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HB 6003

AN ACT RELATING TO TOWNS AND CITIES -- LOW - AND MODERATE- INCOME HOUSING

2025 Regular Session Introduced by Karen Alzate and 9 co-sponsors

HB 6003 ties a municipality’s education aid to its progress in creating or maintaining 10% LMI housing (15% in urban rentals), rewarding overachievement.

05/13/2025 Committee recommended measure be held for further study
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Bill Summary · HB 6003

Summary — HB 6003

Title: AN ACT RELATING TO TOWNS AND CITIES — LOW- AND MODERATE-INCOME HOUSING
Introduced: February 28, 2025 (Rhode Island) — Referred to House Finance
Status (selected): Committee consideration; provisioned to take effect January 1, 2026

Main purpose

HB 6003 links a municipality’s share of state permanent foundation education aid to its performance in creating and maintaining low- and moderate-income (LMI) housing. The bill aims to create a financial incentive for cities and towns to meet statutorily defined LMI housing goals.

Key provisions

  • Adds § 45-53-17 to Chapter 45-53 (Low and Moderate Income Housing).
  • Starting January 1, 2026, each municipality (or group of municipalities in a school district) has a five-year period to meet LMI housing goals:
    • Standard goal: 10% of year-round housing units must qualify as LMI housing; or
    • Urban towns/cities: 15% of occupied rental housing units must qualify as LMI housing (per § 45-53-3).
  • If a community exceeds its applicable statutory minimum after the five-year period, its permanent foundation education aid is increased by a percentage equal to the percentage by which it exceeds that minimum (e.g., 12% LMI = 2% increase if the minimum is 10%).
  • Increases are ongoing only so long as the community maintains LMI housing above the statutory minimum.
  • If statutory minimum LMI requirements change, the education-aid indexing will adjust correspondingly.
  • The Statewide Planning Program (within the Department of Administration) must certify to the General Assembly each year (by April 1) the prior-year percentage and amount of LMI housing in each municipality for implementation purposes.
  • Defines terms for this section: “community” (municipality or school-district-served area) and “education aid” (permanent foundation education aid defined in chapter 7.2 of title 16).

Who is affected

  • Municipal governments and planning departments (must plan and report housing outcomes).
  • School districts (their state foundation aid will be adjusted based on municipal LMI housing performance).
  • Developers, affordable housing advocates, and residents (incentives for additional LMI units).
  • State agencies: Statewide Planning Program and Department of Elementary and Secondary Education (data/certification and aid calculations).
  • State budget/taxpayers (education aid expenditures may increase for communities that exceed goals).

Implementation and timeline

  • Effective date for indexing: January 1, 2026.
  • Five-year compliance window begins January 1, 2026 (communities have five years to reach the target before aid adjustments apply).
  • Annual certification of municipal LMI housing levels due by April 1 each year for the previous year.

Potential impacts

  • Creates a direct fiscal incentive for municipalities to increase LMI housing supply.
  • Could increase state education aid payments to districts in municipalities that exceed targets; fiscal magnitude depends on how many communities exceed goals and by how much.
  • Requires ongoing data collection and certification by the Statewide Planning Program.

Compiled from official sources — confirm details with the bill’s official record.

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