New 'Yes in God's Backyard Act' Funds $50M Annually to Turn Church Land into Affordable Housing

This section of the “Yes in God’s Backyard Act” is a direct response to the affordable housing crisis, aiming to unlock land owned by religious organizations and universities for development. The core idea is simple: if churches and colleges have unused space, the government wants to help them build rental housing where the rent is capped so it doesn’t exceed 30% of a low-income household’s earnings (specifically, households making up to 100% of the area’s median income).

The Technical Team: Free Consulting for Housing Projects

First, the bill sets up a Technical Assistance Program, essentially offering free, specialized consulting services to faith-based groups, universities, and local governments starting in Fiscal Year 2026. If a church owns a large parking lot or an unused parcel and wants to build apartments for veterans or people with disabilities, this program provides the expertise—think guidance on zoning, accessing federal funding, and navigating the complexities of housing development. This program is funded with $25 million in the first year and $10 million annually afterward, ensuring these organizations don't have to hire expensive outside consultants just to figure out if a project is feasible.

Challenge Grants: Paying Cities to Cut Red Tape

The second, and arguably more impactful, part is the Challenge Grant program, which puts up $50 million annually for six years. This isn't just a grant for building; it's a grant for reform. Local governments, states, or regional planning groups can apply, but only if they already have policies in place that actively remove local barriers—like restrictive zoning laws or slow permitting processes—that stop affordable housing from being built on religious or university land. If a city wants this federal money, it has to prove it’s already doing the work to cut the red tape.

These grants are competitive, and the Secretary will prioritize applicants who are focusing on housing for the lowest-income folks: families earning less than 60% of the area median income, the homeless, or those with special needs. This means the money is heavily weighted toward projects that provide truly deep affordability. Grant funds can be used to further assess and remove regulatory obstacles, or even to provide loans directly to specific housing projects.

What This Means for Your Community

For everyday people struggling with rent, this bill offers a pathway to potentially increase housing supply in areas that might otherwise be locked down by restrictive zoning. If you live in a city where land is scarce and expensive, this legislation pressures local government to look at institutional land—often centrally located—as a resource for housing development. For example, a university might convert an underutilized dormitory or a church might develop housing on a large campus, adding much-needed supply to the local market.

However, local jurisdictions that rely on current zoning to maintain neighborhood character may feel pressure to change long-standing policies to qualify for the grant money. While the bill aims to support housing in “well-resourced neighborhoods,” the definition of “actively remove local barriers” is broad, giving the Secretary significant discretion when awarding the $50 million in annual grants. This vagueness means cities will be watching closely to see exactly which policy changes the federal government rewards.