INTRODUCTION

Nobody wants to think about zoning laws (boring!), but in times of growth, they’re crucial. At their most basic level, zoning laws give assurances that homeowners won’t wake up one morning and find, say, a gas station being built next door. On a higher level, zoning laws determine the shape of a neighborhood and how it feels to live in it. It’s the whole idea of a planned community.

“Upzoning” trends that allow for more intense development are always real threats to Gladstone Park’s identity as a dense suburban-style community. It is sometimes difficult to be part a large city that pursues land use plans that are often at odds with where we’re going. If the neighborhood has any one mantra about its future development, it would be “stick to the zoning.” In other words, support the unique zoning choices that City Hall has long bestowed upon its unique neighborhoods that help maintain their characters. Embrace smart growth.

And why shouldn’t it? In designating every square foot of its 234 square miles of city lands for development many decades ago, Chicago deliberately zoned for different sorts of living conditions south, east, north, and west in order to create the diverse communities of which the city is so proud today. Neighborhoods mean something in Chicago. They give all the peoples who move to the Windy City, whether they’re Poles, filmmakers, Muslims, gays, Ukrainians, or techies a place to live that feels like home. Character is what residents of different neighborhoods treasure…while trends come and go.

Residents who come to Gladstone Park, a community long set up for low-rise, spread-out development, sign up for a lifestyle that’s easy-going and family-friendly even if it isn’t as exciting or culturally rich as other closer-in, more built-up areas of the city. If too much unwanted growth starts surrounding them, they will feel forced out of their beloved homes and into the suburbs for the same lifestyle they now treasure where they are.

Of Chicago’s nine major zoning categories, Gladstone Park is set up with designations for the least intensive uses. For example its N. Milwaukee Avenue Business Corridor is nearly all earmarked B3-1, requiring storefronts along it to have the biggest lots (2,500 square feet per dwelling unit, if any) as compared to four other B3 zones that reduce required lot area per unit all the way down to 200 square feet that allow for 18 times the number of households. While increased density may be desirable in some Chicago neighborhoods such as the Loop with its spectacular skyscrapers, it is perceived as overcrowding in communities such as Gladstone Park with most of its residential zoning RS-2 or RS-3 for single-family districts. The community’s Industrial Corridor, too, is a mix of M1-1 and M1-2 for business parks allowing only limited manufacturing and light industry, keeping pollutants and noise to a minimum. The public can examine the zoning designations for every lot in Gladstone Park (and the whole city) on the interactive Chicago Zoning and Land Use Map.

As was discussed in Development Threats, Gladstone Park has had a much more difficult time recently managing its growth. One might surmise from the battles it has faced that the city has developed new goals for the community that differ from how the neighborhood was originally set up. Sometimes initiatives change with new political administrations, empowering developers to push the envelope harder against existing masterplans with the thought that the implicit approvals for nonconforming projects are already there. Other times, different ideas evolve in an effort to meet modern sensibilities about what makes livable, healthy, equitable, and economically-viable communities. While Gladstonians champion progress as much as any other group of people, they know that all growth isn’t smart growth. When it becomes too difficult for the community to protect its residential character or to revitalize its business and industrial districts in positive ways that suit the area, there’s grave dissatisfaction.

It’s not like Gladstone Parkers don’t know they are merely one small far-out cog in the huge wheel that is Chicago. Living in one of 226 recognized communities within 77 “official” neighborhoods with a location 10 to 11 miles from the Loop, they sometimes find it hard to gain the city’s understanding of and respect for their one square mile territory. Regarding housing, they often have to wonder if officials have ever actually stepped foot into their enclave as it tries to force taller, denser buildings into an area that has always staked its claim on its low-rise, low-density character. And residents have seen the city doing little to add infrastructure improvements to attract interest to the business district akin to the fancy brick sidewalks or new lighting that has gone into other neighborhoods closer to downtown. Instead the Milwaukee Avenue Commercial Corridor has been left with unmaintained, dangerous planting bed bumpouts loaded with weeds and litter at crosswalks, degrading its appearance for local shop owners.

So how can Gladstone Park go about reversing this dynamic? Governmentally and politically, it has no legal or financial power to plan its own future. It doesn’t have its own town planning board to forge its future growth. There’s no dedicated zoning board within its borders to adjudicate building proposals. Plus it has no budget of its own to fund beautification or infrastructure improvements. Every request must be funneled through through their alderman into city channels with all the associated red tape. Much gets buried in oblivion.

And no one yet knows if it will get even harder to have their voices heard after the century-old unwritten tradition of aldermanic prerogative was breeched in December, 2021 over an affordable housing battle in the nearby O’Hare neighborhood. When the 50-member City Council voted for a project the local alderman had deemed not suitable for his ward’s constituents, it set a precedent that cast Gladstone Parkers and other smaller communities adrift wondering if they had any home rule left.

For Gladstone Park to have any kind of self-determination in this climate, it must first and foremost stay on top of the city’s new planning initiatives, the most important of which are outlined below. By keeping up-to-date on the specific zoning problems the Far Northwest Side could face, the community can continue to respond appropriately while developing positive strategies to regulate growth. Too, residents can endeavor to improve on their image of who they are as a community, dispelling the old stereotypical, disparaging narratives that have been bandied about by others who don’t understand that the area has evolved. That will give Gladstone Park a more formidable chance to forge into the future with progressive new standards for housing and businesses while maintaining the kind of community the city planned for it in the first place.

BUSINESS DISTRICT UPZONING

Many neighborhoods in Chicago have been gentrifying over the past ten years with wealthier people moving farther out of downtown into less-well-off areas. While their money improves down-on-their-luck neighborhoods, boosting property values and attracting new business investment, it also has the negative result of raising real estate costs and forcing out smaller local businesses and long-standing residents.

With gentrification occurring just south and east of the Far Northwest Side, land values have been skyrocketing. Spurred on by the real estate crashes of the Great Recession of 2008 (and to some extent, the pandemic), investors have set their eyes upon Gladstone Park. Many little-used commercial properties and vacant lots on its Business Corridor are now in the hands of speculators who are only biding their time until the price is right.

With the winds that have been blowing in Chicago, these speculators are betting that they can hold onto their properties and wait for a big return on their investments. Their only intent is to get in and get out. With no interest in renting or leasing their storefronts or office buildings, owners have no need to put money into improving or even maintaining these commercial buildings beyond the bare minimum. Instead they leave the properties sitting vacant without investing a cent in the community. These speculators score the most by selling to big developers who have the pull to win zoning variances from the city to get the properties “upzoned” in order to tear down the smaller buildings to build tall, dense apartment complexes that otherwise would not have been allowed. The beauty of the investors’ strategy is that residents get worn down seeing dilapidated storefronts on their streets, making them more amenable to approving plans for buildings they otherwise would not have wanted. It can be tempting to conclude, “Well, anything’s better than what’s there now.”

Because derelict buildings pull the whole commercial corridor down and discourage further investment, the Chicago City Council recently acted on a measure sponsored by Far Northwestern Alderman Anthony Napolitano (41st). On June 12, 2024, the city’s governing body approved an ordinance that will mandate storefront owners who are not actively trying to lease or sell their properties to register their properties as vacant with the Department of Buildings. The new designation will come with requirements that owners post notices of their vacant status, remove inactive signage, maintain additional liability insurance, and pay new fees of $100 every six months.

But if Gladstonians give way to big housing projects along their commercial corridor, they would be confronted with a double whammy. Not only would big apartment buildings pack more people with needs for city services into a smaller area, but also they would replace the small, low-rise business buildings that provide residents with stores, offices and restaurants…essentially their “downtown” conveniences and pleasures. Put together, such development would change the entire fabric of the community from a working village to a soulless bedroom community populated only with high rise housing complexes with all the stresses of traffic congestion and parking woes that go with it.

It’s not just a cautionary tale; it’s a pattern. Gladstone Park need look no farther than Jackowo, the nickname for Chicago’s last great Polish neighborhood in Avondale/Irving Park just to its south. Real estate authorities had been predicting for 15 years that the community would be the next hot market, spurring investors to snatch up properties, tear down smaller buildings, and erect expensive condos and apartments, as recounted by Mary Wisniewski and Joanna Marszalek in The Death (and Possible Rebirth) of Jackowo in the February, 2022 Chicago Magazine. Rents rose throughout the neighborhood, forcing long-time Polish residents out.

The gentrification of wealthier people moving in led to parallel rent increases on business properties, pricing out local shop and restaurant owners while paving the way for a few deep-pocketed national chains (and fancy boutiques and chic salons) to come in. Meanwhile, storefront vacancies along the once vibrant Milwaukee Avenue business corridor soared to 40 percent as investors waited for the next Starbucks to move in and upgrade their lots’ values.

Ethnic and income diversity in the neighborhood suffered. Same-old, same-old stores and franchised eateries opened up. The vicious cycle left a blandness that Wisniewski and Marszalek conjectured could leave people without a reason to want to live there.

When properties are bought up by speculators, particularly if they are real estate trusts or out-of-state landlords, there is no thought for what the neighborhood actually becomes, the authors say. They caution that the only remedy for successfully transitioning communities like Jackowo is for the city of Chicago to step up with the right combination of zoning changes and tax policies to balance free market forces that otherwise focus solely on profits.

The gentrification of Logan Square yields a similar story. Two decades ago it was gang-infiltrated and one of the deadliest police beats in the city until investors began snatching up decrepit old greystones for cheap, repairing them, and spurring a turnaround. Pretty much all the working class and immigrant families who once lived there, along with their unique businesses, were displaced by the higher costs of living, as detailed in The Chicago Tribune’s “Logan Square, this pinch hits home”. Ironically, the online representation titled it “As Logan Square reinvents itself, the spotlight on affordable housing has never been brighter,” but in both cases, the same article ended with a discussion of the efforts of several nonprofit groups to build a couple of complexes with apartments locals could afford, replacing what had been available earlier. Advocates deemed the effort “a drop in the bucket” compared to what had been lost.

The problem is, there are many schools of thought on how to do what’s best for communities such as Jackowo (or the South Shore or Gladstone Park). On one side of the Jackowo debate is Alderman Carlos Ramirez-Rosa (35th Ward), who promotes downzoning to preemptively prevent speculation and teardowns. In other words, if an older, but perfectly good two-story building is on a lot zoned for four stories, downzone the lot for two or at the most three stories to protect it. Otherwise, investors might buy it and keep it vacant while waiting for a buyer to knock it down and replace it with a four-story building to match the upzoned lot.

On the other side is Alderman Ariel Reboyras (30th Ward), who actively recommends upzoning because, he says, the numbers of extra people who come into five- and six-story buildings bring their wallets and footpower to support more neighborhood businesses. The authors quoted him as vowing, “The only way to rebuild the business community is to add density. How do you do that? Allow them to build up.”

Community activists hit upon a different solution in Chicago’s Logan Square when the wealthy started snatching up decrepit greystones in the gang-ridden, violent neighborhood some 20 years ago, creating a wave of gentrification that forced out thousands of Latino immigrant tenants and businesses. In order to keep some of its cultural identity, they supported nonprofit redevelopment companies dedicated to restoring older houses, three-flats and apartment buildings. Affordable units were carved out and preserved for its long-term residents.

Speculators banking on gentrification in Gladstone Parkers put the community between a rock and a hard place with their aims so disparate from what is good for the neighborhood. Are there any ways such commercial building owners can be persuaded to upgrade and lease their existing structures rather than hold them in abeyance for some future payoff? Can they be instead convinced to make improvements that increase the vibrancy of the Business Corridor even as they wait for a return on their investments? Knowing that speculators’ objectives are all about money, can Gladstone Park further that aim by tapping into incentive programs that make it worth developers’ whiles to buy into revitalizing the commercial district? Can it further help by setting up some sort of special shopping zone to give the area the kind of cachet that will make more business owners want to gravitate to operating in the community? Could private capital through the federal Community Reinvestment Act, for example, be used to start businesses and support entrepreneurship in building a more economically sound commercial corridor while maintaining the working and middle class populations of Gladstone Park? How about establishing a city-supported Special Service Area like the nearby Six Corners Chamber of Commerce manages in funding beautification, promotional, and maintenance elements in its business center?

