legal rights related to evictions. Proponents say that will make it easier for police to remove squatters from properties.

“Some people will make the argument that this is a very rare occurrence. But I think if it happens once or twice, it’s unacceptable,” Scarcella-Spanton said. “It’s always good to have data when we’re trying to push legislation, but most importantly, I think that just seeing the cases that we’ve seen over the last couple of months in the news is reason enough to move forward with legislation.”

Some landlords and property owners in blue states are hoping their lawmakers join the anti-squatting movement.

In California, Cynthia Chidester’s run-in with a squatter at her 95-year-old mother’s home led to a prolonged legal battle that required a domestic violence order to get the squatter evicted in April.

In an interview, Chidester said she wants lawmakers to take the issue more seriously, including passing laws to expedite the eviction process for squatters or unwelcome guests.

Alexandra Alvarado, director of education and marketing at the American Apartment Owners Association, an industry group, told Stateline that squatting has been a “nightmare situation” for landlords and property owners since the pandemic, when many offices emptied and vacation rentals sat vacant.

The removal process needs to be “more efficient,” with housing courts backlogged since the pandemic, she said.

“In our industry, squatting has always been an issue. I think what’s changed is the media’s attention to it,” said Alvarado. “We think there’s been a rise in squatting. It’s difficult to show because we don’t have the numbers, and a lot of these cases aren’t handled much differently than a standard eviction case.”

Eviction protections

But Dunn, of the National Housing Law Project, worries the recent bills could lead to a rollback of eviction protections. Landlords spanning 10 states and 34 cities filed nearly 1.1 million eviction cases in 2023, a year-to-year increase of more than 100,000, and 500,000 more than in 2021, according to Eviction Lab, a Princeton University research group that tracks evictions.

According to Eviction Lab, a Princeton University research group tracking nationwide eviction data, landlords spanning 10 states and 34 cities filed nearly 1.1 million eviction cases in 2023, a year-to-year increase of more than 100,000, and 500,000 more than in 2021.

“It’s not like tenants have great protections in a majority of states as it is,” Dunn said. “It behooves tenants to pay attention to state and local governments when bills like these are proposed, and push back, or they’ll see their rights eroded by a thousand cuts.”

Marc Roark, a law professor at the University of Tulsa who studies squatters and homelessness, described the anti-squatter bills as “low-hanging fruit for political points. It’s a way for legislators to say, ‘Look, I’m doing something to protect your property,’ instead of any substantive housing policy.”

Roark and other housing experts have found that squatters rarely gain ownership of a property. In most states, the period of occupancy required to claim ownership ranges from five to 20 years.

However, Amy Starecheski, a cultural anthropologist at Columbia University who has documented the stories of squatters in New York City, noted that some who take shelter in derelict and abandoned buildings eventually do end up owning them.

“So many people are in need of basic shelter and there are people who are squatting intentionally to challenge private property as a legal and cultural institution,” Starecheski said.

“This might be a moment when people freaking out about squatting are actually freaking out about access to housing, and who gets to own a home and who doesn’t get to own a home.”

Stateline is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Stateline maintains editorial independence. Contact Editor Scott S. Greenberger for questions: info@stateline.org. Follow Stateline on Facebook and Twitter.

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WASHINGTON, DC - APRIL 22: Homeless rights activists hold a rally outside of the U.S. Supreme Court on April 22, 2024 in Washington, DC. The Supreme Court heard oral argument in City of Grants Pass, Oregon v. Johnson and Smith v. Spizzirri, a dispute over the constitutionality of ordinances that bar people who are homeless from camping on city streets. (Photo by Kevin Dietsch/Getty Images)

WASHINGTON — A majority of U.S Supreme Court justices Monday seemed inclined to side with an Oregon town’s law that bans homeless people from sleeping outdoors, in a case that could have broad implications for local ordinances related to homelessness across the country.

During oral arguments in City of Grants Pass, Oregon v. Johnson, conservative justices said that policies and ordinances around homelessness are complex, and indicated it’s a policy question that should be left up to local elected representatives rather than the courts.

“Why do you think these nine people are the best people to judge and weigh those policy judgments?” Chief Justice John Roberts asked, referring to the Supreme Court.

Taking a much different tack, the three liberal justices said that Grants Pass officials went too far and targeted homeless people with fines for the basic human need to sleep when they camped outside.

Justice Sonia Sotomayor grilled the lawyer for Grants Pass on how the city law essentially criminalized homelessness.

“You don’t arrest babies who have blankets over them, you don’t arrest people who are sleeping on the beach, as I tend to do if I’ve been there a while. You only arrest people who don’t have a second home, is that correct?” Sotomayor said.

The case originated in Grants Pass, a city in northwest Oregon that argues its ordinance is a solution to the city’s homelessness crisis.

An attorney representing a group of homeless people argued that they are involuntarily without housing because there are limited shelter beds for the number of homeless people in the area. The lawyer also said the ordinances criminalize homelessness through fines and potential jail time for camping or sleeping in outdoor spaces.

The town of nearly 40,000 has about 600 people who are homeless and the only nonprofit that can provide shelter can house only up to 100 beds, according to a brief submitted by the nonprofit, Grants Pass Gospel Rescue Mission.

‘Cruel and unusual punishment’

The justices are being asked to decide whether the enforcement of that local ordinance on regulating camping on public property violated the “cruel and unusual punishment” clause of the Eighth Amendment.

Theane Evangelis, the attorney representing the city, argued that the city is going after the conduct of unhoused people, rather than the status of homelessness.

“We can look at the law and it has a conduct element — the conduct is establishing a campsite,” she said.

The attorney representing the plaintiffs, Kelsi B. Corkran, argued that the ordinance is a violation of the Eighth Amendment by inflicting punishment for the status of being homeless.

