Since its implementation in September, Texas Senate Bill 840 has begun to reshape housing development in the state’s major cities by easing restrictions on multifamily and mixed-use projects in commercially zoned areas. The legislation enables developers to build such projects without seeking zoning changes, aiming to alleviate the state's housing shortage. Early data suggest the law is producing significant activity, despite resistance from some municipalities.
A recent report from a bipartisan coalition—including Texas Appleseed, the American Enterprise Institute, and Texans for Reasonable Solutions—indicates that SB 840 has directly facilitated the creation of more than 1,250 housing units and indirectly supported at least 7,235 additional units in the months since the law took effect. These figures encompass both projects already approved and those still pending, reflecting strong developer interest in leveraging the law’s provisions.
The coalition’s analysis involved identifying multifamily housing applications that would not have been permissible prior to SB 840, as well as projects made easier through expedited rezoning processes. Notably, some developers have opted to go through traditional rezoning channels instead of building outright under SB 840. This approach allows them to negotiate with local officials and maintain leverage, as city governments often prefer to retain some influence over development decisions.
Dallas has been singled out as a city largely embracing SB 840 by aligning its local rules with the state law and tracking permit applications utilizing the new provisions. This tracking is important because qualifying projects do not always explicitly indicate their status as SB 840 developments, complicating oversight and analysis.
In contrast, neighboring cities have adopted measures intended to circumvent or undermine the law. Frisco has amended its zoning regulations to permit heavy industrial uses in commercial districts, a classification that exempts these areas from SB 840’s reach. Plano has instituted minimum height requirements specifically for SB 840 housing projects, setting different standards compared to other developments within the same zoning districts. Grand Prairie has introduced conditions requiring SB 840 projects to include amenities such as Olympic-size swimming pools and public art installations under the premise of preserving neighborhood aesthetics. Officials from these suburban cities reportedly faced scrutiny at a recent legislative hearing in Austin when questioned about these regulations.
Governor Greg Abbott has taken note of local efforts to sidestep the legislation and has warned of potential enforcement actions during the upcoming legislative session. SB 840 retains strong bipartisan support in the state legislature, underlining its importance as a tool to increase housing availability in Texas. Lawmakers have signaled their intent to uphold the law’s provisions amid continued opposition from “not in my backyard” (NIMBY) sentiments in various municipalities.
As Texas grapples with a growing demand for housing, the effectiveness of SB 840 could hinge on the extent to which cities embrace the law’s framework versus attempts to impose additional restrictions that may hinder new developments.