Is Biden’s grant program for affordable housing more carrot or more stick?

President Joe Biden wants to use an historic amount of federal dollars to create more affordable housing in America. But to do so, he is going to have to find his way through a wall of seemingly impenetrable red tape so that federal money can influence local governance.

It’s not going to be easy, and some are doubting that he can make it happen. But Biden is going to give it a try by putting the wooden rabbit out in front of the Greyhound American Mayors and see if they’ll chase it.

Much of the cost of building new housing is determined at the local level. Almost 20% of the cost of building a single-family home comes from state and local regulations such as permitting and development fees, zoning rules and land-use restrictions.

With all of these costs, building affordable housing is next to impossible.

However, Biden wants to try to tackle the problem with a new competitive grant program. This would entice state and local governments to scale back costly zoning and land-use policies.

That’s a start, but is it enough?

“To say, ‘We’re not going to give you money for affordable housing if you don’t make it easier to build affordable housing, [which is hard] because you don’t want affordable housing,’ — it’s ridiculous,” David Dworkin, president and CEO of the National Housing Conference, an affordable housing advocacy group told Politico. “You need carrot and stick, not carrot or stick, to make it work.”

Dworkin added that if there was a serious effort to make a push to cut through some of the exclusionary zoning red tape, that it would tie federal transportation dollars to the elimination of these barriers, and that’s a much larger pot of gold at the end of the rainbow than is usually shared with states.

The reason the Biden Administration has dodged the notion of putting more pressure on local officials to change these regulations is because it puts the President in a boxing ring without any gloves against some haymaker throwing Mayors who have basically drawn a line in the sand about tying local regulations to federal dollars.

“All these places are reluctant to touch zoning, or it would have been done already,” Jim Parrott, a former housing adviser to the Obama White House, also told Politico. “(It) depends totally on how big the carrot is and whether they deploy sticks.”

Carrot and stick analogies aside, it’s not just housing folks who are wondering if Biden’s plan will ever come to fruition as outlined, or if it will require some more federal muscle.

Some Democrats have argued that there isn’t enough federal money to back this idea, meanwhile Republicans are arguing that infrastructure plan as a whole contains too much federal spending.

With there being pushback on both sides of the spectrum, as well as concern being expressed by housing advocates, it could make it hard for Biden to get this proposal across the goal line and make homes more affordable for many Americans.

Biden’s pitch calls for two million affordable housing units to be developed, preserved, or rehabilitated using a whopping $213 billion.

Homebuilders also have their doubts about Bien’s plan. After all, two million homes is a huge number. To make that happen, Congress is going to need to get creative – maybe take Biden’s plan and use it to spark something more appealing and realistic.

Biden wants to commit $40 billion to create more public housing. Progressive Democrats feel that’s not enough and want to see that number nearly double. Meanwhile Republicans feel building more public housing is taking a step backwards because of its dependency on the government.

Many experts believe that Biden’s infrastructure plan will pass through both the House and Senate, but not as currently proposed. The question is, when it’s done, will there be a boon or a bust for affordable housing in America? Only time will tell.