“Although the city describes its ordinances as punishing camping on public property, it defines campsite as any place a homeless person is while covered with a blanket,” she said. “The city interprets and applies the ordinances to permit non-homeless people to rest on blankets and public parks, while a homeless person who does the same thing breaks the law.”

Corkran is representing Gloria Johnson and John Logan, who are both homeless.

Effects across the United States

The case could not only have implications for the city in Oregon where the case originated, but for cities across the U.S., particularly in the West, that have similar ordinances and are grappling with an increasing homelessness crisis.

There are nearly 327,000 people who are homeless in the country, according to most recent U.S. Census data. States with the highest population of homeless people per 10,000 people include California, Oregon, Washington and Montana, according to five-year estimates in the American Community Survey.

Outside the court, advocates gathered to show their support of the injunction that bars the city ordinance from taking place.

“Homelessness is a result of systemic issues such as a lack of affordable housing, exorbitant rents, and a shortage of well-paying jobs,” Sarae Lewis, a spokesperson for Community Solutions, said in a statement. “Arresting and fining people for sleeping on the streets is ineffective, keeps people homeless for longer, and distracts from real solutions like those we see working in communities across the country.”

Community Solutions, a nonprofit that works to end homelessness, was joined by other organizations that advocate for people without homes such as the National Homelessness Law Center and the National Coalition for the Homeless.

History of the case

The city is appealing to the Supreme Court after lower courts ruled in favor of the plaintiffs, Johnson and Logan, who are homeless residents of Grants Pass.

A federal judge blocked the city’s ordinance that prohibited people from camping and sleeping in parks and on public property. Grants Pass also barred people who are homeless from using blankets, pillows or other material to protect themselves from the weather while sleeping outside.

If that ordinance was violated, it carried a $295 fine that, if not paid, increased to more than $530. Repeat offenders could also be jailed for up to 30 days.

A three-panel judge on the 9th Circuit determined in 2022 that the city has such strict restrictions on anyone sleeping outdoors that it led to a ban on being homeless. 

That decision relied on a 2018 case, Martin v. City of Boise. The case involved homeless plaintiffs who sued the city of Boise, Idaho after it fined them under a camping ordinance.

The 9th Circuit found that the city’s ordinance violated the Eighth Amendment’s ban on cruel and unusual punishment because it imposes criminal penalties for homeless people sleeping outside or on public property when they do not have access to a shelter.

On Monday, Justice Ketanji Brown Jackson noted that the state of Oregon enacted a statute that codified the Martin case, saying city regulations “of this nature have to be objectively reasonable as to time, place and manner, with regards to people experiencing homelessness.”

“It seems like the state has already precluded Grants Pass from doing the sort of thing it’s doing here,” Jackson said to Evangelis.

Evangelis said that the new law was not similar to the Martin case and that the city ordinance also takes into consideration the safety of the community.

“They protect the health and safety of everyone and it is not safe to live in encampments,” she said. “It’s unsanitary. There are the harms of the encampments themselves on those in them and outside.”

City’s argument

Evangelis argued that the court of appeals was wrong in its interpretation, as well as the plaintiffs, who cite a 1962 Supreme Court decision in Robinson v. California.

In that case, the Supreme Court deemed that a state cannot criminalize someone for their status of being addicted to drugs because it violated the Eighth Amendment’s prohibition on “cruel and unusual punishment.”

That case barred the criminalization of narcotics addiction, but not the conduct of the crime that someone who is addicted to drugs might participate in, such as using, buying, selling or possessing drugs.

Evangelis argued that the Grants Pass law is “so far removed from what was at issue in Robinson that it just isn’t implicated here.” She said that the city’s ordinance does not criminalize the status of homelessness.

Justice Samuel Alito said that the Robinson case “presents a very difficult conceptual question.”

“The point is that the connection between drug addiction and drug usage is more tenuous than the connection between absolute homelessness and sleeping outside,” he said.

Evangelis said that the case the plaintiffs are making is that camping or sleeping outside and being homeless are “two sides of the same coin.”

“It’s collapsing the status that they claim into the conduct,” she said. “So we think the conduct here is very clear, because it applies generally to everyone. The law does not say on its face, ‘It is a crime to be homeless,’ I just want to make that clear.”

Justice Elena Kagan asked if under Robinson, the status of homelessness could be criminalized.

“I don’t think that homelessness is a status like drug addiction,” Evangelis said.

Kagan said that homelessness is a status, because “it’s the status of not having a home.”

Evangelis said she disagreed with that because being homeless is a fluid experience that could change from day to day.

Jackson said that the city’s ordinance seemed to punish the basic need for sleep.

“What’s happening is you’re only punishing certain people who can’t afford to do it privately,” she said.

Corkran argued that if someone is violating the city ordinance, and is told to leave but they have no place to go, that means that person is homeless.

“So again, homelessness is not something you can do, it’s just something that you are,” she said.

Department of Justice neutral 

The Biden administration took the middle ground, issuing a brief that is neither in support of nor against either party.

The brief agreed with the 9th Circuit decision in the Idaho case, but argued that cities should be allowed to enforce restrictions for the health and safety of their residents.

“Although the United States continues to believe that the fundamental principle recognized in Martin is sound, it shares amici’s concerns about the broad and burdensome injunctions entered by some district courts in the Ninth Circuit, which may limit cities’ ability to respond appropriately and humanely to encampments and other legitimate public health and safety concerns,” U.S. Solicitor General Elizabeth Prelogar wrote.

U.S. Deputy Solicitor General Edwin Kneedler offered partial support in a brief statement and also answered questions posed by the justices.

“It’s the municipality’s determination, certainly in the first instance with a great deal of flexibility, how to address the question of homelessness,” he said.

A constitutional issue?

Justice Brett Kavanaugh seemed skeptical that the city’s ordinance was a constitutional issue and instead is a policy one, such as how there are not enough beds.

