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(A) Title. This section shall be known and cited as the "Milwaukee Corridor ARO Pilot Area Ordinance".
(B) Purpose. The purpose of this section is to establish modified affordable housing requirements for designated neighborhoods along the Milwaukee corridor adjacent to the CTA’s Blue Line that are experiencing gentrification. The goals of these modified requirements are to mitigate the displacement impacts associated with gentrification, better protect the interests of the area’s economically vulnerable residents from demographic and housing market change, and preserve the economic diversity critical to a healthy economy.
(C) Relationship to 2015 ARO. The requirements in this section supplement or modify the affordable housing requirements in Section 2-44-080. In the event of a conflict between these requirements and the requirements in Section 2-44-080, the requirements in this section will control; provided, however, when a residential housing project receives financial assistance from TIF Funds, the requirements set forth in Section 2-44-080 will continue to apply and will control in the event of a conflict, except with respect to the location requirements set forth herein.
(D) Definitions. Except as provided below, defined terms shall have the meanings given in Section 2-44-080.
"Additional units" means the extra units required to be affordable under this section in excess of the units required to be affordable under Section 2-44-080.
"Affordable unit" means a housing unit required by this section to be affordable, whether located on-site or off-site and whether a rental unit or an owner-occupied unit.
"Appreciated" is a term used to describe a census tract that: (i) had low to moderate home values in 2000 (i.e., a median home value in the bottom three quintiles of all census tracts in the City), and (ii) high home values in 2015 (i.e., a median home value in the top two quintiles of all census tracts in the City), and (iii) experienced a high appreciation rate between 2000 and 2015 (i.e., appreciation rate in the top two quintiles of all census tracts in the City).
"Demographic change" means a shift in the demographic conditions of an area in which at least three of the following four population changes have occurred from 2010 to 2015, relative to the citywide median: percentage of homeowners has increased; percentage of minorities (as defined in Section 2-92-670) has decreased; percentage of residents with a bachelor’s degree or higher has increased; and median household income has increased.
"Ongoing displacement" is a term used to classify census tracts that are in the midst of gentrification. These census tracts: (i) no longer have a vulnerable population, (ii) have undergone demographic change indicative of gentrification, and (iii) have an appreciated market condition, as determined by the Commissioner based upon published data regarding Chicago or area median income, the cost of housing, or other data indicative of gentrification or loss of affordable housing.
"Vulnerable population" means a population with at least three of the following four characteristics based on 2015 data: percentage of renters is higher than the citywide median; percentage of minorities (as defined in Section 2-92-670) is higher than the citywide median; percentage of residents without a bachelor’s degree is higher than the citywide median; and median household income is lower than the citywide median.
(E) Boundaries. A map of the Milwaukee Corridor Pilot Area is published in the Journal of the Proceeding of the City Council of the City of Chicago, October 11, 2017, page 56919, and on file in the Office of the City Clerk and made a part hereof. The boundary lines of the Milwaukee Corridor Pilot Area follow streets, and such boundary lines are to be construed as the centerlines of said streets.
(F) Stage of displacement. The Milwaukee Corridor Pilot Area is characterized primarily by ongoing displacement.
(G) Modified ARO requirements. The requirements of Section 2-44-080 shall apply in the Milwaukee Corridor Pilot Area, except as modified below:
(1) No in lieu fee option. The option to pay a fee in lieu of the establishment of affordable units is eliminated in the Milwaukee Corridor Pilot Area.
(2) Required percentage of affordable units. The percentage of units required to be affordable in a residential housing project in the Milwaukee Corridor Pilot Area, whether rental or for sale, is increased from 10 percent to 15 percent if all of the affordable units are provided on-site or 20 percent if any affordable units are provided off-site. Notwithstanding the foregoing, whenever the City provides financial assistance, the percentage of units required to be affordable remains 20 percent in accordance with subsection (C)(3) of Section 2-44-080.
(3) Affordability standards and income eligibility criteria for rental units. Affordable rental units in the Milwaukee Corridor Pilot Area may be leased to households earning up to eighty percent (80%) of the area median income, but must be affordable to households earning up to sixty percent (60%) of the area median income.
(4) Location requirements. If the developer elects to provide affordable units in an off-site location and the Commissioner approves the developer’s off-site proposal under subsection (V) of Section 2-44-080, the off-site units must be located within the Milwaukee Corridor Pilot Area. Such off-site units may be located anywhere in the Milwaukee Corridor Pilot Area, regardless of distance from the residential housing project or income area in which the residential housing project is located. Notwithstanding the foregoing, when a residential housing project receives financial assistance from TIF Funds, all affordable units must be provided on-site.
(H) Pending applications. This section shall apply to all residential housing projects subject to the affordable housing requirements of Section 2-44-080, unless: (1) an ordinance authorizing a City land sale or financial assistance, as described in Section 2-44-080(C), has been introduced to City Council prior to November 1, 2017; or (2) an ordinance authorizing a rezoning of property, as described in Section 2-44-080(C), has been introduced to City Council and (i) in the case of projects that are subject to planned development review, the Chicago Plan Commission has adopted a resolution recommending approval of the planned development prior to November 1, 2017, or (ii) in the case of any other rezoning of property, the Committee on Zoning, Landmarks and Building Standards has voted to approve the rezoning prior to November 1, 2017.
(I) Rules. The Commissioner is authorized to adopt such rules as the Commissioner may deem necessary for the proper implementation, administration and enforcement of this section. The Commissioner shall provide an annual report to the City Council Committee on Housing and Real Estate detailing the outcomes of the pilot program.
