Advancing Fair Housing through ADU Production

Chicago faces a housing crisis shortage of at least 120,000 affordable rental units, including tens of thousands that need to be either fully accessible to accommodate persons in wheelchairs or livable for people with modest mobility difficulties. By continuing only with current approaches, it will literally take 100 years to close these gaps. The failure to meet the need is not simply about lack of production. Persistent discriminatory practices, low public
awareness, lack of systemic industry engagement, and inconsistent planning also factor in.

 

Chicago City Council is considering an ordinance to promote the production of accessory dwelling units (ADUs). ADUs are units added to existing structures (add-ons or conversions of unproductive basement space) or by building freestanding accessory structures on a parcel.
The raw inventory of qualified spaces for ADU conversions is massive and because many of these conversions could also be made accessible to persons with disabilities, there is an equally massive opportunity to affirmatively advance fair housing and significantly address the unmet
housing needs of those with disabilities. We think the city’s proposed ordinance needs to be fixed to avoid squandering this unique opportunity and will explain the fair housing connection.

 

Fair housing is about creating a housing market where equal opportunity is afforded to all people, without respect to race, age, gender, or other protected class statuses. Unfortunately, the private housing market does not and has never produced equal housing. Fair housing laws and policies work to prevent illegal discrimination and to promote voluntary actions by housing producers and others to improve housing opportunities for underserved groups. Education,
outreach, and incentives to encourage private actors toward constructive participation are necessary ingredients for advancing fair housing.

Chicago has an estimated 30,000 privately-owned multi-family properties that have unproductive space where 2 or more units can be added. Collectively, we estimate ADU conversion potential of 115,000 new units. Factor in hundreds of linear miles of surplus store fronts in

ULI ADU Report Cover

neighborhood commercial districts and the adaptive re-use potential is bolstered by 80,000 additional units. Owners of neighborhood multi-family properties and store fronts bring rehab experience, access to capital, and management experience that make them shovel-ready partners, but their participation is 100% voluntary.


If COVID-19 is teaching anything about solving a crisis, it is that all parties need to participate to achieve success. In contrast, the proposed ordinance discourages participation from three groups. First, the ordinance discourages property owners wishing to add 2 or more units by requiring they commit to setting aside 50% of those units for low income housing for 30 years and risk severe penalties if they fail to comply. Under such a regime, very few owners – maybe zero - will volunteer their properties. Restrictions are more than unnecessary. They bring an abrupt end to contributions from nearly the entire market segment.

Second, the ordinance discourages neighborhood engagement, which occurs under the current practice of deferring to aldermanic prerogative. Ward-level review processes are in place in most Chicago wards that encourages owners interested in pursuing conversions to engage the aldermen, their staff, and neighbors in discussions around their proposed projects. Ironically, the engagement of neighbors offers direct opportunity to confront fair housing biases and NIMBY-ism, and to engage in thoughtful discussion about how to create diverse and inclusive communities. In granting by-right permission to owners, the ordinance denies neighborhoods the invaluable open forum for equitable conversation.


Third is the matter of aldermanic prerogative. Historically, aldermen have used their power over zoning and land use to discourage certain housing in their wards. Sentiment exists to eliminate aldermanic prerogative to counter this, but we caution against throwing out the baby with the bathwater. To advance fair housing through ADU production and conversion, an alderman or alderwoman is uniquely positioned to be programmatically channeled, not sidelined. They can invite and facilitate owner participation at a scale greater than any approach that otherwise excludes them from the ultimate project approval process. The ordinance should ensure a constructive role for interested aldermen in helping lead the way to deliver ADU units through a coordinated approach. Aldermen who choose not to participate will be notable in comparison with those who do. Cutting them all out takes us completely in the wrong direction.


In our experience as a volunteer-led 501c3 nonprofit, we have introduced scores of ADU project opportunities in 20 aldermanic wards. We have teased out architecture and construction costs, evaluated how best to achieve affordability and accessibility, and piloted turnkey project planning and financing, leasing and master lease services. Housing Plus projects ranged from a single unit created in the empty basement of a 2-flat to 10 units converted from unproductive store front and storage space in a mixed-use property. These efforts have triggered countless conversations with thousands of participants that advance the fair housing argument.


In our view, the shortage of units must be properly understood as part and parcel of the city’s fair housing crisis and therefore, the ADU ordinance must fundamentally support the advancement of fair housing by maximizing private owner participation, fostering neighborhood education and outreach, and enlisting aldermen to solve the problems their predecessors created.

RELATED: The Dollars and Sense of ADUs in Chicago

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Address: 425 W. North Avenue, Chicago, IL 60610

Phone:    773 617-2541

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