“Do you think the constitutional role should be different when the number of beds available in the jurisdiction exceeds the number of homeless people versus the number of homeless people exceeds the number of beds available in shelters?” he asked Evangelis.

She said that it was unworkable.

“There is no way to count what beds are available and who is perhaps willing to take one and who would consider it adequate, then the question becomes, are those beds adequate?” she said.

Kavanaugh said that “it’s a difficult policy question.”

Justice Amy Coney Barrett asked Evangelis if the city laws are enforced, “is there a way for everyone to be cared for?”

“That ultimate question is for the legislature and policymakers to figure out what the right solution (is), what the right mix of policies is, but the wrong answer is to do what the 9th Circuit did here,” Evangelis said.

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Malek Hajar, senior project manager at the Vanbarton Group, shows a bathroom inside a model apartment while touring a high rise undergoing conversion from commercial to residential apartments, Tuesday, April 11, 2023, in New York. A growing number of developers are considering converting empty office towers into housing as part of an effort to revive struggling downtown business districts that emptied out during the pandemic. (AP Photo/Bebeto Matthews)

HERNDON, Va. — Juan Ramirez, watching his dog play in Chandon Park here in suburban Virginia on a Saturday morning, tries to imagine the massive office buildings next to the park becoming apartments and townhouses.

“I guess it’s inevitable. People don’t use offices as much now. I hope it’s affordable. Maybe it’ll bring more young people to town, more taxes for parks,” said Ramirez, 38, who grew up in the area and returned recently to take a restaurant management job after living in Minnesota and Ohio.

Cities and suburbs around the country are struggling with vacant office space as remote work becomes an established post-pandemic reality. States are stepping in with tax breaks and zoning changes to help replace the unwanted cubicle farms with much-needed housing. In suburbs such as Herndon, the answer might be tearing down an office complex and replacing it with a residential building. In more urban environments it might mean renovating and retrofitting office buildings to create apartments.

“Office vacancy has climbed to a 30-year high and at the same time there’s a housing shortage. So naturally the question is, ‘Why can we not convert all these vacant office buildings into housing?’” said Jessica Morin, research director for CBRE, a commercial real estate firm. CBRE research shows converting offices to other uses, mostly housing, is set to peak this year at more than 20 million square feet, up from 6.3 million in 2021.

Some places that started conversions before the pandemic are leading the way: New York state and New York City changed their laws during a 1990s downturn to allow more office-to-apartment conversions in Manhattan, although now there’s a state vs. city standoff on zoning rules to convert newer offices.

Ohio, where interest in city living grew when Cleveland spruced up its downtown for the 2016 Republican convention, now has three cities — Cleveland, Cincinnati and Columbus — in the top 15 list for office conversions to housing, according to CBRE.

Nationwide, 119 office conversion projects, including for residential and other use, are under construction or were completed this year, the most since CBRE began tracking them in 2016. Those projects could add about 44,000 new housing units when completed.

Since 2016, projects representing 125 million square feet of offices have or are slated to be converted to other uses, usually to housing but sometimes to warehouses or laboratories. But despite the recent increase, that represents only about 2% of all U.S. office space.

Impediments to making apartments out of offices include the still-high value of office buildings in some downtown areas in cities such as San Francisco, and the cost of demolishing or refitting old office buildings with plumbing for individual kitchens and bathrooms. Many office buildings also lack windows with natural light, which apartment-dwellers often demand.

That’s why state incentives have played a large part, as well as streamlined zoning that makes project costs more predictable for developers. Some states are further along than others. A new California law allows residential “building by right” in office and other commercial zones, meaning developers don’t have to petition for a zoning change. Washington state passed a law last year requiring cities to ease zoning requirements for housing in existing commercial buildings. And an Arizona bill signed into law this month will allow larger cities to convert more commercial buildings into housing without zoning changes.

Predictable zoning rules are important to developers who don’t want to get bogged down in negotiations and refusals that could sink a project.

“Developers just urge their states and localities to be really transparent, streamline the process, make the unknowns limited, because it’s the unknowns that drive risks,” said Julie Whelan, a vice president at CBRE. “Otherwise, they’re going to go look at the next pasture.”

Incentive programs

In addition to the Ohio cities, Chicago; Dallas/Fort Worth; Houston; Hartford and Fairfield County in Connecticut; the Kansas City metro area; Louisville, Kentucky; Minneapolis/St. Paul; Pittsburgh; Milwaukee; New Jersey; and Washington, D.C., are on CBRE’s top 15 list for rate of office space converted to apartments.

Ohio has two incentive programs for office conversion to housing. A 2020 program for “transformational” projects that could spur further development helped convert four floors of offices to apartments under construction at Playhouse Square in Cleveland. A historic building preservation incentive in place since 2007 helped partly convert Carew Tower in Cincinnati to apartments, said Mason Waldvogel, a spokesperson for the Ohio Department of Development.

Missouri is hoping to replicate that success in St. Louis, where about a quarter of the commercial space, including offices, is vacant. That includes the massive 44-story One AT&T Building downtown, with almost 1.5 million square feet, that sold for $3.6 million this month, compared with $205 million in 2006.

Missouri state Sen. Steven Roberts, a Democrat who represents the downtown St. Louis area, said a bill he’s sponsoring has bipartisan support from suburban Republicans, and is aimed at creating downtown areas in St. Louis and elsewhere where people can live, shop and eat as well as work. The bill was voted out of committee in February and is awaiting consideration by the full Senate.

The bill would create a state tax credit for up to 30% of the cost of converting office space to housing, retail or other uses.

“It’s a creative workaround to make downtown more vibrant and successful. We want to get more restaurants, more stores, more nightlife — and the way to do that is to get more people living there,” said Roberts. “It’s an issue for downtown and also for the whole state.”

