Chicago partnership for affordable neighborhoods

Inclusionary programs that include such long-term affordability requirements "have the potential to provide low-income recipients with extended exposure to low-poverty settings," note Schwartz et al. Half of affordable units in a development, however, are set aside for households from within the project neighborhood, allowing longtime residents with lower incomes to remain in their neighborhoods.

A comprehensive analysis of the social impacts of New York City's inclusionary housing program has not yet been undertaken, but Jeanne Brooks-Gunn and Elyzabeth Gaumer are conducting an ongoing study to quantify the effects of affordable housing produced as part of the city's Marketplace Plan.

The NYC Housing and Neighborhood Demonstration Project follows 3, households that applied for newly constructed affordable rental housing at 15 sites in New York City, 4 of which are mixed-income housing developments with inclusionary units. Half of the households in the study are offered affordable housing treatment group , and the other half are eligible for affordable housing but do not receive it control group.

Fewer than 5 percent of the applicants, representing a wide range of household types with incomes between 40 and 80 percent of AMI, apply with a voucher or any type of housing assistance before moving into affordable housing. The researchers have completed a pilot study of an inclusionary housing site in Williamsburg one of the rezoned areas , where they followed a cohort of households from time of application through a two-year period. A smaller study within the much broader setting of this randomized control trial, funded by HUD, will look at the changes in social networks and behavior that result from moving to mixed-income housing at an inclusionary housing site in the city.

Findings from the HUD-funded study will be released later this year, with the final findings from the broader study slated for release in early City of Chicago's Affordable Requirements Ordinance. With 2. The city lost nearly 7 percent of its population from to as residents moved to outer suburbs or migrated to other parts of the country; in particular, the African-American population declined by almost 17 percent. In a report detailing housing affordability in Chicago, the Chicago Rehab Network notes that "traditionally middle- and working-class neighborhoods are showing growing indications of housing stress," with significant increases in the number of cost-burdened households.

The original ARO applied only to developments of 10 or more units that received land or financial assistance from the city. The ARO currently applies to all rental and for-sale projects with at least 10 residential units that require certain zoning changes, include land purchased from the city, receive financial assistance from the city, or are within a planned development in a downtown zoning district.

At least 10 percent of units in these developments must be set aside for lower-income households; the requirement jumps to 20 percent if a development receives financial assistance from the city. Sixty percent of the housing fund's revenues are used for construction or rehabilitation of affordable housing, and the rest go to the Chicago Low-Income Housing Trust Fund, a city-supported rental assistance program.

Given the high cost of construction in these areas, it makes sense that developers chose to pay in-lieu fees," notes Breems. She expects this will start to change as the market picks up across the entire city.

Although an option to pay in-lieu fees provides developers and localities with more flexibility, critics argue that these fees do not always reflect the true cost of creating affordable housing, particularly in areas with high land prices. Calavita and Mallach write that "while a strategy of collecting in lieu fees from downtown developers may result in more housing units [at alternative sites], it could also perpetuate the concentration of affordable housing in lower-income areas with sizable minority populations.

Rental units created under the ARO are required to be affordable to households earning no more than 60 percent of AMI, whereas the for-sale units are targeted to households with incomes at or below percent of AMI. The affordability levels are calculated based on the median income of the Chicago metropolitan area, which is much higher than that of the city itself.

Program critics argue that to adequately serve Chicago's lower-income households, the affordability thresholds should be either set as a lower percentage of the metropolitan area AMI or based on the city AMI. Most of the for-sale ARO units are placed under the stewardship of the Chicago Community Land Trust, which the city established in to "preserve the long-term affordability of homes" created through various city programs. Buyers are required to enter into a year deed covenant with the land trust and receive the initial purchase price plus a percentage of appreciation on resale.

Property taxes for land trust homes are assessed based on the affordable price, keeping housing costs low for buyers. Affordability of units not monitored by the land trust is ensured through a junior mortgage or second year lien. Another voluntary program that was created in and is currently inactive, the Chicago Partnership for Affordable Neighborhoods CPAN , offered developers incentives, such as fee waivers and reimbursement for certain expenses, in exchange for setting aside at least 10 percent of units in a for-sale development for households earning no more than percent of AMI.

The city council eliminated fee waivers in , essentially ending CPAN. Chicago's expanded ARO went into effect shortly before the collapse of the housing market, which makes assessing the program's effectiveness difficult. The inclusionary units are also located in only four percent of the city's neighborhoods, but these neighborhoods are more affluent, have a higher percentage of adults with a college degree, and are more racially diverse than neighborhoods without inclusionary units.

Of the 11 jurisdictions studied in the RAND report, Chicago was the only one in which "IZ neighborhoods had more markers of advantage than non-IZ neighborhoods — an indication that new residential development within the city of which IZ units were a small share was typically marketed to attract new households with higher incomes. Inclusionary zoning has emerged as a proven strategy to address the shortage of affordable housing with the potential for creating socially and economically integrated communities.

Hundreds of jurisdictions have adopted IZ policies that vary broadly in how they are structured, and these differences can influence outcomes related to housing production and integration. The examples discussed in this article, while not representative of most localities with IZ policies, show that inclusionary zoning is more effective in markets where housing demand is high.

An incentive-based approach combined with strong public subsidies is creating and preserving affordable housing in New York City, whereas Chicago's mandatory citywide program is resulting in long-term housing opportunities for lower-income residents. Developer opt-outs included in both programs — offsite construction in New York City and in-lieu fees in Chicago — provide the flexibility needed to encourage developer participation but also highlight the tradeoffs between increasing the affordable housing supply and creating mixed-income developments.

Evidence Matters Home Previous Article. Skip to main content. New York City's Inclusionary Housing Program New York City approved its IZ program, known as the R10 program, in in response to rising housing costs and the resulting displacement of working-class families in high-density, high-demand areas such as Manhattan and downtown Brooklyn.

The term "inclusionary zoning" is sometimes used interchangeably with "inclusionary housing," but experts distinguish inclusionary zoning as one albeit principal form of inclusionary housing. Inclusionary housing refers to a wide range of strategies that localities implement to increase housing opportunities for low- and moderate-income residents. Alan Mallach. Innovative Housing Institute. Heather L. Schwartz, Liisa Ecola, Kristin J. Leuschner, and Aaron Kofner. Is Inclusionary Zoning Inclusionary?

Nico Calavita and Alan Mallach, eds. Robert Hickey. New York City Planning Commission. FAR is the ratio of total square footage of a building to the site area. Depending on a project's construction type and financing structure, the R10 program provides 1. Accessed 2 February A range of floor area bonus ratios are offered depending on whether the units are provided through new construction, rehabilitation, or the preservation of existing housing.

New York City Planning Commission, Census Bureau. In the areas designated for inclusionary housing, developers receive 1. Maximum resale price for inclusionary homeownership units is the appreciation cap or appreciated price, whichever is lowest. The appreciation cap is based on a mortgage amount that is affordable to families earning percent of AMI at the time of resale. The appreciated price is the product of original sale or resale price of a home and the change in the appreciation index as defined in Section of the Zoning Resolution.

Accessed 6 February Contact us Housing. Building Neighborhoods and Affordable Homes Program. Program Requirements Homes must have been built through the City Lots for Working Families program and located within one of the target areas. Buyers must use the homes as their primary residences for a minimum year occupancy period, or the home must be sold to an income-qualified homebuyer. Lawrence Ave. Send Close. I Want To. Apply For. Check Status Of.

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