(J) Commissioner’s authority to enter into service agreements for marketing, income qualification and other services. In furtherance of administering this section, the Commissioner shall have the authority to enter into service agreements with outside providers selected by the Commissioner to market affordable housing created hereunder and pursuant to other City programs to residents of the Milwaukee Corridor Pilot Area, assist developers of residential housing projects in the Milwaukee Corridor Pilot Area with income qualification of tenants and purchasers of affordable units created hereunder, conduct educational programs for residents of the Milwaukee Corridor Pilot Area regarding the purchase or lease of affordable housing, provide counseling and disseminate information regarding eligibility for affordable housing to residents of the Milwaukee Corridor Pilot Area, and provide other services to ensure that the affordable units created hereunder are effectively marketed and provided to the target populations intended to benefit from such affordable units. Such service agreements may contain terms and conditions that the Commissioner deems appropriate, and the Commissioner shall have the authority to perform any and all acts as shall be necessary or advisable in connection with such service agreements and any renewals thereto, including the expenditure of Affordable Housing Opportunity Fund monies, or other duly appropriated funds, for such agreements.
(K) Limited continuing application. This section shall apply to any residential housing project in the Milwaukee Corridor Pilot Area for which the City Council has passed an ordinance approving a rezoning, City land sale, or financial assistance, as described in Section 2-44-080(C), prior to October 1, 2021.
(Added Coun. J. 11-14-18, p. 90308, Art. I, § 1; Amend Coun. J. 11-20-19, p. 9510, Art. II, § 5 and Art. IV, § 5; Amend Coun. J. 12-16-20, p. 25252, § 2 Amend Coun. J. 4-21-21, p. 29627, § 5)
(A) Title. This section shalt be known and cited as the "Pilsen-Little Village ARO Pilot Area Ordinance".
(B) Purpose. The purpose of this section is to establish modified affordable housing requirements for designated neighborhoods along the proposed El Paseo multi-use trail project that are experiencing gentrification. The goals of these modified requirements are to mitigate the displacement impacts associated with gentrification, better protect the interests of the area’s economically vulnerable residents from demographic and housing market change, and preserve the economic diversity critical to a healthy economy.
(C) Relationship To 2015 ARO. The requirements in this section supplement or modify the affordable housing requirements in Section 2-44-080. In the event of a conflict between these requirements and the requirements in Section 2-44-080, the requirements in this section will control; provided, however, when a residential housing project receives financial assistance from TIF Funds, the requirements set forth in Section 2-44-080 will continue to apply and will control in the event of a conflict.
(D) Definitions. Except as provided below, defined terms shall have the meanings given in Section 2-44-080:
"Accelerating" is a term used to describe a census tract that (i) had low to moderate home values in 2015 (i.e., a median home value in the bottom three quintiles of all census tracts in the City), but (ii) experienced a high appreciation rate between 2010 and 2015 (i.e., appreciation rate in the top two quintiles of all census tracts in the City).
"Additional units" means the extra units required to be affordable under this section in excess of the units required to be affordable under Section 2-44-080.
"Adjacent" is a term used to describe a census tract that (i) had low to moderate home values in 2015 (i.e., a median home value in the bottom three quintiles of all census tracts in the City), (ii) experienced a low to moderate appreciation rate between 2010 and 2015 (i.e., appreciation rate in the bottom three quintiles of all census tracts in the City), but (iii) touches the boundary of at least one census tract that had high home values in 2015 (i.e., a median home value in the top two quintiles of all census tracts in the City) or a high appreciation rate between 2010 and 2015 (i.e., appreciation rate in the top two quintiles of all census tracts in the City).
"Affordable unit" means a housing unit required by this section to be affordable, whether located on-site or off-site and whether a rental unit or an owner-occupied unit.
"Appreciated" is a term used to describe a census tract that (i) had low to moderate home values in 2000 (i.e., a median home value in the bottom three quintiles of all census tracts in the City), and (ii) high home values in 2015 (i.e., a median home value in the top two quintiles of all census tracts in the City), and (iii) experienced a high appreciation rate between 2000 and 2015 (i.e., appreciation rate in the top two quintiles of all census tracts in the City).
"Demographic change" means a shift in the demographic conditions of an area in which at least three of the following four population changes have occurred from 2010 to 2015, relative to the citywide median: percentage of homeowners has increased; percentage of minorities (as defined in Section 2-92-670) has decreased; percentage of residents with a bachelor’s degree or higher has increased; and median household income has increased.
"Early displacement" is a term used to classify census tracts that are showing early signs of gentrification. These census tracts (i) have a vulnerable population at risk of displacement from rising housing costs, (ii) have undergone demographic change indicative of gentrification, and (iii) have adjacent, accelerated or appreciated market conditions, as determined by the Commissioner based upon published data regarding Chicago or area median income, the cost of housing, or other data indicative of gentrification or loss of affordable housing.
"First units" means the units required to be affordable under Section 2-44-080.
"Little Village" means the neighborhood within the Pilsen-Little Village Pilot Area that consists mainly of census tracts that are susceptible to displacement.
"Pilsen" means the neighborhood within the Pilsen-Little Village Pilot Area that consists mainly of census tracts that are experiencing early displacement.
"Susceptible to displacement" is a term used to classify census tracts that are at-risk of gentrification. These census tracts (i) have a vulnerable population at risk of displacement from rising housing costs, (ii) have not undergone demographic change indicative of gentrification, but (iii) have accelerating or adjacent market conditions, as determined by the Commissioner based upon published data regarding Chicago or area median income, the cost of housing or other data indicative of gentrification or loss of affordable housing.
