Lawmakers will continue efforts in the coming year to make housing more available and affordable and to build a stronger, more resilient child care industry. The price of rental and owner-occupied housing stresses many household budgets, and the same is true for child care, if it can be found. Legislatures were active on both issues in 2024, and NCSL sees no indication that interest in these two essential policy issues will cool in the legislative sessions ahead.
Here’s a look at what might be in store for 2025.
NCSL Forecast ’25
This special report from State Legislatures News covers the topics NCSL’s policy experts anticipate will occupy state lawmakers’ time in 2025 legislative sessions. Read the full report here.
Hot Topic: Child Care Impacts the Economy
When families can’t access child care, the economy struggles. The cost of child care for two children exceeds the cost of rent in every state, and 70% of parents report having significant issues accessing care. With one-time child care funding from the American Rescue Plan Act now expired, states are looking at options to increase the accessibility and supply of care.
ACTION: NCSL has seen a significant increase in child care policymaking in state legislatures since the pandemic, with over 100 bills enacted last year, the highest since 2019. Some states have directly appropriated general revenue funds to support child care programs; while others are implementing cost-sharing models with businesses to lower the cost of care. Still other states are offering tax credits to employers who offer child care assistance or to parents directly through child and dependent care tax credits.
States are also supporting access to care by ensuring programs have staff available for every classroom. Policies such as increasing worker pay and free child care to child care employees help support a workforce that tends to lack benefits and experience high rates of turnover.
Regardless of which direction legislatures choose, they will have an array of options to address this crisis when they reconvene in the new year.
NCSL Resources:
Hot Topic: Increasing Housing Supply to Meet Demand
The nationwide shortage of rental and owner-occupied properties is 1.5 million units, and the current pace of construction isn’t meeting demand. The lack of adequate housing leads to higher prices for renters and homebuyers alike.
A complex mix of factors is hampering efforts to improve the situation, including relatively high interest rates prompting current homeowners to stay where they are, which contributes to low vacancy rates. Additionally, zoning regulations can limit the construction of more affordable options such as duplexes and townhomes. This contributes to building more high-end homes that are out of reach for many homebuyers. In addition to high interest rates, materials costs, lengthy permitting processes and construction workforce shortages remain significant cost drivers.
ACTION: In 2024, legislators in 44 states, Washington D.C., Guam, Puerto Rico and the U.S. Virgin Islands introduced more than 2,200 bills addressing housing and homelessness. These numbers are near the historic high seen in 2023, signaling to NCSL that housing continues to be a priority among state legislatures.
This year, to combat rising housing prices, legislatures revised zoning regulations, streamlined administrative processes, explored building code changes and incentivized construction of affordable housing options. Legislators also expanded transit-oriented development, created first-time homebuyer programs and limited investor purchases of residential properties. NCSL predicts housing policies will remain a top priority for state legislatures.
NCSL Resources: