Stephen Slivinski and Yasmeen Kallash-Kyler
Housing policy reform is tricky.
Getting policy changes off the ground in the first place can be difficult and compliance after enactment may not be certain. Pressure groups (often called NIMBYs, “not in my backyard” activists) who hope to maintain the status quo can be very vocal in their opposition. And even under existing laws restricting housing supply, the permission process to build something new that a landowner should already be allowed to build by right is often a bureaucratic slog thanks to zoning boards and the NIMBYs on and around them.
Now add to this the economic realities faced by many states. Vermont is a good example. The post-COVID-19 remote work boom benefited the state with a record-high influx of workers. But sclerotic housing bureaucracies failed (or refused) to free up land for more home construction, which caused home prices to spike. (The recent experience of Middlebury College professor and Chamber of Progress advisor Gary Winslett is the norm.) The state is now beginning to lose working-age population at a rapid clip—yet housing prices aren’t falling commensurately because new construction isn’t occurring fast enough.
Policymakers in the Green Mountain State are trying to change this. Governor Phil Scott has proposed raising the threshold that challenges to new construction must meet before they have standing in court. Legislators have also introduced a proposal (after unsuccessful attempts in prior sessions) to create a Housing Board of Appeals, a three-person quasi-judicial panel tasked with reviewing an appeal after the denial of a building permit by a local zoning board. The members would be impartial adjudicators who have the power to overturn local zoning board decisions and would be focused exclusively on housing permit appeals.
While it might seem odd to suggest that a new state government entity would make a process better, it may be a necessary structural antidote to a problem first created by local governments. Like many states, if a local zoning board denies a building permit—sometimes for arbitrary or political reasons—a landowner has little recourse except to appeal the decision to the same board that rejected it. Those boards might not abide by the same kind of due process protections that homeowners would have in a real court of law. And they’re hardly impartial.
The idea might be gaining in popularity too. A board of this sort has been created in Maine and New Hampshire. This reform might be table stakes to simply keep Vermont up-to-date with housing policy innovations in the region and simply stay competitive with their neighbors. (Such a review board is also part of the rating methodology in Cato’s Freedom in the Fifty States report.)
For reform movements to be successful, sequencing often matters. For many states, liberating the permitting process from the NIMBY feedback loop might be a necessary first step to successful and durable zoning reform—and new home building—over the longer term.