While perhaps controversial in some areas, Ald. Jim Gardiner (45th) has so far been very helpful in keeping the Gladstone Park Neighborhood Association informed about all building projects and requests for zoning variances that have come across his desk. Unlike the ward’s former alderman, John Arena, who went behind the community’s back in foisting a too-tall building onto it that most felt didn’t belong, Gardiner acts differently. He described his zoning review process in the November, 2019 Nadig Newspapers as initially seeking GPNA input before holding community meetings to hash through building proposal details. “I was voted in to represent the interests of the community,” he was quoted as saying the night after the Chase Bank redevelopment meeting, “and if the community doesn’t want it, I’m against it.”

As for businesses traditionally considered undesirable, Gladstone Park has some in the form of pawn and payday loan shops, tattoo parlors, and vaping and tobacco stores. It also has a number of car lots on its main drag that some residents feel might be better placed elsewhere. But it is apparently about to say goodbye to the pot shop just across its border, approved by the city in 2016 over strenuous objections of the local community. On May 23, 2022 The Chicago Tribune reported that while cannabis dispensaries had at first opened in unobtrusive, out-of-the-way sites (such as in Norwood/Gladstone Park), they were increasing seeking to relocate to vibrant, upscale areas (like River North). While it’d be tempting for Gladstone Parkers to take umbrage over remarks that the “flourishing” cannabis industry was looking to expand to “pricier, high-profile sites,” it might be at the same time be beneficial to look at the situation from the other side. Maybe it isn’t so bad a big pot corporation wants to leave because it doesn’t want to continue selling weed in the community’s low-rise, spread-out, family-friendly community.

Although many commercial properties are currently sitting vacant in Gladstone Park’s Business District, Propertyshark, a real estate listing conglomerator, was advertising only three as available in the Gladstone Park area as of June 15, 2022. An .18 acre piece of vacant land at 5360 N. Milwaukee was for sale at $499,000. Two other retail properties were available for lease: a 12,900 square foot space in the Associated Bank Building on .31 acre at 5200 N. Central and a 1200 square foot retail opportunity on .07 acre at 5717 N. Elston. A few buildings or lots also have for sale signs on their holdings through exclusive (unadvertised) listings. The big question is: what are the owners of all the other commercial storefronts obviously sitting vacant in Gladstone Park planning to do with their buildings?

THE INFLUENCE OF COMMERCIAL PROPERTY TAX POLICIES

Gladstone Park isn’t the only neighborhood in the city tangling with how to plan for the future of its commercial corridors. On the clear opposite end of Chicago, the South Shore Coordinating Council (SSCC) is similarly debating how to economically, educationally, culturally, and environmentally improve its commercial landscape for its residents. A coalition of business owners, faith-based institutions, educators, elected officials, chambers of commerce, social service and artistic foundations, the SSCC has the advantage of being able to coordinate action with and obtain financial support from Former Mayor Lori Lightfoot’s signature INVEST South/West plan, one of the lasting legacies of her administration. Geared to reverse decades of disinvestment in 10 communities and 12 commercial corridors on Chicago’s South and West Sides, the program is funded with $2.2 billion of private, philanthropic and public grants.

Gladstone Park doesn’t pretend to suffer from the chronic underinvestment that has taken place over many years in the city’s Black/brown disadvantaged sister communities. Nor can it claim to be fighting the same high rates of poverty and violence. But it does have much in common with South Shore neighborhoods when it comes to the cascading effects that result from some of the city’s public tools that, inadvertently or not, can damp down rather than foster business vibrancy. It’s not only zoning ordinances that can impose sometimes onerous regulations. It’s also the city’s tax policies. Perhaps Northside communities could take a page from SSCC’s Quality of Life Plan book as it has begun examining to some of Chicago’s ill-thought-out tax policies that affect the commercial corridors in all city neighborhoods.

Detrimental tax policies have long been acknowledged to contribute to the rash of vacancies in Chicago’s neighborhood commercial corridors. Illinois Representative (now Senator) Robert Martwick, tried to get a statewide prohibition against the practice of commercial properties being deliberately kept vacant in 2019. The Vacancy Fraud Act proposed allowing complaints to be filed and penalties assessed through County Boards of [Tax] Review if property owners were found not to be “actively attempting to lease, sell, or alter the property.” Unfortunately, statewide business lobbyists doomed the bill to failure.

That’s why SSCC’s organization, which serves Oakland, Kenwood, Washington Park, Hyde Park and Woodlawn, stepped up and went after the local Cook County Assessor’s Office (CCAO) that administers property taxes in the city of Chicago. In an effort to decrease absentee ownership of chronically vacant commercial buildings, it proposed more helpful tax policies as outlined in The Chicago Tribune’s November 14, 2022 article “South Shore facing its future.” In urging Cook County to enact legislation against commercial property owners who deliberately keep their storefronts vacant, the Coalition seeks to more firmly support established businesses and seed the development of new ones. Because while CCAO Assessor Fritz Kaegi’s current practice is to cap the number of times a business owner can receive tax breaks for keeping their properties vacant at two years, that policy is not enshrined into law and can thus change at whim.

Admittedly, the Cook County Assessor’s Office (CCAO) treads a fine line when it comes to vacant commercial properties, especially considering its goals for encouraging responsible ownership while discouraging abandonment due to regulations too tough to meet. Yet by relying too heavily on the position that “some level” of commercial property vacancy is “normal and expected,” it is more likely to excuse buildings that are not serving their intended purposes “due to conditions out of the control of the property owner, such as casualty events or other localized factors.” And while CCAO also reduces tax assessments for some vacant or abandoned properties in an effort to promote economic development and neighborhood vitality, commercial and industrial properties qualify only if they are environmentally-contaminated.

While not all commercial building owners take advantage of current Cook County tax policies that make it more profitable to maintain vacancies than to utilize their buildings for businesses, enough do to affect the vitality of entire Chicago neighborhoods. Small business advocates along Chicago’s blighted South Shore commercial district point to the fact that half the storefronts along 79th Street and three out of five on 75th Street are shuttered…easier to stay closed than to open back up. In “Some landlords keep their storefronts empty for years—and get tax breaks for it,” Maxwell Evans of Block Club of Chicago documents and details how business leaders want to reverse that trend.

There are understandably many reasons for empty storefronts. Commercial landlords legitimately may not have the money to bring their properties up to code so that they can be opened for business. But does it really help to give speculators tax breaks that make it more worth their while to do nothing with these storefronts–or tear them down–rather than helping them make them useful again at reasonable rates for Mom-and-Pop businesses?

What about other commercial landlords who look to save themselves from the hassles of leasing by purposely demanding rental amounts too expensive for local entrepreneurs to sustain commercial activity? Does it pay to give them tax breaks to maintain their vacancies as they leverage their investments for the greatest profit? And what good does it do to foster or even just tolerate absentee business landlords as they play the waiting game, staying out of reach of potential entrepreneurs looking to lease storefronts, with intentions only to resell their properties once they increase enough in value?

While single commercial property owners do have the opportunity to apply for grants of up to $250,000 leading to the construction or rehabilitation of new stand-alone and existing commercial spaces from the city’s Neighborhood Opportunity Fund (NOF) as administered through Chicago’s Department of Planning and Development, eligibility requirements limit their use. At the current time, such projects must be located in specific areas of the city’s South, West and Southwest sides that have been identified as disadvantaged. Although it might and does have many vacant commercial properties, a neighborhood such as Gladstone Park in the Far Northwest Side simply doesn’t qualify.

The South Shore Chamber of Commerce (SSCC) thinks destructive tax policies can substantially contribute to community disinvestment in their commercial districts. Tonya Trice, SSCC’s executive director, vows that when the county grants reduced taxes on vacant properties, businesses are prevented from opening and providing services, amenities, and jobs. The organization’s solution is to lobby for a county ordinance to cap the number of times a property can receive a vacancy tax break to three times every 10 years with the hope it will be enacted in 2023. The proposal has the support of the Small Business Advocacy Council as well as the South East Chicago Commission, whose co-founder Elliot Richardson was quoted in the Block Club article as saying, “It’s crucial to revitalize commercial corridors now–especially coming out of this pandemic…” Other members supporting the ordinance are Logan Square, North Lawndale, Greater Englewood, Uptown, Cook County Black Chamber of Commerce and the nonprofit Building Strong Millennials. Maybe more communities on the Northwest Side of Chicago, including Gladstone Park in the Far Northwest, should get in on the action to help reduce the blight in their commercial corridors, too.

On the opposite end of things, some people think there are not enough tax incentives in Chicago to encourage those owning business properties to pull their properties out of vacancy status. They suggest programs that would, for instance, rebate property taxes in any one year to commercial property owners for the express purpose of applying the funds directly to repairs and improvements. Once those properties are brought up to code, they can then be reopened for active businesses. So far little on this line has been seriously considered.

TAX INCREMENT FINANCING (TIFs)

A slew of vacant lots on a polluted former industrial area. A local town’s desire to see an affordable housing complex built there. Maybe above a row of retail stores, possibly with road repairs. But no developers willing to invest their resources in the community-designed project because they don’t think it would be profitable enough.

Enter TIFs (Tax Increment Financing). A powerful economic development tool, the TIF makes it more likely for any town or city across the United States to be able to convince private building corporations to take on the risk of constructing desired projects in disadvantaged areas they would have otherwise avoided. With its dual incentives (bonds and future taxes), they go way beyond straight sales tax breaks and/or property tax abatements that governing authorities have traditionally granted to private corporations for the purposes of building new sports arenas, attracting the film industry, or spurring manufacturers to open new plants in exchange for guarantees of jobs.

As a specialized building incentive program, the TIF was designed for cities and towns to use to revitalize neglected areas with private building projects that cycle to spur further development. Although regulated differently in each of the states, the financial development tool works generally the same way nationally as pictorially represented by West Linn, Oregon’s chart below.

Because TIFs are specifically designed for improving geographic areas that have fallen on hard times, they have a limited but higher purpose. Often this means using the “but-for” test, as in “Would this private project our community badly needs not have been built but for the money the public provided through the TIF?”

Taxpayers living in financially-strapped municipalities are assured that TIFs are specifically structured so that their towns and cities can make improvements without tapping into general funds or directly raising property taxes. The public subsidies given to the private developers to help jump start the projects communities want them to build come from borrowed money the communities raise by issuing bonds. The thinking is that paying back the principal and accrued interest of the bonds is fairly easy, as the money to make those regular payments can come out of the future taxes generated by the development as it grows in assessed value. And those future taxes can also support paying for additional improvements in the TIF District without anybody missing revenues they never had before. It would be like getting something for nothing.

Except that’s not quite how it worked out. Bonding to subsidize private developers—i.e., using public money to take out loans to give to for-profit corporations—sometimes has more ramifications than anticipated. And restricting the municipality from using the additional taxes that come from the increased value of the development for its own expenditures, instead of mandating they be channeled back into the TIF District, has not been as painless as expected. Compounding the impact is the fact that the TIF commitment, as written into the updated 2010 Illinois Tax Increment Allocation Redevelopment Act, lasts such a long time (an initial 23 years, renewable for 12).

Understanding the financial development tool’s ins and outs is the taxpayer’s only way to fully evaluate whether any one TIF will be a benefit or a detriment to his or her municipality. Official explanations are often unhelpful, all of them bandying about the same complicated financial terms such as “equalized assessed value,” “the increment” and “clawbacks” instead of describing aspects of the law with language everyone’s familiar with. When you add in the frequent lack of accounting transparency on top of the enumerable exceptions to the rules that are baked into Illinois’ extremely flexible law, the TIF becomes even more difficult to fathom.

