The Complications of Land-Use Reform
Dominick Rigert works on Nordhaus, a 280-unit apartment building in northeast Minneapolis. The city sweeping land-use reforms that have helped curb rent increases over the last several years. Jerry Holt/Star Tribune via Getty Images
Colorado needs more homes. Research shows land-use reforms typically result in just that. So why did a massive land-use bill die in the state Senate this week?
Flip through the headlines of any Colorado publication and you’ll notice a theme: Rents are sky high. But a major push to reverse that trend died in the state legislature this week and showed that sometimes solutions, which make sense on paper, can be challenging to execute.
Between 2017 and 2022, rents increased about 30% statewide and nearly 50% in some cities. Zoning reform is a powerful tool that can help curb that growth, but the recent demise of a sweeping land-use proposal pushed by Gov. Jared Polis highlights the complications of enacting such legislation.
On Monday, Polis’s “More Housing Now” bill died in the Senate following months of contentious debate. In its initial iteration, the proposal required municipalities to update zoning policies to allow for higher-density housing. Like much of the country, most of the residential land in Colorado is zoned for single-family housing, but it’s the multifamily homes that are more affordable and can be built in greater abundance.
That’s a major issue in addressing the housing crisis. A recent analysis from Pew Charitable Trusts looked at rent increases in cities that enacted land-use reforms that allowed for higher-density housing and compared them to Colorado cities that have not enacted such reforms. The report suggests that cities with strict zoning rules often have higher rent rates compared to cities with more flexible regulations.
The study looks at four cities that previously had restrictive zoning policies but updated them to allow for more types of housing. In those places—New Rochelle, New York; Portland, Oregon; Minneapolis; and Tysons, Virginia—rent growth was kept in check between 2017 and 2023. New Rochelle saw the greatest increases at 7%, which is diminutive in comparison to the 31% increase seen nationwide.
Researchers then considered eight Colorado cities which have not enacted land-use reforms to encourage more housing. In those communities, rents rose between 22% and 53%.
Enacting legislation to push upzoning is becoming increasingly mainstream as cities look to address the housing shortage. But the failure of Colorado’s More Housing Now bill underscores the complexities that arise when states try to take the reins from municipalities.
For example, the proposal didn’t acknowledge that zoning to allow for multifamily units only works when developers are willing to construct those homes, said Kevin Bommer, executive director of the Colorado Municipal League. Many cities and towns have updated their zoning around transit hubs, but it’s done little to address the housing shortage, he added.
“Mayors and others are saying they can't get developers to build high-density [housing] because our transit system has reduced ridership,” he said. “There have been cuts in service, and developers aren't going to build somewhere where they don't think they're going to get a return on their investment.”
The Colorado Municipal League was one of the most significant opponents of the proposal, and not because they don’t believe upzoning is needed, according to Bommer. Rather, he said, members of the league didn’t like the way the bill wrested control from the cities.
Minneapolis garnered widespread attention when it eliminated single-family zoning several years ago. Between 2017 and 2023, rent hardly rose in the city, according to the Pew report. But Bommer pointed out that it was Minneapolis officials who planned those changes, not the state. Colorado’s constitution authorizes home rule governance, which essentially gives municipalities control over local zoning “without state interference,” Bommer said.
“Municipalities are talking about and enacting ordinances that allow [affordable dwelling units], and upzoning and transit-oriented development,” he said. “But they're doing it in consultation with their citizens and not being told to do it by the state with a one size fits all approach.”
Molly Bolan is the assistant editor for Route Fifty.
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