As hours ticked away toward Tuesday's expiration of the current legislative session, Texas lawmakers passed a bill somewhat trimmed in its ambitions to reduce lot-size minimums to 3,000 square feet in cities with a population of at least 150,000 and counties with a population of at least 300,000.

The measure, Senate Bill 15, would allow the development and ground-up construction of smaller homes on smaller lots. The aim is to remedy a full-blown housing affordability crisis plaguing many of Texas's major urban centers and their environs.

When the legislation surfaced earlier this year, its sponsors sought a significant reduction in the minimum lot size to 1,400 square feet, mimicking what Houston has permitted since the 1990s. Even though the compromised minimum now sits at more than twice that figure, the SB 15's advocates can declare a win as they hand it over for Gov. Greg Abbott's signature.

The new benchmark is 3,000 square feet, down from the 5,000-to-7,500 square feet minimum range in Texas cities and counties – effectively a chokehold on attainable market-rate new home development.

With the win, Texas joins a handful of states and cities that have approved similar legislation to reduce lot sizes to address widespread housing shortages by enabling the development of smaller, potentially more affordable homes. California, for example, passed legislation in 2021 to promote higher-density, urban center, “missing middle housing.”

Whether it works across the board is a different matter. Economic uncertainty and higher mortgage rates have discouraged buyers, and the inventory of new homes for sale is growing.

Texas's SB 15 was part of a package of bills endorsed by Texas Lt. Gov. Dan Patrick to address his state’s housing shortage and affordability challenges.

Like any land-use legislative initiative around the country, the Texas effort wasn't without drama that originated among lawmakers opposed to a bill that would preempt local zoning. Opponents pushed hard to limit the "upzoning's" impact if they couldn’t outright defeat it.

Fort Worth State Rep. Ramone Romero Jr., concerned that the law would undermine local zoning control, nearly deep-sixed the measure on a technicality in May.

In reviving it over Memorial Day weekend, lawmakers who opposed the legislation inserted a “poison pill” amendment. This added provision would have required local governments to create a new zoning category if they wanted to implement smaller lot sizes. Consequently, local governments would have been able to effectively dodge the bill by voting not to authorize that new zoning category.

Sam Hooper, legislative counsel for the Texas office of the Institute for Justice, an organization that supports individual rights, says that the amendment was nixed during a conference committee to resolve differences between the House and Senate versions, as expected.

It was a fairly close vote, with Fort Worth Democrats again providing the loudest opposition,” Hooper says.

Applicability

The law applies to municipalities with populations over 150,000 located in counties with populations over 300,000. It targets new subdivisions (tracts of at least five acres, not yet platted) zoned for single-family homes.

Minimum Lot Size and Density

Cities covered by the bill cannot require new single-family residential lots to be:

·      Larger than 3,000 square feet

·      Wider than 30 feet

·      Deeper than 75 feet

Cities also can't set density rules that prevent a single-family home from being built on a lot of at least 3,000 square feet.

Small Lot Regulations

Cities cannot impose:

·      Setbacks greater than 15 feet (front), 10 feet (back), or 5 feet (side)

·      Covered parking requirements

·      More than one parking space per unit

·      Off-site parking requirements

·      More than 30% open space or permeable surface

·      Fewer than three full stories (not exceeding 10 feet per story)

·      Maximum building bulk or wall articulation requirements

Exceptions exist for setbacks related to environmental protection and aquifer recharge zones.

Fees and Shared Infrastructure

Cities may require shared driveways, permit fees equivalent to those for single-family lots, and impact fees as authorized by law.

Exemptions

The bill does not override homeowners’ association rules or private deed restrictions; zoning related to flooding, sewer, or well water for individual lots and existing neighborhoods and developments.

Legal Remedies

Individuals or housing organizations adversely affected by a city’s violation of these provisions may sue for declaratory and injunctive relief, and the prevailing parties are entitled to attorney’s fees and costs.