"Vulnerable population" means a population with at least three of the following four characteristics based on 2015 data: percentage of renters is higher than the citywide median; percentage of minorities (as defined in Section 2-92-670) is higher than the citywide median; percentage of residents without a bachelor’s degree is higher than the citywide median; and median household income is lower than the citywide median.
(E) Boundaries. A map of the Pilsen-Little Village Pilot Area is published in the Journal of the Proceedings of the City Council of the City of Chicago of December 12, 2018, page 92139*, and on file in the Office of the City Clerk and made a part hereof. The boundary lines of the Pilsen-Little Village Pilot Area follow streets, and such boundary lines are to be construed as the centerlines of said streets.
* Editor’s note – Coun. J. 12-12-18, p. 92132, § 2, did not include the page number; it has been inserted at the discretion of the editor.
(F) Stage of displacement. Pilsen is characterized primarily by early displacement. Little Village is characterized primarily as susceptible to displacement.
(G) Modified ARO requirements. The requirements of Section 2-44-080 shall apply in the Pilsen-Little Village Pilot Area, except as modified below:
(1) Increased in lieu fees. The in lieu fees for affordable units in the Pilsen-Little Village Pilot Area shall be as follows: (i) $178,469 per affordable unit in Pilsen; and (ii) $101,388 per affordable unit in Little Village. Each in lieu fee shall be subject to the annual adjustment set forth in the definition of "in lieu fee" in Section 2-44-080(B) and collected pursuant to Section 2-44-080(G). Notwithstanding Section 2-44-080(F)(2) – (4), in lieu fees collected within the Pilsen-Little Village Pilot Area shall not be reduced because of any sale or lease of required affordable units in the residential housing project to an authorized agency.
(2) Required percentage of affordable units. Except as provided in subsection (3) below, the percentage of units required to be affordable in a residential housing project in the Pilsen-Little Village Pilot Area, whether rental or for sale, is increased from 10 percent to 20 percent.
(3) Incentive for larger units. Notwithstanding subsection (2) above, in the Pilsen-Little Village Pilot Area, the Commissioner, after consultation with the alderman of the ward in which the residential housing project is located, may reduce the required number of affordable units in exchange for units with more bedrooms, as follows:
(i) one 2-bedroom unit is equivalent to 1.25 studio or 1-bedroom units; and
(ii) one 3-bedroom unit is equivalent to 2.5 studio units or two 1-bedroom units.
(4) Location requirements. In the Pilsen-Little Village Pilot Area, first units must be provided on-site. Additional units may either be provided on-site or the developer may pay a fee in lieu of the establishment of one or more such additional units. Notwithstanding the foregoing, when a residential housing project receives financial assistance from TIF Funds, all affordable units must be provided on-site.
(H) Pending applications. This section shall apply to all residential housing projects subject to the affordable housing requirements in Section 2-44-080, unless: (1) an ordinance authorizing a City land sale or financial assistance, as described in Section 2-44-080(C), has been introduced to City Council prior to January 1, 2019; or (2) an ordinance authorizing a rezoning of property, as described in Section 2-44-080(C), has been introduced to City Council and (i) in the case of projects that are subject to planned development review, the Chicago Plan Commission has adopted a resolution recommending approval of the planned development prior to January 1, 2019, or (ii) in the case of any other rezoning of property, the Committee on Zoning, Landmarks and Building Standards has voted to approve the rezoning prior to January 1, 2019.
(I) Rules. The Commissioner is authorized to adopt such rules as the Commissioner may deem necessary for the proper implementation, administration and enforcement of this section. The Commissioner shall provide an annual report to the City Council Committee on Housing and Real Estate detailing the outcomes of the pilot program.
(J) Expiration. This section shall expire and be repealed of its own accord, without further action by the City Council, on December 31, 2023.
(Added Coun. J. 12-12-18, p. 92132, § 2; Amend Coun. J. 11-20-19, p. 9510, Art. II, § 6 and Art. IV, § 6)
(a) Title. This section shall be known and cited as the "Affordable Conversion Unit Ordinance" or "ACU Ordinance".
(b) Purpose. This section establishes affordability requirements for certain conversion units established in conformity with the Chicago Zoning Ordinance, Title 17 of the Municipal Code of Chicago, in order to preserve and expand available affordable housing in the City.
(c) Definitions. As used in this section:
"Additional Dwelling Unit-Allowed Areas" has the meaning ascribed to that term in Section 17-7-0570.
"Affordable Conversion Unit(s)" means any one or more affordable housing unit(s) designated as such and required to be registered as such by the Department of Housing pursuant to subsection (e) of this section.
"Affordable housing unit(s)" means housing that is affordable to households earning up to 60% of the area medium income ("AMI"), as published annually by the Department of Housing. As used in this definition: "Affordable" means annual rent less than or equal to the amount at which total monthly housing costs, as specified in rules duly promulgated by the Commissioner, do not exceed 30% of income for a household making 60% of the area medium income.
"Area median income" or "AMI" means the median household income for the Chicago Primary Metropolitan Statistical Area, as calculated and adjusted on an annual basis by the United States Department of Housing and Urban Development.
"Commissioner" means the Commissioner of the Department of Housing.
"Conversion unit" has the meaning ascribed to that term in Section 17-17-240.6.
"Owner" has the meaning ascribed to the term "property owner" in Section 17-17-02134.
"Residential building" means a residential building, as defined in Section 17-17-02146, that is a principal building, as defined in Section 17-17-02125.