Other states have enacted laws to encourage more conversion of offices to housing, according to a Minneapolis Federal Reserve Bank report last year. Laws passed by Florida and Montana in 2023 allow new and converted multifamily housing in commercial areas, and laws in Rhode Island and Wisconsin support conversion of existing commercial and office buildings.

A Colorado bill now in committee would provide tax credits for commercial conversion to housing starting in 2026, supporting Denver’s plans to transition its office-oriented Central Business District to a “Central Neighborhood District.” Denver identified 16 commercial buildings as prime candidates for housing.

Zoning changes

Starting in the mid-1990s, a combination of state and city laws helped transform lower Manhattan’s business district with more apartments, a process that accelerated after 9/11. A proposal by Democratic Gov. Kathy Hochul to expand the program to newer buildings failed to pass the legislature as part of a broader measure that included requirements for suburban and upstate communities to build more housing. Negotiations are continuing with lawmakers to make the change for New York City this year.

New York City also has begun working on its own rules to allow office-to-housing conversions citywide for buildings built before 1990, said Casey Berkovitz, spokesperson for the Department of City Planning. The state could do it faster and could also create tax incentives that the city cannot create on its own, and that’s also part of current negotiations with the state legislature, Berkovitz said.

“When you have a 20% office vacancy rate and a 1.4% rental apartment vacancy rate, it makes a lot of sense to substitute one for the other,” Berkovitz said. “We don’t want our own regulations standing in the way of that if it makes financial sense.”

In Herndon, town officials last month approved a zoning change that would clear the way for demolition of the Worldgate Drive offices and the construction of a combination of rental apartments, townhouses and “two over two” units with accessory living areas an owner can rent out or share with family members. All apartments would be market rate without subsidized affordable units, Ken Wire, an attorney for the developer, Boston Properties, said at last month’s hearing on the zoning change.

“We believe that by providing more housing in the area, we are adding to the overall supply, which thereby reduces price pressures in the market,” Wire said.

Virginia considered two state Senate bills this session that would have created incentives to convert offices to apartments but neither has passed, said Allison Brown, policy associate for the nonprofit Virginia Housing Alliance. One would have created a state income tax credit for office-to-residential conversion, and another would have allowed more residential building in commercial areas if they included affordable housing.

The Worldgate Drive housing plan may spur Herndon to change its zoning rules to allow similar projects without zoning changes, said Elizabeth Gilleran, the town’s director of community development.

Herndon wants to “retain its sense of community and historic small-town feel” but also keep a strong commercial tax base that has helped support the town’s tax coffers when home values inevitably rise and fall, Gilleran said. The town recently approved conversion of a small office park and a hotel to homes. But offices and other commercial buildings will remain a key component of the town’s suburban building mix as density grows with a recent new commuter rail stop that opened in 2022.

“The town doesn’t wish to become a bedroom community,” Gilleran said.

Stateline is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Stateline maintains editorial independence. Contact Editor Scott S. Greenberger for questions: info@stateline.org. Follow Stateline on Facebook and Twitter.

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Governor Murphy signs legislation to protect reproductive health care providers and out-of-state residents seeking reproductive services in New Jersey on Friday, July 1, 2022 (Edwin J. Torres/NJ Governor’s Office).

Gov. Phil Murphy signed an overhaul of the state’s affordable housing system into law Wednesday, the final step for a plan that will extend new legal protections and bonus credits to municipalities seeking to build new low- and moderate-income housing.

The law, which ends a court-run system that has overseen affordable housing construction for close to a decade, abolishes the defunct Council on Affordable Housing, guards municipalities from exclusionary zoning lawsuits under certain conditions, and creates a bevy of new bonus credits that municipalities can use to reduce their affordable housing obligations, among other things.

“Let’s be clear: today’s legislation is a major victory for the working families of New Jersey because nobody in our great state should ever have to worry about finding a safe, comfortable place to call home,” Murphy said at a bill signing in Perth Amboy.

Under the new law, the Department of Community Affairs, instead of the courts, will make calculations to determine the affordable housing needs in six state regions.

The protections the law grants to municipalities that meet affordable housing deadlines are not absolute. Such municipalities could still face challenges under the Mt. Laurel doctrine, constitutional case law that requires municipalities to provide realistic opportunities for the construction of affordable housing.

Those challenges would be handled by a court-run affordable housing dispute resolution program created by the law.

The legislation broadens the number and scope of bonus credits municipalities can use to reduce their affordable housing obligations by up to 25%.

Towns earn one credit for each unit of affordable housing they build, and the new law allows them to earn full or partial bonus credits for extending affordability terms on existing affordable housing, building housing for individuals with certain disabilities, or erecting age-restricted affordable housing, among other things.

“This new law ensures that New Jersey will have one of the strongest frameworks in the U.S. to require affordable homes in historically exclusionary communities,” said Adam Gordon, executive director of Fair Share Housing Center. “This will help tear down the walls that have denied too many in our state access to opportunity and create new affordable homes near jobs, schools, and transportation.”

The law was opposed by Republicans and some municipalities who warned it would lead to uncontrolled development that could strain local infrastructure or change the character of towns.

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(Courtesy of the Department of Community Affairs)

Lawmakers sent a bill retooling the state’s affordable housing system to the governor’s desk Monday after divided votes in both legislative chambers.

The bill would abolish the defunct Council on Affordable Housing to codify the version of the court-run affordable housing system the state has operated under since New Jersey’s Supreme Court declared the agency all but dead in 2015.

The new system would enact new legal protections for towns that meet deadlines for submitting affordable housing plans, create a spate of bonus credits municipalities can use to reduce their affordable housing obligations, and erect a new court-run system to adjudicate affordable housing disputes.

