aro rules: draft for public comment 5.27 · article 10: marketing aro units: for sale units 10.1...

ARO Rules: DRAFT FOR PUBLIC COMMENT 5.27.2015

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ARO RULES WILL BE UPDATED AS NEEDED: VISIT WWW.CITYOFCHICAGO.ORG/ARO FOR THE CURRENT VERSION

ARO Rules Table of Contents Article 1: Executive Summary

Article 2: Applicability

2.1 Rezonings and Planned Developments 2.2 City Land Sales 2.3 Financial Assistance 2.4 Existing Buildings 2.5 Projects approved by City Council prior to the 2015 ARO Effective Date 2.6 Effective date of the 2015 ARO

Article 3: Interaction with the Affordable Housing Zoning Bonus (density bonus) Article 4: ARO Zone Map Article 5: Calculation of Required Units and/or Fees-in-Lieu

5.1. Calculation of affordability obligation 5.1.1 Projects that do not receive financial assistance

5.1.2 Projects that receive financial assistance 5.2 Calculation of required on-site affordable units 5.3 Calculation of the In-Lieu fee 5.3.1 Timing of the In-Lieu fee calculation 5.3.2 Annual Increases to the In-Lieu Fee, based on the Consumer Price Index (CPI)

Article 6: Administrative Procedures for ARO Projects

6.1 Administrative procedures for Rezonings 6.2 Administrative procedures for projects receiving or Purchasing City Land 6.3 Administrative procedures for projects receiving Financial Assistance 6.4 Administrative procedures for Planned Developments

Article 7: Compliance Options

7.1 Construct affordable units on-site 7.2 Sign a long-term lease with or sell units to the Chicago Housing Authority (CHA) or another Authorized Agency 7.3 Build, buy or rehab units off-site

7.3.1 City’s goal for off-site units 7.3.2 Meeting required with DPD staff 7.3.3 Location and required number of off-site affordable units 7.3.4 Cost to construct and size of off-site affordable units 7.3.5 Design and construction standards for off-site affordable units 7.3.6 Requirements for review of off-site affordable units 7.3.7 Process to review and approve off-site units 7.3.8 Enforcement provisions

http://www.cityofchicago.org/ARO


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7.4 Compliance through the ARO TSL (Transit Served Location) Bonus 7.5 Compliance through payment of the In-lieu fee

Article 8: Recording of the Affordable Housing Agreement and Payment of the In-lieu fee Article 9: Design and Construction Standards for Affordable Units

9.1 Timing of Construction/Occupancy 9.2 Design

9.2.1 Dispersal throughout the building 9.2.2 Rental and For Sale Units 9.2.3 Unit Type and Quality 9.2.4 Square Footage 9.2.5 Amenities and Finishes 9.2.6 Access to Amenities 9.2.7 Parking 9.2.8 Fees and Earnest Money 9.2.9 Single Family developments

9.3 Pricing 9.3.1 For-Sale Units 9.3.2 Rental Units

9.4 Income eligibility 9.4.1 For-Sale Units 9.4.2 Rental Units 9.4.3 Income limits

Article 10: Marketing ARO Units: For Sale Units

10.1 Marketing Intake Meeting 10.2 Marketing Plan

Article 11: Requirements for ARO Homebuyers 11.1 Be income-qualified 11.2 Complete Homeownership Training

11.2.1 General Pre-purchase training 11.2.2 Condo training 11.2.3 CCLT training

11.3 Mortgage pre-approval 11.4 Completed application 11.5 Exclusions 11.6 Affordability term

Article 12: Process to Sell ARO Units to Income-Qualified Homebuyers

12.1 Lottery



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Article 13: Homeowner Restrictions on ARO Units 13.1 Resale or Transfer of ARO units 13.2 Monitoring and Reporting Requirements 13.3 Refinances

Article 14: Marketing ARO Units: Rental Units

14.1 Marketing Intake Meeting 14.2 Marketing the affordable units

Article 15: Process to income qualify an ARO Tenant

15.1 General Guidelines Article 16: Monitoring and Reporting Requirements for ARO Rental Units

16.1 Affordability Term Article 17: Penalties for Non-Compliance

17.1 Developer fails to pay the in-lieu fee or provide required affordable units 17.1.1 Fines and revocation of residential real estate developer license 17.1.2 Other remedies

17.2 Developer creates units – but leases them to households that are not income-qualified Article 18: Changes to the Rules and Regulations Article 19: Changes to the Project

19.1 Project does not move forward 19.2 Changes to the project 19.3 Sale of the property 19.4 Project converts from Rental to For-Sale 19.5 No changes permitted after the building permit has been issued

Article 20: Affordable Housing Opportunity Fund

20.1 Administration of Funds 20.2 Collection of Funds 20.3 Distribution of Funds 20.3.1 Administrative and monitoring costs 20.3.2 Construction, Rehabilitation or Preservation of affordable units 20.3.3 Chicago Low Income Housing trust fund

Article 21: Hardship Waivers Article 22: Program Contacts



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Exhibit A: Affordable Housing Profile Form Exhibit B: Affordable Housing Agreement: Rental Exhibit C: Affordable Housing Agreement: For Sale Exhibit D: ARO PD Statements Exhibit E: For Sale Marketing Form Exhibit F: Rental Unit Marketing Form Exhibit G: Homebuyer Application, including all required documentation/affidavits Exhibit H: Income Limits Exhibit I: ARO Zone Map Exhibit J: Frequently Asked Questions Exhibit K: description of the Chicago Community Land Trust Exhibit L: Affordable Rents



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Article 1: Executive Summary The Affordable Requirements Ordinance (ARO) is triggered when development projects receive a zoning change, City land, or financial assistance, or are a downtown PD, AND they build a residential project with ten or more units. 10% of units are required to be affordable; 20% if financial assistance is provided. Updates to the ARO that will take effect on October 12, 2015, will do the following: Create three zones in the city to reflect different housing markets and priorities:

o downtown; o higher-income areas; and o low-moderate income areas

The new ARO map was finalized, after a public comment period, in these Rules and Regulations. Adjust in-lieu fees: In-lieu fees for units not provided on-site would increase to $175,000 downtown and $125,000 in higher-income areas, and would be reduced to $50,000 in low-moderate income areas. In addition, if a project was subject to both the downtown density bonus and the ARO, developers would be required to pay the higher of their ARO or density bonus fees. Fee levels would be adjusted annually for inflation, beginning in January 2018. Require on-site units: Require 1/4 of the required 10% affordable units (20% if the City provides financial assistance) to be provided as on-site housing units, with two exceptions: Create an off-site option: Developers in Higher Income areas and Downtown could meet the requirement to provide 1/4 of the required 10% affordable units (20% if the City provides financial assistance) by building, buying, or rehabbing units off-site:

Rental projects downtown and rental or for-sale projects in higher-income areas could build, buy, or rehab the required units with a comparable investment within two miles of the subject properties and within the same zone or downtown;

For-sale projects downtown could build, buy, or rehab the required units with a comparable investment anywhere in the city.