(d) Affordable conversion units – Required when. If, pursuant to Section 17-2-0303-C, two or more conversion units are added, either separately or in any combination, at any time after the effective date of this ACU Ordinance, to a residential building other than to a residential building owned, operated or maintained by the Chicago Housing Authority, the owner of such building shall maintain 50% of those newly added conversion units as affordable housing units for the duration of the affordability requirement as set forth in subsection (i) of this section; provided, however, that if this 50% calculation results in a fractional number, any such fractional result shall be rounded down to the nearest integer. This subsection (d) shall run with the land and be enforceable against any subsequent owner.
(e) Registration. Concurrent with the application by a building owner for a building permit with the Department of Buildings for a conversion unit, the Department of Housing will advise the owner whether any of the proposed conversion units are required to be maintained as affordable housing unit(s). If the owner is required under this section to maintain any of the proposed conversion units as affordable housing unit(s), the owner shall register those designated Affordable Conversion Unit(s) with the Department of Housing in accordance with rules duly promulgated by the Commissioner. Such registration shall be accompanied by the Affordable Conversion Unit Initial Registration Fee for each Affordable Conversion Unit, as set forth in Section 2-44-065, to defray the costs of administering this section.
(f) Recorded notice – Required. For each Affordable Conversion Unit, the Department of Housing shall require the owner to record, with the Cook County Recorder of Deeds, a document in a form prescribed by the Commissioner, against the property on which such Affordable Conversion Unit is located indicating that such Affordable Conversion Unit is required to be maintained as an affordable housing unit for the duration of the affordability requirement, as set forth in subsection (i) of this section. Such notice shall require owners and subsequent owners to keep owner contact information, including an e-mail address, current with the Department of Housing.
(g) Building permit – Prohibited when. No building permit shall be issued by the Department of Buildings for any Affordable Conversion Unit until: (i) the applicant for such permit provides the Department of Housing with a copy of the recorded notice required under subsection (f) of this section; and (ii) the Department of Housing provides written notification of such fact to the Department of Buildings.
(h) Annual compliance affidavit – Required. Each owner of one or more Affordable Conversion Unit(s) shall, on or before January 15 of each calendar year following initial registration of such Affordable Conversion Unit(s) with the Department of Housing, file an annual compliance affidavit with the Department of Housing certifying that each such Affordable Conversion Unit is being maintained as an affordable housing unit within the meaning of this section.
(i) Duration of affordability requirement. Each Affordable Conversion Unit shall be maintained as an affordable housing unit for 30 years from the date of the recorded notice required under subsection (f) of this section.
(k) Rules. The Commissioner is authorized to adopt such rules as the Commissioner deems necessary or appropriate for the proper implementation, administration and enforcement of this section.
(l) Penalty. In addition to any other penalty provided by law, any owner of an Affordable Conversion Unit who violates this section shall be subject to a fine of $500.00 for each offense. Each day that a violation continues shall constitute a separate and distinct offense.
(m) Private right of action. An aggrieved tenant may enforce this section against any owner subject to this section by means of a civil action in which the court may provide injunctive relief or award treble damages and the plaintiffs court costs and reasonable attorney fees.
(n) Chicago Low-Income Housing Trust Fund. The Commissioner is authorized to enter into agreements with the Chicago Low-Income Housing Trust Fund to reserve City-funded vouchers for use in connection with conversion units, including but not limited to Affordable Conversion Units and dwelling units in coach houses.
(o) Low- and moderate-income household assistance. The Commissioner is authorized to establish grant programs to assist low- and moderate-income households with the construction, rehabilitation (including modifications that enhance accessibility for people with disabilities), and preservation of conversion units, including but not limited to Affordable Conversion Units and dwelling units in coach houses. Funds from the Affordable Housing Opportunity Fund and other sources, as may be appropriated from time to time, are hereby authorized for use in connection with such programs.
(p) Recommendation to City Council of expansion of additional dwelling unit-allowed areas. On or before May 31, 2024, the Department of Housing and the Department of Planning and Development shall evaluate the establishment of conversion units (including Affordable Conversion Units) and coach houses in Additional Dwelling Unit-Allowed Areas to reassess best practices for their regulation and to make recommendations to the City Council regarding expansion, contraction or elimination of such Additional Dwelling Unit-Allowed Areas.
(Added Coun. J. 12-16-20, p. 26066, § 3)
(a) With respect to each Eligible Program (as defined in paragraph (b) below), Eligible Persons (as defined in paragraph (b) below) shall not be subject to the restrictions of Section 2-156-110, but only as that section pertains to the participation of said Eligible Persons under such Eligible Program.
(b) As used in this section:
(i) "Eligible Programs" shall mean: (1) programs administered by the Department (or by delegate agencies or other entities with funds provided, in whole or in part, by the Department) which provide various forms of economic assistance (including, but not limited to, land write-downs and financial assistance in the form of grants, loans, fee waivers and tax credits) directly to individuals who are tenants in residential buildings in the City or are owner-occupants of one- to four-unit residential buildings in the City (including individuals who are owner-occupants of a condominium unit in the City), or which provide for the rehabilitation of one- to four-unit residential buildings in the City (including one to four condominium units, without regard to the total number of condominium units in the building); and (2) rental subsidy assistance for very low-income households (as "very low-income" may be defined by United States Department of Housing and Urban Development), provided by the Department through The Chicago Low-Income Housing Trust Fund, an Illinois not-for-profit corporation, or through another entity selected by the Commissioner, and which is paid directly to owners of residential buildings in the City.
(ii) With respect to each Eligible Program, "Eligible Persons" shall mean employees and appointed officials of the City (other than those persons described in the next succeeding sentence) who meet the eligibility requirements to participate under such Eligible Program. With respect to each Eligible Program, the following employees and appointed officials of the City shall not constitute "Eligible Persons" for such Eligible Program: any employee or appointed official who, during his/her tenure of employment or appointment, respectively, by the City (1) exercises or has exercised any contract management authority with respect to such Eligible Program, (2) is or was in a position to participate in a decision-making process with respect to such Eligible Program, or with respect to a specific project entered into pursuant to such Eligible Program, or (3) gains or has gained confidential information with regard to such Eligible Program.
(iii) If an employee or appointed official of the City qualifies as an "Eligible Person" pursuant to paragraph (ii) above, the following shall also qualify as "Eligible Persons": (1) such employee’s or official’s spouse or domestic partner, and (2) any entity in which such employee or official has a "financial interest" (as defined in Section 2-156-010).
(c) The Commissioner is authorized to promulgate rules and prepare forms to effectuate the purposes of this section in conformity, to the extent applicable, with subsection (c) of Section 2-44-050.
(Added Coun. J. 11-14-18, p. 90308, Art. I, § 1)
(A) Title. This section shall be referred to as the Affordable Housing Preservation Ordinance.
(B) Definitions. As used in this section:
"Affordability preservation agreement" means an agreement between the owner and a purchaser: (i) in which the purchaser agrees to maintain the development in a manner that preserves the development’s existing affordability restrictions, or (ii) that would qualify the development as affordable housing as defined in the Illinois Affordable Housing Act, and (iii) in which the affordability restrictions set forth in the agreement are memorialized in covenants running with the land, in a form approved by the Commissioner, enforceable by the City as a third party beneficiary. The affordability restrictions in each affordability preservation agreement shall extend for a period as shall be agreed to by the owner and the purchaser and which shall be not less than ten (10) years from the date of the sale or disposition of the development.
"Affordability restrictions" means limits on rents that owners may charge for occupancy of a rental unit in assisted housing and limits on tenant income for persons or families seeking to qualify as tenants in assisted housing.
"Assisted housing" or "assisted housing development" or "development" means a rental housing development, or a mixed-use development that includes rental housing, that receives government assistance under any of the following programs:
(1) new construction, substantial rehabilitation, moderate rehabilitation, property disposition and loan management set-aside programs, or any other program providing project-based rental assistance, under Section 8 of the United States Housing Act of 1937, as amended;
(2) the Below-Market-Interest-Rate Program under Section 221(d)(3) of the National Housing Act;
(3) Section 236 of the National Housing Act;
(4) Section 202 of the National Housing Act;
(5) Programs for rent supplement assistance under Section 101 of the Housing and Urban Development Act of 1965, as amended;
(6) Programs under Section 514 or 515 of the Housing Act of 1949;
(7) Section 42 of the Internal Revenue Code.
"Bona fide offer" means an offer evidenced by a purchase contract reflecting a sales price and an earnest money deposit equal to at least 5 percent of the sales price identified in the purchase contract.
"Federally Assisted Housing Preservation Act" or "Act" or "State Act" means the Federally Assisted Housing Preservation Act, codified at 310 ILCS 60/1, et seq., as amended.
"H.U.D." means the United States Department of Housing and Urban Development.
"Just cause eviction" means any eviction for serious or repeated violations of the terms and conditions of a lease or occupancy agreement, or for violation of applicable federal, state or local laws or for other good cause.
"Non-qualified entity" means any person or entity that is not a qualified entity.
"Owner(s)" means the person, partnership, corporation, limited liability company or other legal entity that holds title to an assisted housing development.
"Prepay" or "prepay the mortgage" or "prepayment" means the payment in full or refinancing of the federally insured or federally held mortgage indebtedness prior to its original maturity date, or the voluntary cancellation of mortgage insurance, on an assisted housing development described in paragraph (2), (3) or (4) of the definition of "assisted housing" set forth in this subsection, that would have the effect of removing the affordability restrictions applicable to the assisted housing development under the programs described in paragraph (2), (3) or (4) of the definition of "assisted housing" set forth in this subsection.
"Qualified entity" means any person or entity deemed to be a qualified entity by the Commissioner pursuant to subsection (I) of this section.
"Substantial deviation" means any substitution of parties to a contingent sales agreement; any change in sales price of greater than 2 percent; any change in the terms of any owner financing; any change in the allocation of escrow or other fees or costs amongst the parties to the agreement; or any other substantive change to the terms of sale that alters the relative financial position of the parties to the agreement.
"Terminate" or "terminate participation in the federal program" or "termination" means:
(1) the expiration or early termination of an assisted housing development’s participation in a federal subsidy program for assisted housing described in paragraph (1) of the definition of "assisted housing" set forth in this subsection; or
(2) the expiration or early termination of an assisted housing development’s affordability restrictions described in Section 42(g) of the Internal Revenue Code for assisted housing described in paragraph (7) of the definition of "assisted housing" set forth in this subsection, when that event results in an increase in tenant rents, a change in the form of subsidy from project-based to tenant-based, or a change in the use of the assisted housing development to a use other than rental housing.
(C) Notification to Department – Required when. If the owner of an assisted housing development intends to prepay the mortgage, or to terminate participation in the federal program, or to sell or otherwise dispose of an assisted housing development, such owner shall so notify the Department. Such notification shall be given to the Department on the same date that the owner provides or is required to provide such notification to all tenants of the development under the Federally Assisted Housing Preservation Act. Provided, however, that if an owner is not required under Section 8 of the Act to provide notice to tenants of the owner’s intent to prepay the mortgage, or to terminate participation in the federal program or to sell or otherwise dispose of the development, the owner shall provide notice to the Department in accordance with the requirements of subsection (F) of this section.