Where’s the TIFs for Dummies book we all need? Is artificial intelligence the only resource we can depend on to weigh in on the financial tool’s pluses and minuses when it points out that while TIFs can help align private building with public policy goals by filling funding gaps between developers and municipalities, it can (and often is) misused? Is AI the only clear voice when it credits TIFs for supporting economic growth and infrastructure improvements in blighted areas, but criticizes them for being used in circumstances that often instead benefit wealthier parts of towns and cities (the wrong people) while taking taxpayer money away from public services for all?

So how do TIFs work? In its simplest form, the municipality first identifies a needed project in a blighted area, such as a commercial revitalization of its downtown or the conversion of a contaminated factory site into an entertainment district. It sets geographical boundaries for the District where the building activity is to occur. Then it links up with a private developer, issuing bonds to provide enough upfront money to pool with the construction company’s own funds to make it financially worthwhile for it to consent to get the desired TIF project off the ground.

The bond issuance part of the TIF formula has always been fairly cut and dried. Just like a homeowner taking out a mortgage to buy a house, the municipality goes into debt to get a sum of money for the purpose of linking with a private developer who commits to taking on the desired building activity. Interest rates vary according to market conditions and the diversity of the town’s or city’s taxpayers (not the same as the municipality’s general bond rating.) The advantage of the bond is that a town or city always knows exactly how much its payments will be for principal and accrued interest as spread over the lifetime of the TIF.

It is the second stream of money the TIF provides to the developer—the “increment” of the development financing tool’s name—that breeds the most confusion, uncertainty, and controversy. For this second incentive, the town or city agrees to freeze the the developer’s annual taxes at the same base amount it had been collecting on the TIF District property before a shovel even went into the ground. In other words, it agrees to let the developer pay the same approximate amount of taxes annually as it had been paying at the very beginning for the next 23 (or 35) years the TIF is operating.

This doesn’t mean that, as sites are remediated and buildings built, the TIF District is not continually reassessed for its increased value. It is. Just like anyone who adds a room onto his or her house and increases its worth, extra taxes are levied. But the additional tax amount generated by TIF improvements—aka the increment—is collected and put into a dedicated account. The municipality is tasked with managing this steady, often swelling stream of revenue, but is prohibited from using any of it to pay for the rising costs of schools, police, road repairs, or other regular services. Because, by law, the extra or incremental taxes generated by the TIF District’s increased worth, must go back into the TIF to make bond payments and fund additional projects in the District…even when there’s no longer any use for it. It is only when the TIF ends 23 or 35 years later that the municipality can collect and put all taxes produced by the former District into its own treasury to spend as it sees fit. That is, unless the TIF-forming body writes exceptions into the agreement such as reserving 10% of the increment’s extra tax money annually for schools or exempting housing project income from paying into the pot.

To better understand the basics of how a TIF increment works, it helps to look at a pictorial representation of the mechanism, as mounted on Hanover Park, IL’s TIF site.

As promising as TIFs were from the time they were enacted in Illinois in the 1950s, they have been enthusiastically employed by local municipalities as the public financing method of choice to get hoped-for projects built in needy geographic areas of their communities. But almost from the beginning they have also been misused…and not just by Chicago Mayor Richard M. Daley when he steamrollered the city using TIFs to fund his building blitz during his 1989-2011 administration. And that is the one biggest rub.

For although Illinois municipalities are not supposed to be able to qualify for a TIF wherever they want for any purpose, you’d hardly know it. It seems as if any city or town can satisfy state TIF law for identifying an area as disadvantaged and in need of public development money for a project they want built. Because to establish a TIF District, a municipality only needs to cite there is “blight” in its geographic location by proving it has one of the following factors:

*advanced dilapidation of industrial structures

*properties needing environmental remediation

*ill-maintained housing that doesn’t meet zoning and/or safety codes

*excessive numbers of commercial vacancies with tax delinquencies, or

*obsolete or inadequate community facilities

In reality, almost any proposal in poor or rich neighborhoods has historically been able to come up with ways to qualify.

Which is why when three of the more dubious TIFs were implemented in the greater Chicago area in 2024, Illinoisans cried foul. In January, Aurora, IL committed a $50 million chunk of its taxpayers’ money in the form of a TIF bond toward the relocation and construction of a new $360 million casino and hotel in their city. And in March in nearby Niles, IL, village trustees approved a $1.2 million TIF to attract a James Beard award-winning chef to renovate and open a new Greek restaurant on busy, four-lane N. Milwaukee Avenue where an Italian restaurant had operated successfully on its own for years. On a roll, that same municipality put out $96 million of its taxpayers’ money for a TIF bond in June towards the $440 million redevelopment of its 60-year-old suburban Golf Mill Town Center [Shopping] Mall that would include a new residential component.

Sheer numbers tell us that Tax Increment Financing districts—both those acknowledged to be in disadvantaged areas with goals of benefiting needy residents and those in wealthier areas with more questionable objectives—have proliferated in Illinois. The Prairie State ranks sixth of all 50 states in establishing over 1,000 TIFS each, followed by Iowa, Minnesota, Texas, Ohio, and Wisconsin. And as of 2022, there were 127 active TIFs in Chicago alone according to The Civic Federation, making it the most TIF-friendly city in the country.

If a town or city has only one or no more than a few smaller TIFs, the impact on its municipal budget can be fairly inconsequential. But with over 100 TIFs in the city of Chicago, millions of dollars of extra taxes (the increment) are collected on the increased value of property within the development districts that are excluded from its general treasury. Reserved for and thus returned to its TIF districts, these additional revenues by law are diverted from the the city’s coffers so that they are unable to be used for general expenses such as public safety, education, libraries, and roads. How Chicago’s Controversial TIF Program Took Over a Third of the City, a 2018 study by Northwestern’s Medill School of Journalism, illustrates in graphic form how a whopping 12.5% of the city’s property taxes were at that time tied up in TIFs for a commitment of at least 23 years each.

More detailed information on current Chicago TIF districts can be sought from The TIF Illumination Project, an ongoing local investigation project that takes an in-depth look at the negative impacts TIFs have on the City of Chicago on a ward-by-ward basis.

A municipality takes on many risks when establishing a TIF. At its most fundamental level, if the project is a dud, the results disappoint residents who were supposed to benefit while not improving the socioeconomic prospects of the community. If the project sticks a municipality with an underused retail district or poorly-positioned apartment complex, it can become more of a problem than the undeveloped property was before any building activity took place. Since public forces don’t have ownership over the private development, they have little control over how it’s run. If yearly TIF enhancements such as improved roads and lighting are unable to invigorate it, spending more is like pouring good money into bad. But perhaps even worse, a failed project means that the property does not go up in value, the future property tax (the increment) does not increase. The town or city is left holding the bag with nothing to show for it, yet still has to make payments over many years of time out of its general funds to pay for the up-front bond it awarded the private developer.

Ironically, even though TIFs are geared to broadly improve the areas they are in, not everyone, even in needy neighborhoods, has been happy with the results. An uprising in Chicago’s Pilsen community over the city’s plans to expand the geographical area of its TIF—first implemented there in 1998 when it was truly down and out—made the front page of The Chicago Tribune in September, 2024. Yes, while residents were at first pleased to get improvements to the community’s library, schools, and parks, they then became subject to the increased property values the TIF projects created, raising costs of living the residents could hardly afford.

Pilsen’s TIF district residents had long complained the TIF initiative amounted to no more than a handout for private developers, taking much needed revenue away from expenditures for the common good. But when long-time small businesses and residents began drowning in increasing property taxes, forcing many of Pilsen’s Hispanics out, they rebelled. Replaced by wealthier non-Hispanics in a process known as gentrification, the neighborhood’s entire culture began changing. As if to beat locals on their heads more, advocates for the Pilsen TIF expansion project are trying to alleviate future damage by proposing to compensate upended residents with direct property tax relief from the financial tool’s surplus…even though that practice is now forbidden by state law.

Meanwhile, TIFs have been responsible for spurring neighborhood resentments by pitting sections of the city without any glittery TIF projects against those within the subsidized private developments. A September, 2024 letter writer to The Chicago Sun-Times called the financial development tools “diversion TIFs,” alleging they created “shadow budgets” forcing the city to have to extract more taxes from non-TIF areas to cover the tax money (the increment) TIF neighborhoods are tying up in their districts in order to get desired projects built. If all Chicago communities come to believe they are paying more in property taxes to make up for surrounding TIF districts not putting their fair share into the general treasury, then every section of the city will need a TIF to stay even.

Many critics agree, pointing out that the negative impacts TIFs have on municipal budgets might be lessened if the financing tool didn’t have such long terms. The original idea was to set the financial tool’s length so as to provide enough time for the municipality to pay back the incentive bond out of the future taxes that arise from the increased value of the development (the increment), leading to about half of all states to design their TIFs around a lifetime of 20-29 years, according to the Council of Development Finance Agencies. In its 2015 State-by-State Report the CDFA, comprised of the nation’s leading public and private development finance agents, revealed that only a handful of states limit their TIF lifetimes for fewer than 20 years, yet some 11 had amended their statutes between 2012 and 2015, some altering the tool’s length or qualifying it.

In Illinois, TIFs are set up to last 23 years long with an optional renewal period of 12 more years. The problem is that only after the TIF ends are properties in their districts fully released to the tax rolls with towns and cities able to collect the higher taxes based on their updated values for their own treasuries. Taxpayers must always remember that the total amount of property taxes to be collected for their municipalities for any one year is set. So if tax amounts are lower in one area, they have to go up in another so that their town or city can gather the total number of dollars it needs to operate. The property tax pie is the property tax pie…it’s just split in different proportions according to who gets what.

But the most contentious aspect of TIFs has always been around the uncertainty revolving around the increment, that extra tax amount collected after the project’s increased viability boosts the district’s property value over the next 20-30 years. These additional annual taxes became a steady stream of revenue that nearly always outpaces the original benchmarked amount of tax revenues municipalities are allowed to collect and use for general expenses based on what the property was worth before any improvements. When the increment quadruples or even increases tenfold in value annually, the resulting revenues that go back into the TIF can amount to thousands if not millions of dollars. The wrinkle is that if the TIF district runs out of any real use for the increment, the money becomes “surplus” with an indeterminate future.

In its practical application, it is not uncommon for towns and cities to run out of TIF improvement projects 15 or 20 years down the road, sometimes well before the TIF expires. At the point that the unused increment money is not needed and becomes “surplus,” the extra taxes that make up the increment is up for grabs with few guardrails regulating what can be done with it. Provisions in Illinois’ TIF law allow the town or city to repossess (“claw back”) the unspent monies to spend in almost any way it wants. Municipalities have been known to come up with inventive yet legal ways to move this surplus into different bank accounts, often accounting for it in creative fashion if they account for it at all. Although any such surplus is supposed to be refunded back to the tax bodies and schools that would have otherwise been the recipients, recent revelations have identified cases where monies were instead used to balance city budgets or were even taken from one TIF and put into the account of a completely different TIF. Fiscal maneuvers such as these can be made “under the radar” without any community oversight, as The Chicago Tribune revealed in 2023 after discovering that the city had, since 2020, started quietly taking nearly $140 million in pooled surplus funds from surrounding TIFs to put into the bank account of the unrelated Lincoln Yards/the 78 TIF. Many Chicagoans, dismayed over what they saw as misappropriated public money, could do nothing about it.

Turns out the public shouldn’t have been caught so unaware, as that squishy practice had gone on for years in the city. A The Chicago Tribune analysis in 2023 revealed that more than $740 million in TIF surplus had been transferred from one TIF district to another over the previous six years instead of being refunded back to the schools and/or general treasury as protocol would dictate.

So it’s no wonder the Illinois Families for Public Schools has long denounced TIFs for robbing schools, parks, and public colleges of the funding they need. To illustrate the phenomenon, IFPS touts its illustration showing dollars flying out of money bags containing TIF development projects’ extra tax revenues (the increment) and over the roofs of their schools. Maybe then it wasn’t a surprise when CEO Pedro Martinez proposed to repossess the city’s nearly $1 billion dollars of surplus TIF money for Chicago Public Schools to plug holes in its budget in October, 2024, as detailed by Chalkbeat Chicago.

