Is Housing Affordable for All in Chicago?

Chicago has committed to revitalizing the third largest public housing system in the country with its Plans for Transformation program. Its mission is to improve the appearance, quality and culture of affordable housing in the city, but not necessarily to rescue low-income residents from poor housing conditions.

According to the Metropolitan Planning Council, affordable homes in Chicago are defined as rentals for families making up to 60 percent of the Chicago Area Median Income (AMI), which is around $45,000 per year for a family of four. John Markowski, Commissioner of the Chicago Department of Housing says, "40 percent of rental households make less than $20,000, and many don't live in affordable housing."

Markowski notes that the Chicago Department of Housing is not the same as the Chicago Housing Authority (CHA), and does not own or manage buildings, but instead they are "the largest locally funded rental subsidy program in the country." The organization accesses government resources to finance affordable housing programs in the city of Chicago. The commissioner says that Chicago ranks as the 4^th most affordable large city.

Within the last month, the Chicago City Council approved an ordinance designed to increase the supply of affordable housing. It expands the Affordable Requirements Ordinance, which currently requires 10 percent of units to be affordable in residential developments that receive discounted City land and 20 percent to be affordable in developments that receive City financial assistance. The city expects the new policy to produce about 1,000 units of affordable housing each year. Several other affordable housing ordinances were also approved.

As a result of the CHA's 15-year Plan for Transformation, no new applicants are being accepted for public housing, and the waiting lists are closed. Many high-rise projects have been torn down, and previous low-income housing sites for families and senior citizens are being replaced with mixed-income housing. While the renovations and new construction have an aesthetic appeal to the city, the new construction, which will replace or renovate 25,000 units of public housing by 2009, has generated fewer overall units that are available to the low and moderate-income population that occupied previous buildings.

At the end of 2005, the CHA had completed 14,189 or 56 percent of the units. 3,738 affordable homes are also being developed under Plans for Transformation. The majority are rental homes, but some will be sold. As of October 2005, 638 of these homes were built, with 778 more are estimated to be complete by December 2007.

The general definition of affordable housing means that a household pays no more than 30 percent of its annual income on housing. According to the U.S. Department of Housing and Urban Development, "an estimated 12 million renter and homeowner households now pay more then 50 percent of their annual incomes for housing, and a family with one full-time worker earning the minimum wage cannot afford the local fair-market rent for a two-bedroom apartment anywhere in the United States."

The National Low Income Housing Coalition states that, in Illinois, "an extremely low income household (earning $20,745, percent of the Area Median Income of $69,150) can afford monthly rent of no more than $519, while the Fair Market Rent for a two bedroom unit is $805. A minimum wage earner (earning $5.15 per hour) can afford monthly rent of no more than $268."

Many residents in Chicago depend on low-income housing provided by the Chicago Housing Authority, or Section 8 vouchers from the Chicago Housing Choice Voucher Program, in order to be able to afford rent in the city. This population includes low-income working families as well as the elderly or people with disabilities.

In Chicago, the Section 8 Voucher Program serves more than 36,000 families. The program is a time consuming one, with many interested individuals being placed on a waiting list for years before being interviewed and accepted into the program. The last waiting list was generated in 1997 and contained 35,000 families. A random choice lottery was used to select individuals into the program. According to CHAC the waiting list still contains 9,750 families.

Once a family has been selected, interviewed and meets CHAC income guidelines, they begin the process of looking for housing that meets their needs. Then the unit must face and pass an inspection before it is approved for subsidy. The renter then pays between 30-40 percent of their income on rent, while CHAC covers the difference.

This is just one of the options that Chicagoans have for affordable housing. According to the Chicago Department of Housing's Affordable Housing Plan for 2004-2008, the city is continuing its goal of providing affordable housing to residents in the city. Between 2004 and June of this year, the department has committed $969 million to affordable housing and has assisted more than 23,000 units.

Through the first half of 2006, the department spent over $101 million and supported over 4,900 units of affordable housing. This includes creation and preservation of affordable rental units, such as Wentworth Commons, a new development on Chicago's south side that now provides housing for men, women and children who were formerly homeless or at risk for homelessness.

In addition to rental assistance, Department of Housing goals of affordable housing are also to create opportunities for home ownership. To encourage developers to create affordable housing, city owned land is sold to them at a $50,000 discount. The price cap for these developments is $195,000 for single-family homes and $265,000 for two-flats.

However these home-buying options are geared toward first time homebuyers who earn less than 100 percent of area median income, which is currently $75,000 for a family of four. Although this is considered a part of affordable housing, it is not likely that these programs would benefit extremely low -income individuals, but those who have a more moderate source of income.

Chicago also has a City Mortgage program, which, over the last 10 years, has helped over 4000 individuals and families become homeowners. This program allows a person to obtain a 30-year, fixed rate mortgage at competitive interest rates, and provides an up-front grant of 4 percent of the total mortgage to help cover the down payment and closing costs on a home.

Illinois was the fourth state in the U.S. to enact an affordable housing appeals statute. In August 2003, Illinois Governor Rod Blagojevich signed the Affordable Housing Planning and Appeals Act. In June of 2006, the governor signed two additional affordable housing laws, Senate Bill 2290, the Comprehensive Housing Planning Act which transforms the 2003 law into a permanent measure to create and preserve affordable housing across the state, and Senate Bill 2885, the Location Efficiency Incentive Act, which provides business benefits to qualifying companies who locate in areas with affordable housing and access to public transportation.

According to a June 2006 governor's press release, "The new law specifically identifies six underserved populations that must be addressed in the state's annual comprehensive plan: very low-income households and families; low-income seniors; low-income people with disabilities; homeless people and those at risk of becoming homeless; people unable to find affordable housing near jobs or transportation; people living in existing affordable housing in danger of becoming unaffordable."

With economic development and the growing population of Chicago, property values in certain areas continue to rise, and affordable housing options seem less available to those who need it, and difficult to obtain for those who are not already receiving it. Unfortunately, the minority population seems to be the most severely affected by the issue.

The Chicago Area Fair Housing Alliance is made up of 30 organizations that work together to advocate equal housing in the city. President Rob Breymaier was recently featured on Truth in Action, a segment of Chicago Works, a program that airs on Chicago Access television. He talked about housing in Chicago with Clarence Wood, Chair of the Chicago Commission on Human Relations.

They noted that Chicago is the 5^th most segregated region in the country. Breymaier discussed how, for example although affordable housing was being created in the Pilsen neighborhood in Chicago, many residents who lived there could not afford this housing and were being displaced. The rate of affordability was based not on the median income of the community, but on the regional median income. He stated that residents there desired that at least some of the affordable housing being built in that area be made affordable for the people who live there.

Breymaier stated that more than government programs alone are necessary for affordable housing to be effective and make real change. "We can't simply talk about economic development and not talk about how race is affected, and we can't talk about economic development without talking about housing as well," he said. "We can't simply develop affordable housing in poor communities and hope that that will make a difference." He said that while it would make some difference, affordable housing should be available in more affluent parts of the city as well, so that people can live wherever they desire to live in the city.

Although the city is working on improving existing affordable housing and building new units, there are still many low income residents who are not able to take advantage of any of these options, because there just aren't enough resources for everyone. CHA and the Section 8 program are the main resources, but both programs say they are not able to help any new residents, and neither gives a timeline as to when they will be able to.

The Resident's Journal reflects the voices of many people who are affected by public housing, and shows that while the millions of dollars that are going into affordable housing are making a difference to some, there are others who still may never benefit, as Chicago continues to flourish and becomes a city that is harder to survive in as a low income resident.