The notice required by this subsection shall be delivered in person or mailed to the Commissioner by certified mail, return receipt requested, on a form provided by the Department, and shall contain the following information: (1) the name, address and telephone number of each owner of the development; (2) the address of the development; (3) the nature of the subsidy maintaining the affordability of the development; (4) whether the owner is exempt under Section 8 of the Federally Assisted Housing Preservation Act from providing a notice of intent to tenants, and if exempt, the basis for the exemption; (5) a description of the development, including the number of units comprising the development and the number of bedrooms within each unit; (6) the date on which the owner intends to prepay, terminate, sell or otherwise dispose of the development; (7) a complete and detailed list of all existing affordability restrictions applicable to the development and the units to which these restrictions apply; (8) the development’s current rent roll, including each unit number and the monthly rent charged for each unit; (9) the number and location of vacant units in the development; (10) a statement of the development’s vacancy rate during the preceding 12 months; (11) a statement of the development’s current income and operating expenses; (12) itemized lists of the development’s capital expenditures in each of the two preceding calendar years; (13) the amount of project reserves; (14) copies of all financial and physical inspection reports filed with federal, state or local agencies; (15) if the owner intends to sell or otherwise dispose of the development, the owner’s asking price for the development; (16) a complete and detailed list of all affordability restrictions, if any, applicable to the planned disposition of the development; and (17) any other information that the Commissioner may require.
(D) Unlawful act – Exceptions. If, after an owner notifies or is required to notify under the Federally Assisted Housing Preservation Act the tenants of an assisted housing development of the owner’s intent to prepay the mortgage, or to terminate participation in the federal program or to sell or otherwise dispose of the development, and the tenants of such development (1) do not exercise their right under the Act to form a tenant association, or (2) fail to provide notice to the owner pursuant to Sections 4 or 6 of the Act, or (3) fail to meet any of the requirements of Section 7 of the Act, then it shall be unlawful for the owner to sell or otherwise dispose of the development to any qualified entity or non-qualified entity except in conformity with the requirements of subsection (E) of this section. Provided, however, that this prohibition on the sale or disposal of the development to a non-qualified entity shall not apply if the owner enters into an affordability preservation agreement, as defined in subsection (B) of this section, with a non-qualified entity.
(E) Contingent sales agreement – Right of first refusal – Required when. An owner may negotiate with any non-qualified entity that is interested in purchasing an assisted housing development. Provided, however, that any agreement of sale executed between the owner and such non-qualified entity shall be contingent upon the right of first refusal of a qualified entity, unless the owner enters into an affordability preservation agreement, as defined in subsection (B) of this section, with a non-qualified entity.
The contingent sales agreement required by this subsection shall contain the essential terms of the sale, including, at a minimum, the right of first refusal of a qualified entity; the sales price; the terms of seller financing, if any, including the amount, the interest rate and the amortization rate thereof; the terms of assumable financing, if any, including the amount, the interest rate and the amortization rate thereof; and, if applicable, any proposed improvements to the property to be made by the owner in connection with the sale.
Upon execution of such contingent sales agreement, the owner shall provide the Commissioner with a copy of the agreement, which shall be a public record. Upon receipt of the contingent sales agreement, the Commissioner shall immediately make a copy of such agreement available to all qualified entities for their review and consideration. Such qualified entities shall have a period of 120 days, measured from the date of receipt by the Commissioner of a contingent sales agreement meeting the requirements of this subsection, to make a bona fide offer to the owner to purchase the affordable housing development from the owner on terms that are economically substantially identical to the terms of the contingent sales agreement submitted by the owner pursuant to the requirements of this subsection.
If, within the 120-day period provided for in this subsection, a qualified entity makes a bona fide offer to the owner to purchase the affordable housing development from the owner on terms that are economically substantially identical to the terms of the contingent sales agreement and agrees to close on the sale within 120 days from the date the parties sign the contract to purchase the development, the owner shall sell the affordable housing development to the qualified entity upon those terms. If more than one qualified entity submits an offer to purchase the affordable housing development, the owner shall select from among such offers and shall sell the development pursuant to the terms of the selected offer. The owner shall enter into an affordability preservation agreement with the qualified entity purchasing the affordable housing development. Nothing in this subsection shall be construed to require any owner to extend any form of owner financing to a qualified entity.
If, within the 120-day period provided for in this subsection, a qualified entity fails to make a bona fide offer to the owner to purchase the affordable housing development from the owner on terms that are economically substantially identical to the terms of the contingent sales agreement, or fails to agree to close on the sale within 120 days from the date the parties sign the contract to purchase the development, or fails to close on the sale within 120 days of such date, the owner may sell the development to the non-qualified entity identified in the contingent sales agreement submitted by the owner in accordance with the requirements of this subsection. Provided, however, that any substantial deviation in the terms of sale from those set forth in such contingent sales agreement or the failure of the non-qualified entity identified in such contingent sales agreement to close on the sale of the development shall require the owner to resubmit any new terms of sale to the Commissioner for distribution to all qualified entities in conformity with the requirements of this subsection.
(F) Duties of owners exempt from compliance with the State Act. Except as otherwise provided in subsection (G) of this section, if an owner is not required under Section 8 of the Federally Assisted Housing Preservation Act to provide notice to tenants of the owner’s intent to prepay the mortgage, or to terminate participation in the federal program, or to sell or otherwise dispose of the assisted housing development, such owner shall provide such notice to the Department, not less than 12 months before the prepayment, termination, sale or disposal occurs, in conformity with the applicable requirements of subsection (C) of this section. It shall be unlawful for such owner to sell an affordable housing development to any qualified entity or non-qualified entity except in accordance with the requirements of subsection (E) of this section. Provided, however, that this prohibition on the sale or disposal of the development to a non-qualified entity shall not apply if the owner enters into an affordability preservation agreement, as defined in subsection (B) of this section, with a non-qualified entity.