Developers would pay a $5,000/unit administrative fee to use this option. o Allow a buy-out for downtown for-Sale projects: For-sale projects downtown that elect not to

build any affordable units on-site (or off-site) could buy out of the on-site or off-site unit requirement by paying a $225,000 in-lieu fee per required unit.

Provide a density bonus for affordable units near transit: Projects in a Transit Served Location (the TSL ordinance) that provide 50% of required affordable units on-site can claim additional density and height, and reduced parking requirements. Incentivize developers to work with the CHA: The Chicago Housing Authority (CHA) or other authorized agencies could purchase or lease ARO units; in exchange, developers would pay a reduced in-lieu fee for remaining unit obligations, equal to a $25,000 reduction per required unit.



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Increase the number of eligible affordable buyers by increasing the maximum income for purchasers to 120% AMI ($91,200 for a family of four). Increase funding to the Trust Fund: The Chicago Low Income Housing Trust Fund would receive 50% of fees-in-lieu collected via the Affordable Housing Opportunity Fund, up from the current 40%. Increased fees downtown would be phased in over two years. The table below summarizes a developer’s requirements and options to meet the ARO in each of the three ARO Zones:

Options to meet the ARO

Low-Moderate Income Areas: Rental and For-

Sale

Higher Income Areas: Rental

and For-Sale

Downtown: Rental

Downtown: For-Sale

Construct required units on-site and pay no in-lieu fee

X X X X

Place at least 1/4 of the required 10% affordable units (20% if the City provides financial assistance) on-site and pay a fee-in-lieu per any remaining units

X $50,000 in-lieu

fee

X $125,000 in-

lieu fee

X $175,000* in-lieu fee

*$140,000 through April 15, 2016

ARO Transit-Served Location bonus X X X X

Lease or Sell Units to the CHA or other authorized agency and receive a $25,000 In-Lieu Fee Reduction

X X X

Off-Site Option: within two miles and in a higher income area

X X

Off-Site Option: anywhere X

No on-site units – with $225,000* in-lieu premium *$160,000 through April 15, 2016

X



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Article 2: Applicability 2. 1 Rezonings and Planned Developments

The ARO applies when a lot is developed with a Residential Housing Project (containing ten or more units) AND:

2.1.1 The City Council approves a rezoning of a lot to permit a higher FAR than would otherwise be permitted in the base district, including through transit-served location floor area premiums where the underlying base district does not change; OR 2.1.2 The City Council approves a rezoning of a lot to permit a higher floor area ratio or to increase the overall number of housing units than would otherwise be permitted in an existing planned development as specified in the Bulk Regulations and Data Table, even if the underlying base district for the planned development does not change; OR 2.1.3 The City Council approves a rezoning from a zoning district that does not allow household living uses to a zoning district that does allow household living uses; OR 2.1.4 The City Council approves a rezoning of a lot from a zoning district that does not allow household living uses on the ground floor of a building to a zoning district that permits household living uses on the ground floor; OR 2.1.5 The City Council approves a rezoning from a downtown district to a planned development, even if the underlying base district for the property does not change; OR 2.1.6 The City Council approves a rezoning that involves city land sales.

2.2 City Land Sales The ARO applies to the entire project when the City sells real property to a developer, even if that real property is sold at market price, and a Residential Housing Project containing ten or more units is built on a site containing all or a portion the lot; or on a site for which the City land is utilized to satisfy minimum off-street parking, minimum lot area, setback or other zoning or Municipal Code requirements or standards.

2.3 Financial Assistance Whenever the City provides financial assistance to any developer in connection with the development of a Residential Housing Project, 20% of the total units in a Residential Housing Project must be affordable. If the project receives TIF assistance and the guidelines governing the TIF Redevelopment Project area in which the project is proposed do not state otherwise, for rental projects, half of the affordable units must be affordable to households earning 60% of AMI and half of the affordable units must be affordable to households earning 50% of AMI.



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For for-sale projects, half of the affordable units must be affordable to households earning 100% of AMI and half of the total units must be affordable to households earning 80% of AMI.

When TIF funds are used to fund the construction, renovation and rehabilitation of new housing units to be occupied by low-and very low-income households, the affordability guidelines set forth in the TIF Guidelines – not the ARO – will apply. Many of these projects also receive other forms of City financial assistance, such as Low Income Housing Tax Credits, which have more restrictive affordability requirements than the ARO, and, as such, will be monitored by DPD’s Developer Services Division and not under the ARO. However, projects receiving these other forms of financial assistance must include a Planned Development (PD) Statement provided by the City acknowledging the applicability of the ARO, should project details change, or the monitoring period required by the alternate sources expire prior to the 30-year term required by the ARO.

Residential Housing Projects that receive TIF assistance – but no other form of City financial assistance that would impose stricter affordability requirements – must meet the requirements of the ARO.

City land sales alone do not constitute financial assistance, even if the land sale represents below-market value.

2.4 Existing Buildings For existing buildings that contain housing units prior to a rezoning, only the additional housing units permitted after the rezoning are subject to the ARO. For projects that trigger the ARO because of a City land sale or financial assistance, the entire building will be subject to the ARO – including any existing residential units.

2.5 Projects approved by City Council prior to the 2015 ARO Effective Date Projects that have been introduced to City Council prior to the 2015 ARO Effective date of October 12, 2015 AND have been approved by City Council prior to July 12, 2016 will be subject to the requirements of the 2007 ARO, as described in Section 2-45-110 of the Municipal Code, as well as the policies followed by the Department while implementing this Ordinance (including consistently rounding up for any fraction of a whole number). These projects have the option to pay the in-lieu fee of $100,000 or provide affordable units on-site, and are subject to the following exemptions:

1) the development of a Residential Housing Project for which the rezoning has triggered the ARO - for which a building permit is applied for 3 years or more after the date of the approval of the zoning change by the City Council (note that this exemption does not apply to PDs, for which the ARO is independently triggered); or



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2) any Residential Housing Project developed on land purchased between May 13, 2005-May 13, 2007; or any PD filed with the Zoning Administrator before August 21, 2007– except that any units developed as a result of additional floor area authorized after this date are subject to the ARO.

For existing PDs authorized before the 2015 ARO effective date (October 12, 2015), only the additional housing units or floor area allowed by the amendment will be subject to the ARO, provided the PD has not sunsetted. However, if the existing PD included an ARO obligation, that obligation would remain, even following an amendment to the PD – and the new units would additionally be subject to the 2015 ARO.

For PDs with multiple subareas, the ARO is only triggered if the overall floor area or unit count is increased. 2.6 Effective Date of the 2015 ARO Rezonings, Planned Developments and City Land Sales that have been introduced to City Council; or projects requesting Financial Assistance that complete an application which has been received and accepted by the Department in advance of the 2015 ARO Effective date (October 12, 2015) are subject to the rules and requirements of the 2007 ARO, as described in Section 2-45-110 of the Municipal Code. However, projects submitted prior to the 2015 ARO Effective date (October 12, 2015) and thus subject to the 2007 ARO must secure City Council approval by July 12, 2016. If they do not secure Council approval by that date, the requirements of the 2015 ARO will apply.

Article 3: Interaction with the Affordable Housing Zoning Bonus (density bonus) Projects that are subject to the ARO and that elect to take an Affordable Housing Zoning Bonus (commonly referred to as the density bonus) must first make their required payment under the Density Bonus. The density bonus payment can be applied as a credit to the in-lieu fees owed under the ARO. The density bonus payment cannot be utilized to meet the project’s on-site or off-site unit requirement. In most cases, this will mean that the developer will pay the higher of the ARO or density bonus in-lieu fee.

For example: A 227-unit rental project in the DX-7 zoning district is subject to the ARO and elects to take a density bonus of up to 40,000 square feet. Under the ARO, the applicant would have an obligation for 23 affordable units, with a requirement to put ¼ - or 6 – of those units on-site or off-site. Assuming the applicant elected to place 6 of the units on-site and pay the in-lieu fee for the remaining 17 units, the in-lieu fee owed under the ARO would be [17] x $175,000, or $2,975,000. Under the Density Bonus, the applicant would owe $928,000 (based on the density bonus formula: 40,000 bonus sf x 80% x $29 (median land price per base FAR foot for the West Submarket) = $928,000. In this example, the $928,000 the developer pays to receive the Density Bonus would be applied as a credit to the ARO obligation of $2,975,000.

Article 4: ARO Zone Map



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The ARO Zone Map will be finalized following the Public Comment Period. The map will be updated, using the criteria designated by the Commissioner, by the City of Chicago on January 1 of every fifth year, beginning on January 1, 2020. The new map will be published on the ARO website by June 30 (or 14 days after data is available, whichever comes later) of the year preceding the effective date and is attached here as Exhibit I.

Article 5: Calculation of Required Units and/or Fees-in-Lieu Projects that are subject to the ARO must provide 10% of the project’s total units as affordable (20% if the project receives financial assistance from the City).

A minimum of one-quarter of the required affordable units must be provided on-site (or off-site, as described in Article 7.3). Once developers meet their on-site requirement, they may elect to pay an in-lieu fee to meet their remaining affordability obligation.

5.1 Calculation of Affordability Obligation Calculation of the affordability obligation is based on the total number of housing units in the residential housing project, including any units enabled by a downtown affordable housing zoning bonus (density bonus) or the ARO Transit Served Location (TSL) bonus.

Where the application of the percentage requirements of this section results in a fractional housing unit, the developer shall round up to the nearest whole number for any portion of 0.5 or above and round down to the nearest whole number for any portion less than 0.5.

5.1.1 Projects that do not receive financial assistance For Residential Housing Projects for which a rezoning triggers the ARO or that purchase or receive City land, or for PDs downtown, 10% of all units in a residential housing project are required to be affordable.

5.1.2 Projects that receive financial assistance Projects that receive financial assistance from tax increment financing revenues, the affordability obligation increases to 20% of the total housing units, with the following mix:

For Rental projects, 50% of the required affordable units must be affordable to households earning 50% of AMI or below and 50% of the required affordable units must be affordable to households earning 60% of AMI or below.

For For-Sale projects, 50% of the required affordable units must be affordable to households earning 80% of AMI or below and 50% of the required affordable units must be affordable to households earning 100% of AMI or below.

5.2 Calculation of required on-site affordable units



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One quarter of the required affordable units must be provided on-site. In some cases, the required on-site units may be built, bought or rehabbed off-site (see Article 7.3) or leased or sold to the CHA or another Authorized Agency (see Article 7.2).

For the purpose of calculating the number of required on-site affordable units, DPD will multiply the total number of units in the project by 2.5%, as shown below. For projects that are eligible for the TSL bonus, and that take that bonus, DPD will multiply the total number of units in the project by 5%, as shown below.

total units in project

total affordable

units required

on-site* affordable

units required

on-site TSL units

required

10-14 1 0 1

15-19 2 0 1

20-24 2 1 1

25-29 3 1 1

30-34 3 1 2

35-44 4 1 2

45-49 5 1 2

50-54 5 1 3

55-59 6 1 3

60-64 6 2 3

65-69 7 2 3

70-74 7 2 4

75-89 8 2 4

90-94 9 2 5

95-99 10 2 5

100-104 10 3 5

* note that, except for projects taking the TSL bonus and projects in low-moderate income ares, the on-site obligation may also be met through the provision of off-site units, or the sale or lease of units to the CHA or an Authorized Agency

5.3 Calculation of the In-Lieu Fee After meeting the on-site unit requirement, developers may pay an in-lieu fee to meet the remaining affordable obligation.

If a developer elects to sell to or sign a long-term lease with the CHA or another Authorized Agency, as detailed in Article 7.2, the remaining in-lieu fee will be reduced by $25,000 per remaining required unit. Only projects located in Higher Income Zones or Downtown are eligible for this option. Developers of Downtown For-Sale projects may elect to pay an in-lieu premium (also referred to as the Buy-Out fee) rather than place units on-site.



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In-lieu fees were updated with the 2015 ARO: The updated in-lieu fees will be phased in over one year from the date of Publication (April 15, 2015) for downtown projects, with the initial in-lieu fees assessed beginning on the 2015 ARO Effective date of October 12, 2015 and the final in-lieu fees taking effect on April 15, 2016. The in-lieu fees will be determined by the zone in which the project is located, as described in the table below:

5.3.1 Timing of the In-Lieu Fee Calculation The in-lieu fee will be calculated at the time the complete Affordable Housing Profile is approved by the ARO Project Manager. The fee, as calculated, will be valid for one year following the date the form is signed. If the fee has not been paid and received by the department within the year following the signature of the Affordable Housing Profile form, the in-lieu fee owed will be recalculated at the time that payment is made. In an effort to prevent the submission of Affordable Housing Profiles prematurely in order to secure a lower in-lieu fee, if the form is substantially altered within the year following the initial signature, the DPD Project Manager may recalculate the in-lieu fee owed based on the current rate. 5.3.2 Annual Increases to the In-Lieu Fee, based on the Consumer Price Index (CPI) Beginning January 1, 2018, the in-lieu fees shall be adjusted annually based on the United States’ Department of Labor’s Bureau of Labor Statistics Consumer Price Index for all Urban Consumers for the Chicago metropolitan area, or a comparable index selected by the commissioner if this index no longer exists. As the 2015 ARO initial effective date is October 12, 2015, the increase in the Consumer Price Index (CPI) will be based on the CPI for October of each year (or, if data for October is not yet available,

ARO Zone

Initial In-lieu Fee

(effective October 12, 2015)

Final In-lieu Fee (effective April 15,

2016)

Initial Authorized

Agency In-Lieu Fee

(effective October 12, 2015)

Final Authorized Agency In-Lieu Fee

(effective April 15, 2016)

Initial In-Lieu

Premium (effective

October 12, 2015)

Final In-Lieu

Premium (effective April 15,

2016)

Low-Moderate Income $50,000 $50,000 n/a n/a n/a n/a

Higher Income $125,000 $125,000 $100,000 $100,000 n/a n/a

Downtown rental

$140,000 $175,000 $115,000 $150,000 n/a n/a

Downtown for sale $140,000 $175,000 $115,000 $150,000 $160,000 $225,000



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the most recent month for which data is available) and will take effect on January 1 of the following year. The current in-lieu fee is available at www.cityofchicago.org/ARO.

Article 6: Administrative Procedures for ARO Projects

6.1 Administrative Procedures for Rezonings

6.1.1 DPD Staff flag ARO-Subject Zoning Changes Zoning Change Applicants indicate on their Application for an Amendment to the Chicago Zoning Ordinance whether a project is subject to the ARO. ARO-subject projects are then flagged by Committee on Zoning staff and forwarded to the ARO Project Manager (PM). The ARO PM will typically contact the developer or their attorney within one week following the initial Council introduction and provide detail on the steps necessary to comply with the ARO. 6.1.2 ARO PM places holds on building permits The ARO PM will place a hold in the Hansen permitting system on the addresses identified in the Zoning Amendment application to ensure that no new construction or rehab building permits (including foundation permits) are issued for these address ranges until the developer pays the required in-lieu fee and/or records the Affordable Housing Agreement securing the construction of affordable units. 6.1.3 Applicant completes and submits Affordable Housing Profile Form (AHP) As soon as project details are finalized, the developer should submit the Affordable Housing Profile Form (AHP), and required supporting documentation. The AHP provides the details on total number of units proposed; number, type (# of bedrooms), and pricing of affordable units; and anticipated project start dates. 6.1.4 ARO Project Manager Reviews and Approves Affordable Housing Profile Form Once all required/requested documents have been received, the ARO PM will review the Affordable Housing Profile Form (AHP). The ARO PM reviews the form to ensure that the number and type of affordable units proposed reflects the market mix. If off-site affordable units are proposed, the ARO PM will forward the application for review to DPD’s Construction and Compliance division for their review. Depending on whether the required affordable units will be provided on-site, off-site, or to an authorized agency, the sign-off on the AHP (assuming all requested documentation has been received) will take 1-4 weeks.




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Following sign-off by the ARO PM, the developer must also sign the AHP. 6.1.5 Developer works with ARO PM to complete and record the Affordable Housing Agreement and/or pays In-Lieu Fee and, if applicable, off-site unit review fee When project details have been finalized and before the first building permit can be issued, the applicant must pay the in-lieu fee and/or record the Affordable Housing Agreement. The Affordable Housing Agreement – not to be confused with the Affordable Housing Profile Form (AHP) – outlines and commemorates the requirements and procedures that govern how the developer and subsequent owners or occupants of the unit and/or development will comply with the ARO. In order to prepare this the Agreement, the ARO PM will require a copy of the following documents:

6.1.5.1 An executed copy of the deed transferring title to the developer; 6.1.5.2. A copy of the title policy showing the developer as the owner of the property and the named insured; 6.1.5.3 If there were any exceptions in the title policy such as building code violations, evidence that the property owner has cleared those exceptions; 6.1.5.4 Articles of organization for the LLC, certified by the Illinois Secretary of State; 6.1.5.5 Operating agreement of the LLC (if any), certified by the manager of the LLC; 6.1.5.6 Certificate of Good Standing for the LLC, issued by the Illinois Secretary of State; 6.1.5.7 Resolutions authorizing the LLC to enter into the Affordable Housing Covenant and Agreement; 6.1.5.8 Resolutions authorizing the person identified in the signature block to sign the Affordable Housing Covenant and Agreement; 6.1.5.9 Name of the managing member of the LLC (signatory for covenant); 6.1.5.10 Copy of the ordinance approving the city land sale, financial assistance, or change in zoning. 6.1.5.11 Copy of the Affordable Housing Profile, signed by the applicant and the ARO PM.

Sample copies of the Affordable Housing Agreement are attached here as Exhibits B-C, but the applicant should always check on www.cityofchicago.org/ARO to ensure that they are working from the current version of this and all documents. The in-lieu fee and, if applicable, the off-site unit review fee, must also be received by the ARO PM prior to the release of the first building permit. Payment is accepted in the form of a check made out to the City of Chicago. Wired Funds or credit card payments will not be accepted. The preparation of the covenant may take up to 2 months to process, so developers are advised to begin working with the ARO PM at least two months before they expect to receive a building permit, in order to avoid permitting delays . 6.1.6 Applicant records the Agreement with the Cook County Recorder of Deeds




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Once they have received permission from the ARO PM to do so, the developer is responsible for recording the signed Agreement with the Cook County Recorder of Deeds. 6.1.7 ARO PM releases the hold on the building permit After the ARO PM receives a copy of the recorded Affordable Housing Agreement and/or has received a check in the amount of the payment-in-lieu, the ARO PM will release the permit hold. The building permit hold release takes effect immediately, but developers should make an appointment to deliver the recorded covenant and/or payment, in order to ensure the ARO PM is available to accept it.