“Without securing the most basic human needs — a place to live — the other policies we pass cannot be as effective,” said Sen. Troy Singleton (D-Burlington), the bill’s prime Senate sponsor. “Today, I’m grateful we’re collectively poised to take an important and indeed monumental step of ensuring that the best parts of our affordable housing system are set in statute.”

The bill, which passed both chambers in party-line votes, would immunize towns that timely submit affordable housing plans and other documents from exclusionary zoning lawsuits that can force the construction of affordable housing without the approval of local officials.

Municipalities who meet the deadlines could still face challenges that allege they did not follow through on their affordable housing plans, or if portions of the same violate what’s known as the Mount Laurel doctrine. That refers to constitutional case law requiring municipalities to provide realistic opportunities for the creation of low- and moderate-income affordable housing within their borders.

Housing is considered affordable if prices, rents, and related expenses do not exceed 30% of the resident’s gross income. Moderate affordable housing is affordable to residents making between 50% and 80% of their area’s median income, or between 50% and 30% for low-income affordable housing, and less than 30% for very low-income housing.

The bill would set lengthy deed restrictions on newly created affordable housing, requiring rental units created under the program to stay affordable for 40 years, with a 30-year restriction on for-sale units.

“This legislation will help tear down the walls that have denied too many access to opportunity and create new affordable homes near jobs, schools, and transportation,” said Adam Gordon, executive director of Fair Share Housing Center. “It’s good news for families across the state who are struggling to keep up with the soaring cost of housing.

A municipality earns one regular credit for each unit of affordable housing it builds, and towns can earn bonus credits that further reduce their obligations in certain circumstances.

The bill would expand the number and type of bonus credits municipalities can use to offset their affordable housing obligations, creating bonus credits for towns that convert existing market-rate units into affordable ones or extend affordability terms on existing housing.

Municipalities could receive full or partial bonus credits for affordable housing that serves individuals with special needs, age-restricted housing, or housing built on land previously developed for retail or office space, among numerous others.

Bonus credits can be used to meet no more than a quarter of a municipality’s affordable housing obligations.

Republicans and some municipalities have broadly opposed the legislation, cautioning its impacts had not been studied and that the bill could lead to outsized development that would strain local infrastructure or change the character of towns, especially rural ones.

“No one’s done a market analysis to see if the state could even absorb that many homes,” said Sen. Tony Bucco (R-Morris), the chamber’s minority leader. “We can’t be putting municipalities in a position where they’re going to be forced to pave over open space and farmland or develop high-density housing, multi-story housing which will completely change the character of our communities.”

Bucco said the measure would raise costs for municipalities. Other opponents of the bill have charged it would lead to higher property taxes for current residents, though the bill’s sponsors have disputed that.

“The residents in communities surrounding Mt. Laurel developments have continued to experience stable taxes,” Singleton said on the Senate floor Monday, “In fact, a study by Princeton University researchers found no difference in property taxes between Mt. Laurel after it built affordable housing and surrounding communities.”

The affordable housing changes passed alongside a package of narrower bills meant to ease the creation of affordable housing.

Among other things, bills in that package would create a sales tax exemption for materials and services used in the construction of 100% affordable housing developments, allow payments in lieu of taxes for certain affordable housing projects, and create a pilot agreement to help offset affordable housing projects’ property insurance premiums.

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MIAMI, FLORIDA - OCTOBER 02: Construction workers build a residential high rise on October 02, 2023 in Miami, Florida. According to the Census Bureau, apartment building starts fell to a seasonally adjusted annual rate of 334,000 units in August, marking a 41% decline from the pace seen the same month a year prior. (Photo by Joe Raedle/Getty Images)

Inflation is slowing and job growth has surged, but many Americans still feel the burden of expensive housing – fueled in part by high demand, low inventory and mortgage rates.

Home prices across the U.S. rose 5.5% over the past year in December 2023 and they are projected to increase 2.8% year over year by December 2024, according to CoreLogic, a consumer and business information company. None of the states in CoreLogic’s data showed home price declines.

Rents shot up 23.9% between the beginning of 2020 and the start of of 2023 and home prices rose 37.5% according to Harvard University’s Joint Center for Housing Studies’ 2023 state of the nation’s housing report. The median sales price of a home sold in the U.S. is $417,700, according to the St. Louis Fed.

Given the state of housing affordability in the U.S., here’s what to know about ongoing construction shortages, high interest rates, where housing prices are climbing, and what policymakers could do about it.

How did the housing market get this way?

Much of the current predicament renters and homebuyers face is linked to high housing demand, low housing inventory and the Fed’s cycle of hiking interest rates.

Very low mortgage rates – January 2021 saw the lowest recorded mortgage rate at 2.65% – fueled demand but drove up prices, exacerbated by low housing inventory, Matthew Walsh, economist at Moody’s Analytics explained. The Federal Reserve then raised interest rates in 2022 to combat inflation, which in turn influenced mortgage rates.

Those rates reached near 8% in October, and higher rates put constraints on housing supply, with more homeowners staying put. It’s now 6.77% for a 30-year fixed rate mortgage.

A lack of housing stock, both in for sale and overall inventory, is a key long-run problem for housing affordability, said Robert Dietz, chief economist for the National Association of Home Builders. A lack of accessible rental inventory that provides both single family and multi-family rental housing is a problem, he said.

“We simply don’t have enough developed land to build on, particularly in the places where it’s needed the most, which tends to be highly dense, more regulated markets in the largest metros where there’s a lot of population growth,” he said.

He added that a lack of  construction labor as well as expensive building materials – partly affected by supply chain problems – have exacerbated the problem.

A 2023 Home Builders Institute report found that construction would need to add hundreds of thousands of workers to meet residential construction demand. An HBI survey done in 2021 found that around 90% of home builders for single family homes said there was a shortage of carpenters and that more than 80% of remodelers said there was a shortage in most of the construction trades they needed subcontractors for.

