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State law requires certain percentage of housing to be 'affordable'

Ill. requires towns to have homes in lower price range

Published: Saturday, July 19, 2014 11:46 p.m. CDT
Caption
(Kyle Grillot – kgrillot@shawmedia.com)
Lenny Szarek Carpentry employee Dennis Slomka works Tuesday on the Crystal Lake Pedcor project. Pedcor expects to open the first building in the Crystal Lake apartment complex in August.

Construction workers along Congress Parkway in Crystal Lake carry long boards in and out of future residences as they put the final touches on a set of apartments.

The first 10-unit building, which will be managed by Pedcor Investments, is set to open in August, according to city officials.

When the Pedcor project went through the approval process, there were no objectors, said Michelle Rentzsch, director of Community Development in Crystal Lake. At meetings, there were people in the audience in favor of the project, and some people looking for affordable rentals in the community.

In total, 60 affordable housing units are being built in an area that is predominantly commercial office space. The property also is close to Metra train stops and a Centegra Health Bridge location.

Although Crystal Lake didn’t need additional affordable housing under state law, the new apartments are expected to be well accepted.

“I think Pedcor is going to be a popular project and I think it will do well,” Rentzsch said.

As part of the 2003 Affordable Housing Planning and Appeal Act, the state wants municipalities with at least 1,000 people to have at least 10 percent of their housing units deemed “affordable.”

Presently, 11 municipalities in McHenry County do not meet the mark, including Cary, Algonquin, Lakewood and Johnsburg. They have to submit a plan to the Illinois Housing Development Authority by July 2015 showing how they will increase their amount of affordable housing units.

According to the IHDA, to be considered affordable in the Chicago metropolitan area, an owner-occupied house for a family of four would have to cost no more than roughly $163,600. A one-bedroom apartment cannot exceed $828 a month to be called affordable.

To determine how many affordable units a municipality needs, the IHDA looks at how many houses are affordable to homebuyers who make 80 percent of the area’s median income and to renters making 60 percent of the area median income.

Man Yee Lee, IHDA assistant marketing and communications director, said the goal of the act is to encourage more affordable housing for people with low and moderate incomes, no matter where they live.

“There is clearly a need,” Lee said.

The law also sets up a process for affordable housing developers to appeal to the State Housing Appeals Board if they believe their projects were unfairly denied or that unreasonable conditions were placed upon the approval of a project that serves low-income and moderate-income households.

Developers can appeal a local decision if the municipality doesn’t have at least 10 percent of its units deemed affordable and if the municipality isn’t showing progress toward the mark. If the appeals board rules in favor of the developer, it would be a binding decision on the local government.

However, there has never been an appeal submitted to the State Housing Appeals Board, Lee said.

A proposed affordable housing apartment complex in Cary, which is also a Pedcor development, received endorsements from business groups, but many residents oppose it.

The additional 60 units would help Cary work toward the 10 percent goal. To help pay for the construction of the apartment buildings, Pedcor hopes to receive federal low-income housing tax credits.

Lee said affordable housing can be used by many people who are just graduating from college, but have to live with their parents because they can’t find a place that is affordable where they grew up. It could also be geared toward entry-level teachers and police officers, as well as seniors on fixed incomes.

IHDA’s latest compliance report came out last year and includes Algonquin, which was also cited in 2005 by the state.

Community Development Director Russell Farnum said Algonquin village staff plans to begin working on a plan to present to its board and to the IHDA next month.

Farnum said municipalities can have developers set aside a percentage of houses or units to be affordable in a development, or pay a fee in lieu of providing affordable housing, among other things.

The act has recommendations on what municipalities can do to increase their number of affordable housing units.

Local governments may individually or jointly create a housing trust, which can be used to acquire property for residential use; provide rental assistance; help with home purchasing; or help with emergency repairs, among other things. Local governments may also acquire land and hold it for affordable housing, or use their zoning powers to require the creation or preservation of affordable housing.

Sometimes an affordable housing development is approved but never built.