6.2 Administrative Procedures for Projects Receiving or Purchasing City Land

6.2.1 Land grants or purchases through the City’s Adjacent Neighbors Land Acquisition Program (ANLAP) ANLAP will typically not trigger the ARO, as the vacant lots sold through ANLAP are required to be purchased by owner-occupant neighbors, and to be used, for a minimum of ten years following the purchase, only for uses auxiliary to the existing residence, including open space, a garage, or an addition to the existing home. Because of these restrictions built into ANLAP, the deed of purchase for an ANLAP property does not typically trigger the ARO. 6.2.2 Land purchases through the City’s Sealed Bid process do not require that the owner disclose the intended use of the sale prior to purchase. However, the ARO’s applicability to the site is advertised in the bid, and the deed of purchase requires compliance with the ARO if it is triggered by the construction of a residential housing project including ten or more units. 6.2.3 Land purchases through the Negotiated Sales program are sold in two ways:

6.2.3.1 Lots sold at a discount are required to remain as open space or parking for 40 years – in which case the ARO would not apply, unless the parking is required by or accessory to a project that would trigger the ARO; 6.2.3.2 Lots sold at market value are required to be used for open space or parking – but may be converted to other uses after the first 6 months to 1 year. For lots sold at market value, the deed of purchase requires compliance with the ARO if it is triggered by the construction of a residential housing project including ten or more units.

6.3 Administrative Procedures for Projects Receiving Financial Assistance Projects receiving financial assistance from the City for the construction of a Residential Housing Project are required to provide 20% of the units as affordable.



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If residential projects receiving TIF are also receiving Low Income Housing Tax Credits, the long-term affordability of the required affordable units – as well as the income of the prospective tenants – will be tracked by the Department’s Developer Services division.

Residential projects that are receiving TIF assistance – but no other form of City financial assistance that would impose stricter affordability requirements – must meet the requirements of the ARO. Developers will be required to identify whether their project will likely be subject to the ARO on the TIF Application. The TIF PM will share the Affordable Housing Profile Form with the ARO PM. Before the project can go to the Community Development Commission (CDC), the Affordable Housing Profile must be completed and signed by both the ARO PM and the developer/applicant. The Affordable Housing Profile includes details on the number and type of affordable units required, and/or the timing of the in-lieu payment. The Affordable Housing Profile Form, signed by the ARO PM, must also be attached to the TIF Redevelopment Agreement (RDA) as an Exhibit. In addition to the Affordable Housing Profile Form, the Affordable Housing Agreement securing the number and type of affordable units must be recorded separately and attached as an exhibit to the TIF RDA. The RDA must be reviewed by the ARO PM and a City attorney representing the ARO prior to final approval.

6.4 Administrative Procedures for Planned Developments

6.4.1 DPD Staff Flag ARO-Subject Planned Developments (PDs) PD Applicants are required to indicate on their Application for an Amendment to the Chicago Zoning Ordinance whether their project will be subject to the ARO. ARO-subject projects are then flagged by Committee on Zoning/Plan Commission Staff and forwarded to the ARO PM. The ARO PM will typically contact the developer or their attorney within one week following the initial Council introduction and provide detail on the steps necessary to comply with the ARO. 6.4.2 ARO PM places holds on building permits The ARO PM will place a hold in the Hansen permitting system on the addresses identified in the Zoning Amendment application to ensure that no new construction or rehab building permits (including foundation permits) are issued for these address ranges until the developer pays the required in-lieu fee and/or records the Affordable Housing Agreement securing the construction of affordable units. 6.4.3 Developer completes and submits Affordable Housing Profile Form As soon as project details are finalized, the developer should submit the Affordable Housing Profile Form (AHP), and required supporting documentation.



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The AHP provides the details on total number of units proposed; number, type (# of bedrooms), and pricing of affordable units; and anticipated project start dates. This form must be signed by both the developer and the ARO PM before the project can go to Plan Commission. 6.4.4 Developer works with the ARO Project Manager to draft PD Statements PDs must include a PD statement, as provided in its current form by the PD/ARO Staff, identifying their ARO, and, if applicable, their Density Bonus obligation. If developers are electing to meet their ARO obligation by providing ARO units off-site, the details must be approved by DPD and included in the PD statements as well. The PD statement templates are attached here in Exhibit D. 6.4.5 Developer works with ARO PM to complete and record the Affordable Housing Agreement and/or pays in-lieu fee

Refer to Article 6.1.5 6.4.6 Developer records the Agreement with the Cook County Recorder of Deeds

Refer to Article 6.1.6 6.4.7 ARO PM releases the hold on the building permit

Refer to Article 6.1.7 At the time of each Part II review for the Residential Project, the developer may update and resubmit the Affordable Housing Profile Form to the ARO PM for review and approval. If the developer subsequently reduces the number of dwelling units in the Residential Project, DPD may adjust the requirements without amending the PD.



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Article 7: Compliance Options

Options to meet the ARO

Low-Moderate Income Areas: Rental and For-

Sale

Higher Income Areas: Rental

and For-Sale

Downtown: Rental

Downtown: For-Sale

Construct required units on-site and pay no in-lieu fee

X X X X

Place at least 1/4 of the required 10% affordable units (20% if the City provides financial assistance) on-site and pay a fee-in-lieu per any remaining units

X $50,000 in-lieu

fee

X $125,000 in-

lieu fee



ARO Transit-Served Location bonus X X X X

Lease or Sell Units to the CHA or other authorized agency and receive a $25,000 In-Lieu Fee Reduction

X X X

Off-Site Option: within two miles and in a higher income area

X X

Off-Site Option: anywhere X

No on-site units – with $225,000 in-lieu premium

X**

*downtown fees will be phased in over one year: through April 14, 2016, the fee-in-lieu for downtown projects will be $140,000 **through April 14, 2016, the in-lieu premium will be $160,000

7.1 Construct affordable units on-site All ARO-subject projects may meet their ARO obligation by providing all of their required affordable units on-site, or by providing one-quarter (25%) of the required affordable units on-site and paying an in-lieu fee for any remaining units. On-site units must comply with the Design and Construction Standards for affordable units detailed in Article 9 and must be sold according to the processes outlined in Articles 10 through 16.



