Watered-down SRO preservation ordinance advances

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Single-room occupancy buildings that provide the housing of last resort for low-income Chicagoans would be more costly to convert to market-rate housing, under a watered-down plan advanced Monday to help solve the city’s “low-income housing crisis.”

In spite of the changes tailor-made to appease them, SRO owners complained to the City Council’s Housing Committee that the financial burden they were being forced to bear was still too great.

That’s because it would prevent them from immediately selling their properties and require them to contribute to an SRO preservation fund — at a rate of $20,000-per-unit — to avoid any strings attached by the city.

Owners dead-set on selling specifically would be required to spend at least six months searching for a buyer who is committed to maintaining affordable housing for the next 15 years.

If the deal falls through, the clock would start again on a four-month period where the SRO owners could sell to any buyer. If there’s still no deal, the SRO owner would be required to try again to find a buyer committed to maintaining affordable housing.

In addition, SRO owners would be required to provide displaced tenants who have lived in the building for at least 32 straight days with one-time relocation assistance.

The compensation would range from $2,000 to $8,600 for most tenants and as much as $10,600 for those forced out because of unsafe conditions.

“It’s unfair for SRO owners to be singled out with special burdens for what is a community-wide [problem]… This would have a better result if we were to start by figuring out how to fund these kinds of housing choices in a general way,” said Lawrence Adelson, an attorney representing an SRO owner.

Adelson didn’t miss a beat when Ald. Bob Fioretti (2nd), a mayoral challenger, asked why the ordinance that has Mayor Rahm Emanuel’s formidable support could be “constitutionally impaired” under both state and federal law.

“First of all, you delay the sale. Those same sale and displacement allowance conditions also apply to your buyer in the event that your buyer continues to be an SRO. And that’s likely to depress the price,” Adelson said.

Julie Dworkin, director of policy for the Chicago Coalition for the Homeless, countered that the ordinance approved by the Housing Committee Monday strikes the appropriate balance between upholding property rights and addressing the pressing need to preserve the dwindling supply of SRO units.

In 1973, Chicago had 53,000 units of SRO housing, Dworkin said. Today, it’s down to just 6,000.

A survey of SRO buildings conducted by the coalition last year showed that two-thirds of SRO residents are older than 50. Nearly half suffer from mental or physical disabilities. And roughly 25 percent are military veterans, Dworkin said.

“Nearly half of those we surveyed reported that they would be homeless if they lost their current housing. Another 15 percent said they did not know where they would go,” she said.

Dworkin noted that “Chicago’s Plan 2.0 to end homelessness”  unveiled by Emanuel in 2012 projected that Chicago needs at least 3,500 units of affordable housing for single adults just to meet the needs of those already experiencing homelessness. Fewer than 200 units have been created since then while the North Side alone has lost 2,000 units of SRO housing.

No wonder Chicago’s network of emergency shelters has been operating over-capacity this summer and fall with an average of 70 families-a-night sleeping at an overflow facility. Meanwhile, more than 17,000 homeless households are waiting to be placed in permanent housing.

“Our city has an obligation to not move backwards when it comes to affordable housing resources,” she said.

“We’ve heard the concerns of owners. We understand that they have provided this source of affordable housing without city support for years. [But] with this ordinance, the city will now be establishing dedicated funds to support owners and buyers who want to keep the buildings affordable….[It] will go a long way toward preserving this housing. It will ensure that owners are supported in maintaining their buildings and fairly compensated if they wish to sell them.”

Monday’s Housing Committee vote sets the stage for the compromise ordinance to get final approval by the full City Council on Wednesday.

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