New 'Build HUBS Act' Extends Transportation Loans Until 2031, Fast-Tracks Housing Near Transit

The “Build Housing, Unlock Benefits and Services Act” (or Build HUBS Act) is a major push to tackle the housing crisis by leveraging federal transportation loan programs. Essentially, it extends two critical Department of Transportation (DOT) financing programs—TIFIA (for general infrastructure) and RRIF (for rail projects)—for another five years, running through fiscal year 2031. The core idea is to make it much easier and faster to finance “transit-oriented development” (TOD) projects, especially those that include affordable housing, by streamlining the application process and offering sweet deals on interest rates.

The Fast Lane for Housing Development

If you’ve ever tried to get a project financed, you know the federal government requires proof you won’t default, usually through an “investment-grade rating.” This bill loosens that requirement for TOD projects. Instead of a traditional rating, developers can use an “investment-creditworthiness assessment alternative,” like a joint guarantee from a creditworthy local government or a certification from an approved private lender. This is huge because it cuts down on the time and expense of getting a project greenlit, especially for smaller developments that might not attract a big bank rating.

To really speed things up, the bill creates a delegated origination program, modeled after the successful system the Department of Housing and Urban Development (HUD) uses. This means approved private lenders can originate and underwrite these DOT loans on the government’s behalf. Think of it like getting pre-approved for a mortgage through a local bank rather than waiting for the central office in D.C. to review every piece of paperwork. For developers and local governments, this translates directly into shorter timelines and less bureaucratic headache.

The Sweet Spot: Attainable Housing

The bill defines an “attainable housing project” as one where most units are affordable to households earning 80% of the area median income (AMI), and the entire project serves households up to 120% of AMI. If a TOD project qualifies as “attainable housing,” the financial incentives are significant: the interest rate on the federal loan is slashed to one-half of the U.S. Treasury rate. This subsidy makes it dramatically cheaper to build housing for working families and young professionals, potentially translating into lower rents or mortgage payments for those residents.

For example, if you’re a teacher or a nurse making a decent salary but struggling with rent near a city center, this bill is designed to spur the creation of housing you can actually afford, located right next to the train or bus line you use for your commute. The bill requires that at least 75% of the federal funds in these projects must go directly to the residential component, ensuring the money is truly focused on housing production.

Cutting the Red Tape (and Environmental Review)

To match the accelerated financing, the bill also speeds up the environmental review process under the National Environmental Policy Act (NEPA) for certain activities. It explicitly exempts land acquisition for TOD projects from NEPA review. It also grants categorical exclusions for specific types of construction, such as converting an existing office building into residential units within the same footprint, or building commercial space on already disturbed land near a transit facility.

While this speeds up construction—which is crucial for housing supply—it raises concerns for environmental watchdogs and local community groups. Bypassing NEPA means less public input and potentially less scrutiny on local environmental impacts, even if the project is otherwise beneficial. It’s a classic trade-off: speed and supply versus thorough review.

Local Control Remains the Final Hurdle

Crucially, the bill includes a savings provision that explicitly states this Act does not override, change, or take precedence over any existing State or local zoning and land use laws. This means that while the federal government is offering cheap money and fast-track approvals, local governments still hold the final say on density, height, and overall design. For local governments, this creates a tricky situation: they are under pressure to approve dense, transit-friendly projects to unlock this favorable federal financing, but they retain all the political heat from residents concerned about changes to their neighborhoods. The money is there, but the local fight over zoning remains.