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7.2 Sign a long-term lease with or sell units to the Chicago Housing Authority (CHA) or another Authorized Agency ARO-subject projects Downtown or in Higher Income Zones may sell or lease their required affordable units to the CHA or another Authorized Agency. If a developer sells or leases at least one-quarter (25%) of their required affordable units to the CHA or another Authorized Agency, the remaining in-lieu fees will be reduced by $25,000 per remaining required affordable unit. The CHA or Authorized Agency must meet the definition of “Authorized Agency” detailed in the Ordinance, to the satisfaction of the ARO Project Manager. The Developer must submit a letter from the Authorized Agency with their Affordable Housing Profile Form verifying that the CHA or other Authorized Agency will be purchasing or leasing the affordable units for the minimum 30-year term. For For-Sale units sold to the CHA, the CHA would buy the units from the developer and then lease to tenants on the CHA’s list. For for-sale units that are sold to the CHA and subsequently leased, CHA will need to secure HUD approval in order to purchase the units. Because CHA is not able to secure HUD approval until the units are complete, the City will require that the developer record the affordable covenant and pay the full in-lieu fee for any units not provided to the CHA prior to permitting. Once the units have been approved by HUD for purchase by the CHA, the City will reimburse the developer for $25,000 per-unit-not-provided (ie the in-lieu fee reduction). For Rental units leased to the CHA, prior to the issuance of any building permits for the project, the developer must sign a minimum-30-year an Agreement to enter into a Housing Assistance Payments contract (AHAP) that will state the CHA’s intention to provide rental assistance for 30 years to low-income households upon completion of the project. The AHAP – and subsequent HAP agreement – would formalize the CHA’s agreement to provide rental assistance payments to the owner of the building, who will then house tenants from a list maintained by the CHA. The leases will be between the building owner and the tenant referred from the CHA’s list. If a developer is working with an Authorized Agency other than the CHA, prior to the issuance of any building permits for the project, the developer must, at the City’s direction, sign a minimum 30-year lease or record a 30-year deed restriction (as provided by the City) against the property to ensure that the unit remains affordable to households at 60% of the Area Median Income (AMI). All Authorized Agencies will be responsible for submitting an annual report to DPD’s Compliance Division, by October 31 of each year. The report, provided in the format requested by DPD, will provide the following information and any additional information requested by the Commissioner:

Number of ARO units currently in the authorized agency’s inventory;

Monthly Rental rate for each affordable unit;

Information concerning each tenant household’s composition and gross income;

Affordable unit operating expenses and revenues received by each agency.

Prior to the initial leasing of the affordable units, DPD must verify that the prospective tenants are income qualified. The Authorized Agency, with the exception of the CHA, should not sign a lease with any tenant leasing an ARO unit unless the tenant’s income has been approved by DPD.



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7.3 Build, Buy, or Rehab units off-site

7.3.1 City’s goal for off-site units By allowing the construction of off-site units to meet the on-site requirement, the Department is hoping to harness the expertise, experience, and ingenuity of the development community to create more affordable units off-site than would otherwise be created in the ARO-subject property. Developers are encouraged to be creative in meeting their off-site obligation. In addition to creating more units than would be possible on-site, the expectation is that the off-site units could be larger and potentially more affordable than their on-site counterparts. 7.3.2 Meeting required with DPD Staff At least several weeks prior to submitting their Affordable Housing Profile Form to the City – and at least three months prior to the expected date of permit issuance, any developer who is considering meeting their on-site ARO obligation by providing off-site units must schedule a meeting to review their proposal with the ARO PM. At the meeting, the developer should be prepared to discuss their proposed budget; project location; project scope; and other topics that will help DPD determine whether the off-site units will be comparable to the on-site in-lieu budget. This meeting should be scheduled at least three months prior to the anticipated permitting date.

7.3.3 Location and Required Number of Off-Site Affordable Units ARO-subject developers in Higher Income Zones and Downtown may meet their on-site ARO obligation by providing their required affordable units off-site as new construction; rehabilitated; or existing units, per the approval of DPD. In Low-Moderate Income Zones, developers must provide their required affordable units on-site: there is no off-site option. In Higher Income Zones, developers may comply with their one-quarter (25%) on-site ARO obligation by providing the required affordable units off-site. Off-site affordable units for projects in higher-income zones must be located within a two-mile radius from the residential housing project and in the same or a different higher income zone or downtown district. Rental projects must create off-site rental units; For-Sale projects must create off-site for-sale units. Downtown, developers of rental units may comply with their one-quarter (25%) on-site ARO obligation by providing the required rental affordable units off-site. Off-site affordable units for downtown rental units must be located within a two-mile radius from the residential housing project and in a downtown district or higher income zone. Downtown developers of for-sale units may comply with their one-quarter (25%) on-site ARO obligation by providing the required for-sale affordable units off-site. Off-site affordable units for



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downtown for-sale projects may be located location anywhere in the city, subject to the approval of the ARO PM. Off-site units must adhere to the existing requirements of the Chicago Zoning Ordinance. No increase in density, financial assistance or other assistance from the city shall be required in order to accommodate the off-site affordable units, with the exception that the City may transfer or sell land for the purpose of establishing off-site affordable units. 7.3.4 Cost to Construct and Size of Off-Site Affordable Units At minimum, the off-site units must have the same number of bedrooms as those that would have been required on-site. Square footage may be different, depending on the overall proposal from the developer, as approved by the ARO PM. The cost to construct or renovate the total number of off-site units must equal or exceed the total amount of the equivalent in-lieu fees that would be required for the residential housing project. For example, if a developer was building 100 rental units in the downtown zone, they would be required to build 10 affordable units, 3 of which would be required to be on-site. If they elected to construct these 3 units off-site, their off-site budget would be, at minimum, 3 x $175,000, or $525,000.

7.3.5 Design and Construction Standards for Off-Site Affordable Units In addition to the general Design Guidelines outlined in Article 9, the following guidelines will apply to off-site units. While the requirements below are not intended to be exhaustive, at minimum, off-site affordable units must meet the following design and livability standards.

7.3.5.1 Affordable off-site units shall be functionally equivalent to the market-rate units in the residential housing project in terms of the exterior appearance, energy efficiency, and quality of construction. 7.3.5.2 Appliances (range or stove, refrigerator, dishwasher, if provided) shall be new, Underwriters Laboratories listed and approved, with a one-year minimum warranty.

7.3.6 Requirements for Review of Off-Site Affordable Units For projects intending to build, buy, or rehab off-site units to meet all or a portion of their ARO requirement, the following documentation must be submitted with their completed Affordable Housing Profile form.

