People need to live within easy access of a mix of transportation options—including walking, biking, public transit, and driving—to get to work, school, and other activities. Without easily accessible transportation options, people have to spend more time and money getting around. And without options to walk, bike, or take public transit, they’re forced to use cars and contribute to environmental pollution.

To make the cost of living more affordable and reduce negative impacts on the environment, transportation and housing investments must be linked. That’s why many urban planners, for instance, advocate for transit-oriented development, or the practice of building communities that are walkable and well served by public transportation. Some metropolitan planning organizations (MPOs), like the Puget Sound Regional Council (PDF) and the Regional Transportation Commission of Southern Nevada (PDF), have developed plans and strategies to encourage this type of project.

But the United States has a long history of separating transportation and land-use policy. Decisionmaking about the two policy areas is typically divided between different agencies, and only a small share of the nation’s regional organizations systematically coordinate between housing and transportation planning. For example, many transit lines are constructed with surface parking lots surrounding the stations, instead of homes. Similarly, many housing developments are built without sidewalks nearby, forcing residents to drive everywhere.

The 2021 Infrastructure Investment and Jobs Act (IIJA), which funded transportation projects nationwide over five years, enabled MPOs to develop housing coordination plans, which link land-use policy with mobility investments. But in recent years, the federal government has not funded these plans, and few MPOs have developed them.

Congress is developing plans to replace the IIJA by reauthorizing federal funding for surface transportation (including highway and transit investment). To maximize the benefits of transportation spending, Congress could expand upon the housing coordination concept.

Without proper guidance from the federal government, only some state and regional leaders have begun to integrate housing and land use into transportation plans

For decades, federal law has required MPOs and state transportation agencies to develop short- and long-term transportation plans that detail planned investments. These plans must show projects’ costs and their impacts on the transportation system. The IIJA, for the first time, explicitly permitted most MPOs to integrate housing and land use into this transportation planning process through housing coordination plans. The IIJA suggests these plans can

• reduce commuting distances and times by building housing near jobs,
• ensure that transportation options match growth,
• increase the amount of development in areas already served by transportation options, and
• expand the percentage of households with easy access to a region’s transportation network.

Some MPOs have begun undertaking this work: The Community Planning Association of Southwest Idaho has developed a housing needs estimate, and the Broward County, Florida, MPO has developed a coordination plan.

But many MPOs have expressed concern that the US Department of Transportation hasn’t provided adequate guidance on integrating housing coordination plans into transportation plans. The IIJA also didn’t provide funding for plan development, such as hiring additional staff.

In 2022, several US senators asked (PDF) the Department of Transportation to release such guidance and “implement policies and undertake actions” to encourage coordination. But the department didn’t take those steps, and because the plans were optional, most MPOs didn’t develop them.

The reauthorization of federal transportation programs offers opportunities to better coordinate housing and transportation policy

As Congress develops legislation to reauthorize funding for transportation programs, it could fortify the federal government’s approach to housing coordination planning in the following ways:

• Require that MPOs integrate housing coordination as a key element of their short- and long-range plans, rather than making this coordination optional. This coordination is a first step to guaranteeing that an investment achieves positive returns and gives residents transportation options. Congress should dedicate funding for this planning.
• Mandate that the Department of Transportation develop guidance for MPOs writing housing coordination plans. This guidance should specify approaches for analysis and performance evaluation metrics.
• Tie transportation project funding and approval to achieving positive impacts on housing and localities developing altered land-use plans. New public transportation lines should maximize their usefulness to residents of existing housing, while land-use policies should be designed to increase housing supply near stations.
• Allow federal transportation funds to be used to support coordinated land-use investments. States, cities, and counties could use federal dollars to acquire land around transit stations to prepare for housing development.

Even with these changes, there will be more work to do. Most decisionmaking about land-use policy is undertaken by local governments, not MPOs. So local governments must work with MPOs to ensure more effective outcomes.

Together, these approaches could help MPOs ensure their investments in transportation adequately meet local housing needs while orienting housing development around transportation options. If done right, they can result in both lower costs of living and a less-polluted environment.