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Anti-Gentrification Plan Makes Developers Pay Big For Building Near 606

By  Mina Bloom and Alisa Hauser | May 23, 2017 3:08pm | Updated on May 23, 2017 9:40pm

 Members of the Logan Square Neighborhood Association and Latin United Community Housing Association speak at a rally for "The “606 Residential Area Preservation Ordinance” to be introduced to City Council on Wednesday and heard in June.
The 606 Rally for Anti-Gentrification Ordinance, May 23, 2017
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LOGAN SQUARE — If a new law designed to curb gentrification along The 606 passes, developers and new land owners alike would be charged hefty fees — anywhere from $300,000 to $650,000 — to demolish residential buildings along the western portion of the trail and replace them with projects that don't include a substantial amount of affordable housing.

Under the legislation, obtained by DNAinfo Chicago Tuesday, the money would be deposited into an affordable housing trust managed by a board of trustees made up of local aldermen, leaders from local groups including Logan Square Neighborhood Association and Latin United Community Housing Association (LUCHA) and commissioners of the city's Departments of Buildings and Planning and Development 

The board would use the trust to push more affordable housing in the area, as well as preserve existing housing, such as using the money to help longtime residents who need assistance with paying property taxes or giving them grants to improve their homes so they can stay in the area, Ald. Roberto Maldonado (26th) told about 50 cheering supporters at a rally on Tuesday night at 1800 N. Humboldt Park Ave. underneath the Bloomingdale Trail.

"This is an ordinance to help our longstanding community residents, rather than to help the new developers that want to come here and displace us and kick us out of here," said Maldonado, a co-author of the proposal.

Scheduled to be introduced in City Council Wednesday, the law would impose the following demolition fees on developers who don't designate at least 50 percent of the units as affordable housing: $300,000 for a single-family home, $450,000 for a two-flat, $550,000 for a three-flat, $650,000 for a four-flat and $150,000-per-unit for five units or more.

The law also makes it more expensive to expand existing residential buildings along the trail. Developers and new land owners would be forced to pay $100,000 for every 1,750 square foot of additional space up to $250,000 for every 2,500 square foot of additional space.

The law applies to what co-author Ald. Joe Moreno (1st) calls "a pilot area" — a large portion of Logan Square and Humboldt Park bounded by West Hirsch Street on the south, West Palmer Street on the north, Western Avenue on the east and North Kostner Avenue on the west.

More broadly, the goal of the law is to put the brakes on the booming real estate market along the trail that is fueling gentrification and displacing residents in predominately Latino neighborhoods.

Currently, demolition permits in Chicago cost $200 on average, but there are typically additional fees.

After the rally on Tuesday, Moreno, when asked if he foresees opposition to the plan and fees as high as $650,000, told DNAinfo that the fees have to be steep.

"I would assume it will face opposition. The fees have to be substantial so that developers think twice," Moreno said.

Under the citywide Affordable Requirements Ordinance, which was updated in 2015, developers are required to include affordable housing or pay fees to the city, which is the same basic concept as The 606 law.

However, The 606 law calls for much higher fees than the citywide law, and those fees would be funneled into a separate trust just for the pilot area.

Maldonado, who moved to Humboldt Park in 1992, rode the wave of soaring property values along the trail to flip four properties, pocketing $300,000 in profits two years ago.

Maldonado was not available for comment after the rally, but addressed opponents during his speech to supporters.

"Those naysayers who say we are going to hurt development, if that's the case, I'm going to be hurt. What we want is fairness, fairness so that we can allow existing homeowners that we have in our community, to stay in our community," Maldonado said.

Brian Perea, a spokesman from the Logan Square Neighbors Association, said that according to the Institute for Housing Studies at DePaul University, which used information from the Cook County Assessor's Office, there are 4,330 property index numbers (PINS) in the law's pilot area, and 8,582 units of housing. The majority of those, almost 1,700, are 2, 3, or 4-flat buildings.

The law, which would likely be the first of its kind in Chicago, is far from a done deal. It requires approval from the full City Council, which would vote on it in June.

But Ald. Scott Waguespack (32nd), whose Bucktown ward is located along the eastern half of the 2.7-mile long elevated trail, said on Tuesday night that he doesn't think the bill is legal. He has reached out to the city's Law Department to get an opinion.

"I don't think their ordinance would pass legal muster," Waguespack said.

Read the full ordinance below:

606 Affordable Housing Preservation Ord. May 2017 by Mina Bloom on Scribd

Listen to audio from the rally:

 

LSNA at The 606 rally for affordable housing

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