Weighing in, The Chicago Tribune published an editorial dead set against the idea of CPS taking the TIF surplus back from the unused extra taxes (the increment) for its schools. The newspaper’s take was that since TIFs are an unrivaled and indispensable development tool, their surpluses must not be raided for other purposes even if they sometimes seem like “mayoral and aldermanic piggybanks [that] reward deep-pocketed developer friends who don’t need the money.” All of which leads cynics to wonder whether it’s possible that once government officials fully figured out how TIFs work, they began manipulating them for their own political benefit…not blamed if they failed some 20-30 years down the road when they were out of office or (if still serving) able to use their eventual surpluses as cash cows they could do anything they wanted with.

Accordingly, Paul Vallas, the former city budget director and unsuccessful 2022 Chicago Mayoral Candidate, was one of the first to call TIF surpluses “slush fund(s).” In his The Chicago Tribune opinion piece Five key ways TIFs should be reformed for Chicago’s benefit, he proposed new regulations firming up how the financial vehicles could be allowed to operate. In a further opinion piece How Chicago can save itself from the financial abyss, Vallas claimed that the city had claimed a $1 billion “windfall” in TIF surpluses the previous three years, although it was his contention that some 50% of that that should have been designated exclusively for the plagued CPS employee pension fund instead of going into the public school district’s general funds.

The Editorial Board of The Chicago Tribune sounded the alarm in June, 2019 in another opinion piece about how TIFs are being abused in the city. Citing a long history of the financial development tool’s misapplication, it pointed out there have been far too many TIF districts established in the wealthy areas of the city (i.e., the Loop). It proposed clarifying the rules to prioritize projects that actually improve life for “regular” Chicagoans. Most importantly, the Board declared it was time for a new approach to city investment altogether.

Former Chicago Mayor Lori Lightfoot agreed, releasing a statement during her administration (2019-2023) criticizing the city’s TIF process as “warped, causing division and trauma to the people and communities TIFs were designed to protect.” Although current Mayor Brandon Johnson himself has not been shy about using TIFs for pet projects, he has also made it clear that he feels TIFs are “a wrongheaded development tool” because of the inequity they have caused. Both Black mayors, along with Aneel Chablani, chief counsel of the Chicago Lawyers’ Committee for Civil Rights, have broadly indicted TIFs for too frequently locating them in advanced areas that don’t need them as well as for causing areas to gentrify so that wealthier folks move in, displacing the original inhabitants who were supposed to be helped.

The powerful Chicago Teachers Union has also weighed in, issuing a statement October 9, 2024 calling for Chicago to “De-TIF” the city. “Chicago has an obligation to fully fund and staff its public school program,” it wrote. “Wealthy downtown developers and commercial real estate…shouldn’t get million dollar bailouts when students go without libraries or mental health support.” How do they recommend Chicago De-TIF to solve Chicago Public School’s budget crisis? Echoing the plan put forth by CEO Martinez, CTU advised “clawing back” nearly $1 billion currently sitting in city TIF surplus accounts, money that would have gone to the schools if it weren’t for the requirement to keep investing the increment’s extra tax dollars back into the TIF.

Chicago bankers, some of whom have something to benefit by managing TIF monies, have never-the-less been heard to surreptitiously criticize the financial tool as it has been willy-nilly implemented in the city. Not wanting to go on the record, one recently privately cast TIFs broadly to the author as “a race to the bottom” by disrupting standard, appropriate tax policies while discouraging responsible municipal financing. When developers see the city dangling TIF money right and left, they say, governing officials lose their negotiating powers. And developers, becoming more and more conditioned to expect subsidies, boldly hold back on starting construction on big complexes they could have built on their own, instead waiting for an infusion of TIF public monies.

In its On to 2050 report, the Chicago Metropolitan Agency for Planning itself cautions that while local governments have valid reasons for incentivizing private development, research has indicated incentives often have limited impacts on business decisions and are usually not the make-or-break factor in influencing the decision to build or not build. The Agency also points out that incentivized developments can create many ancillary costs that are never considered as part of the formula such as burdens on roads, schools, fire companies, parks and other publicly-managed entities that are larger than the revenues they generate.

Are TIFs good deals or bad deals? It’s hard to know. You’ll hear TIF proponents claim the financial development tool has been like a magic bullet, unlocking the potential of deprived areas by creating diverse new opportunities for housing, jobs, and shopping options. You’ll hear just as many people claim that all TIFs do is put public money in the hands of private developers who don’t need it while taking decades worth of future tax money away from their schools, police departments, libraries, and other municipal services.

If you live in a municipality with TIF district, how much you’re paying into the TIF fund isn’t itemized on your tax bill. You may never find out the full cost-benefit ratio of any one TIF even 10 or 20 more years down the road. Which is all the more reason every town and city establishing TIF Districts must be fastidious in setting what the project’s aims are, what its viability is without public subsidies, and how long the constraints last. A further consideration is determining if there are enough legitimate enhancements that could be implemented further in the TIF District with the additional tax money (the increment) will be generating the next 20 or 30 years. Taxpayers must keep in mind that, like any business contract, a TIF is a continuing decades-long enterprise. And policy makers must always remember that rejiggering tax reallotments—as TIFs do—affect real people living in real neighborhoods.

Although judiciously-chosen and -managed projects have led to TIF success stories, too freely- and/or carelessly-established TIFs have, by contrast, created serious tax revenue issues for local governments…and not only by diverting future tax monies from schools, police, libraries, and other municipal services. Which maybe is why Chicago has recently pulled back from its reliance on TIFs in favor of straight incentives or other sweeteners such as free vacant lots and other construction subsidies in exchange for a private developer’s commitment to build. The new Middle Infill Housing Initiative, unveiled by the city’s Department of Planning and Development in October, 2024, is such a plan.

There have been no TIF Districts as yet in Gladstone Park although there was a small one in its larger Jefferson Park neighborhood to the south that improved roadways and spruced up some sports fields. If Gladstonians dreamed big and could manage to attract a commercial business such as Trader Joe’s to want to establish itself here, it could wrap the development around a TIF geared to improve deteriorating sections of its business district with its many vacant storefronts. In dire need of beautification, the N. Milwaukee Avenue corridor in Gladstone Park could also greatly benefit from planting beds, attractive sidewalks, new lighting, and especially a solution for the unsafe and unattractive bumpouts at its commercial corridor crosswalks. The question is, should we want to commit to such a TIF or should instead we pursue other grants for these improvements? Or should we continue to leave all building proposals in our community up to private developers who design their projects primarily to suit their own purposes to ensure profits?

AFFORDABLE HOUSING UPZONING

So, if it’s all about sticking to the designated zoning in Gladstone Park, how did the upzoned 5150 project and the GlenStar complex turn it into an affordable housing issue?

The situation is multifaceted.

Part of the problem stems from confusion about the terminology and methods Chicago employs to address its low-income housing programs which now fall under the newer term “affordable” as opposed to the “fair” housing lingo of past times. The U.S. Department of Housing & Urban Development (HUD) first defined affordable housing in 2006 as that in which the occupant pays no more than 30 percent of gross income for housing, including utilities. Although HUD created the benchmark, every state and city factors in specifics to its own formula, tinkering with earning equations and different forms of implementation. Another wrinkle is that the standard defines the affordable level of each community based on its area median income (AMI), which means it is different according to where you are. This can results in absurdities, such as when a well-to-do area with with a very high AMI is able to define the affordable level to lease apartments in its community as households with incomes of $100,000, $150,000 or even more.

In 2003 the state of Illinois passed the Affordable Housing Planning and Appeal Act to address the lack of moderately-priced housing in many of its communities. The law came with affordability indexes for all municipalities with populations of 1,000 or more, based on their AMIs and newly calculated every five years. When the total stock of affordable housing in any one of these communities falls below 10%, unable to accommodate homebuyers making 80% or less of its AMI or renters making 60% or less of it, the Illinois Housing Development Authority requires them to submit an affordable housing plan.

Chicago goes further with an unusually complicated system set up to provide rental housing to low-income households at rates they can afford. On its online platform Medium, the Center for Tax and Budget Accountability describes the city’s setup as divided into two main vehicles Of the 89,000 rental households in the Windy City that participated in affordable housing programs in 2018, some are managed and regulated by the 85-year-old Chicago Housing Authority (CHA) while others arise through the city government’s Department of Housing (DOH). Both entities use different means to create and manage rental housing opportunities with some overlaps.

It is instructive to note that CHA was founded upon the passage of the Federal Housing Act of 1937, and began its mission owning and managing the city’s first public housing projects (Jane Addams, Julia C. Lathrop, and Trumbull Park Homes built by President Franklin Roosevelt’s Public Works Administration) in the late 1930s. CHA is the agency at the source of the Housing Choice Voucher Program, commonly known as Section 8, the federal law that authorizes rental housing assistance for low-income households by paying subsidizes to private landlords to make up the difference between what clients can pay and market rates. Such private property managers service 21,000 families at 65 properties and CHA contracts with four management companies to service another 50,000 clients in family, senior, and what it calls “scattered” sites (which include condos and single-family detached homes).

Meanwhile, City Hall has more recently relied on governmental laws with a carrot/stick approach to bring more affordable housing units into Chicago. The city began incentivizing developers of private apartment complexes to set aside affordable units in exchange for valuable commodities such as zoning relief and tax exemptions. But when it gave builders an out…letting them pay large buyout fees to keep all their rentals at market rate and void each “required” unit of affordable housing…too many developers rejected the sweeteners to take the penalty. That led former Mayor Lori Lightfoot to tweak the ordinance in 2021, forcing developers to raise the affordable housing quotient to 20% in new complexes while curtailing buyout possibilities. The City Council toggled that with a substantial new tax relief package geared to compensate developers for building more non-market rate units for low-income applicants, particularly in areas they determined to be “low-affordability” such as the O’Hare neighborhood.

It was no coincidence that the new sweeteners were gears to apply to the 7-story tall 297-unit project GlenStar had been seeking to obtain a variance on in just that neighborhood despite vehement protestations of residents maintaining the complex was out of character to their community. Crafting a clever media campaign, housing advocates ignored the neighborhood’s real concerns to dredge up racism from 50 years in the past to turn the tide of popular opinion to its side. Riding roughshod over locals, a pressured City Council took the unprecedented action of breaking with aldermanic prerogative to deny the wishes of its own local politician and his constituents. GlenStar’s controversial O’Hare was approved and a gloating Lightfoot announced it to great fanfare. Yet two years later, GlenStar hadn’t yet broken ground for the project, citing unfavorable marketing conditions. One couldn’t help wonder if the developer had stalled the project after its former tax attorney determined the costs for setting aside 59 of the 297 units (the obligatory 20%) as affordable at $52 million over 30 years while it would have gotten back less than half of that, some $23.5 million, back in public tax relief over that same period.

Getting apartment complex developers to build taller and denser buildings than would normally be allowed by zoning laws in some neighborhoods in order reserve a set number of their units as affordable might seem to be the best way to reduce housing inequities. After all, rather than segregate lower-income renters together into dedicated buildings—the type of public housing that failed in the past—the initiative has the advantage of mixing people of different ethnicities and socioeconomic brackets together. And it lets the city outsource the physical task of construction to private corporations, changing its primary role to that of regulator. But by itself it’s not necessarily a creative or even practical solution. Firstly, when affordable housing requirements cut into developers’ profits too much, nothing (like the GlenStar project) gets built. No amount of incentives will convince builders to build unless they know it demonstrably benefits their bottom lines. Secondly, putting “affordable” units in one overbuilt complex that doesn’t fit into and isn’t readily accepted by the surrounding neighborhood could turn out to be counterproductive rather than helpful in the long run. Like the 10-story Veterans Square Office Building plopped into the center of low-rise Jefferson Park, complexes of such size can turn into boondoggles that disrupt skyscapes, traffic flow, and parking, making the area a less desirable place to live. Thirdly, city governments as well as developers, will not know for many years whether all the tax incentives currently being offered will turn out to be cost effective. At what eventual cost per apartment? Would it have been more effective to front that money to low-income renters directly to apply to their choice of market-rate apartments?

