Governor Shapiro’s Housing Action Plan and Proposed Changes to the Pennsylvania Municipalities Planning Code
Governor Josh Shapiro recently announced Pennsylvania’s first comprehensive Housing Action Plan (the Plan), a statewide strategy intended to address housing supply constraints, affordability concerns and regulatory barriers to development.
03.18.26
The Plan follows Executive Order 2024-03, signed in September 2024, directing state agencies to develop a coordinated approach to building and preserving housing across the Commonwealth. According to the Shapiro Administration’s projections, Pennsylvania could face a shortfall of approximately 185,000 housing units by 2035 if additional steps are not taken. At the same time, more than one million Pennsylvania households currently spend over 30% of their income on housing, and more than half of the Commonwealth’s housing stock is over 50 years old, increasing maintenance costs and reinvestment needs.
The Housing Action Plan outlines five core goals: 1) building and preserving housing stock; 2) expanding housing opportunity; 3) providing pathways to housing stabilization; 4) modernizing housing development regulation; and, 5) improving coordination and accountability across agencies. While the Plan includes nearly thirty initiatives spanning multiple policy areas, the most consequential proposals for developers, municipalities and landowners involve potential amendments to the Pennsylvania Municipalities Planning Code (the MPC).
Enacted in 1968, the MPC establishes the statutory framework governing local zoning, subdivision and land development regulation in Pennsylvania. Although the Commonwealth oversees statewide building codes and certain environmental regulations, municipalities retain broad authority over zoning and land use approvals under the MPC. The Governor’s proposal does not eliminate local control but instead seeks to “modernize” the statute to increase speed, predictability and efficiency in residential development approvals while encouraging additional housing production.
Among the concepts outlined in the Plan is the development of a state-supported library of model land use ordinances. These model provisions would address zoning definitions, parking and density requirements, lot size and setback standards, hazard mitigation, and other land use practices. The models would be tailored to different municipal contexts—urban, suburban and rural—and designed as flexible templates rather than mandates. The stated objective is to provide municipalities with vetted best practices aligned with state law and emerging housing needs.
The Plan also proposes the creation of a “Housing-Ready Community” designation for municipalities that proactively update their zoning and land development regulations to better enable residential construction. Municipalities receiving this designation could receive preferential consideration for certain state funding programs administered by the Pennsylvania’s Department of Community and Economic Development (DCED), such as DCED’s Main Street Matters program and the Pennsylvania House Finance Agency’s (PHFA) PHARE Fund. This approach relies on financial incentives, rather than direct preemption, to encourage local regulatory reform.
Substantively, the Administration signals support for expanding permissible housing types and increasing by-right development opportunities. Potential statutory revisions could facilitate accessory dwelling units (ADUs), the conversion of underutilized structures to residential use, manufactured housing in certain single-family districts, and the reduction of minimum lot size and setback requirements. The Plan also contemplates easing restrictive parking minimums and reassessing density limitations, particularly in areas near transit, employment centers and community services. In addition, it encourages mixed-use development along main streets and commercial corridors to integrate housing with jobs and amenities.
At this stage, the Housing Action Plan outlines policy objectives rather than enacted legislation. Any amendments to the MPC will require action by the General Assembly and are likely to generate significant discussion among municipal officials, planners, developers and other stakeholders. If adopted, MPC reforms could alter approval timelines, expand by-right development potential in certain zoning districts and shift the strategic landscape for both municipalities and applicants.
Klehr Harrison will continue to monitor legislative developments closely and consider how potential MPC amendments may affect pending projects, zoning ordinances, comprehensive plans and long-term development strategies with our clients. We will continue to provide updates as more detailed legislative proposals emerge.
Co-authors Matthew McHugh, partner, and Leonard Altieri, associate, are members of the zoning & land use practice group at Klehr Harrison.