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Uptown, Edgewater, Rogers Park

New Buildings In High-Income Neighborhoods Would Need 30 Percent Affordable Units Under Aldermen’s Proposal

The proposed overhaul of the city's affordable requirements ordinance would also stop letting developers pay a fee to get out of building on-site affordable units.

An apartment building along Wilson Avenue in Uptown as seen on December 20, 2020.
Colin Boyle/Block Club Chicago
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UPTOWN — A group of aldermen and housing advocates want to strengthen the city’s requirement for affordable housing in apartment developments to battle displacement and segregation in booming neighborhoods.

The proposed overhaul of the city’s affordable requirements ordinance would significantly boost the number of affordable units in the city and what kind of affordable housing is built and where, supporters say.

The city’s current affordable requirement ordinance mandates developers building 10 or more units make 10 percent or more of the units affordable. The ordinance applies to developers who need a zoning change to build, are building in a Planned Development, receive city assistance or are building on city-owned land.

Under the current ordinance, developers can pay an “in-lieu” fee to reduce the number of on-site affordable housing required in their buildings, with the fees going to low-income rental assistance and an affordable development fund.

Since 2007, the ordinance has produced more than 1,000 affordable units and more than $124 million in “in-lieu” fees, according to the city’s Inclusionary Housing Task Force, commissioned by Mayor Lori Lightfoot.

But the ordinance has not done enough to stop displacement in neighborhoods that have seen development booms, critics have said. And allowing developers to pay a fee to get out of building on-site affordable units contributes to the city’s problem with segregation, they contend.

The newly proposed ordinance would significantly increase the number of affordable units required to be included in developments. It would also mandate more family-sized affordable housing and would do away completely with the “in-lieu” system.

The Chicago Inclusive Housing Ordinance has the backing of Alds. Daniel La Spata (1st), Michael Rodriguez (22nd), Byron Sigcho-Lopez (25th), Roberto Maldonado (26th), Rossana Rodriguez Sanchez (33rd), Andre Vasquez (40th), Matt Martin (47th) and Maria Hadden (49th). It was drafted in consultation with ONE Northside, an Uptown-based community advocacy group.

Sigcho-Lopez said the current affordable ordinance has done little to stop the displacement of tens of thousands of residents from neighborhoods like Pilsen and Logan Square, where upscale apartment complexes have been built in recent years.

“This is not inevitable,” Sigcho-Lopez said of development causing displacement. “These are the kinds of policies we need to make sure we actually get [people] an opportunity, that we open our doors again.”

For developments proposed in high-income/high-displacement areas, the proposed affordable requirement would be boosted from 10 percent of units to 30 percent.

Developments in moderate-income areas would be required to have 20 percent affordable units, while developments in low-income areas would keep 10 percent.

Currently, the city’s ordinance requires units deemed “affordable” to be offered to those making 60 percent of the average median income, which is $38,000 for a one-person household.

The new ordinance would require a mix of affordable units offered at 50 percent of the average median income ($31,850), 30 percent ($19,000) and 20 percent ($12,740).

A complaint of the recent development wave is there is too high a concentration of studios and one-bedroom apartments. The new ordinance would require 60 percent of the affordable units be two-bedroom and 30 percent be three-bedroom.

The changes would greatly expand housing opportunities for families priced out of certain areas of the city, advocates sid. It would also help during the pandemic, when thousands of Chicagoans are at risk of eviction, the aldermen said.

The city wrote in its September report that changes to the affordable requirement ordinance are needed. The Inclusionary Housing Task Force, co-chaired by Alds. Sigcho-Lopez, Walter Burnett Jr. (27th), Harry Osterman (48th) and others, recommended increasing the proportion of required units that must be built, wiping out the “in-lieu” system, building more “deeply” affordable units and family-sized units, and creating more incentives for market-rate developers, among other suggestions.

Lightfoot’s administration planned to craft an ordinance this winter based on the recommendations, according to the Sun-Times.

Hadden said the aldermen have been in talks with the administration, and they have been “really positive.” They hope an update to the ordinance can come sooner rather than later.

“Chicago doesn’t have time to wait,” Hadden said. “We know that there is more trouble to come.”

Martin said his office has successfully lobbied six developers to include more than the 10 percent affordable requirement in his North Side ward, including in two projects approved by City Council last week. The work shows more affordable units can be included in developments, Martin said.

The pandemic is exacerbating housing issues across the city. A more impactful affordable requirement will go far in helping reverse the problem, supporters said.

“If wealthy developers come out of this crisis on top like they did the last one, we will need these policies to make sure poor, working- and middle-class Chicagoans of all colors don’t get left behind,” said Lamont Burnett, organizer with ONE Northside and a member of the city’s affordable requirements task force.

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