At the first in-person meeting in over a year, the Chicago City Council voted Wednesday to increase the percentage of affordable housing units developers are required to provide in projects receiving a zoning change or financial assistance from the city.
The updated Affordable Requirements Ordinance (ARO) doubles the number of affordable units from 10 to 20 percent for projects located downtown or in gentrifying neighborhoods. Officials hope the revised rules, which go into effect on October 1, will help address an estimated citywide shortage of nearly 120,000 affordable homes.
"This significant ordinance will lead to the creation of much-needed affordable housing units across our city," said Ald. Harry Osterman, who serves as chairman of the city's Committee on Housing and Real Estate and co-chairs Mayor Lightfoot's Inclusionary Housing Task Force.
"The ARO does not solve all of our housing needs in the city of Chicago but is a significant tool in the toolbox, and this ordinance moves our city forward in a very positive direction," Osterman said.
Developers can still opt out of constructing affordable units by paying "in-lieu" fees that support other affordable housing programs. A minimum of 50 percent of units must be built (either on-site, off-site, or across a combination of the two), which is up from 25 percent.
The revised ARO allows new units to be built in any area of the city lacking affordable housing. The legislation also incentivizes the construction of bigger family-sized units by requiring all off-site units to be two-bedroom or larger.
Drafting an ARO that boosts affordable housing without discouraging the same developments that support the ARO has been a tricky balancing act for the various community groups and private developers on the city's Inclusionary Housing Task Force.
Although some developers have publicly spoken against the new rules, it's worth noting that some areas of the city, including the red-hot West Loop, have already adopted a 20 percent requirement under a 2017 pilot program.
The new ARO passed the City Council by a 42-8 margin. A handful of aldermen voted against the ordinance because they thought the rewrite didn't go far enough to provide affordable housing and address the city's history of segregation and inequality.
Ald. Byron Sigcho-Lopez (25th) voted against the ordinance for not requiring on-site family-sized units. "We ask that our families are included in these projects," said Sigcho-Lopez. "Today in the city of Chicago, despite the rhetoric, this is not the case.
"It's disappointing that our real estate industry and developers get their way ... when it was very clear that an agreement [to require more family-sized units] was within reach," Sigcho-Lopez said.
Ald. Walter Burnett, Jr (27th), who voted in favor of the revised ARO, called the legislation "the best compromise that we can get at this time" and said the ARO keeps getting better each time the city updates it.
"[The new ordinance] gives us some flexibility, to not only build more affordable housing but get the cash to sustain existing affordable housing throughout the city," said Burnett. "It gives alderman some leverage and room to be creative with affordable housing."