What we do know is that so far the city been unsuccessful in supplying anywhere near the amount of affordable housing needed with all their programs operating. Waiting lists extend for years if not decades…particularly for disabled applicants. Although Chicago Housing Authority spokesperson Matthew Aguilar counted 170,000 families on waitlists for all types of public housing assistance at the end of 2021, the number is not definitive because some people are on multiple lists. (There is no central list.) All 47,000 Housing Choice Vouchers CHA currently receives from the federal government go to low-income households, but there are 32,000 more families waiting for them. They can only get into the program if others currently receiving vouchers drop out and stop using them.

The problem with Chicago’s most recent approach to providing new affordable housing is that it relies primarily on private developers building multiple-storied apartment complexes of large scale. Upzoning properties for this purpose comes at the expense of increasing neighborhood density to degrees not previously seen, particularly in the low-rise areas in the Far Northwest where Gladstone Park lies. Is there a benefit for granting higher and higher tax rebates in exchange for each affordable housing unit these builders include in their complexes in areas where there are no other tall buildings like them? Even some affordable housing advocates such as Lisa Yun Lee, executive director of the National Public Housing Museum of Chicago, has recommended thinking beyond the over-reliance on high-rise buildings for low-income residents in her October 17, 2022 The Chicago Tribune opinion piece Ignoring the need for affordable housing is no longer an option. There is an urgent need for equitable housing opportunities that utilize alternative approaches such as sustainable prefab single-family homes, she said.

When Alderman Byron Sigcho-Lopez, 25th Ward, jumped into the fray, he put the impetus squarely on the Chicago Housing Authority to create more affordable living opportunities. “We need to make sure that the Chicago Housing Authority starts being the agency that they claim to be, which is an agency to invest in community housing, not to privatize and subsidize developers.” he insisted in an October, 2023 interview with Chicago Magazine. By December of that same year, The Chicago Tribune was agreeing in an editorial of its own, recommending the changed strategy of going back to building market-based affordable housing instead of “shaking down developers of high-end apartments who’d rather fork over cash than mess up their plans.” Meanwhile, CHA CEO Tracey Scott responding in a defense of the housing agency in a Chicago Tribune opinion piece of her own, wrote it is no secret the Chicago needs some 120,000 more units of affordable housing, but is almost totally reliant on the U.S. Department of Housing and Urban Development to fund them. CHA, she pointed out, is the nation’s third largest housing authority, currently serves one out of every 20 Chicagoans in subsidized housing and needs $80 billion worth of capital funding just to preserve the buildings in its current portfolio no less create new opportunities.

Toward the aim of providing more affordable housing on a smaller scale, Chicago’s City Council re-legalized the building of six-unit apartment buildings on standard (25-foot wide) city lots.in 2022 as part of the Connected Communities ordinance. As long as the proposed building is in a TOD area zoned for it, the builder would be allowed to reduce parking provisions by 50%, resulting in up to 6 apartments with only 3 parking spaces (the “Standard 6-3”). The Standard 8-3 permits up to 8 apartments with only 3 spaces. (In either plan, the builder could petition the city to reduce parking spaces to zero.) A design for such a Standard 8-3 apartment building (with two parking spaces) by the Chicago architectural firm Aggregate Studio shows it taking up virtually the entire lot with the most minimal of side setbacks and 15′ in front.

Gladstone Park is lucky is have what the authorities officially call “naturally-occurring affordable housing” in its abundant stock of two/three flats and modest two-bedroom starter homes priced lower than in almost any other Chicago community north of downtown. It’s no wonder, then, that people in the community look askance at Chicago’s one-size-fits-all plans for affordable housing in multi-story, densely-filled privately-built apartment developments with inadequate parking that are wildly out of character for its more suburban-like community of low-rise buildings and freely-available parking. It’s not that most residents who live here don’t believe every person has the right to fair and equitable housing; they do. But they know the community already offers reams of affordable living situations that fit virtually every situation. What they are against is affordable housing as it is now implemented by the city and its agencies that want to apply the same kind of plan in the center city as in smaller neighborhoods with different needs and cultures.

For the Far Northwest Side and Gladstone Park is already one of the most affordable of Chicagos’s communities in which to rent a home. About one-third (32 percent) of Gladstone Park’s residential stock is now in rentals, close to the national rate of 36 percent, according to rentcafe.com. As of November, 2024 renters were paying an average monthly market rate of $1192. That figure is appealing to the 12.3 percent of people with annual earnings under $25,000 who live in all of Jefferson Park (including Gladstone Park) and another 14.7 percent in the community with incomes between $25,000 and $49,999, as documented in the July, 2024 Chicago Metropolitan Agency for Planning’s Community Data Snapshot. Renters are particularly attracted to Gladstone Park’s two/three flats, two-family homes, and small apartment buildings that are located in bucolic suburban-like areas immersed between single family homes.

The cost of buying a single-family home in Gladstone Park is also much less expensive than in almost any other areas of Chicago. At the height of the pandemic’s real estate frenzy in May, 2022, the median price of a home in the community was $355,000 as compared to $594,000 in tonier Lincoln Park some five miles southeast toward the center city. By November, 2024, average home prices had risen to $425,000 in Gladstone Park vs. $795,000 in Lincoln Park, according to Redfin. While many prospective homebuyers may not be aware that brick bungalows that go for $800,000 five miles out of downtown can cost just half that when you get five miles even further out in the Far Northwest Side, They also do not know that the community’s more modestly-sized ranches can be had for $300,000 or less. Word of mouth spreads amongst those in the know, resulting in city employees such as teachers, police officers, and firefighters being drawn to the Gladstone Park area to seek a high quality living experience at a lower cost.

[“Naturally occurring affordable housing.png” and italicized caption here]

It is no wonder, then, that Gladstone Parkers ask these questions:

• Does all housing for low-income households in Chicago have to fit City Hall’s one-size-fits-all plan to outsource the building of huge housing complexes to private developers who agree to price 20% of its units as affordable? For although it may be the path of least resistance in more built-up areas of the city, it’s not an appropriate strategy for many Far Northwest communities such as Gladstone Park.
• Can’t Chicago planners instead support Gladstone Park’s naturally-occurring affordable housing by helping preserve the community’s two/three flats that are so rapidly disappearing in denser areas closer to the center city? One option could be to set up dedicated loan programs to help people from low-income households buy existing multifamily housing and escape the cycles of poverty while building generational wealth. After all, what better situation is there than living in one unit while paying the mortgage with rentals from the other(s)? City Hall could also look to creating innovative programs to help people buy the community’s reasonably-priced two-bedroom homes. Supporting and preserving the affordable housing Gladstone Park already has would go a long way for helping deserving candidates and their children settle successfully and economically into the suburban-like community’s welcoming culture.

Gladstone Park champions home ownership in its low-rise, spread-out community for the common-sense reason that when people have money invested in their own properties, they develop the pride to maintain them at optimal levels. On the other hand, rental housing of any kind – market rate or not – brings with it the reality of tenants who are not for the most part putting down permanent roots or caring quite so much about their surroundings. Which is why Gladstone Park homeowners have to be afforded the strength to be able to absorb its renters into its environs and still maintain its highly stable neighborhood.

With the right balance of permanent versus temporary residents, there are still enough people on every street motivated to go on litter patrol, watch packages on others’ front porches, keep lawns neatly trimmed and snow shoveled from sidewalks, make sure the alleys are clean, even take care of neighbor’s children in a pinch. Dispersing the right percentage of rental housing among single family homes throughout the community is what has always allowed residents to more easily absorb even the transitory residents into becoming true Gladstone Parkers. One simply can’t maintain that same level of community cohesiveness and involvement if there are too many people concentrated in any one huge building, fighting for parking spaces and cut off from the community’s culture.

And its naturally-occurring affordable housing is what has helped Gladstone Park steadily diversify all on its own. With little fanfare, the “official” Jefferson Park neighborhood in which Gladstone Park is situated saw a doubling of its Hispanic population to 25 percent of the total in the last 25 years, according to the Chicago Metropolitan Agency for Planning’s Community Surveys (CMAP). Asians make up 12.5%. Outsiders also probably don’t know that in the last five years the Gladstone Park Neighborhood Association has welcomed in congregations of Moroccan Muslims and Ethiopian Christians to local religious centers.

Gladstone Park also continues to serve as the present-day epicenter of the Polish diaspora with large numbers of immigrants from that country migrating north into the community from their original abode in Avondale (and still coming directly from Poland today). The Polish population in Chicago and in Gladstone Park in particular is so significant that Illinois recently designated Milwaukee Avenue from Sangamon Street in Chicago to Greenwood Road in the suburbs of Niles as “The Milwaukee Avenue Polish Heritage Corridor” in an effort to recognize the undeniable impact Polish culture has had on the city. At a ceremony September 8, 2023, State Senator Robert Martwick, State Representative Lindsey LaPointe, State Treasurer Michael Frerichs, local Alderman Samantha Nugent and other officials enshrined the road as the “Polish Heritage Corridor” by erecting a sign in Chopin Plaza at the merger of N. Elston and Milwaukee in the heart of Gladstone Park. “There is no Chicago without its Polish community, and there is no Polish community without understanding Chicago,” declared Metropolitan Water Reclamation District Commissioner Dan Pogorzelski.

So it’s obvious Gladstone Park already does its fair share when it comes to housing people of all income levels and many ethnicities. And a great deal more so when compared to the adjacent Chicago community of Sauganash/Forest Glen on Jefferson Park’s northern and eastern borders. Categorized as “sparse suburban,” its dwellings are even more spread out with only 9 percent of their housing stock in rentals, as detailed in niche.com. Sauganash/Forest Glen has a home ownership rate of 91 percent and its few rentals have much steeper prices that averaged $1638.00 a month during the pandemic. Further, if one were to explore Sauganash/Forest Glen’s affordable housing options in LowIncomeHousing.us, which bills itself the country’s “premiere online resource of affordable housing options,” one finds not one opportunity located within its borders.

The question is, why does City Hall not pressure a Sauganash’s/Forest Glen to take on any responsibility for supporting Chicago’s affordable housing? Why does the brunt seem to fall on less wealthy communities like Gladstone Park to do more than its share? Must these neighborhoods engage the services of the well-respected DePaul Institute for Housing Studies to compile statistics and present evidence to the powers-that-be that the wrong areas are sometimes being unfairly singled out with policies that do not benefit either affordable housing projects, residents seeking space in them, or the communities they are being foisted upon?

TRANSIT ORIENTED DEVELOPMENT (TOD) UPZONING

But affordable housing upzoning isn’t the only kind of denser building growth that could be coming to the Gladstone Park area. Citing climate change and the goal of reducing fossil fuels and pollution, federal, state and local government have been trying to respond to the great cultural shift away from the automobile in favor of mass transit, cycling and walking with supportive legislation. One innovative way cities across the nation have embraced to achieve these new goals is through the structure of what’s being called Transit Oriented Developments (TODs). The idea is that TOD developers will be able to build larger housing complexes close to train and bus stations based on the presumption tenants will abandon their cars for mass transit and not need parking spaces. In the bargain, builders would profit by trading parking spaces for additional housing units, a cost savings which could be passed on as lower monthly apartment rental costs for tenants.

