Over a decade and a half, and through several revisions, Evanston’s inclusionary housing ordinance is on track to directly produce nearly 100 units of affordable housing.
It’s also generated nearly $4.4 million in fees for other affordable housing efforts in the city from projects approved since 2013.
An Evanston Now analysis of city reports and planned development documents shows that the ordinance has generated 66 completed affordable housing units so far. Another 22 units will be delivered in projects already under construction, and 10 more have been approved in one project that has not yet broken ground.
When originally approved in 2007, the IHO applied only to new condominium developments. They were all the rage at the time, but fell out of favor almost immediately when the housing market collapsed.
The original ordinance required a $4,000 per unit contribution to the affordable housing fund — or making a tenth of the units in a new development affordable.
After the new-construction rental housing market started to boom around 2013, the Council amended the ordinance in late 2015 to raise the penalty fees, if a tenth of the units were not affordable, to between $7,500 and $10,000 per unit.
At the time of the council vote, then Community Development Director Mark Muenzer estimated that 2,500 new housing units would be created in Evanston over the next five years and that the ordinance would lead to the inclusion of 250 subsidized units in that count.
In reality, Muenzer’s prediction proved wildly optimistic. Only 988 new housing units were created in planned developments by 2020. They included just 40 subsidized units created under the IHO.
Despite the tapering off of developer interest, the Council adopted further revisions to the ordinance in 2018.
Those changes for the first time required that developers of rental housing to provide at least half of their subsidized units on site, gave height and density bonus incentives for doing that, and even larger incentives if they provided all the affordable units on site.
The 2018 amendments also raised the fee-in-lieu payments for rental developments to $17,500 per unit downtown and $15,000 elsewhere. For condo developments the per-unit fee-in-lieu payment was boosted to $26,250 downtown and $22,500 elsewhere.
The latest version of the ordinance has assured that if there is new development, at least some of the units produced will be affordable.
It’s more difficult to tell whether it has adversely impacted the overall production of new housing in town.
One thing residents should keep in mind is that Evanston has an excess of affordable housing. We are currently (and have been for many years) compliant with the state affordability guidelines while many of our neighbors on the North Shore are not.
As long as we are in compliance with the state there really is no reason to waste resources or restrict development based on “affordability.”
Part of the challenge is trying to strike the balance between the NIMBY homeowners here that oppose any new construction (remember how much work it took to fill in the hole @ 800 Chicago Ave?) and the desire to keep rents low. You can’t have low rents and also never build anything! Look at the mess in SF or NYC.
Evanston is affordable now but it feels like things are going to be changing. The Wirtz’ family selling off all their Southeast Evanston properties to a PE firm, makes me feel like all of us renters will be commoditzed soon and see our rents go up 25% or more.
I agree with everything Tom Hayden said.
I will add the question on whether city requirements to set aside affordable units is effective at making housing more affordable overall. There are a few units which is good for those who will get them, but those come at a cost which must be covered by other new units being built. Compound that with costs of attempting to overcome objections to build almost anything — which will include some projects not getting built and land is left unused or under-used, and I think housing costs would go up overall.
I do not presume to know the best way to make housing more affordable on a broad basis, and it might not be possible, but I think the question has to be asked if we are getting what we want out of our policies, and if it is worth the unintended consequences of those policies.