(a) As used in this section, “housing growth zone” means any area within a municipality in which applicable zoning regulations adopted pursuant to section 8-2 are designed to facilitate substantial development of new dwelling units consistent with subsection (c) of this section. Any housing growth zone shall encompass an entire development district and may include areas outside such district.

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(b) Notwithstanding section 8-169jj, prior to the execution of any memorandum of agreement that establishes a development district, any chief executive officer of a member municipality, or the chief executive officers of the municipalities constituting a joint member entity, shall create a proposal for a housing growth zone and submit such proposal, including proposed zoning regulations applicable to such zone, for the Connecticut Municipal Redevelopment Authority’s review and approval.

(c) (1) The authority shall approve any proposal submitted pursuant to subsection (b) of this section if the authority determines that the proposed zoning regulations applicable to the housing growth zone are likely to substantially increase the production of new dwelling units necessary to meet housing demand within the region.

(2) In making its determination pursuant to subdivision (1) of this subsection, the authority shall presume that any proposal that includes the following provisions is likely to substantially increase the production of new dwelling units: (A) The proposal permits middle housing as of right, and (B) except as provided in subparagraph (iv) of this subdivision, the proposal requires only the approval of the zoning board of appeals, planning commission, zoning commission or combined planning and zoning commission for the issuance of any applicable permits for any application that would result in a net increase of dwelling units other than middle housing units, provided such zoning board of appeals, planning commission, zoning commission or combined planning and zoning commission, with respect to any application submitted pursuant to this section, shall (i) have the same power to issue any permit or approval as any other municipal body or official who would otherwise act with respect to such application, (ii) hold a single public hearing not later than thirty days after the receipt of any such application, (iii) by majority vote, determine whether to approve or deny such application not later than thirty days after such public hearing, and (iv) upon the recommendation of the zoning board of appeals, planning commission, zoning commission or combined planning and zoning commission, require concurrent approval from any sewer commission, water commission, municipal wetlands commission, municipal conservation commission or board or municipal historic preservation commission of the municipality pursuant to a joint review process for such application by any such commission or board, as applicable, not later than thirty days after receipt of such application. The applicant shall file any such application with the zoning board of appeals, the planning commission, zoning commission or combined planning and zoning commission, which shall forward such application to such applicable commission or board to provide for such joint review if such review is recommended by such zoning board of appeals, planning commission, zoning commission or combined planning and zoning commission.

(3) In making its determination pursuant to subdivision (1) of this subsection whether a housing growth zone proposal is likely to substantially increase the production of new dwelling units, the authority shall consider whether the proposal (A) allows the development of new dwelling units without the requirement of any off-street parking spaces, (B) requires that ten per cent of units be sold or rented at, or below, prices which will preserve the units as housing for which persons and families pay thirty per cent or less of their annual income, where such income is less than or equal to eighty per cent of the median income, for any application involving a net increase of ten or more dwelling units, and (C) generally promotes residential diversity.

(d) Notwithstanding this chapter, no member municipality, nor the municipalities constituting a joint member entity, shall submit an application or request for funds for any authority development project pursuant to section 8-169nn, nor shall any bonds, notes or other obligations of the authority be issued to carry out such project, pursuant to section 8-169oo, until the member municipality, or the municipalities constituting a joint member entity, enacts all of the zoning regulations proposed in the housing zone growth proposal approved by the authority.