Chicago passed its first Transit Oriented Development ordinance in 2013. The city’s original law was revised in 2021 as Equitable Transit Oriented Development (eTOD) .and was again retooled in July, 2022 to incentivize builders to take advantage of its provisions particularly in disadvantaged neighborhoods. That was because, despite all its good intentions to combine Transit Oriented Development with affordable housing in Chicago’s Black and brown communities, statistics available from the Chicago Department of Planning and Development revealed that 90 percent of TOD projects by June 18, 2021 had either been built downtown or in well-off or gentrifying neighborhoods on the North and Northwest sides. Further ideas suggested prohibiting single family homes and three-flats from being built in areas around transit centers altogether while reducing parking requirements for TOD apartment complexes even further.

While the city’s interim TOD law added actions to “advance racial equity, wealth building, public health and climate resilience goals,” the gist remains the same as in the earlier ordinance. The whole basis for TODs has always been the wildly optimistic notion that people renting apartments near transit centers (or major streets with bus and train hubs) would ditch all their cars and exclusively walk, bike, and use public transportation. Assuming no tenants would want to drive paved the way for permiting developers of TOD housing projects to build larger, denser complexes while reducing (or eliminating) requirements to provide resident parking. The “equitable” part of the ordinance, amongst other efforts, encouraged the inclusion of numbers of affordable housing units, particularly in Black and brown communities.

TOD’s current incarnation expands the areas eligible for transit oriented development housing to 2,640 feet from a CTA or Metra rail entrance or exit and within 1,320′ of a CTA bus corridor. One space of bike parking is now required per unit and spaces for car parking are limited with new maximums, not just minimums. If ground floor units are constructed as accessible, further bonuses would be granted. Other regulations make it more difficult to convert existing two- and three-flats into single-family housing to maintain a minimum housing density in the TOD area.

Right from the beginning the city targeted the Jefferson Park Transit Center, a multimodal facility serving Chicago Transit Authority (CTA) buses and Blue Line “L” trains, the Metra train and Pace buses at 4917 N. Milwaukee, as an ideal site for a comprehensive mixed-use TOD development. As early as 2016 the city’s Planning and Development Department commissioned a study of the location under former Chicago Mayor Rahm Emanuel. Located 0.2 mile from the southern border of Gladstone Park and the 5150 N. Northwest Highway housing project, Jeff Park Transit is only a five minute walk.

By the time there was a concrete Transit Oriented Development proposal on the table, the COVID pandemic was in full force with community input made difficult. A November 5, 2020 online Zoom meeting on a plan for a four-story 36-unit TOD building at 5071 N. Northwest Highway near the Jefferson Park Transit Center malfunctioned with unmuted participants asking questions and making comments over the presentation project officials were trying to make, according to Nadig Newspapers. The meeting had to be postponed.

At the rescheduled meeting December 3, 2020, more details emerged. As an economic disincentive to owning cars, tenants of the 3 studio, 21 one-bedroom, and 15 two-bedroom apartments would have to pay $150-300 a month more to rent one of the 15 parking spaces the developer was putting in, reported Nadig Newspapers. When one resident complained that homeowners living near the proposed complex were already playing musical chairs parking their cars even though street parking was permit only, the promise was made that tenants would not be eligible for those parking permits.

Ironically, the 11,749 square foot parcel had already been rezoned to RM-4.5 in 2007 for a 14-unit building with 14 underground parking spaces that had never come to fruition, according to the November 6, 2020 Nadig Newspapers article. The new project developer of 5071 N. Northwest Highway originally asked for a zoning change to B2-3 that would permit a maximum of 29 units with 29 parking spaces, or one per unit. But under TOD, the density of apartments would be allowed to increase to 39 units with no parking required (although 15 were still on the table). Project attorney Paul Kolpak maintained the market rate development was geared to the higher density levels the city wanted near transit hubs and would cater to young professionals who could be relied upon to take public transportation and not own cars. By zoning regulation, four affordable housing units would be required in the project, but the developer was considering a buyout of two of the units to keep them market rate, according to his attorney.

Due to residents’ objections, the developer came back with a new proposal February, 2023 to return to plans for a three-story building with 14 units and 14 parking spaces (dependent on a side yard variance for the parking provisions). As all parties acknowledged that eliminating tenant parking would significantly contribute to the congestion of cars in the immediate area of the Transit Center, they rejected the use of TOD provisions allowed by city code. Although Jefferson Park neighbors voiced opinions that the development was still out of character considering the single family homes nearby, they agreed the current proposal was the best possible solution for the situation.

In mid-2020 another proposal came in for a seven-story, 88-feet tall, 192-unit development on the TCF National Bank property at 4930 N. Milwaukee. On the corner of Gale Street in the heart of the community, the mixed-unit complex, directly across the street from the Jefferson Park Transit Center, would also include 5800 square feet of commercial space.

If built as proposed, “Gale Street Lofts” would be downtown Jefferson Park’s third tallest building, according to Nadig Newspapers. It would feature many amenities, including a landscaped rooftop with pool. Five of the 192 one- and two-bedroom apartments were to be designated affordable.

By virtue of it being a TOD project, only 86 of the 139 parking spaces the Gale Street Lofts developer planned to put in would be available to tenants instead of the 192, or one per unit, normally required for a building its size. Of the remaining parking spaces, 46 would be set aside for retail tenants with seven for the bank, which planned to relocate into a smaller facility at the south end of the property.

The TOD ordinance continues to evolve. In July, 2022 a sweeping revision called Connected Communities passed the City Council as part of former Mayor Lori Lightfoot’s initiative to further combat segregation and gentrification. By capping the amount of parking for new residential buildings within four blocks of transit centers to one spot per two units, the ordinance hopes to convince people to ditch their cars and turn to walking, cycling, and public transit. An added bonus, advocates said, would be less expensive housing costs resulting from builders not required to budget for all the extra land that tenant parking provisions would take.

In July, 2023, Elevated Chicago and some other groups collaborated with the Institute for Housing Studies at DePaul University to explore the lack of TOD implementation near transportation hubs in the neediest areas of the city. Perhaps to no one’s surprise, they found that residents often avoided public buses and trains if they were forced to walk by vacant lots they saw as threats to their physical safety as well as breeding grounds for environmental hazards. Of the 14,700 vacant lots in Chicago close to CTA train stations, nearly 74% of them are in predominantly Black communities, making it more challenging for those living nearby to take advantage of public transit. Numbers of vacant properties in Englewood, West Englewood, East and West Garfield Park, and North Lawndale. all communities of color, topped the charts. Furthermore, 25% of these vacant lots are city-owned and some 90% of the city-owned vacant lots near transit centers are in Black communities. All the more reason for Elevated Chicago to recommend concentrating TOD development on vacant lots in these disadvantaged areas.

While it may be good policy to relieve housing developers of the need to provide parking through Transit Oriented Developments (TODs) on the assumption that tenants in any of the neighborhoods in the city won’t want to have cars in areas that formerly sported vacant lots, is it worth it to impose the same standards on other Chicago communities with different needs? While eliminating parking provisions at a Transit Oriented Development housing complex may work in Black and Brown communities (and in the center city), doubts have been raised whether that same design could work as well the further you get out into Chicago neighborhoods that are more suburban in character. So while it could fly near transit centers in needier areas as well as the more built-up commercial sections closer to downtown, it might be much less amenable in the more suburban-like community of Gladstone Park and others to its north and west. Would renters in the Far Northwest Side – already 9 miles from the center city – really want to give up their cars or be willing to find and pay for parking their vehicles in independent lots or garages?

Interestingly, after a vacant parcel of land between 5338 and 5356 W. Argyle Street near the Jefferson Park Metra Station went up for sale in 2021, the Jefferson Park Neighborhood Association, fearing another TOD, lobbied for Alderman James Gardiner to downzone the property in November, 2022 so that the only allowable use would be for two-flats or single-family homes. So while previously-approved plans for “Carmen Corners” had called for the 28,000 square foot site to host two four-story buildings with 48 apartments (with an unknown number of parking spaces), it ended up geared for nine 2,100 square foot single-family homes with rear garages. Ironically, the property had long been earmarked for single-family homes until former Alderman John Arena – voted out of office in large part because of his advocacy for increased density in the community – had had the property upzoned for multifamily housing six years ago. Gardiner was quoted in Nadig Newspapers as declaring the change back was “perfect,” showing how Jefferson Park’s (Gladstonians’ greater neighborhood to the south) could come together and plan a future consistent with the wishes of the community.

There are at least one other approved, proposed, or potential TOD developments in Jefferson Park. An unnamed project at 5306 W. Ainslie has a building permit for a 200-foot, 16-story, 114-unit apartment building to be combined with the existing 10-story Veterans building on Veterans Square on N. Milwaukee, according to Nadig Newspaper’s Facebook Page. A lawsuit alleging the building is too large for the planned development has stalled the project, which includes a 200-space parking garage.

HOMELESSNESS/MIGRANT CRISIS

While affordable housing seems to get all the attention, homelessness is a much more critical problem requiring even more complicated solutions.

As far out as Gladstone Park is from the center city, it has a negligible homelessness problem. But that doesn’t mean it doesn’t exist. While there are no parks big enough to invite tent encampments like the 42-acre Gompers Park in the nearby Mayfair neighborhood, an occasional adult, teen runaway, or chronically-unhoused veteran may take up refuge in a local bus shelter. But it is what is not seen that’s more critical: the single adults and families without homes who are doubling up in the community with relatives or friends in less than ideal conditions.

It is difficult to get a handle on the population of Chicago’s unhoused since there are so many different methodologies on counting people who have no permanent place to live. Perhaps the lowest estimate comes from The City of Chicago 2021 Homeless Point-in-Time count & Survey Report directed by the city’s Department of Family & Support Services (DFFS). In its data snapshot taken on one day (January 29, 2021), DFFS counted a total homeless population of 4,477 people, 3,023 in shelters. Another 702 to 1454 were estimated to be living “on the streets,” which included encampments, 24-hour facilities dedicated for that purpose, and CTA buses and trains as well as area airports. Around the same time the US Department of Housing & Urban Development identified 5,390 Chicagoans as homeless, including those staying in shelters and those living in places “not meant for human habitation.” (More recent statistics are not noted here since 2022 and 2023 figures have been distorted by the temporary influx of more than 20,000 homeless migrants bused to the city by Texas Governor Greg Abbott in a vindictive move to get back at Democrats over America’s faulty immigration policy.)

Meanwhile, the Chicago Coalition for the Homeless (CCH) documented 65,611 homeless people in the city in 2020 in its report. What was the reason for the disparity? CCH included 49,585 adults and children who had no place of their own but were temporarily doubled up in homes owned or rented by someone else. While technically providing a roof over their heads, these fly-by-night placements cause crowding and instability, bouncing people around while jeopardizing employment, schooling, and overall mental wellbeing.

During the same year, the Chicago Public Schools reported serving 16,663 homeless students, mostly doubled up in households that aren’t their own.

In an update, the Chicago Coalition for the Homeless identified the number of people accessing homeless services in 2022 at 36,878, jumping from 27,913 the previous year. In 2023, the city counted the number of people “out on the street” at 6,139, a significant increase. Of these, 2,196 were migrants, attributed to the crisis created after the state of Texas started busing asylum-seekers to Chicago and other sanctuary cities to get rid of people illegally crossing their border.

Many Chicago and state governmental and private entities work to reduce homelessness. DFFS has a Rental Assistance Program and an Expedited Housing Initiative to serve the city’s homeless populations. The Chicago Housing Authority has long offered choice vouchers and currently is developing more housing for those who need it through a $35 million investment from the Chicago Recovery Plan along with additional investments through the American [COVID] Rescue Plan. Chicago is still working on its 2000 Plan for Transformation when it tore down failed public housing projects, pledging to rebuild units to house the many families that were displaced. But a significant wrinkle is the fact that recent trends have shown up to 75% of affordable units being constructed are studios and one-bedroom units too small to house families. (About 40% of people wanting affordable housing apartments are on the waiting list for one-bedrooms.) That keeps rental housing large enough to include children in limited supply.

