Delaware Workforce Housing Program (DWHP)

How It Works

The Delaware Workforce Housing Program gives private investors a cash grant for part of what they spend creating homes for working households. According to the bill synopsis, it was modeled on Delaware’s Downtown Development Districts program, which the state created in 2014 to draw private investment into designated downtown areas.

The basic mechanics come straight from the statute:

• Qualified investor. An owner, or a tenant, of property in an eligible area who builds, expands, or rehabilitates it for use as workforce housing.
• Qualified investment. Spending above the minimum threshold that is properly charged to a capital account for building, expanding, or rehabilitating depreciable real property placed in service during the calendar year.
• Minimum threshold. DSHA sets a minimum investment a project must exceed. The law says it cannot be lower than $25,000.
• Grant size. Up to 20% of the qualified investment above that threshold.

Suppose an investor spent $525,000 on qualified improvements and DSHA’s threshold were $25,000. The grant could be up to 20% of the $500,000 above the threshold, or $100,000. These figures are invented for illustration. The law lets DSHA cap grants, add qualifying criteria, or favor certain project types, and change those conditions no more than once a year.

Grants are a form of gap financing. They lower the investor’s net cost, which can make moderate rents or sale prices work where they otherwise would not.

Who It Serves

The law defines a workforce housing unit as a home for a household earning no more than 100% of area median income as defined by HUD. The substitute bill replaced the word “affordable” with “workforce” throughout. Its synopsis explains that “affordable” is generally understood in the housing industry to mean 80% of median income and below, while this program reaches up to 100%. That extends it into the workforce housing band, above the income ceilings of most federal rental programs.

Projects must sit in Investment Level 1 or 2 areas as set out in the Delaware Strategies for State Policies and Spending. The statute refers to the version of that document approved by the Governor in Executive Order 42 on July 23, 2020.

How to Access It

Investors apply to DSHA and must be approved before receiving a grant. DSHA verifies investment costs using its own forms and deadlines. The statute requires DSHA to adopt regulations through Delaware’s Administrative Procedures Act.

On April 22, 2026, DSHA announced it had received $5 million for the program and posted a draft of the proposed program design. It took public comment through May 1, 2026, and described that step as coming before the formal Administrative Procedures Act process. Anyone considering a project should check with Housing Delaware for the current rules and application status before relying on a grant.

History

Senate Bill 22 was introduced on March 21, 2024, and replaced by a substitute bill on April 24. The substitute passed the Senate in May and the House on June 30, and the Governor signed it on August 9, 2024. Its preamble cites DSHA’s 2023 Housing Needs Assessment as finding the state more than 19,000 affordable units short. The law took effect immediately, with implementation tied to final regulations or one year after enactment, whichever came first. It also requires DSHA to report on the program’s effectiveness to the Governor and General Assembly every November 15, starting in 2025.

Limitations

• No tax credit stacking. A unit that uses federal or state low-income housing tax credits cannot also get a grant. In a mixed building, only the non-credit units qualify. That keeps the program separate from the LIHTC, the main federal subsidy for affordable rentals.
• Appropriation-dependent. Grants are available only to the extent the General Assembly funds them.
• Location limits. Projects outside Investment Levels 1 and 2 are not eligible.
• No affordability term in the statute. The law defines who a unit is for but does not set how long it must stay at workforce income levels. That is left to DSHA’s rules.
• New and unproven. As of DSHA’s April 2026 notice, the program design was still in draft, so there is little track record to evaluate. See how workforce housing is financed for how tools like this compare.