A set of 18 senior housing condos as part of a 55-and-over community was slated to be built on the east side of Algonquin, but the project hasn’t started, Farnum said.

Having affordable housing in all communities can be beneficial.

“I think it’s something important in every community has to do, so no [one] community is overrun with affordable housing,” Farnum said. “It’s fairly equitable.”

Many communities will promote how many people and rooftops are in a community to attract businesses for economic development.

“The number of rooftops is one of the site selection factors for retailers and other spin-off development, and it balances out the tax base,” Farnum said.

Construction of a new 60-unit affordable housing apartment complex has just begun in Lake in the Hills.

The project, being constructed by DKI Inc., is along Harvest Gate. The company built the nearby senior facility, which has a waiting list, said Dan Olson, the community development director for Lake in the Hills.

“The board saw it as a need, and it’s a good product,” Olson said.

He added it’s important to offer a variety of housing options in a community, for people of all income levels.

McHenry Mayor Sue Low leads a municipality that meets the affordable housing mandate.

“I believe there should be options for everyone,” Low said. “You shouldn’t be excluded from a community just because you can’t afford to live there. There should be the opportunity for people to reside in the community they work in or choose to work in a community and find a place to live.”

Low said the goal for a community is to keep people in the community, whether it be through housing options, employment or recreational opportunities.

She said communities are able to attract businesses or retail by having more residents.

“Years ago, we used to drive to where there’s a shopping mall,” Low said. “The trend [now] is to have the convenience .... to attract those types of businesses, you have to have the rooftops.”

Additional businesses, whether retail or commercial, would generate increased property and sales taxes, Low said.

“It helps the community be healthy and more affordable to live,” Low said.

She added that an area also needs to have a population that spans different age groups so they all can support the different taxing bodies, such as school, library and fire districts.

“Everyone relies on those dollars to provide services ... to their residents,” Low said.

Municipalities also need to be open-minded and willing to look at other options, Low said.

She said the term “affordable housing” has a bad connotation.

“It’s too bad there’s a misconception of what that means,” Low said. “We have all these opportunities for employment in our community. What we would want is these people to come here to work, collect a pay check, and spend their money [here].”

The McHenry County Economic Development Corp. put its support behind both Pedcor projects in Crystal Lake and Cary.

“It would be nice if we could have people who work in our community find housing in our community,” said Pam Cumpata, the president of the McHenry County EDC.

Cumpata said there are employers in the county that have workers who have to commute from Elgin or Belvidere.

“We have companies in our county that employ people at wages that right now, wouldn’t be able to buy a home or find a nice apartment to live in,” Cumpata said. “They could be tellers at financial institutions to individuals that work at factories.”

“The starting wage is not sufficient to find housing for themselves,” she added.

Affordable housing shares

Percentage of housing units deemed “affordable”

Barrington Hills - 0.7 percent

*Trout Valley - 1.2 percent

Lakewood - 2.7 percent

Prairie Grove - 3.6 percent

Spring Grove - 4 percent

Bull Valley - 5 percent

*Ringwood - 6.5 percent

Cary - 6.9 percent

Algonquin - 7.8 percent

Johnsburg - 8.3 percent

Port Barrington - 8.9 percent

Oakwood Hills - 9.2 percent

Fox River Grove - 9.5 percent

Huntley - 11.4 percent

Lake in the Hills - 16.9 percent

Crystal Lake - 20.7 percent

*Greenwood - 25.5 percent

McHenry - 31.2 percent

Wonder Lake - 32 percent

Island Lake - 34.6 percent

Woodstock - 36.1 percent

Richmond - 46.4 percent

Marengo - 46.9 percent

Lakemoor - 49.6 percent

*Union - 60.8 percent

*Holiday Hills - 64 percent

Fox Lake - 66.7 percent

McCullom Lake - 70.2 percent

Harvard - 71.6 percent

Hebron - 75.7 percent

*Municipalities with less than 1,000 people are exempt from the Affordable Housing Planning and Appeals Act’s 10 percent rule.

Source: Illinois Housing and Development Authority

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