NW Side among areas targeted for increased affordable housing requirements; Alderman Sposato says proposal would discourage development
by BRIAN NADIG
A proposed ordinance from the Lightfoot administration that at least one Northwest Side alderman has criticized would double the affordable housing requirements for zoning proposals involving 10 or more residential units in several areas of the city, including the Far Northwest Side.
The City Council Housing and Real Estate Committee held a April 15 hearing on the proposal and plans to continue discussions next week. The committee had planned to discuss the ordinance until the late afternoon, but members decided to adjourn the hearing early “out of respect,” as one council member said, due to the release of a video of the fatal police shooting of a 13-year-old during a foot pursuit.
The ordinance is aimed at increasing the number of affordable units in “inclusionary areas” where there is a low number of affordable units and in “community preservation areas” where there have been problems of low-income residents being displaced due to rising housing costs, according to city Department of Housing officials.
The department estimated that the city has a shortage of about 120,000 affordable units, which are those offered at below-market rate rents, usually to households earning between 30 and 60 percent of an area’s median income.
Under the proposal, development projects of at least 10 units which need a zoning change would have to set aside 20 percent of the units for affordable housing compared to the exiting requirement of 10 percent for most areas of the city (currently there are some pilot areas with a 20-percent set-aside). The North and Northwest sides would be subject to the new requirements.
In some instances developers may be able to seek a set-aside reduction if the affordable units would have two- or three-bedrooms to better accommodate families or if the rents would be low enough for those households earning around 30 percent of the area’s median income.
Developers also can opt to pay a fee (currently around $150,000 per unit) in lieu of providing some of the required affordable units. The city uses those fees to help create more affordable housing.
However, under the proposal, developers paying those fees would have to build at least 50 percent of the required affordable units compared to only 25 percent under the current Affordable Requirements Ordinance.
In addition, developers would continue to have options to build some of their required affordable units at an off-site location. Currently off-site units must be built within a two-mile radius of the main development site, but the proposal would give developers more options.
At the hearing, housing commissioner Marisa Novara testified that the most of the city’s existing affordable units are located on the West and South sides in Black and Brown communities and that the ordinance would help give more options of where to live to those families in need of subsidized housing.
“It’s not just the sheer number of units … (but) options” for families, Novara said proposal’s goals.
“If we want Chicago’s inequities to change, it’s not going to change organically,” Novara said. She added that Chicago is “one of the most segregated cities in the country.”
In all, the city has 25 programs that address affordable housing shortages, Novara said.
Alderman Nicholas Sposato (38th) is planning to testify against the proposal.
“This ARO (proposal) is going to destroy economic development in the city,” Sposato said in an interview.
Sposato said that the best ways to reduce rents is to encourage developers to build more units so that the supply is higher than than the demand but that the proposal would put too much of a financial burden on developers, scaring away large development projects.
“You’re going to see smaller developments, nine units,” Sposato said. “There’s no incentive for them (to build under the proposal). 10 percent is hard enough.”
He added that there are several sections of the Northwest Side, including the O’Hare corridor in the 41st Ward, where rents are affordable.