(G) Exceptions. Notwithstanding any other provision of this section, the requirements of this section shall not apply to: (1) any sale or other disposition of assisted housing in a manner pursuant to which the development, after the sale or other disposition, continues to be assisted housing as defined in subsection (B) of this section; or (2) any government taking of an assisted housing development by eminent domain or negotiated purchase; or (3) any forced sale of a development to an entity not affiliated with the owner pursuant to a foreclosure; or (4) any other involuntary sale, transfer or other disposition of assisted housing which occurs without the consent (whether direct, indirect, express or implied) of the owner of such assisted housing.
(H) Duties of owner relative to existing tenancies. To the extent allowed by H.U.D., an owner shall: (1) maintain in good standing any available H.U.D. Section 8 contract, executed pursuant to the United States Housing Act of 1937, as amended, during the notice period set forth in subsection (C) of this section and during both of the 120-day periods identified in subsection (E) of this section; and (2) refrain from taking any action, other than notifying H.U.D. of the owner’s intention to prepay the mortgage, or to terminate participation in the federal program or to sell or otherwise dispose of the development, that would preclude a qualified entity or other potential purchaser of the development from succeeding to the contract or negotiating with the owner for purchase of the development during the time periods set forth in item (1) of this subsection. No owner shall disturb any tenancy, other than for a just cause eviction, during the time periods set forth in item (1) of this subsection.
(I) Duties of the Commissioner – Qualified entities – Eligibility criteria. The Commissioner shall establish and maintain a list of qualified entities who are interested in and capable of maintaining an assisted housing development in a manner that preserves the development’s existing affordability restrictions or qualifies the housing development as affordable housing within the meaning of the Illinois Affordable Housing Act. No entity shall be deemed to be a qualified entity by the Commissioner, unless such entity is capable of demonstrating compliance with the following eligibility criteria:
(1) a history of providing safe and sanitary affordable housing services;
(2) sufficient capacity to provide additional affordable housing services in the City, demonstrated through the adequacy of current fiscal and administrative resources;
(3) a history of encouraging and facilitating resident participation while providing affordable housing services;
(4) a history of sound fiscal management of affordable housing services; and
(5) adoption of, and compliance with, standards of financial accountability that conform to applicable state and/or federal law.
The Commissioner shall: (i) ensure that all notices and contingent sales agreements received by the Department from owners pursuant to the requirements of this section are posted on the City of Chicago website without delay; (ii) periodically notify owners of assisted housing developments of the owner’s duties and obligations under this section; and (iii) remove from the list of qualified entities any entity that fails to continue to meet the eligibility criteria set forth in items (1) through (5) of this subsection.
(J) Rules. The Commissioner shall have the authority to promulgate rules necessary to implement the requirements of this section.
(K) Penalties. Any person who violates this section shall be fined not less than $200.00 nor more than $1,500.00 for each offense. Each day that a violation continues shall constitute a separate and distinct offense to which a separate fine shall apply.
(L) Private right of action. Any aggrieved person, including but not limited to any tenant or tenant association, may enforce the provisions of this section by means of a civil action in which the court may provide injunctive relief or award treble damages and the plaintiffs court costs and reasonable attorney fees.
(M) Remedies cumulative. The penalties and remedies provided in this section shall be in addition to any other penalty or remedy provided by law.
(Added Coun. J. 11-14-18, p. 90308, Art. I, § 1)
(A) If the owner of a property containing subsidized housing records a declaration pursuant to the requirements of the Condominium Property Act, codified at 765 ILCS 605/1, et seq., as amended, such owner shall so notify the Department. Such notification shall be given to the Department on the same date that the owner records or is required to record the declaration. The notice required by this section shall be delivered in person or mailed to the Commissioner by certified mail, return receipt requested, on a form provided by the Department, and shall contain the following information: (1) whether the property owner has notified the tenants of the property identified in the declaration that a declaration has been filed, and, if so, the date the tenants were so notified; (2) the estimated time frame of conversion; (3) whether the owner has a relocation plan for tenants, and, if so, the nature of the plan; and (4) whether federal funds are being used for the conversion, and, if so, the nature of the federal funds, including any affordability restrictions on the use of such funds. Upon receipt of the notice, the Commissioner shall immediately make a copy of such notice available to any entity designated as a qualified entity pursuant to Section 2-44-120 of this Code. Any person who violates this section shall be fined not less than $500.00 nor more than $1,500.00 for each offense. Each day that a violation continues shall constitute a separate and distinct offense.
(B) As used in this section:
"Declaration" means the declaration referred to in the Condominium Property Act.
"Subsidized housing" means any housing or unit of housing subject to a Section 8 contract with the United States Department of Housing and Urban Development entered into pursuant to Section 8 of the United States Housing Act of 1937, as amended.
(Added Coun. J. 11-14-18, p. 90308, Art. I, § 1)
(a) Title. This section shall be known as the Demolition Permit Surcharge Ordinance. The surcharge imposed by this section shall be known as the Demolition Permit Surcharge and is imposed in addition to all other fees, surcharges and taxes imposed by the City of Chicago, the State of Illinois, or any other municipal corporation or political subdivision of the State of Illinois.
(b) Definitions. As used in this section:
"Area Median Income" has the meaning ascribed to that term in Section 2-44-080(B).
"Building" has the meaning ascribed to that term in Section 17-17-0223.
