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As Arizona continues to attract new residents at an astonishing rate, the state’s housing shortage has reached crisis levels. The allure of Arizona’s quality of life, low cost of living, favorable climate, and simplified tax structure has led to a significant influx of people and businesses. However, this population growth has not been met with an adequate increase in housing supply. The Common Sense Institute Arizona estimates a shortage of approximately 100,000 housing units, making it clear that immediate action is necessary to address this issue. In this article, we will explore a comprehensive set of solutions aimed at solving Arizona’s housing shortage crisis.
The Collaborative Approach
Addressing Arizona’s housing crisis requires a collaborative effort among government entities and the private sector. Bipartisan solutions are essential to overcome the barriers to housing development, including regulatory challenges, bureaucracy, and preemptive state laws.
Expedite Zoning and Approval Processes
One of the key challenges in Arizona’s housing market is the inconsistency and inefficiency in the zoning and approval processes across different municipalities. To streamline and expedite these processes, a universal, state-level approach should be established. This uniform process would ensure that developers follow the same steps, checklists, and timelines, regardless of the city in which they are building. By reducing bureaucracy and delays, homes can reach the market more quickly, meeting the increasing demand.
Let State Housing Department Grade Cities
The state should implement statutory guidelines for streamlined entitlement, review, and permitting processes for residential development. Following the standardization of these processes, the Department of Housing would assess and grade municipalities based on objective criteria such as the duration, cost, and complexity of their entitlement and permitting processes. This grading system will create incentives for cities to improve their processes and compete with national benchmarks and standards, ultimately benefitting the housing market.
Develop Statewide Zoning Definitions
Zoning definitions often vary from one city to another, creating confusion and inefficiency for developers. To address this issue, Arizona should establish consistent zoning definitions at the state level. This not only brings transparency to the zoning process but also allows for the diversification of housing types within municipalities. Additionally, the state can introduce housing opportunity zones, which use a percentage of existing tax revenue to fund housing development in areas where market demand cannot be met.
Form Local ‘Housing Opportunity Zones’
Similar to existing tax incentives, Arizona can create housing opportunity zones to encourage housing development in areas with the potential for significant growth. Developers constructing housing while meeting accountability benchmarks could benefit from tax incentives, which would help offset their costs. Cities can also use the tax revenues generated from these projects to reimburse themselves for public infrastructure expenses associated with housing development.
Help Cities Fund More Affordable Housing
Encouraging cities to establish their own affordable housing funding is a crucial step in addressing housing affordability. The state can incentivize cities to create dedicated funds for affordable housing by establishing a statewide grant program. An example of this approach is Tempe’s “Hometown for All” program, where a portion of development permitting fees goes into a fund to finance land acquisition and redevelopment within the city borders.
A Comprehensive Approach
The solutions outlined in this article are just a part of a broader plan comprising 19 strategies developed by Common Sense Institute Arizona. These are not partisan ideas; they are Arizona’s ideas. The housing shortage crisis is a challenge that all Arizonans must address together. The state’s ability to remain an attractive and affordable place for new businesses and residents hinges on addressing this critical issue. By implementing these solutions and working collaboratively, Arizona can ensure that it continues to be a thriving and welcoming state for everyone.
