Mayor Brandon Johnson presides over a council meeting on Dec. 16, 2024. [Don Vincent/The Daily Line]

The City Council on Wednesday approved a measure to set up an independent corporation to serve as the developer for the city’s Green Social Housing program.

The council’s Joint Committee on Finance and Housing and Real Estate voted 25-13 to approve the measure Wednesday around noon. About an hour later, the City Council voted 30-18 to give it final approval. 

Under the ordinance (SO2025-0015560), the city will set up a nonprofit corporation called the Residential Investment Corporation (RIC) to be the financial steward of a $135 million revolving loan fund that will be used to provide low-cost financing for the construction or acquisition and rehabilitation of properties to serve as mixed-income developments and add affordable units to the city housing stock.  

“This will be another tool in our toolbox to help spur development in tough financial environments across the city, and not just for affluent communities, but this tool can help invest in neighborhoods where investors have been unwilling to,” said Ald. Leni Manaa-Hoppenworth (48), the lead co-sponsor of the ordinance, which was introduced by the mayor. 

The $1.25 billion Housing and Economic Development Bond package approved by the council last spring created and funded the revolving loan fund. The program will support environmentally sustainable residential developments that dedicate at least 30 percent of their units as serving low-income households, The loan fund replaces the need for costlier private equity to help fund the developments. 

The RIC will primarily own and operate the developments and reinvest the profits to maintain or increase affordability and support future projects, according to the mayor’s office. The city plans to break ground on the first Green Social Housing project next year. 

Since being introduced in February, the ordinance has gone through multiple revisions, and votes have been postponed over various concerns from council members. A second substitute version was accepted during the Wednesday committee meeting. 

The second substitute ordinance includes changes such as giving the Chicago Board of Ethics and Office of the Inspector General oversight of the RIC, requiring members of the RIC board of directors to abide by the city’s gift restriction policy and requiring board members and RIC contractors to abide by city campaign finance restrictions. 

The RIC board of directors will be appointed by the City Council and serve four-year terms. 

Board of Ethics Executive Director Steve Berlin said the ethics-related changes in the latest version were an improvement. 

Additionally, the latest version of the ordinance clarifies what a mixed-income development means, adds provisions to ensure acceptance of rental vouchers at developments supported by the RIC, limits on operating funds from the city and the requirement that the RIC establish a relocation policy for tenants of acquired and rehabilitated properties. 

Supportive alderpeople had urged immediate passage of the measure to waste no further time deploying a tool they said could alleviate the city’s housing affordability shortage. 

“I wanted to thank my council members for bringing up real concerns, for bringing up real challenges that they had with this package,” Ald. Mike Rodriguez (22) said. “By no means is any piece of legislation ever perfect. However, I think that what's been worked on here has been worked on diligently … But the fact is, that in our great city, we've had great challenges, one of which is our housing crisis here, and it ain't getting better, folks. The fact is, we are not receiving support from the federal government.”  

The city’s housing commissioner has argued that Green Social Housing is also an important tool for continuing to support affordable housing as the federal government looks to potentially cut off crucial funding streams. 

“Particularly, I think time is of the essence here, with the changes we know that are coming from the federal government,” Ald. Maria Hadden (49) said. “We're going to have to be more self-sufficient with what we're seeing.” 

Vice Mayor Walter Burnett (27) addressed concerns from colleagues that the Green Social Housing program may not assist all communities equally. He argued that even helping some parts of the city still helps the city at large. 

“If we don't do anything to help balance [the increasing cost of housing] out, and help stabilize that and help regular people to be able to stay in this city and to be able to work in this city without having to spend a lot of money to come to work, we going to lose this city,” Burnett said. 

But Ald. Nicole Lee (11), while still voting yes, said that though she thought the council’s ethical concerns had been addressed, her concerns also lied with the city housing department’s stated goal to primarily support new developments that have at least 75 units, which could narrow where the program is being used. Lee asked if the city would also seek to support the acquisition of similarly sized properties.  

Housing Comm. Lissette Castañeda told Lee that the 75-unit minimum was chosen based on the rate of return the city is seeking from its efforts and that acquisitions of existing structures provide more room for flexibility, such as by acquiring three 25-unit buildings. 

“While I still have some concerns about whether or not you know this is going to be successful, I think we can't paralyze ourselves into inaction,” Lee said. 

Ald. Jason Ervin (28) added his voice to the group of supportive alderpeople by arguing that a tool doesn't need to affect every corner of the city to be worth approving.  

“I don't think we should be holding up communities and individuals that would like to use this source of funding to make development goals in their particular communities,” Ervin said. “It's not designed for every community, and I fully recognize that, but it is designed [for] and can help some communities.” 

Alderpeople who still opposed the final version of the ordinance said they remained unsure that the program could deliver on its promises, citing uncertainty about if market-rate units could sustain the affordable units in the supported developments in the long term or how accountable the board of directors would be to the City Council. 

“I think the idea that you have brought to us is a very, very good one,” Ald. Brendan Reilly (42) said. “It’s one that the city should figure out a way to implement — but without handing the keys to the car to a bunch of appointed folks.”