No doubt, lots of Chicagoans are having a tough time finding a place to live that won’t leave them broke.
Every area of the city, from Jefferson Park to the South Loop to Gage Park to Pullman, has a dearth of affordable housing, especially two- and three-bedroom units that are big enough for families, according to a report from the DePaul University Institute of Housing Studies.
In recent days, Mayor Emanuel has shown he’s paying attention, especially as the race for mayor builds steam. On Monday, he announced he’s bringing back the city Department of Housing that his predecessor, Richard M. Daley, had disbanded.
He’s also rolled out two housing initiatives:
• New homebuyer subsidies in six neighborhoods that were hard hit by the 2008 housing crash;
• A $30 million public-private fund to help developers buy and renovate apartment buildings in gentrifying communities, in exchange for a pledge to keep 20 percent of the units affordable.
We expect more such initiatives, and look forward to seeing how well each works. We certainly want to keep Chicago from turning into the next San Francisco, which is also a case study in why there is no silver-bullet solution. San Francisco has practiced rent control since 1995, but that hasn’t stopped the market rent for a two-bedroom apartment from soaring to $2,499 per month.
In that spirit, Chicago is right to take a hard look at strengthening its 2015 Affordable Requirements Ordinance. The ARO let developers sidestep requirements to include below-market rental units in new construction projects by paying into a fund to finance construction of affordable units elsewhere.
The ARO made sense, to a certain degree. Chicago got more affordable units, although fewer than the city projected, and the fund helped support subsidies for very low-income housing.
But the program also has been a disappointment. Developers, as it turned out, were willing to shell out up to $175,000 not to build affordable housing, especially downtown or in wealthier North Side neighborhoods. Most of the new units were built in low-income communities on the South and West sides that already have a glut of low-income housing.
So much for making a real dent in our city’s extreme racial and economic segregation.
Two pilot programs launched last fall, one in the Milwaukee Avenue corridor and another involving the Near North and Near West sides, won’t let developers off the hook. For the next three years, developers in gentrifying Logan Square, say, or part of the Near North Side will have to include a certain percentage of affordable units in new projects, period. No opting out by dropping money into a fund.
Plus, opt-out fees for the remaining percentage of affordable housing they were obligated to build will rise to $225,000.
The city promises to keep a close eye on the results. If developers keep building anyway — and early signs are that they will — the city should expand the pilot programs.
No one wants to keep developers from making a profit.
But Chicago has to do a better job of creating affordable housing throughout the entire city.
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