But the Bring Chicago Home Coalition thinks more should be done to put roofs over the heads of the city’s homeless population. Its very ambitious campaign seeks to establish a dedicated fund to dependably provide permanent housing and services to support the special needs of a homeless population by raising the city’s real estate transfer tax (RETT). Estimates say that increasing the transfer tax by 1.9 percent on properties over $1 million would generate more than $160 million annually for homeless housing and support services, particularly those who are sometimes resistant to housing intervention.

But RETT revenues are directly tied to real estate sales, which are subject to extreme fluctuations to the market. When The Chicago Tribune cumulated figures in October, 2023, they found that while revenues had spiked to $242 million in 2006, they had tumbled to $62 million (or less than a third of that) at the height of the Great Recession in 2009. Recent Illinois home sale prices have been plunging, down some 15% from July to September, 2023, compounded by 11% fewer residential home closings altogether, leading the Chicago Association of Realtors to scream foul about the proposal to burden their industry with new taxes at this time. They point out that rising interest rates, reflecting national trends, already result in buyers paying 35% of their average wages to afford a typical 30-year mortgage, the highest level since 2007 just before the housing crash ushered in the Great Recession. Yet Chicagoans are also rent-burdened, with half of them spending more than 30% of their income on monthly rents according to analyses by Apartment List.

As the Coalition gains support for the RETT from Chicago voters by framing it strictly as a kind of “Mansion Tax,” investors and property managers says it ignores the fact the tax also applies to the commercial properties that contribute so substantially to powering downtown Chicago, the economic engine of the state (and region). With so many of Chicago’s big office buildings in financial stress ever since workers emptied out during the pandemic and stopped their patronage of nearby restaurants, stores and entertainment venues, downtown can’t afford to take an additional hit, they say.

Which is why the Building Owners and Managers Association (BOMA), which represents the interests of commercial office, retail, and large apartment buildings, has become a formidable opponent of RETT. The $320 million of real estate transfer taxes that came from 2015 to 2022 from commercial properties, or 25% of the total, BOMA claims, already propels Chicago to the top of the list of cities with the highest commercial property tax in the country. Also opposed to the initiative are the Neighborhood Building Owners Alliance and the Illinois Hotel & Lodging Association. (The initial version set the RETT at $3.75 per $500 on sales of houses costing less than $1 million and tripling it to $13.25 for every $500 for those priced over $1 million.)

Measures to refine the idea are one way to make RETT more palatable to constituents. Alderman Nicole Lee proposed exempting multi-unit apartment buildings with affordable rentals and others have suggested raising the amount when the extra tax kicks in. Johnson himself has proposed a three-tier structure, lowering the real estate transfer tax rate on properties below $1 million some 20% and reducing the levy on homes between $1 and $1.5 million. Sweetening the deal is its “marginal” structure, which levies the higher rate only on the additional dollars above a bracket, not the full amount. Calculations by the Harris School for Public Policy on the how much money the new formula would bring in under this formula set it at an estimated $100 million, which would pay for emergency rental assistance as well as providing and rehabbing shelter space.

So who would RETT help? While there are many cohorts of homeless people, 73 percent of Chicago’s unhoused population is composed of Blacks/African Americans, mostly male. The city’s homeless veterans (some of whom, of course, are also Black/African American) in particular stand out. Defined as those who have returned from military service with disabling conditions that have kept them without access to permanent homes for at least 12 months, these chronically-homeless vets make up 7.7 percent of the shelter population. Another 5.3 percent of them live on the streets. Unlike the needs of families, their housing needs can be satisfied with one-bedrooms or even studio apartments.

After former Chicago Mayor Rahm Emanuel and the city’s Office of Veterans Affairs assembled a coalition of service agencies for its 2014 Ending Veteran Homeless Initiative, strides were made to help this population of unhoused people. During its first three years, it claimed to have reduced homelessness of veterans by 28 percent. At the same time, affordable housing slots have opened specifically for disabled military personnel by nonprofits such as Full Circle Communities with its new 5150 N. Northwest Highway apartment complex in the extreme southern part of the Gladstone Park neighborhood.

Perhaps because of how impactful the RETT could be, the way to passage of the Bring Chicago Home initiative that would help more homeless people find a place to lay their heads is steep. It must be passed either through a city referendum or by approval by the Illinois General Assembly. Ironically, although Lori Lightfoot campaigned for the boost in the real estate transfer tax to benefit the homeless, once she assumed the reins as Chicago Mayor, she betrayed her supporters by calling the effort “flawed” and did everything to stymie the organization’s efforts to get the proposal on the city’s February, 2023 municipal ballot. When progressive new Mayor Brandon Johnson was sworn into office a few months later, he stuck to his guns about putting the measure in slightly retooled form before the voters at his first opportunity. Downtown real estate concerns lobbied heavily against the referendum, saying it was the wrong move at the wrong time and 53% of the paltry number of voters (only about 20%) that went to the polls agreed, soundly defeating the Bring Chicago Home initiative in March, 2024. In a conciliatory gesture afterward, business leaders were quick to suggest that they were willing to work with the Johnson administration supporting many of the same housing objectives through the creative use of TIF funds left over from other city building projects.

Chicago’s Migrant Crisis has contributed substantially to the city’s homeless population since September, 2022 when Texas Governor Greg Abbott began busing asylum seekers to northern “sanctuary” cities that have more welcoming policies for the immigrant arrivals. Since then more than 48,000 migrants have passed through Chicago causing the city and state to spend an estimated $460 billion on their care, primarily through shelter systems. As on April, 2024, 8.971 migrants were still being housed in 18 shelters although numbers dropped to roughly 5,000 in 17 locations by September of that year.

In response to outcries that more resources were being given to migrants than the 68,000 Chicagoans who were counted in early 2024 as part of the chronically unhoused population, the city and state adopted a new tactic. In their One System Initiative, Chicago and Illinois announced they plan to combine the city’s migrant shelters with its legacy homeless shelter system into a unified program for all unhoused by the spring of 2025. More than 25 community-based agencies will be tasked with coming up with in-house staff positions, eliminating the need to contract with outsourced agencies like the controversial for-profit Favorite Staffing, which up until this time managed the majority of the migrant shelters at great cost and to much criticism.

While migrants as a group have different needs—they have more families with children enrolling in city schools while more of the chronically unhoused have substance abuse problems, for example—the new system is geared so that all those who need a roof over their heads would no longer have to compete for the same limited resources. That would mean caring for all unhoused whether they’d been homeless for five days or five years.

ACCESSORY DWELLING UNITS (ADUs)

In December, 2020, the Chicago City Council approved the construction of Accessory Dwelling Units (ADUs) in five pilot areas of the city as an alternate form of affordable housing. After proponents put a their spin on the initiative by dubbing it the “Coach House Ordinance,” there was little debate and even less opposition leading up to its passage. Part of the reason was that the law was enacted during the depths of the COVID epidemic with few residents venturing out to participate in governmental processes at the time.

One of the few voices raised publicly against the ordinance was passed came from Jeffrey Rovner, a West Rogers Park builder, who maintained Chicago’s ADUs were all about making money for developers, not increasing the amount of affordable housing. By removing most zoning requirements for single-family houses, Chicago’s law would cram more people into one area, creating all kinds of new problems, he wrote.in a May 24, 2020 Chicago Sun-Times Letter to the Editor. “Think about the quality of life on your block as the density grows, “ he cautioned. “The available parking is reduced. There’s an increase in trash and noise. There’s a lack of space for garbage carts, which then overflow, feeding rats.”

So what was the idea behind Chicago’s ADU ordinance? Proponents said it was to restore the early 20th Century tradition of homeowners constructing a housing unit or two in old coach houses on their properties…allowing them to repurpose a structure originally built for sheltering horses and carriages. Conveniently separated from the main dwellings, they figured the new coach house apartments would allow longtime homeowners to maintain their properties with the extra income coming from the rental of smaller, but affordable living quarters on their land. It would also give some potential homeowners the opportunity to own property for the first time, they said, using the rental money from the extra housing unit(s) to pay down their own mortgages. It appealed to others who figured the apartments would be especially suitable for multi-generational family members—particularly aging parents—by virtue of their proximity to main houses on the lots. From which arose their second nickname: Granny Flats or In-Law Suites.

With so many advantages, one might ask why Chicago ended the tradition of allowing homeowners to convert their old carriage houses to extra housing units way back in 1957. The simple fact was that American society had changed. By midcentury, Americans were embracing the trend toward suburbanization, leaving cities in droves to settle on larger properties in greener pastures. To prevent feelings of city life overcrowding and provide for a car culture that had grown to staggering proportions, Chicago’s governing body determined it was more important for its residents to be able to spread out more and find parking spaces for their vehicles rather than allow neighborhood densities to increase with new living spaces. That’s when Chicago enacted zoning regulations requiring builders to provide at least one parking space for every unit of new housing unit they constructed, making street parking outside of downtown into a zero-sum game. That, along with adherence to more modern setback and lot coverage requirements, effectively shut down most of the coach house conversions.

Some 50 years later many American cities, including Chicago, began to discover that times had changed once again. Corporations that had once moved out of the urban areas moved back downtown with employees wanting to live in the city again, sort of a reverse migration. Shockingly, cities found that one of their biggest problems had become the lack of affordable housing, not the lack of parking. A wide range of urban residents including veterans, young adults, seniors, the disabled, single parents and their children and the underemployed could no longer pay for adequate shelter. Homelessness had become a crisis exceeding all proportion. At the same time, owning a car was no longer the right of passage it used to be. Young adults living in the city were just as likely to take public transit, bike and walk than to get their drivers’ licenses.

Portland, Oregon was one of the first cities to revisit old ideas. During the last two decades concerned citizens in this Pacific Northwest city tried out new ideas, becoming the nexus of the ADU revolution. After three volunteers formed Accessory Dwellings to design and promote all the ways affordable housing units could be added to existing residential properties, the movement really took off. Evolving over the years from the prototypical apartment on top of the backyard garage, their latest initiative is helping Portland homeowners install RV hookups on their properties. With the additional help of a company called Tiny Hookups LLC, homeowners there are guided in how to create living quarters in what were once called travel trailers on a small portion of their land.

Which leads us to point out that Accessory Dwelling Units can be virtually any kind of structure on a residential property, attached or detached, that furnishes an extra living unit or two for singles, couples, or a family, related or not. The goal is to offer alternative housing opportunities for tenants needing living spaces for reasonable monthly rentals by building modest-sized housing units made of economical materials. It could be an attic or basement conversion with a separate entrance, a new one- or two-story backyard building where a garage is (or used to be), or even a foldable prefab container house. (Amazon sells a number of shipping containers and “tiny” prefab homes ranging from $2,400 boxes to $27,500 foldable, movable units with multiple rooms that qualify in some municipalities.) If enough people jumped on the bandwagon, proponents speculated, ADUs could significantly boost the availability of affordable housing so badly needed virtually everywhere.

ADUs came to the Chicago area through the Chicago Metropolitan Agency for Planning (CMAP), the regional planning organization for the northeastern Illinois counties of Cook, DuPage, Kane, Kendall, Lake, McHenry, and Will. CMAP’s On to 2050 document calls for all of the 284 communities in its region, including Cook County’s Chicago, to simplify approval processes to make building ADUs easier to finance and build in order “to meet the growing demand for housing, increase access to jobs and services, promote compact development, and support multigenerational living.”

CMAP emphasizes there is no one-size-fits-all and points out how different municipalities have taken disparate approaches. Some local towns require the owner of the residential property to live in either the primary residence or the ADU so that there are no absentee landlords. Others regulate the size of them by limiting their total square footage, maximum number of bedrooms, or total building coverage on the lot to cut down on numbers of allowable occupants. A few are putting in “character” clauses so that the altered or new dwellings fit in with the community and don’t stand out like sore thumbs. It is up to localities as to whether they want to add landlord/tenant laws to existing state codes to more firmly regulate the responsibilities owners and renters of accessory dwelling units have. Although some municipalities have required one parking space for each ADU, CMAP advises greater flexibility. By “liberalizing rules” such as those normally instituted for parking requirements, it says, more people will be encouraged to develop ADUs.