What is the Federal Reserve doing with interest rates?

The Fed is expected to cut rates this year, which should have some impact on housing prices. The Fed may not cut rates until May or later, but economists have forecast multiple rate cuts this year.

Many homebuyers and renters are hoping that a cut in interest rates could provide lower home and rental prices, since a lack of homebuying can drive up rental costs.

But economists say there won’t be meaningful relief anytime soon.

“It should push mortgage rates down into the low 6% range and perhaps in 2025 moving into the high 5s,” Dietz said. “That’s not the 2 to 3% rate that we saw earlier, but it will help price in some demand by lowering the monthly payment on a hypothetical mortgage. It is going to have a disproportionate impact on first-time buyers who tend to be particularly sensitive to changes in rates because they don’t have any home equity as first-time buyers.”

Selma Hepp, chief economist at CoreLogic, said home prices will remain pricy for quite some time, even when mortgage rates come down.

“Because home prices have gone up 40%, no matter how much you adjust mortgage rates —  and we’re not expecting them to come down to 2% any time soon if ever again — you’d really have to get them to 2% to get that affordability back,” she said.

What are home price trends in different parts of the U.S.?

New Jersey, Connecticut and Rhode Island saw the highest home price increases in December, according to CoreLogic’s data, but no states saw home prices go down.

Hepp said that is significant because until this report, a couple states continued to show year-over-year declines: Utah and Idaho as well as the District of Columbia. She said that change may have been fueled by people moving from parts of California and from Seattle who drove up home prices in their new states.

A Moody’s Investor Service report released in October showed Florida, Montana, Nevada, and Idaho had the largest decline in affordability, due in part to growth in new residents.

But no part of the country is being spared by the effects of rising housing prices. Walsh said some of the fastest price appreciation he’s seen is in parts of the northeast and midwest because some of those markets are more affordable compared to parts of the country that saw an influx of residents earlier in the pandemic, such as metro areas in Mountain states including Colorado and Arizona

“The places where we’ve seen the most moderation in home prices have been in the places that lost that affordability edge…,” he said. “… Some of the fastest growing places in the northeast, like upstate New York, a place that really hasn’t seen quick increases in home prices in a long time, have been showing signs of life over the past year.”

How are policymakers helping?

Some states and cities are stepping up to the challenge of improving its affordable housing stock.

A program in Maine is funding more affordable rental housing, which includes the improvement of existing housing. Minnesota’s Family Homeless Prevention and Assistance Program is expanding rental assistance.

Voters in Phoenix and Albuquerque, New Mexico, last year supported bond measures that will spend millions on affordable housing. In 2022, voters approved housing bonds to fund more affordable housing for Buncombe County, North Carolina; Columbus, Ohio, and Kansas City, Missouri. Localities in Colorado and Montana voted to use tax revenues on affordable housing development and projects in 2023 as well.

On the federal level, the Biden administration announced in July it would address low housing supply by incentivizing projects with greater density and creating a program to fund projects that focus on zoning reforms. In October, the administration also introduced new housing initiatives to increase homeownership, such as loans to boost affordable housing on tribal lands and letting homeowners use prospective rental income from “dwelling units” at their home as part of their income when they want to qualify for FHA-insured mortgages. Some economists say that zoning is far too restrictive to increase housing supply and make it more affordable.

Government policies to address housing affordability should include “thinking about ways to incentivize state and local governments to reduce regulatory burdens and enact zoning reform to promote density where the market demands it,” Dietz said.

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(Photo by Spencer Platt/Getty Images)

New Jersey lawmakers are trying to conform state law with a new constitutional mandate barring governments from taking more than they are owed when collecting tax debt, but the attempt got off to a rocky start Thursday.

Advocates for investors and homeowners warned members of the Senate Urban and Community Affairs Committee that the proposal may still be constitutionally deficient by offering a limited timeline for homeowners to preserve their equity.

The bill would allow homeowners facing tax sale foreclosure to file with the state Superior Court in a bid to keep whatever equity remains after outstanding liens are settled in a sheriff sale, but those provisions only activate if a homeowner enters the filing within 45 days of receiving a foreclosure complaint.

“This bill does not solve the problem. It puts the onus on property owners to demand a sale in order to preserve their equity,” said David Deerson, a property rights attorney at the Pacific Legal Foundation. “We call this the you-snooze-you-lose procedure. If a property owner fails to make a claim within 45 days, it’s game over.”

Deerson was among the attorneys that represented Geraldine Tyler, a Minnesota woman who won a U.S. Supreme Court decision in May when the high court found that the state’s Hennepin County made an unconstitutional taking in violation of the Fifth Amendment when it kept $40,000 in proceeds from the sale of Tyler’s home even though she owed only $15,000 in unpaid taxes and other costs.

Deerson told the committee that New Jersey would still commit unconstitutional takings under the bill, which was introduced last month. The committee’s hearing on the measure was discussion only, and it took no action on it.

There is no guarantee residents would even receive foreclosure notices, he said, citing a case in East Orange where the city sent a foreclosure complaint to a business that was undergoing renovations and had no mailbox.

“[Lynette] Johnson did not even realize that her property had been foreclosed and the redemption period had ended until government officials showed up to tow cars off the property,” he said, referring to the East Orange property owner. “She certainly would not have understood that she needed to file a claim to preserve her equity.”

A New Jersey appellate panel reinforced the Tyler decision in December, finding the protections granted by the ruling extend to tax sales under New Jersey’s Tax Sale Law. Those concerns were echoed Thursday even by some real estate investors, who warned the opt-in requirement would likely run afoul of the Tyler decision even if it complies with some older court precedent. 

“We kind of believe that’s out of date based on what the Supreme Court decided,” said Marc Rubinsohn, director at National Tax Lien Association and CEO of Pro Capital, a real estate investment firm. “We understand the concerns of the towns, but I think this kind of breeds a lot of uncertainty. Investors don’t like uncertainty.”