"CCLT" means the Chicago Community Land Trust, as defined in Section 2-44-080(B).
"Coach house" has the meaning ascribed to that term in Section 17-17-0234.6.
"Demolition" means any activity requiring a permit pursuant to Section 14A-4-407.
"Demolition Permit Surcharge" or "surcharge" means the Demolition Permit Surcharge established under subsection (c) of this section.
"Detached house" has the meaning ascribed to that term in Section 17-17-0246.
"Dwelling unit" has the meaning ascribed to that term in Section 17-17-0248.
"Multi-unit residential" has the meaning ascribed to that term in Section 17-17-0299.
"Permit" has the meaning ascribed to that term in Section 14A-2-202.
"Pilot area" means:
A. All parcels located in the boundaries identified in Section 17-7-0580; and
B. All parcels located in the boundaries identified in Section 17-7-0590.
"Townhouse" has the meaning ascribed to that term in Section 17-17-02179.
"Two-flat" has the meaning ascribed to that term in Section 17-17-02184.
(c) Demolition permit surcharge imposed. Pursuant to 65 ILCS 5/11-42-1, the following Demolition Permit Surcharge is hereby imposed on the issuance of any permit for demolition that includes one or more dwelling units located in either of the pilot areas, except as otherwise provided in subsection (e):
(1) $60,000 for the demolition of a detached house, townhouse, or two-flat; and
(2) $20,000 per dwelling unit for the demolition of a coach house or multi-unit residential building.
(d) Payment. Prior to the issuance of any permit for demolition of any building subject to the Demolition Permit Surcharge, the applicant, who shall be a demolition contractor, shall pay to the Department of Finance an amount equal to the surcharge required under subsection (c) of this section. No permit for demolition of any building subject to such surcharge shall be issued by the Department of Buildings until: (i) the applicant for such permit provides the Department of Housing with a copy of the receipt of payment issued by the Department of Finance showing that the surcharge has been paid; and (ii) the Department of Housing provides written notification of such fact to the Department of Buildings.
(e) Exemptions. The surcharge required under this section shall not apply if:
(1) At least 50 percent of the dwelling units in any building replacing the building subject to subsection (c) will be restricted to households earning up to 60 percent of the Area Median Income, as evidenced by documentation required by the Department of Housing; or
(2) The demolition of the building is determined to be necessary to remedy conditions imminently dangerous to life, health or property, as evidenced by a written order issued by the Department of Buildings, the Department of Public Health, the Fire Department or a court of competent jurisdiction.
(f) Deposit and use of revenue. The revenue generated by the surcharge shall be deposited in the Affordable Housing Opportunity Fund described in Section 2-44-085(I) unless such revenue is required to be deposited into another fund pursuant to federal or state law. Such revenue shall be reserved and utilized to pay the administrative costs and expenses of implementing this section and, after subtracting such costs and expenses, transferred to the Department of Housing and allocated to the CCLT. The CCLT shall apply such revenue toward the construction, rehabilitation, or preservation of affordable housing in direct proportion to the revenue collected in each pilot area.
(g) Duration. The surcharge required under this section shall be in effect through December 31, 2029. At least 150 days prior to such date, the Department of Housing shall submit to the City Council Committee on Housing and Real Estate a written report identifying the amount of revenue generated under this section; its observed effect on development activity in the applicable pilot area; and any other information that the Committee may require.
(h) Rules. The Commissioner is authorized to promulgate rules necessary or appropriate to implement this section.
(i) Application of uniform revenue procedures ordinance. Whenever not inconsistent with the provisions of this section or whenever this section is silent, the provisions of the Uniform Revenue Procedures Ordinance, Chapter 3-4 of this Code shall apply and supplement this section.
(Added Coun. J. 3-24-21, p. 28494, § 2; Amend Coun. J. 3-23-22, p. 45493, § 3; Amend Coun. J. 3-20-24, p. 10236, § 3; Amend Coun. J. 9-18-24, p. 16736, § 1)
Editor's note – Coun. J. 3-24-21, p. 28494, § 3, as amended by Coun. J. 3-23-22, p. 45493, § 2, and Coun. J. 3-20-24, p. 10236, § 2, provides: “This ordinance shall take full force and effect on April 1, 2021 and shall expire and be repealed of its own accord, without further action by the City Council, on December 31, 2024. This ordinance shall apply to permits applied for, on and after the effective date as well as permits applied for before the effective date, but which have not been issued by such date.”
Notwithstanding any other inconsistent or contrary provision of this Code, following consultation with the Commissioner of Buildings, the Commissioner of Housing is authorized to waive any debt and release associated liens for any residential or mixed-use building that is included in a Department of Housing initiative or program that supports neighborhood revitalization efforts and is subject to an abatement proceeding under Section 14A-3-313. The Comptroller and Corporation Counsel shall coordinate with the Commissioner of Housing to ensure that the approved waiver is executed.
Approval by the Commissioner of Housing for the removal of City debt shall take into consideration whether the waiver will: (i) promote the redevelopment and re-occupancy of a specific vacant or abandoned building; (ii) support neighborhood development and stabilization efforts; (iii) improve the health, safety, and welfare of the surrounding community; and (iv) encourage City revitalization.
For purposes of this subsection only, "debt" means a sum of money owed to the City, including, but not limited to, (i) any water or sewer assessment, or (ii) any obligation or payment of a sum of money owed to the City pursuant to a court order or an order of the Department of Administrative Hearings. Provided, however, the term "debt" shall not include property tax debt.
(Added Coun. J. 12-14-22, p. 58278, Art. VII, § 2)
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