In its last meeting before the Utah Legislature’s 2025 legislative session scheduled to begin on Jan. 25, the Political Subdivisions Interim Committee on Wednesday voted to endorse a draft bill that takes another gentle, optional approach to encourage cities to plan for more affordable housing types in their communities.

The new bill would allow — not force — cities and counties to implement a “density overlay” in a “housing-eligible zone” of their choice. In other words, the bill would give city leaders another tool in their planning toolbelt to zone for certain, higher-density housing types in areas that are already classified for residential use.

If a city were to adopt the so-called density overlay defined in the bill, in that area it would allow a minimum of eight housing units per acre, as well as allow the development of:

• Single-family homes on small lots that are no more than 5,400 square feet.
• “Diverse housing options” that could include a variety of side-by-side or stacked duplexes, triplexes, or fourplexes, courtyard buildings, cottage courts, town homes or “live-work mixed use” buildings where at least one housing unit sits above a commercial property.
• Or a combination of single-family homes on small lots and these types of diverse housing options.

The bill also says that if a city council adopts a density overlay in an area that is undeveloped (meaning no structures have been built at time of adoption), the county could add additional rules. Those requirements could include:

• “Some or all” of the homes offered for sale in the density overlay be “deed-restricted for up to five years to ensure owner occupancy.”
• Some or all of the homes in the area are offered for sale to “an owner-occupier at a purchase price affordable” to a household making no more than 120% of the county’s area-median income.
• If they’re rentals, they may be offered for rent at a price point that’s affordable to a household earning no more than 80% of the county’s area median income.

First steps toward a statewide housing plan

Additionally, the bill would also direct the state’s Commission on Housing Affordability to begin preparing a set of “regional strategic plans” for housing across the state, meant to “define success in housing policy for the region” and set metrics and goals to “address housing shortages and projected population growth” in those areas.

If passed, the bill would set a deadline of Aug. 31 for the Commission on Housing Affordability to report back to the Political Subdivisions Interim Committee with “at least one recommended regional strategic plan for housing,” as well as the commission’s recommendations for how to divide the state into regions and “any recommendations for potential statutory changes necessary to implement a recommended regional strategic plan.”

The bill — largely drafted with input from the Commission on Housing Affordability, which met throughout the year to shape its recommendations for lawmakers in 2025 — comes after a legislative audit issued a year ago warned time was running short for policymakers to tackle the state’s worsening housing crisis.

That legislative audit called on lawmakers to create a “statewide strategic housing plan,” noting there is “currently no state-level forecast of housing needs, or efforts to set statewide housing strategy or measure progress toward a common goal.”

The audit also encouraged lawmakers to explore policy changes like tying land use requirements to projected population growth (as seen in states like California and Oregon) and to consider “upzoning,” or requiring cities to allow more homes to be built on less land (as seen in Minnesota, Pennsylvania or, more aggressively, New Zealand).

The bill unveiled Wednesday takes maybe a half-step toward drafting a statewide housing plan — starting first with directing the commission to begin by breaking the state up into regions.

Steve Waldrip, Gov. Spencer Cox’s senior adviser for housing strategy and innovation, told Utah News Dispatch last month that discussions around the statewide plan would likely focus on “regional” needs and what different types of cities will need to accommodate their housing demands rather than a one-size-fits-all approach. He also indicated that a “full blown” statewide plan wouldn’t be ready for the 2025 session, but lawmakers could take steps to get it started.

No mandates

A big question heading into the 2025 session is whether lawmakers will take more aggressive steps to tackle the state’s housing crisis and whether it will use state preemption powers to do it.

Other proposals could surface — and already have, including a bill Rep. Ray Ward, R-Bountiful, is pursuing to make single-family homes and accessory dwelling units a “permitted use” in urban cities.

But the bill unveiled Wednesday and now headed for priority consideration during the session doesn’t harness any state powers to force cities to zone for higher density or affordable housing types. Instead, it follows lawmakers’ past playbook of giving cities options rather than strong-arming them.

Senate Majority Whip Mike McKell, R-Spanish Fork, who also co-chairs the Political Subdivisions Interim Committee, said the bill is all about being “optional, optional, optional.”

“We stayed away from mandates,” McKell said, adding “that’s been a constant concern of this committee, is having strong mandates in the code.”

“Obviously, we’ve got a problem that we need to solve,” McKell added, but he said the Commission on Housing Affordability will continue to work on solutions, and this bill “seemed like a better approach at this point” than handing down local mandates.

Cameron Diehl, executive Director of the League of Cities and Towns, thanked lawmakers for the bill and applauded their “emphasis on creating the tools, as opposed to the mandates.”

Over the last few months, Diehl has said the League’s leaders have been “having very similar discussions around the use of potential overlays to facilitate additional opportunities for homeownership and more opportunities for affordable homeownership.”

“What this is trying to do is create a tool very similar to the tools that we worked on in the 2024 legislative session,” Diehl said. “So while we’ve not taken a position on this exact language, we have spent the last couple of months as a league talking about what this sort of overlay could look like and how it facilitates affordable home ownership.”

Diehl also welcomed more conversations as the bill progresses through the legislative process.

McKell called for the interim committee to endorse the bill and advance it for consideration during the 2025 legislative session “with the understanding” that as the session unfolds the bill could be changed.

“I think we’ve got this to a really good, strategic place right now,” he said. “Affordable housing is an issue we’re going to be working on for a long time. … But I think there’s going to be a lot of work where (the League of Cities and Towns) is going to have a lot of input moving forward.”

The committee voted to endorse the bill, with one “no” vote from Rep. Paul Cutler, R-Centerville. It now advances for further consideration during the 2025 session.

“More to come,” Rep. Jim Dunnigan, R-Taylorsville, said after the vote.