By May, 2023 nearly a dozen communities in CMAP’s seven-county region permitted some form of ADU through their zoning ordinances (or were considering doing so). These are the governmental entities of Antioch, Bull Valley, Evanston, Homewood, Lake Bluff, Northbrook, Oak Park, Park Forest, South Elgin, Wilmette, Woodstock, and Chicago.

Mayor Lori Lightfoot, a progressive who had made affordable housing a major point of her campaign, became an early adopter of the units after being influenced by the successes of ADUs in California. The Urban Land Institute Chicago (ULI Chicago), a nonprofit dedicated to spearheading responsible use of urban land to create thriving communities, produced its 2020 ULI Chicago ADU Initiative in 2020, which became the basis for the city’s ADU ordinance passed later that year. In the report ULI Chicago speculated that basement units, in particular, were “likely” to go for for more reasonable market rates even if the units weren’t officially designed by Chicago Housing Authority as legally affordable (in other words, with subsidized rent for lower income residents).

By the time Chicago passed its first ADU ordinance, there were already an estimated 1.5 million of the units in the U.S. as determined by Porch, a software provider for home service companies such as home inspectors, moving companies and real estate firms. The business also found that half of the ADUs were located in only four states with California the clear leader with 30% of all ADUs in the country.

The ADU cause was taken up by Mayor Brandon Johnson after he was sworn into office in 2023. He, along with proponents from the Chicago Housing Department and many other governmental officials, expressed full support for expanding ADUs citywide, agreeing the project’s biggest failure was them not taking off as fast as they’d hoped in the pilot areas. This they attributed to barriers to otherwise willing homeowners caused by excessive costs and a lack of financing for building the units. (IAP cited Chicago Cityscape’s figures that determined it cost an average of $75,000 to build a basement unit (some requiring excavation to meet minimum ceiling heights) and $150,000 to build a coach house unit in 2023. And that financing from standard lending sources or grants was difficult to obtain.)

Chicago’s ADU Ordinance, which distinguishes between coach houses and conversions, keys itself on flexibility with only a few restrictions. Coach houses may cover no more than 60% of a property’s required rear setback, have living space no larger than 700 square feet, and not exceed 22 feet in overall height above ground. No short-term leases/vacation rentals are permitted and in most cases, one of the buildings on the property must be owner-occupied. But ADUs are exempt from minimum lot area per unit rules. No additional parking is required. There are no guidelines about building design matching the character of the neighborhood. And, perhaps most impactful, there are no limits on the number of ADUs allowed to go in on any one block.

Using a map compiled by CityScape, the ULI Chicago ADU Initiative determined that if all existing coach houses (primarily) on single-family residential lots in the city were converted to ADUs in 2019/2020, there would be more than 2,400 units of new housing units. (See map below.) The organization also opined that by giving owners of 2/4 flats the opportunity to add ADU housing on their lots, it might prevent them from electing to tear down the often more affordable multifamilies with two, three, or four living units that are so rapidly disappearing from the city. (Building larger, taller and more dense apartment buildings in their place is now more profitable.)

However, Chicago’s ADU ordinance has given some future landlords pause. While the first ADU a homeowner builds can be rented at market rates, properties with two or three conversion units must designate one as a legally-restricted affordable unit for tenants who earn 60% or less of the neighborhood’s Area Median Income (AMI) for the next 30 years. Properties with four or five conversion units must designate two of them as affordable. These restricted units are also eligible for subsidies from the Chicago Low Income Housing Trust Fund to support conversion unit tenants who earn 30% AMI or less. It is not known at this time whether these requirements are cutting down the total numbers of ADUs being built in the city.

A little over one year after Chicago’s Coach House Ordinance went into effect, Chicago Cityscape detailed ADU building activity in the five pilot areas of the city where they are currently allowed. By April, 2022, 39 permits had been issued for 45 units: 11 for backyard/coach houses (single units only) and 28 interior permits for 1 to 4 units. Of the interior ADUs, 100 percent were for basement units although attic development is also allowed by the law. Another 246 more applications for ADUs had by then been pre-approved by the Chicago Department of Housing, putting them in the planning stages.

Some objections began surfacing when it was found that some of Chicago’s interior basement unit permits were for the specific purpose of improving and then permitting these existing “outlaw” units. In other words, the rehab work (while having the positive result of bringing the units up to building code) legalized long rented-out units that had long flouted zoning standards.

Then came the caveat that although the ADUs were specifically touted as the solution for housing older parents, apartments above garages accessible by long flights of steps don’t serve aging relatives well. So even though the units are called “Granny Flats,” many actual grannies can’t actually live in the structures. Likewise, these second story dwelling units aren’t accessible to people with disabilities (many of whom are also veterans)…two other populations that are supposed to benefit as the recipients of ADUs. (Whether these same people can access attic or basement conversion units, up or down other flights of steps, is another question.)

Although Chicago is taking a multi-pronged approach to solve the housing affordability crisis, relying on ADUs to contribute substantially may be overly optimistic. Many people in the five pilot areas of the city have anecdotally been building the extra units for investment purposes to rent out to unrelated parties. In other words, their goal has not been to provide inexpensive dwelling units for unhoused people. Or to house aging parents. Of the few cities that have been at the alternate housing units long enough to develop a track record, such as in Australia, few have seen ADUs as the magic affordability bullet they once thought it might be. In a December 17, 2023 Guardian, Australia article, Professor Nicole Gurran expressed her skepticism, saying, “There is no reason why you wouldn’t allow people to build granny flats in their own back yard…[but] the issue I have is when state governments call that an affordable housing strategy. I do think we should be doing better as a country in terms of providing real affordable housing.”

Still, Chicago’s affordable housing advocates have gone full speed ahead in promoting ADUs. In March, 2023 Chicago CityScape brought over 100 building designers, lenders, and city staff together to discuss the advantages and challenges of implementing Chicago’s ADU ordinance. Two years in, the city had issued what proponents considered a paltry 148 building permits for 181 ADUs in the five pilot areas with basements remaining the most common type of conversion. In order to tackle issues such as restrictive zoning, difficulties in permitting, scarce financing options, and a lack of guidance for potential participants. the city housing department pledged it was in the process of hiring a staffer to help ease the entire ADU process. Because while the number of ADUs has been on the rise nationwide for some time, there is still a scant amount of information for participants to rely upon.

In October, 2023 Chicago CityScape and ADU designer AIA Chicago sponsored a tour of a newly-constructed ADU in the Lakeview neighborhood. Using plans by Latent Design, the backyard unit with nearly 700 square feet and a balcony was built in modern style for the property owner’s mother.

Although Gladstone Park did not fall into the ADU pilot area (the closest permitted neighborhood was southeast in Albany Park), that may not always be the case. In June, 2023 Alderman Bennett Lawson (44th) filed legislation in the City Council to legalize ADUs across the entire city. Because the pilot program had spectacularly failed to encourage ADU development to provide less expensive housing options in the South and Southwest parts of the city for which it was intended, the new ordinance proposes loosening or removing even more zoning restrictions on them to attempt to get the desired response. (By this time, the Department of Housing had issued a total of 596 pre-approvals that results in 251 building permits.) Meanwhile, architects and builders were complaining that limiting ADU’s to 700 square feet raises the price per square foot so much that even homeowners on the North and Northwest sides (where most of them had gone up) can’t recoup their investments through renting. To correct that flaw, Lawson proposed expanding their maximum size in addition to including provisions for erecting not just a second, but a third unit on any one lot previously zoned for only one house. The new relaxed ADU requirements in the re-legalization effort created enough controversy that aldermen from diverse neighborhoods all over the city couldn’t get together behind the changes and held off on voting on the ordinance when it was scheduled to come up for a vote July 17, 2024.

The controversy was fueled in part by the skewed response to the pilot program whereby few ADUs were built in the South and Southwest parts of the city where they were most wanted and needed. That prompted the Illinois Answers Project (IAP) to investigate the successes and failures of the pilot program and survey the wide variety of opinions regarding possible expansion throughout all 77 neighborhoods. (IAP, published by the Better Government Association, is a nonpartisan Illinoisan watchdog journalism news organization.) In an effort to demonstrate what neighborhoods could be ripe for ADU development, ULI Chicago highlighted the three single-family zoned tracts on city maps, detailing how areas with higher percentages of the least restrictive residential zones (RS3) offered the best locations. While the Gladstone Park isn’t specifically separated out, Jefferson Park, the larger neighborhood in which the community is contained, is designated with 41.4% of its lots in RS3 zones. Contrast that with adjacent Norwood Park with only 10.1% of its lots zoned RS3.

During the first two years since Chicago legalized ADUs in the five pilot areas, nearly 500 have been built, mostly in the two permitted areas on the wealthier North and Northwest sides. The Additional Dwelling Units were particularly popular as income producers in the neighborhoods of Hermosa, Logan Square, Avondale, Irving Park, and Albany Park, according to 35th Ward Alderman Carlos Ramirez-Rosa who serves that area.

Many members of the City Council currently remain wary of the viability or advisability of ADUs in their wards. Some alderpersons are gravely concerned about loss of control to determine the fate of local neighborhoods with the ordinance allowing property owners to bypass zoning changes instead of going through each ward for permits to build new “coach houses” (or convert more basements or attics). Some affordable housing advocates feel that by favoring ADUs with eased regulations and grants, demand for the construction of new multi-storied housing complexes on vacant lots would decrease. Others fear that by letting single family residential lots everywhere turn into multi-unit conversions of unregulated design, the character of those neighborhoods would change. If there is an expansion of the ordinance, some say the city must get away from its one-size-fits-all provisions because what works in some neighborhoods is not a good fit everywhere. For while almost no one’s against a family housing its parents or grandparents in a separate unit on their properties, the unfortunate truth is most of Chicago’s ADUs are being built as rental units for investment purposes.

Right now it is unknown whether anyone is officially talking about the increase density ADUs impose upon a neighborhood except for the members of the Gladstone Park Neighborhood Association. (Proponents of the ADU ordinance say the extra living units create only “gentle density” as if the additional units are like dropping sugar cubes into cups of coffee and having them dissolve out of sight.) After discussions spanning two of its monthly meetings, the GPNA Board adopted a resolution in June, 2024 “categorically” opposing the city expanding the ADU program to its community. Pointing out how Gladstone Parkers specifically choose to live in the Far Northwest corner of the city for its already “naturally affordable” housing and diversity as well as its readily available parking with virtually no need for permit parking or parking meters, the organization declared ADUs an “ill fit” for its community. Particularly opposing the complete lack of parking requirements with no standards set for how many ADUs would be allowed per block, GPNA also cited the fact that most of the permits have been for conversions of what had been illegal basement units. Bringing in more residents without any mechanism to provide for the increase in demand for multiple services (police, fire, utility, health care, schools, etc.) that would entail was also a concern.

CONCLUSION

The unfortunate truth is that, because of the Far Northwest Side’s low density, spread-out nature, and proximity to the suburbs, it has always supported a strong driving culture. There is almost no need for private parking lots or garages, and they are few and far between. For this reason, there are many who believe that putting upzoned denser housing with inadequate parking in or near Gladstone Park would destroy the community’s easy-going nature defined by its lack of traffic and parking woes. The biggest fear is that the city would come in, forcing the community’s hand with Chicago’s dreaded parking meters, creating one-way streets and permit-only street parking.

There is middle ground. How about the city and the community coming to a better understanding of each other so they can explore more mutually-acceptable solutions for a neighborhood like Gladstone Park that doesn’t perhaps fit the traditional Chicago standard? And how about engaging some of the other organizations that support fair housing in myriad other ways? Housing Action Illinois, a conglomerate of some 160 nonprofit organizations, government agencies and corporations in the state, lists 64 with Chicago addresses. Their expertise and different ideas would be worth their weight in gold.