Local leaders are warily watching a proposed Indiana Statehouse bill they say would erode their authority and standards for housing projects proposed in their communities.
House Bill 1001, authored by State Rep. Doug Miller, R-Elkhart, would allow single-family homes and townhomes to be built in areas that are zoned residential to move forward without a hearing. Accessory dwelling units would also be automatically approved, while rules about design standards and mandatory parking spaces would be taken out of local hands unless municipalities specifically opt out.
The bill caps construction fees and allows developers to build affordable housing on land owned by religious institutions, so long as the institution maintains ownership of the property. Additionally, the bill would require impact fees — fees assessed to a developer to help pay for parks or infrastructure — be spent on projects within one mile of the new home.
The bill allows opt-out provisions for other regulations like designated parking spaces, design standards and density requirements, meaning those decisions wouldn’t be left up to local officials unless municipalities specifically opt out. It also caps construction fees and allows developers to build affordable housing on land owned by religious institutions, so long as the institution maintains ownership of the property.
Proponents of the bill say the bill would help with the state’s “severe housing shortage” by cutting down on regulations and ultimately, time by eliminating red tape. However, those against say it would remove local governments’ abilities to regulate architectural standards, what types of housing can go where, require a traffic study when proposing a project and potentially ruin existing homeowners’ home values.
“If it continues the way it is, it’s a very bad piece of legislation, in my opinion and my staff’s opinion,” said Greenwood Mayor Mark Myers.
The bill passed the House 76-to-15 on Tuesday with very few changes from when it was in committee. It now goes to the Senate, where changes are expected.
Housing advocates support bill
Before a House committee on Jan. 20, building groups argued HB 1001 will cut down on the time it takes to build new housing by cutting red tape. Rick Wajda, CEO of the Indiana Builders Association, cited in his testimony data from the National Association of Home Builders that says 25% of the cost for a single-family home comes from government regulations and permitting. For an apartment building, it can be as much as 40%.
Indiana Association of Realtors CEO Mark Fisher testified that the language regarding accessory dwelling units, or ADUs, is especially important because it addresses Indiana’s “most glaring” housing needs.
In an interview with the Daily Journal, Amanda Ott, director of residential programming for the Johnson County Housing Coalition, said some of HB 1001’s provisions — like making it easier to have ADUs and for religious institutions to build homes on their properties — are great. The language about duplexes is also helpful.
Lot size, density and architectural standards all affect the price of a home, and HB 1001 would limit governments’ abilities to implement them unless they pass resolutions opting out of the law. Ott believes this would put pressure on elected officials, she said.
Affordable housing is an economic driver, even if people don’t see it that way. Companies looking to relocate want to know if their workers can afford to live in a community, and if a community has diversified housing, then they will see economic development, Ott said.
For Johnson County, the average house price in 2025 was around $320,000 to $325,000, Ott said, citing a recent Daily Journal story. The mortgage payment would be 33% of the median income of a Johnson County household, which is more than most banks would be comfortable giving a loan for, she said.
“The reality of it is we really need that affordable housing in Johnson County because already our median home price and our median income is not matching up,” Ott said.
In Ott’s view, the bill is a start, but it won’t fix everything. Johnson County’s housing needs are diverse, from the heavily populated northern part to the more rural and less populated southern parts, she said.
“We’re going to have to really think creatively about how we would go about working on affordable housing, but this bill would definitely be a really great start,” she said.
A loss of local control?
Local governments acknowledge something needs to be done to make housing more affordable, but argue that HB 1001 takes too much decision-making power out of their hands.
Myers, Greenwood’s mayor, argues HB 1001 would make the city’s comprehensive plan and unified development ordinance “pretty much worthless.”
“It would allow people to build things in neighborhoods where they shouldn’t go. It removes most of our architectural standards. It takes a lot of authority away from the city, and pretty much does away with our entire planning department,” Myers said.
Franklin Mayor Steve Barnett has spoken with some state representatives about the bill, and they’ve said it’s “not even close to being done,” he said.
He questions why they voted to advance it to the Senate if that’s the case.
“I don’t understand that. … I understand there needs to be something done to help the affordability of housing, but taking away standards and regulations from towns and cities is not the way to do that,” Barnett said.
While homebuilders argue that the bill is about affordability for homebuyers, Barnett disagrees. He believes it’s about builders wanting higher profits and not having to comply with high standards, he said.