Municipal officials view tax lien sales as a key method of recouping lost revenue. Local governments can collect delinquent property taxes by selling the tax lien to a third party who can, after a two-year waiting period, foreclose the property if the homeowner hasn’t squared their debt.

For governments, the benefit is twofold: They recoup some funds from the sale of the tax lien and are more likely to collect taxes on property once it comes under new ownership.

Keith Bonchi, general counsel for the Tax Collectors and Treasurers of Association of New Jersey, estimated tax lien sales put roughly $75 million into municipal coffers each year and said it is important New Jersey’s new tax sale system does not push investors out of the state.

But those tax sales don’t come without costs for municipalities, which can pay $500 in legal fees and more than $1,000 in other costs, Bonchi said.

Maureen Cosgrove, the association’s second vice president, added municipalities are concerned about costs the new system could add for towns by expanding sheriff sales, noting they already had to remit some funds to cover county expenses for sheriff sales.

Others questioned whether municipalities would actually face an undue burden.

“I know the towns are concerned about paying 2,000-a-piece for sheriff sale bills, but last year, last we checked in November, there were 96 [tax foreclosures] being done by towns,” said Rubinsohn, the Pro Capital CEO. “That’s less than $200,000. Those same towns advertised $56 million in liens for us to buy last year, so I think we need to put the priorities where they need to be.”

Wall attorney Christopher Campbell suggested municipalities could seek to recoup expenses by charging investors an upfront percentage fee on the sale price of a lien that would go directly into municipal coffers. Interest on temporary deposits into a Superior Court trust fund, which holds funds related to litigation, could also be a source of municipal revenue, Campbell said.

“There are ways around it to keep people from losing their equity, but this bill doesn’t necessarily do it,” Campbell said.

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(Photo by New Jersey Monitor)

The Assembly approved a bill overhauling the state’s affordable housing system Monday after more than an hour of debate that saw Republicans warning about the legislation’s unintended effects and Democrats emphasizing the state’s need for more housing.

“Today’s vote is good news for New Jersey families who are struggling to keep up with skyrocketing housing costs,” said Adam Gordon, executive director of Fair Share Housing Center. “This legislation puts New Jersey on a path toward historic gains in affordable housing production over the next decade.”

The chamber approved the bill in a 51-28 vote that fell entirely along party lines despite a raft of amendments meant to address local officials’ concerns that the overhauled affordable housing system would leave towns with no realistic path to meeting their obligations.

Republicans caution the changes would, over time, increase residents’ tax bills. Some urged the state to do away with a constitutional doctrine — known as the Mt. Laurel Doctrine — that requires municipalities to provide an opportunity for low- and moderate-income housing.

“We must address property taxes and affordability. That’s the solution, not this bill,” said Assemblyman John DiMaio (R-Warren), the chamber’s minority leader.

But Democrats said the revamp is needed as the state faces a deficit of more than 200,000 affordable housing units and an aging population.

“We want people to stay and thrive in New Jersey,” said Assemblywoman Yvonne Lopez (D-Middlesex), the bill’s prime Assembly sponsor. “Having access to affordable housing is key to that goal.”

Last week, the Assembly Appropriations Committee approved a series of amendments to the bill meant to address criticism from municipal officials who expressed concern about too much development and said legal protections in a past version of the measure were insufficient.

The amendments expand those protections, broadening legal immunity for municipalities that meet program deadlines to include all exclusionary zoning lawsuits, instead of only builder’s remedy lawsuits — a subset of exclusionary zoning suits that can force development without local approval.

Municipalities would still face legal challenges that turn on accusations they ignore provisions they agree to as part of their affordable housing plan or violate the Mt. Laurel Doctrine. In those cases, the bill would require challengers to prove a municipality’s plan or implementation violates the doctrine or agreement.

Though the amendments drew praise from the New Jersey League of Municipalities and the New Jersey Conference of Mayors, it’s not clear they were enough to win their support for the bill itself.

“The League supports these amendments, which represent good faith and responsive engagement and leaves us optimistic that remaining matters for the successful implementation of the bill and the envisioned path forward will be resolved,” the group said in a statement to lawmakers Monday morning.

The league added that some of its member towns are still concerned about methodological questions — how a town’s affordable housing obligation would be calculated, for example — and about the bill’s impact on the environment.

Though advocates that have pushed the bill accepted most amendments as a matter of compromise, they worried about changes that would reduce deed restriction terms imposed on affordable rental units from 40 years to 30 years. The shorter term would reduce New Jersey’s stock of affordable housing over time, they said.

“You get to a certain period and then it’s not affordable anymore. That really can have impacts in terms of losing the affordable housing stock that’s been created,” Gordon said. “When you lose those units, it’s very hard to replace them.

Other changes would allow age-restricted affordable housing to meet up to 30% of a town’s obligation, up from 25% in prior versions, and would create a new type of bonus credit municipalities can take to reduce how many new units they must build.

Municipalities earn one regular credit for each unit of affordable housing they build. They can earn bonus credits worth between one-half and one regular credit for certain types of affordable housing — like age-restricted housing — lowering how many units they must construct.

The amendments would allow municipalities to earn a full bonus credit for each unit of existing market-rate housing that is converted to affordable housing, as long as the municipality has a signed agreement with the building’s owner or is the building’s owner.

The bill’s travails are likely not over. The bill would create a court-run dispute resolution program, and the amendments add a provision that would require them to defend municipalities from challenges to their affordable housing plans.

“The real effect of this amendment would be to require the court to become a party to a matter under its review,” said Pamela Geller, a legislative liaison for the Administrative Office of the Courts. “Simply put, we cannot do this.”

Geller said Lopez had committed to removing that language, though it was still present in the bill the Assembly approved Monday.

