What’s the Big Idea?
Wisconsin has a housing affordability challenge, due in part to inadequate housing production. Enacted on April 2, 2026, Wisconsin Act 173 is intended to reduce debate around proposed housing projects in the hopes of making the development process smoother and more predictable by documenting housing demand and setting specific approvable densities.
Effective January 1, 2028, the law requires cities and villages that have a zoning ordinance to map housing growth areas in their comprehensive plans. For each growth area, communities must establish minimum and maximum net residential density ranges over a 20-year planning period. The law can then compel communities to approve development proposals that are consistent with those net densities. Other goals and policies in the comprehensive plan may not be used as a reason to deny a rezoning for a proposed housing development.
Act 173 further specifies that these growth areas and density standards must be established before areas intended for future residential development can be annexed from unincorporated areas. Changes to a community’s zoning and subdivision ordinances must be consistent with these residential density standards as well.
Finally, the law increases the “housing extension” option currently available for certain tax increment districts (TIDs) at the end of their lifespan from one to two years. These funds can be used to support housing supply and affordability anywhere in the community.
| Local Process | New Under Act 173 |
| Comprehensive Planning | Map housing growth areas For each mapped housing growth area, provide minimum and maximum allowable net residential density in 5-year increments based on unit demand projections |
| Zoning Approval Discretion | If…
…then the project must be approved Plan consistency based only on the Future Land Use Map and associated policies (not on alignment with other plan goals or policies) |
| Zoning Approval Timing | The community has 90 days to approve or deny residential zoning proposals |
| Funding for Housing | A Tax Incremental District can now be held open for two years at the end of its life to support eligible housing costs in the community |
Net Residential Density
The law requires designation of maximum and minimum net residential density in any area where residential uses will be allowed in the next 20 years. Net residential density is the number of residential units divided by the residential acreage, excluding wetlands, 100-year floodplains, or public lands (roads, parks, stormwater outlots dedicated to the public, etc.).
Residential Demand Projections
In addition to establishing net residential density ranges for all areas designated for future residential use, Act 173 requires communities to map residential land use demand in 5-year increments over the 20-year planning period. The density allowed in those designated areas may change from one 5-year period to the next.
In practice, fulfilling this mapping requirement will be challenging, as most plans include more land than needed in a given period to address the uncertainties of landowner interest in development. Plans may include phasing or staging policies that delay development of certain lands until a designated threshold of land development or unit production has been met, provided those policies allow enough housing production to meet community-wide demand projections.
Application and Permitting Processes
Wis. Stats. §66.10016 was enacted in 2023 to compel building permit approval of code-compliant residential development. Act 173 extends that law to cover zoning change applications too, and puts the community on a 90-day clock to approve the application IF the following criteria are met:
- The land is planned for residential development in the comprehensive plan
- The land is adjacent or close to existing development and reasonably served by existing infrastructure
- The proposed density is within the limits described in the comprehensive plan (or there are no such limits described)
- Current housing supply doesn’t meet demand for the next 5 years as forecasted in the comprehensive plan
- The land is not designated for farmland preservation
Applicants can request a delay in the 90-day countdown to the local decision for any reason.
Will our community be forced to approve a development we don’t want?
The updates to 66.1001 are intended to bring predictability to the development process for the benefit of all stakeholders. There is a modest risk that a community will be forced to approve something, but that risk can be managed by amending the comprehensive plan to clearly describe the desired development outcomes. The new requirements specify that only the plan’s future land use map and associated land use category policies can be used to evaluate consistency with the comprehensive plan, but they do not change the community’s responsibility to ensure that public infrastructure will be able to handle the development. Communities can still deny proposals if there is a demonstrated lack of adequate public infrastructure or services.
What does our community need to do?
Cities and villages should review their comprehensive plans to determine:
- Do you have 20-year land demand projections for housing, in 5-year increments, based on credible household projections?
- Are growth areas designated for development by 5-year growth increments, or otherwise phased for development?
- Are there minimum and maximum densities described for each area on the future land use map where residential development may be allowed?
- Does the plan accurately document the current capacity of local sewer, water, and other public infrastructure systems?
If the answer to any of these questions is “No”, we encourage you to address this gap before January 1, 2028. You should also review your zoning amendment process – can you accommodate the 90-day timeline from application to decision? Are residents and decision-makers familiar with the new requirements?
How can CARPC help?
CARPC planners are happy to review your comprehensive plan for compliance with these new requirements. We can assist with policy development, mapping, and/or a public engagement process to help you meet these requirements on a fee-for-service basis. Contact Caitlin Shanahan at Caitlins@capitalarearpc.org or 608-474-6021.
