CHICAGO — Mayor Lori Lightfoot’s administration unveiled a plan Wednesday to boost affordable housing in the city, offering a competing proposal to an aldermen-backed plan with more stringent affordable housing requirements.
Lightfoot and city housing officials are trying to strengthen the city’s affordable requirements ordinance, which mandates a percentage of affordable units in residential developments that need city approval.
The city’s current ordinance requires developers who are building 10 or more units to make 10 percent or more of the building 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.
Since 2007, the ordinance has produced only about 1,000 affordable units. Gentrification and displacement due to lack of affordable housing have only accelerated since then, according to a report from the city’s Inclusionary Housing Task Force, which was commissioned by Lightfoot.
There are now two competing measures to overhaul the affordable requirements ordinance so that it helps stop gentrification, segregation and displacement in booming parts of the city. The plans diverge on some of the central components of the ordinance.
Lightfoot’s plan would require developers building in most parts of the city to include 20 percent affordable units, up from the current 10 percent.
Currently, the ordinance requires units designated at “affordable” be priced for those making 60 percent of the area’s average median income. But housing advocates say that threshold is too high for many Chicago residents, particularly minority residents and immigrants who are being displaced from areas experiencing rapid development.
Lightfoot’s proposal would incentivize developers to include affordable units for those making less than 60 percent of the average median income. Those that rent units at 50 percent of the average median income ($31,850) can include 16 percent affordable units, down from 20 percent. Those that rent at 30 percent of the median income ($19,000) can include 10 percent of units overall unit count as affordable.
“As city leaders, it is our responsibility to step up and do the work to reverse the adverse effects segregation has had on our city,” Lightfoot said in a statement on her proposed ordinance overhaul.
Lightfoot’s is the second proposal to strengthen affordability requirements.
Late last year, a group of aldermen and housing advocates unveiled the Chicago Inclusive Housing Ordinance, which would significantly increased the amount of required affordable units and do away with a popular loophole in the ordinance.
The inclusive housing ordinance would require developments in high-income areas to include 30 percent affordable units, higher than Lightfoot’s 20 percent proposal. Developments in moderate-income areas would require 20 percent under the plan.
Whereas Lightfoot’s plan incentives offering units at lower income thresholds, the inclusive housing ordinance would mandate a mix of affordable units offered at 50 percent of the average median income, 30 percent and 20 percent ($12,740).
The inclusive housing ordinance would also do away with the “in-lieu payment” system, which allows developers to include only a quarter of the needed affordable units if they pay a per-unit fee into city-controlled affordable housing funds.
Lightfoot’s plan reduces the number of affordable units that can be avoided by paying in-lieu fees from 75 percent of a development’s affordability requirement to 50 percent. The mayor’s proposal also revises where developers can build off-site affordable units to meet their affordability requirement.
The in-lieu system has raised more than $124 million since 2007, but it has done little to address segregation because it keep developers from including affordable units in new development, activists have argued.
Both housing affordability ordinances have been introduced to the City Council, where they will be considered first by the Committee on Housing and Real Estate.
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.
Aldermen that back the plan are asking the Lightfoot administration to work with the group to find a common ground between the two proposals. The pandemic’s impact on housing stability creates urgency behind this issue, Ald. Byron Sigcho-Lopez said at a press conference Tuesday.
“We urge Mayor Lightfoot to work with us … so that we can pass a bill that we can all be proud of,” he said. “This is the time to put housing as a human right and best practices at the front of the conversation.”
Ald. Harry Osterman (48th), the housing committee chair, said aldermen will continue to be briefed on the administration’s new proposal. Osterman said the committee will work through the proposals with an end goal of passing a strengthened affordability requirement, though the timeline for such work is not yet known.
“This is a huge issue and one we’ve been working on for several years,” said Osterman, who co-chaired the mayor’s Inclusionary Housing Task Force along with Sigcho-Lopez and Ald. Walter Burnett Jr. (27th). “We’re still laying out how we’re going to move forward on this. There will be a lot of transparency and input from the public.”
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