I 
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 addi-
tion to the Committees on Transportation and Infrastructure, and En-
ergy 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 Representa-
tives 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 ‘‘attain-
able housing’’ means housing that— 
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(A) serves— 
(i) a majority of households with in-
come not greater than 80 percent of area 
median income; and 
(ii) households with income not great-
er than 100 percent of area median in-
come; or 
(B) serves— 
(i) a majority of households with in-
come not greater than 60 percent of area 
median income; and 
(ii) households with income not great-
er than 120 percent of area median in-
come. 
(2) ELIGIBLE ENTITY.—The term ‘‘eligible enti-
ty’’ 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 
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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 sec-
tion 102 of the Housing and Community Devel-
opment 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 no-
tice 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 Sec-
retary shall establish a program to award grants on 
a competitive basis to eligible entities that have in-
creased their local housing supply. 
(2) LIST
OF
ELIGIBLE
ENTITIES.—The Sec-
retary shall make a list of eligible entities publicly 
available on the website of the Department of Hous-
ing and Urban Development. 
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(3) ELIGIBLE PURPOSES.—An eligible entity re-
ceiving a grant under this section may use funds 
to— 
(A) carry out any of the activities de-
scribed in section 105 of the Housing and Com-
munity Development Act of 1974 (42 U.S.C. 
5305); 
(B) carry out any of the activities per-
mitted 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 pro-
gram, unless otherwise determined by the Sec-
retary; and 
(D) carry out initiatives of the eligible enti-
ty that facilitate the expansion of the supply of 
attainable housing and that supplement initia-
tives 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.— 
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(A) IN GENERAL.—An eligible entity seek-
ing 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 in-
creased housing supply during the 3-year 
period ending on the date on which the ap-
plication 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 juris-
diction of the eligible entity; 
(iii) a description of how each eligible 
purpose described in clause (i) may ad-
dress a community need or advance an ob-
jective, or an aspect of an objective, in-
cluded in the comprehensive housing af-
fordability strategy and community devel-
opment plan of the eligible entity under 
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(v) passing zoning overlays or other 
ordinances that enable the development of 
mixed-income housing; 
(vi) streamlining regulatory require-
ments 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 pub-
lic financing to promote development of at-
tainable housing; 
(ix) streamlining environmental regu-
lations; 
(x) eliminating unnecessary manufac-
tured-housing regulations and restrictions; 
(xi) minimizing the impact of over-
burdensome energy and water efficiency 
standards on housing costs; and 
(xii) other activities that reduce cost 
of construction, as determined by the Sec-
retary. 
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(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 dif-
ferent geographical areas and a relatively even 
spread of rural, suburban, and urban commu-
nities. 
(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 in-
creasing housing supply, including adop-
tion of any of the frameworks developed 
under section 203; and 
(ii) demonstrated a marked improve-
ment in housing supply growth. 
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(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 Com-
munity 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 sec-
tion shall be construed— 
(1) to authorize the Secretary to mandate, su-
persede, or preempt any local zoning or land use pol-
icy; or 
(2) to affect the requirements of section 
105(c)(1) of the Cranston-Gonzalez National Afford-
able 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 ad-
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justed for inflation based on the Consumer Price 
Index. 
Æ 
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