The Johnson County Commissioners, in a joint letter, said counties support the goal of increasing housing supply and affordability in the state. But HB 1001 “still significantly limits local planning and zoning authority in ways that will have real, long-term impacts on our communities” — without guarantees that savings will be passed onto homebuyers, the letter to local state representatives said.
There have been conversations about permitting fees causing homes to be unaffordable, which would be capped in HB 1001. But in Bargersville’s case, their homes typically average in the $400,000s, with utility and parks impact fees adding about $9,000 to $10,000 to a home’s cost, Town Manager Dax Norton said.
“I haven’t talked to the homebuilders, but I can’t help but think that’s not having a huge impact on affordability,” Norton said. “It comes down to product and size.”
Limits on impact fees, traffic studies
The limits on collecting impact fees are also a concern among officials.
“We want money to go towards the park system because we want to build parks for the families that want to come into the neighborhoods, and if you don’t have the funds to do that, then you can’t afford to do the parks,” Myers said.
In Bargersville, road impact fees, for example, have allowed them to build a roundabout at County Road 144 and Morgantown Road, and will allow them to make the intersection of County Road 144 and Saddle Club Road safer by installing a roundabout, Norton said.
“There are many different opportunities to fix infrastructure as more cars are in our network and on our roads,” Norton said. “So impeding our ability to collect those fees so that the folks that are moving in and those that live here now can still enjoy efficient transportation networks, good parks, water and sewer upgrades that don’t cause the ratepayer that exists now to have to pay more rates — that’s what we want to make sure is protected.”
Another concern is the limitations on requiring a developer to do a traffic impact study. Greenwood officials need to know the traffic impact of a development so they can build up the roads to handle it — especially as the city expands further east and adds county roads into its inventory, Myers said.
“We have to bring them up to city standards, and without the impact fees to help pay for that, and then also with us losing money through [Senate Enrolled Act 1 of 2025], it’s going to make it harder for us to upgrade those neighborhoods,” Myers said.
State lawmakers reduced local governments’ reliance on property taxes, encouraging them to use other sources. But now they’re taking away another source of income rather than getting rid of taxes, Barnett said.
‘You have to balance things’
Local officials say they understand home affordability is important, but there needs to be a way to have local control.
“If everybody could sit down together and come up with ways to build quality, starter-type homes, workforce-type homes that are going to last and be sustainable — which I think that those exist now — but still allow us local control to make those decisions based on what our constituents are saying to us, I think that’s the best thing,” Norton said.
Myers agrees there is a housing shortage, but HB 1001 is not the right way to do it. City officials work hard to put different types of homes in different areas, and a resident who built a $900,000 home wouldn’t want a $150,000 home next door because it would drop their home’s property value.
“You want to stair-step things and not just say, ‘Oh, we’re going to build this neighborhood of really nice houses and next door, we’re going to put in market-rate apartments for multifamily with no real oversight,’” Myers said. “You have to balance things and not just hodgepodge, thrown together.”
When there are no standards, there’s no community pride in Barnett’s view. Lawmakers need to take a hard look at what they’re trying to do and not simply use the word “affordability” to “make themselves look good,” he said.
“We all want affordability, but you need to figure out how to do affordability in a positive manner. And they need to learn how to lower costs instead of just lowering standards,” he said.
Describing the bill as “very one-sided,” Myers also questioned what he said was a conflict of interest involving Miller, the bill’s author. Miller has connections to the home construction industry, Myers said, and Miller’s biography on his Indiana House Republicans webpage shows that he is a real estate agent who owns two property-related companies and is on the board of directors for Realtor and homebuilder associations.
Miller also proposed a similar bill last session that was pulled due to a perceived conflict of interest, said Myers, who is on the board of directors for Accelerate Indiana Municipalities.
“It makes me wonder why it’s not a conflict this year and why it’s continually being brought up,” he said.
While there are provisions to allow local governments to opt out, Myers questions this, too.
“Why would you write a law that you turn around and say, ‘But if you don’t like it, you can opt out?’ That didn’t make a lot of sense to me,” he said.
Barnett is losing faith in Indiana’s lawmakers. For the past few sessions, they’ve rolled back home rule while many of them have no local government experience, Barnett said.
“They’re headed down the wrong track, and hopefully our Senate can fix this,” he said.
The Indianapolis Business Journal contributed to this report.
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