U.S. Department of Housing and Urban Development (HUD)

This proposal does not target a specific CFR provision. Instead, it calls for the rescission of federal tolerance for local exclusionary zoning practices through interpretive guidance, enforcement posture, and discretionary funding criteria—specifically within: • 24 CFR Part 91 – Consolidated Plan regulations • 24 CFR Part 570 – Community Development Block Grants (CDBG) • 24 CFR Part 5 – General HUD program requirements

HUD Deference to Local Zoning Authority in Federal Housing Funding Programs

HUD has historically deferred to local zoning codes even when they uphold policies of exclusion and economic segregation—like minimum lot sizes, single-family-only mandates, and density caps that functionally bar affordable housing. Rescinding this deference would allow HUD to require anti-discriminatory and inclusive zoning practices as a condition of funding, ending the default protection of local policies that restrict who gets to live where.

U.S. Department of Housing and Urban Development 451 7th Street SW Washington, DC 20410

Phone: (202) 708-1112 Email: housingpolicy@hud.gov

For decades, HUD has allowed localities to receive federal housing and development funds without requiring any meaningful zoning reform—despite overwhelming evidence that local zoning rules entrench racial and economic segregation. Federal programs like CDBG and HOME are supposed to promote fair housing and inclusion. But HUD regulations and guidance have traditionally treated exclusionary zoning as “beyond federal scope,” allowing municipalities to take public funds while blocking affordable multi-family housing.

Exclusionary zoning is a policy of economic gatekeeping—preserving high-wealth enclaves and denying lower-income families access to good schools, jobs, and infrastructure. These policies don’t just shape real estate—they shape opportunity. Rescinding HUD’s deference to local zoning would allow the agency to condition funding on zoning practices that affirmatively further fair housing, in line with the Fair Housing Act and the Biden administration’s 2023 zoning reform guidance. This is not a federal land grab—it’s a restoration of accountability for public dollars.

Following rescission: • HUD would revise guidance under 24 CFR Part 91 to require that Consolidated Plans include a zoning equity assessment. • Under 24 CFR Part 570, CDBG recipients would need to demonstrate that local zoning does not exclude affordable or multi-family housing. • HUD would issue new interpretive guidance stating that deference to exclusionary zoning practices is incompatible with the duty to affirmatively further fair housing (AFFH).

Scott Turner

Secretary of Housing and Urban Development