Illinois HB 4389: STARTER HOME INCENTIVE ACT

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104TH GENERAL ASSEMBLY 
State of Illinois 
2025 and 2026
HB4389

Introduced 1/14/2026, by Rep. Jed Davis 

SYNOPSIS AS INTRODUCED:

New Act

 Creates the Starter Home Incentive Zone Act. Provides that a municipality may establish a Starter Home Incentive Zone within a designated area if the municipality adopts any 3 of the following reforms within a designated zone: (1) reduced minimum lot sizes applicable to detached single-family homes; (2) reduced minimum dwelling size requirements permitting homes of 1,600 square feet or less; (3) fast-track permitting with a decision issued within 10 to 20 business days; (4) reduction, waiver, or cap of impact fees for detached single-family homes; or (5) reduced setback requirements. Provides that municipalities containing a Starter Home Incentive Zone shall receive specified benefits from the Department of Commerce and Economic Opportunity. Provides that municipalities containing a Starter Home Incentive Zone may receive specified benefits from the Department of Transportation. Provides that, on or before January 31 of each year, a SHIZ-certified municipality shall submit a report, not to exceed 2 pages, containing specified information for each Starter Home Incentive Zone within the municipality. Requires the Department to adopt rules necessary to implement the Act in accordance with the Illinois Administrative Procedure Act. Provides that the Department may not require any municipality to submit reports, data, analyses, or documentation beyond the annual compliance report, unless expressly authorized by the Act. Limits home rule powers. Effective immediately.

LRB104 16675 RTM 30079 b

A BILL FOR

HB4389LRB104 16675 RTM 30079 b

1 AN ACT concerning local government.

2 Be it enacted by the