An Act to amend the Code of Virginia by adding in Title 36 a chapter numbered 13, consisting of sections numbered 36-176 through 36-180, relating to preservation of affordable housing; definitions; civil penalty.
HB4 creates a new chapter in Title 36 of the Code of Virginia focused on preserving publicly supported affordable housing. It authorizes localities to adopt ordinances requiring owners of qualifying properties to give 24 months’ written notice before an affordability restriction expires or otherwise terminates. The notice must be provided to the locality, tenants, and any tenant association, and must explain whether the owner plans to let the affordability restrictions end, convert the property, renew the restrictions, or sell the property. Localities may also impose compliance-verification requirements and civil penalties of up to $5,000 per violation for failure to provide the required notice.
The bill also gives participating localities a new acquisition tool: after notice is given, the locality may appoint a qualified designee and record a notice of right of first refusal. If the owner accepts a bona fide third-party offer, the locality or its designee has 30 days to submit a matching offer that includes a commitment to preserve affordability for at least 15 years. The bill sets out exemptions, procedural deadlines, recording requirements, and enforcement provisions, including civil actions, injunctive relief, punitive damages, and attorney fees. It also requires larger localities that adopt such ordinances to report their use of the authority to the Department of Housing and Community Development.
The bill’s impact on state law is to add a local-option framework for preserving subsidized housing at risk of losing affordability restrictions. It affects owners of publicly supported housing, tenants, tenant associations, local governments, and potential purchasers by creating notice, disclosure, and purchase-right obligations tied to properties that receive specified federal, state, or local housing subsidies or tax credits. It also interacts with existing housing, landlord-tenant, land records, and affordable housing finance programs by making the new right of first refusal secondary to certain existing rights and financing arrangements.
Overall, the bill appears to have been viewed favorably as a housing preservation measure, but not unanimously. It advanced through committee and passed both chambers, though the House and Senate votes show meaningful opposition, especially in the House and a narrower margin in the Senate. The vote pattern suggests broad support for affordable housing preservation, paired with concern about government intervention in private property sales and the burdens placed on owners and prospective buyers.
The main points of contention are likely the mandatory notice period, the local right of first refusal, the ability to require matching offers, and the civil penalties and litigation remedies. Supporters would view these tools as necessary to prevent the loss of affordable units and to give localities a chance to preserve housing for low- and moderate-income residents. Opponents are likely to object to the impact on property rights, transaction timing, and marketability of affected properties, as well as the administrative and legal complexity imposed on owners and local governments.
HB4 adds a new local-option chapter to Title 36 governing publicly supported housing, allowing localities to regulate notice of affordability-restriction termination, create a right of first refusal, appoint qualified designees, and enforce compliance through penalties and civil actions. It directly affects owners of subsidized or tax-credit-supported housing, tenants, tenant associations, local governments, and third-party buyers, while also requiring annual reporting by larger participating localities to the Department of Housing and Community Development.
The bill appears to have had generally positive support as an affordable housing preservation measure, as shown by successful committee reporting and passage in both chambers. However, the recorded votes also indicate notable opposition, suggesting that while many legislators supported the policy goal, there was substantial concern about the scope of local authority and the burdens imposed on property owners and buyers.
The most notable disputes likely centered on the 24-month advance notice requirement, the local right of first refusal, and the requirement that a locality or designee be allowed to match a third-party offer while committing to long-term affordability. Additional contention likely involved the civil penalty structure, the possibility of punitive damages and attorney fees, and whether the bill unduly interferes with private real estate transactions and property rights. Supporters would favor these provisions as necessary preservation tools, while opponents would likely view them as overly intrusive and administratively burdensome.