H.R. 5938

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5938 Introduced in House (IH)]

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119th CONGRESS
1st Session
H. R. 5938

To establish a grant program to increase the local housing supply, and 
for other purposes.

_______________________________________________________________________

IN THE HOUSE OF REPRESENTATIVES

November 7, 2025

Mr. Cleaver (for himself and Ms. Pressley) introduced the following 
bill; which was referred to the Committee on Financial Services, and in 
addition to the Committees on Transportation and Infrastructure, and 
Energy and Commerce, for a period to be subsequently determined by the 
Speaker, in each case for consideration of such provisions as fall 
within the jurisdiction of the committee concerned

_______________________________________________________________________

A BILL

To establish a grant program to increase the local housing supply, and 
for other purposes.

Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Innovation Fund Act''.

SEC. 2. INNOVATION FUND.

(a) Definitions.--In this section:
(1) Attainable housing.--The term ``attainable housing'' 
means housing that--
(A) serves--
(i) a majority of households with income 
not greater than 80 percent of area median 
income; and
(ii) households with income not greater 
than 100 percent of area median income; or
(B) serves--
(i) a majority of households with income 
not greater than 60 percent of area median 
income; and
(ii) households with income not greater 
than 120 percent of area median income.
(2) Eligible entity.--The term ``eligible entity'' means--
(A) a metropolitan city or urban county, as those 
terms are defined in section 102 of the Housing and 
Community Development Act of 1974 (42 U.S.C. 5302), 
that has demonstrated an objective improvement in 
housing supply growth, as determined by the Secretary, 
whose methodology for determining such growth is 
published in the Federal Register to allow for public 
comment not less than 90 days before date on which the 
notice of funding opportunity is made available; or
(B) a unit of general local government or Indian 
tribe, as those terms are defined in section 102 of the 
Housing and Community Development Act of 1974 (42 
U.S.C. 5302), that has demonstrated an objective 
improvement in housing supply growth, as determined by 
the Secretary, whose methodology for determining such 
improvement is published in the Federal Register to 
allow for public comment not less than 90 days before 
the date on which the notice of funding opportunity is 
made available.
(3) Secretary.--The term ``Secretary'' means the Secretary 
of Housing and Urban Development.
(b) Establishment of a Grant Program.--
(1) Establishment.--Not later than 1 year after the date of 
enactment of this Act, the Secretary shall establish a program 
to award grants on a competitive basis to eligible entities 
that have increased their local housing supply.
(2) List of eligible entities.--The Secretary shall make a 
list of eligible entities publicly available on the website of 
the Department of Housing and Urban Development.
(3) Eligible purposes.--An eligible entity receiving a 
grant under this section may use funds to--
(A) carry out any of the activities described in 
section 105 of the Housing and Community Development 
Act of 1974 (42 U.S.C. 5305);
(B) carry out any of the activities permitted under 
the Local and Regional Project Assistance Program 
established under section 6702 of title 49, United 
States Code;
(C) serve as matching funds under a State revolving 
fund program related to a clean water or drinking water 
program administered by the Environmental Protection 
Agency in which the eligible entity is the grantee 
under that program, unless otherwise determined by the 
Secretary; and
(D) carry out initiatives of the eligible entity 
that facilitate the expansion of the supply of 
attainable housing and that supplement initiatives the 
eligible entity has carried out, or is in the process 
of carrying out, as specified in the application 
submitted under paragraph (4).
(4) Application.--
(A) In general.--An eligible entity seeking a grant 
under this section shall submit to the Secretary an 
application that provides--
(i) a description of each purpose for which 
the eligible entity will use the grant, and an 
attestation that the grant will be used only 
for 1 or more eligible purposes described in 
paragraph (3);
(ii) data on characteristics of increased 
housing supply during the 3-year period ending 
on the date on which the application is 
submitted, which may include whether such 
housing--
(I) serves households at a range of 
income levels; and
(II) has improved the quality and 
affordability of housing in the 
jurisdiction of the eligible entity;
(iii) a description of how each eligible 
purpose described in clause (i) may address a 
community need or advance an objective, or an 
aspect of an objective, included in the 
comprehensive housing affordability strategy 
and community development plan of the eligible 
entity under part 91 of title 24, Code of 
Federal Regulations, or any successor 
regulation (commonly referred to as a 
``consolidated plan''); and
(iv) a description of how the eligible 
entity has carried out, or is in the process of 
carrying out, initiatives that facilitate the 
expansion of the supply of housing.
(B) Initiatives.--Initiatives that meet the 
criteria described in paragraph (3)(D) include--
(i) increasing by-right uses, including 
duplex, triplex, quadplex, and multifamily 
buildings, in areas of opportunity;
(ii) revising or eliminating off-street 
parking requirements to reduce the cost of 
housing production;
(iii) revising minimum lot size 
requirements, floor area ratio requirements, 
set-back requirements, building heights, and 
bans or limits on construction to allow for 
denser and more affordable development;
(iv) instituting incentives to promote 
dense development;
(v) passing zoning overlays or other 
ordinances that enable the development of 
mixed-income housing;
(vi) streamlining regulatory requirements 
and shortening processes, increasing code 
enforcement and permitting capacity, reforming 
zoning codes, or other initiatives that reduce 
barriers to increasing housing supply and 
affordability;
(vii) eliminating restrictions against 
accessory dwelling units and expanding their 
by-right use;
(viii) using local tax incentives or public 
financing to promote development of attainable 
housing;
(ix) streamlining environmental 
regulations;
(x) eliminating unnecessary manufactured-
housing regulations and restrictions;
(xi) minimizing the impact of 
overburdensome energy and water efficiency 
standards on housing costs; and
(xii) other activities that reduce cost of 
construction, as determined by the Secretary.
(5) Grants.--
(A) In general.--The Secretary shall make not fewer 
than 25 grants on an annual basis (unless amounts 
appropriated to provide grant amounts consistent with 
subsection (b) are insufficient, in which case fewer 
grants may be awarded), with strong consideration of 
different geographical areas and a relatively even 
spread of rural, suburban, and urban communities.
(B) Limitations on awards.--No grant awarded under 
this paragraph may be--
(i) more than $10,000,000; or
(ii) less than $250,000.
(C) Priority.--When awarding grants under this 
paragraph, the Secretary shall give priority to an 
eligible entity that has--
(i) demonstrated the use of innovative 
policies, interventions, or programs for 
increasing housing supply, including adoption 
of any of the frameworks developed under 
section 203; and
(ii) demonstrated a marked improvement in 
housing supply growth.
(D) Grant administration and terms.--Projects 
assisted under this section for activities described in 
sector 23 of the North American Industry Classification 
System shall be treated as projects assisted under the 
Community Development Block Grant program under title I 
of the Housing and Community Development Act of 1974 
(42 U.S.C. 5301 et seq.).
(c) Rules of Construction.--Nothing in this section shall be 
construed--
(1) to authorize the Secretary to mandate, supersede, or 
preempt any local zoning or land use policy; or
(2) to affect the requirements of section 105(c)(1) of the 
Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 
12705(c)(1)).
(d) Authorization of Appropriations.--
(1) In general.--There is authorized to be appropriated to 
carry out this section $200,000,000 for each of fiscal years 
2027 through 2031.
(2) Adjustment.--The amount authorized to be appropriated 
under paragraph (1) shall be adjusted for inflation based on 
the Consumer Price Index.
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