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File - Construction workers install roofing on a high rise in Manhattan's financial district on Tuesday, April 11, 2023, in New York. On Friday, the U.S. government issues the April jobs report. (AP Photo/Bebeto Matthews, File)

Last month, city council members in Fort Worth, Texas, decided developers that received massive tax breaks to build affordable housing would no longer be able to buy their way out of the obligation by paying a $200 annual fee in lieu of each unbuilt low-income unit.

In Columbus, Ohio, leaders voted in December to expand the city’s tax break program for affordable housing. And in Cincinnati, builders can now get an automatic property tax exemption for some affordable housing projects, rather than having to apply.

Tax abatements have long been a tool cities use to encourage developers to build homes low-income residents can afford. Developers pay lower property taxes in return for setting aside homes or apartments for potential residents with lower incomes. Cities lose that tax revenue, but they gain affordable housing.

As the nation’s housing crisis continues, many cities are altering their policies. Some are making the programs stricter; some are offering more money or extending tax breaks for more years. No matter the approach, municipal leaders say they’re trying to figure out how to get more of their residents safely housed.

“As a city, we can’t force developers to make housing affordable. But we have tools,” said Sarah Odle, neighborhood development coordinator for the city of Fort Worth.

“The name of the game for a developer is to make money,” Odle said. “And the name of the game for us is if we’re going to give you incentives, then we want something substantial in return — and that’s housing that is truly affordable.”

Expanded tax breaks

In Fort Worth — which attracted nearly 50,000 new residents from 2020 to 2023, the most of any city in Texas — tax abatements have driven affordable housing for years. Developers can receive a five-year tax break if they build in designated zones and set aside 20% of their units as affordable housing.

Last month, however, the Fort Worth City Council removed the option that allows developers to pay an annual $200 fee per unit in lieu of building affordable homes. Developers are now required to set aside affordable housing if they want the tax breaks.

In December, the Columbus City Council in Ohio expanded the tax abatement program beyond certain neighborhoods to include the entire city, granting developers a 100% tax break for 15 years.

A spokesperson from Columbus’ Department of Development told Stateline that housing building permits are projected to be down 10% from last year. But officials expect the expanded tax incentive to accelerate affordable housing in all areas of the city — including in historically underinvested areas.

An hour and thirty minutes away in Cincinnati, an ordinance passed by the city council last month allows affordable housing developments funded by public-private partnerships there to get an automatic property tax exemption without council approval, streamlining the building process.

In their bid to spur more affordable housing, cities also are trying to boost the post-pandemic trend of downtown office-to-housing conversions.

In 2022, D.C. expanded tax breaks for developers converting downtown offices into housing, with tax exemptions for up to 20 years if they meet affordability requirements.

Boston Mayor Michelle Wu, a Democrat, last year also announced a public-private partnership that expands tax breaks for conversions to housing. Developers must reserve at least 20% of their new units as affordable, with some space for federal voucher holders as well.

Chicago and Pittsburgh have put similar tax deals in place in the past two years, with affordable housing stipulations attached.

Washington state legislators recently held a hearing on proposed legislation to offer affordable housing tax incentives for conversions statewide.

Washington state Sen. Yasmin Trudeau, a Democrat who represents Tacoma and who sponsored the measure, said her bill is a quick approach to address Seattle’s need for more housing, which is estimated at 1 million new units over the next 20 years.

Trudeau is optimistic about the bill’s chance of success this legislative cycle, as it passed a Senate committee in January. But some aspects of her legislative package didn’t advance, including a tax incentive for converting market-rate apartments to affordable units, as well other legislative levers to maintain affordability.

“There’s a larger conversation we’re not having about ways to maintain affordability, such as rent stabilization or transit-oriented development, which are built-in affordability measures,” she said.

‘Double-edged sword’

Tax abatement deals might not always live up to expectations, according to David Dworkin, president and CEO of the National Housing Conference, a Washington, D.C.-based affordable housing advocacy group.

“I think tax abatement is a double-edged sword. If you have it, you can create fairly significant incentives to create and maintain, to create and preserve affordable housing where you don’t have it,” said Dworkin.

However, he said, new construction can displace current residents with low incomes, and oversight is needed to ensure that developers follow through on promises of affordable units.

In a review of New York’s affordable housing tax incentives, the Fiscal Policy Institute, a nonpartisan think tank, suggests increased abatements hurt cities by removing their primary source of revenue, handicapping them to handle other costs associated with rising populations and burdening school districts.

Meanwhile, some states are seeing conflicts between legislative action and local goals.

In Florida, for instance, a law passed with bipartisan support last year, the Live Local Act, offers developers sweeping tax breaks in exchange for building affordable units for people making up to 120% of the area median income. Developers that participate also can override local zoning rules to build in commercial and industrial areas.

Developers have rushed to take part, according to The Wall Street Journal.

But Pasco County, on Florida’s west coast, is aiming to change the law, arguing that the cutoff for affordable housing should be at 80% of median income to help more families in need.

The law puts local governments in a financial bind, county officials say. In Pasco’s case, commissioners had made plans for their industrial zones and are trying to lure more employers — not residents — to the suburban bedroom county outside of the Tampa-St. Petersburg area.

The Pasco County Attorney’s Office told Stateline in an email that the Live Local Act “forces the county to make these sacrifices for housing” with no guarantee of homes that will be affordable to residents.

In various meetings on the issues, Pasco County administrators have discussed imposing a moratorium on all multifamily development if no change is made to the law.

Other states have sought to rein in local tax breaks.

This year, a Republican bill in the Arizona legislature would halve the period a property can receive tax breaks from eight years to four.

Last year, Texas lawmakers approved a revision to how tax breaks are used for affordable housing. The law closes loopholes that allowed some properties to be tax- exempt for years and requires regular audits for future tax deals.

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