Gov. Josh Green, along with U.S. Sen. Brian Schatz and U.S. Department of Housing and Urban Development Regional Administrator Jason Pu, announced Wednesday that Hawaii has received over $6.6 million in new federal grant funding to support housing development.

The $6,631,950 in funding is part of an $85 million grant program established by Schatz’s bipartisan “Yes in My Backyard” legislation, which was first funded in the fiscal year 2023 appropriations bill.

Pu stated that the initial round of the $85 million grant awarded funding to 21 cities and counties nationwide, following receipt of over 175 applications from 47 states and territories.

Hawaii received the second-largest funding, after Los Angeles, which received $6.7 million.

The initiative builds upon the Biden-Harris administration’s ongoing efforts to tackle the nation’s housing challenges, aiming to ensure that all communities have access to safe, equitable and affordable housing options.

The new “Pathways to Removing Obstacles to Housing” program incentivizes state and local governments to revise land-use policies and address local barriers hindering affordable housing supply.

The lack of infrastructure has been identified as a significant barrier to increasing housing supply in the state.

The PRO Housing grant awarded to the state Office of Planning and Sustainable Development establishes a State Infrastructure Bank to finance long-term infrastructure needs and accelerate investments to expand housing production at a larger scale.

The grant will also enhance the state’s capacity to identify and mitigate regulatory obstacles that inflate housing costs statewide, complementing a recent comprehensive pro-housing legislative package designed to expand residential opportunities in urban and commercial zones.

As an awardee, staff from the state are invited to join a technical assistance forum alongside other cities, counties, states and regional entities that have received funding — facilitating peer learning discussions on overcoming housing barriers and exploring emerging best practices, according to Pu.

Hawaii’s PRO Housing profile reported that the state faces the highest housing costs in the country and requires 50,156 new units by 2025 to meet its housing demand.

Pu encouraged the state to apply for round two of PRO Housing to meet housing demand, as HUD plans to make an additional $100 million available for the second round of the competition by the end of summer.

In PRO Housing’s inau­gural round, there was $13 requested for every $1 available in funding.

“States and local communities told us about the barriers that they identified from locally led processes, including those here in the state of Hawaii,” Pu said. “We heard about the need to lower housing costs for renters and homebuyers, the need to make permitting easier, the need to invest in infrastructure and the need to fill funding gaps.

“Among this competition, the state of Hawaii’s application stood out among all these other applicants.”

Schatz told the Honolulu Star-Advertiser that the housing crisis in the state “is an urgent problem that has worsened,” yet he remains optimistic about the potential for significant change due to elected officials advocating for larger- scale reforms.

He earlier said that a recent report found that “Hono­lulu was the sixth least affordable place to live on the planet — not in the country, on the planet.

“This is a crisis. This is a crisis that threatens to gut our community, socially and economically.”

Schatz mentioned that the development of affordable housing could take years because the state needs to first navigate through various processes, including construction and financing timelines.

While the funds were just received Wednesday, Green said the state will act promptly to establish policies that facilitate the commencement of various development projects.