7.3.6.1 Documents required prior to project review, including, at minimum

7.3.6.1.1 Description of status of site control 7.3.6.1.2 Project work scope 7.3.6.1.3 Project budget (including acquisition costs), with per-unit cost breakdown 7.3.6.1.4 Construction schedule 7.3.6.1.5 Description of anticipated building permits



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7.3.6.1.6 Site plan (if new, include elevations; if rehab, include construction drawings + scope; if existing, include scope of work)

7.3.6.2 Documents required prior to issuance of the subject ARO project’s building permit

7.3.6.2.1 Evidence of site control 7.3.6.2.2 Evidence of building permits 7.3.6.2.3 Administrative review fee ($5,000) and in-lieu fee for units not being

constructed 7.3.6.3 Documents required prior to Leasing of Units

7.3.6.3.1 Certificate of occupancy for subject ARO project 7.3.6.3.2 Marketing plan, as detailed in Article 10 (For Sale Units) or Article 14

(Rental Units) 7.3.7 Process to review and approve off-site units

7.3.7.1 Developer provides required documents at the time the Affordable Housing Profile Form is submitted to the ARO PM 7.3.7.2 ARO PM reviews AHP to ensure the project is eligible to provide off-site units, and the location is appropriate 7.3.7.3 Construction Staff review work scope, budget, construction schedule and building permit information to verify that the proposed budget is sufficient; and that functionally equivalent units with new appliances will meet quality construction standards, and meet the City of Chicago Health/Safety Requirements 7.3.7.4 Prior to issuance of the building permits for the ARO-subject project, the administrative review fee of $5,000 per off-site unit must be received, as well as the in-lieu fee for any remaining affordability obligation 7.3.7.5 If units are existing, Construction Staff will conduct an inspection of the units before approval 7.3.7.6 If new units are proposed, Construction Staff will review any building plans and building permits 7.3.7.7 Once the ARO PM has received copies of the Certificate of Occupancy for the off-site units, she will notify Construction Staff, who will schedule a final inspection of the off-site units. 7.3.7.8 Once the units have been inspected and meet with the Construction staff’s approval, the ARO PM will authorize the issuance of the Certificate of Occupancy for the ARO subject property

7.3.8 Enforcement Provisions In addition to the requirement to receive the certificate of occupancy for the off-site units prior to that of the ARO-triggering project, Off-site ARO units are subject to the same enforcement provisions as other ARO units, as outlined in Article 17.

7.4 Compliance through the ARO TSL (Transit Served Location) Bonus



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ARO-subject applicants that elect to take the ARO TSL Bonus will follow the same procedures as those outlined above for Planned Developments providing New Construction Units On-Site (See Articles 6.4 and 7.1) – with the exception that:

50% of required affordable units will be required to be constructed on-site.

Verification from Zoning staff that the project is eligible for the ARO TSL Bonus will be required prior to the ARO PM’s sign-off on the Affordable Housing Profile Form.

To be eligible for the ARO TSL Bonus, developers must already be going through the Planned Development process as a Transit Served Location. The ARO TSL Bonus is not available unless a developer is already taking the TSL Floor Area (or other available) bonus(es).

7.5 Compliance through payment of the In-Lieu Fee ARO-subject applicants of For-sale Downtown projects only may opt out of the on-site unit requirement by paying an in-lieu fee of $225,000 per required affordable unit. All other ARO-subject applicants must first meet their on-site unit requirement, but may pay the in-lieu fee for any remaining obligation. The in-lieu fee payment must be received prior to the issuance of any building permit, including excavation or foundation permits. Payment is accepted in the form of a check made out to the City of Chicago. Wired Funds or credit card payments will not be accepted. Upon receipt of payment, the ARO PM will issue a receipt to the developer.

Article 8: Recording of the Affordable Housing Agreement and Payment of the In-Lieu Fee For projects for which all units are included under a single building permit, the in-lieu fee and/or the recording of the affordable housing agreement are required prior to the issuance of the initial building permit (or, if applicable, the foundation permit). For single family developments, multi-phased projects or others in which permits are issued on a unit-by-unit basis, the ARO obligation may be phased, as follows:

When the developer intends to construct affordable units, he/she must record the Affordable Housing Covenant against the project’s address range prior to the issuance of the tenth permit.

When the developer intends to make the in-lieu payment, the developer must make the first payment after the permitting of the 10th unit; the 2nd payment after the permitting of the 14th unit; the 3rd payment after the permitting of the 21st unit, and so on.



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Article 9: Design and Construction Standards for Affordable Units Developers who provide affordable units must adhere to the following rules and regulations. Developers who are constructing off-site units must adhere to the Standards outlined in Article 9, and also the Standards in Article 7.3, except that where these requirements conflict, the requirements of Article 7.3 will govern.

9.1 Timing of Construction/Occupancy Affordable units must be available for occupancy concurrently with or prior to the market rate units in the residential housing project or phase thereof. This means that a proportionate share of affordable units shall be completed for each group of market rate units completed at 25%, 50%, 75% and final completion of the residential housing project. The Commissioner may approve an alternate timing plan if he/she determines, in his or her sole discretion, that there is no economically feasible way to comply with the phasing requirements, in which event the developer shall post a bond or similar security in an amount equal to one and one-half times the required in-lieu fee to secure the completion of those units. 9.2 Design

9.2.1 Dispersal throughout the building Affordable units should be reasonably dispersed in the project, such that no single building or floor has a disproportionate percentage of affordable units. Applicants will be asked to indicate the floors on which the affordable units will be located on the Affordable Housing Profile Form. 9.2.2 Rental and For Sale Units For-Sale projects must include affordable for-sale units, and Rental projects must include affordable rental units. However, projects with both rental and for-sale units may request permission from the Commissioner to allow all the required affordable units to be constructed as rental units. 9.2.3 Unit Type and Quality Affordable units must be comparable to the market rate units in the residential housing project in terms of unit type, number of bedrooms per unit, quality of exterior appearance, energy efficiency, and overall quality of construction. For condominium and apartment projects, developers must provide the same mix of unit sizes (by bedroom count) in the affordable and market rate components. So, for example, in a market development with 10 one-bedrooms, 20 two-bedrooms, and 10 three-bedrooms, 1 affordable one-bedroom; 2 affordable two-bedrooms; and 1 affordable three-bedroom unit would be required.



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The ARO PM’s sign-off is required on the unit mix as part of the Affordable Housing Profile Form. This unit mix must be maintained for the 30-year affordability period. If the building’s unit mix changes prior to the issuance of building permits, the applicant must alert the ARO PM and the affordability requirements may be adjusted. For detached single family or townhome projects where the majority of units include 3 or more bedrooms, additional flexibility may be allowed. 9.2.4 Square Footage The square footage of affordable units should be generally consistent with the square footage of comparable (by number of bedrooms) market rate units in the project. 9.2.5 Amenities and Finishes While developers are encouraged to include the same amenities and finishes in affordable units as in market units, affordable units may have different in-unit amenities and finishes than market-rate units in the residential housing project, as long as:

The basic components are the same; and

The affordable amenities and finishes are durable, of good and new quality, and are consistent with then-current standards for new housing. Amenities include air conditioning and laundry facilities. Developers will be required to provide information on the affordable unit amenities and finishes as part of the Affordable Housing Profile Form. 9.2.6 Access to Amenities Affordable units shall have access to all on-site amenities available to market-rate units, including the same access to and enjoyment of common areas and facilities in the residential housing project. 9.2.7 Parking Affordable units shall have functionally equivalent parking when parking is provided to the market rate units in the residential housing project. Parking (in the same format as provided to market units) must be included in the sale price or rent of the unit, unless the developer can demonstrate to the satisfaction of the City that parking is not included in the purchase price/rent of the market-rate units. When parking is not included, the purchase of the parking space will be considered a separate transaction and cannot be included as part of the financing of the affordable unit. 9.2.8 Fees and Earnest Money



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Affordable tenants or purchasers shall not be assessed any fees that are not assessed to market rate buyers. Developers may accept earnest money from an affordable buyer, but that earnest money should be 100% reimbursable if the applicant does not meet DPD’s affordability guidelines. 9.2.9 Single Family Developments With the Commissioner’s approval, in a residential housing project which contains single-family detached homes, affordable units may be attached homes rather than detached homes and lots for affordable units may be smaller than lots for market-rate units (consistent with applicable zoning). In a residential project which contains attached multi-story housing units, affordable units may be configured as one-story flats within a multi-story structure.

9.3 Pricing “Affordable” is defined in the Ordinance as a sales price or rent less than or equal to the amount at which total monthly housing costs, as specified in the rules and regulations, would total not more than 30% of household income for a household whose income is the maximum allowable for an eligible household.

9.3.1 For Sale Units ARO For-Sale units must be priced to be affordable to households earning no more than 100% of the AMI. If TIF assistance is provided to the developer for the purposes of residential construction, 10% of the total units must be priced to be affordable to households at 100% of AMI and 10% of the total units must be priced to be affordable to households at 80% of AMI. The City’s affordable pricing formula takes into account a buyers’ total monthly housing costs, per the assumptions indicated below. The formula assumes that a buyer will finance 95% of the purchase price. Maximum sales prices assume 1.5 occupants per bedroom and 1 occupant for a unit with no bedrooms. Total Monthly Housing Costs include the following:

Monthly Housing Costs

Cost Assumption

property taxes 2% of the price and/or value

condo assessment/home maintenance

Higher of the amount indicated by the developer/homeowner - or the average assessments, set by the City using MLS data for all annual sales, for units by number of bedrooms.

For 2015, those amounts are set at:

studio $300

one-bedroom $325



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Once the applicant and City have signed off on the Affordable Housing Profile, the price is valid for a period of two years. If the Affordable Housing Agreement securing the units is not filed before the two year period expires, the City will recalculate the price. Once the Affordable Housing Agreement has been recorded, the price will be valid for two years from the date of the recording. If the unit(s) is/are not under contract within the two year period following the date of the Agreement, the Developer shall notify the ARO PM and the ARO PM will recalculate the affordable price(s) of the affordable units in accordance with the then-current formula. 9.3.2 Rental Units ARO Rental units must be priced to be affordable to households earning no more than 60% of the Area Median Income. If TIF assistance is provided to the developer for the purposes of residential construction, 10% of the total units must be priced to be affordable to households at 50% of AMI and 10% of the total units must be priced to be affordable to households at 60% of AMI.

two-bedroom $350

three-bedroom $375

four-bedroom $375

For single family homes that do not assess homeowners a monthly fee, this amount is reduced to $150/month to encourage maintenance savings for single family homes.

CCLT covenant fee tbd

Private Mortgage Insurance

PMI is estimated at 0.070% of the mortgage amount.

Property Insurance

0.25% of the market price for condominiums 0.75% of the market price for single family homes or townhomes (where buyers are paying for full homeowners rather than renters/contents insurance)

Interest Rate

The interest rate is the higher of the current interest rate, as published in the Chicago Tribune, and rounded up to the nearest quarter point - OR - the 10-year average of interest rates, as calculated by the City of Chicago, based on data provided annually by Freddie Mac as "Contract interest rates on commitments for fixed-rate first mortgages. Source: Primary Mortgage Market Survey® data provided by Freddie Mac." For 2015, the interest rate is 5.07%.



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Affordable rents are updated annually by the department, based on income limits as published by HUD and utility allowances published by the Chicago Housing Authority. DPD will publish the affordable rents at www.cityofchicago.org/ARO as soon as they become available. Maximum rents assume 1.5 occupants per bedroom and 1 occupant for an apartment with no bedrooms.

9.4 Income Eligibility

9.4.1 For-Sale Units For projects that are not receiving financial assistance, for-sale units must be purchased by households earning up to 120% AMI. If TIF assistance is provided to the developer for the purposes of residential construction, buyers for 10% of the total units may earn no more than 80% of AMI and buyers for 10% of the total units may earn no more than 100% of AMI. DPD follows HUD’s HOME guidelines for calculating annual gross household income. Per DPD Policy, eligible purchasers may not spend more than 38% of their household income on housing. 9.4.2 Rental Units For projects that are not receiving financial assistance, rental units may be leased by households earning up to 60% of area median income (AMI). If TIF assistance is provided to the developer for the purposes of residential construction, tenants for 10% of the total units may earn no more than 50% of AMI and tenants for 10% of the total units may earn no more than 60% of AMI. Tenants are income qualified at the time of initial rental, or if a tenant is added or removed from the lease. While developers are required to submit annual reports indicating that the affordable units are leased at an affordable price per the current Maximum Rent Limits, the tenants already residing in the units do not need to be income qualified annually, unless there are any changes to the individuals listed on the lease. Prior to the initial leasing of the affordable units, DPD must verify that the prospective tenants are Income-qualified. The developer or management company should not sign a lease with any tenant leasing an ARO unit unless the tenant’s income has been approved by DPD. DPD follows HUD’s guidelines for calculating annual gross household income, as published in Chapter 5, titled “Chapter 5: Determining Income & Calculating Rent” of the HUD Handbook and published at http://portal.hud.gov/hudportal/documents/huddoc?id=DOC_35649.pdf




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9.4.3 Income Limits Income limits for the Chicago Primary Metropolitan Statistical Area (PMSA) are calculated annually by the Department of Housing and Urban Development, and are published on the Department’s website. Income limits are typically updated by HUD between December and April of each year. The income limits in place at the time of a tenants or homebuyer’s application will be utilized in determining their eligibility to lease or purchase the unit. The DPD approval letter certifying income eligibility for Rental units is valid for one year. The DPD approval letter certifying income eligibility for For Sale units is valid for two years, but is specific to the project for which a prospective buyer is applying to purchase. A prospective buyer may not transfer an income certification between projects. The current income limits are provided in Exhibit H.

Article 10: Marketing ARO Units: For Sale Units While DPD will typically list the affordable units on their website, and may share the information with interested buyers, it is the responsibility of the developer to market and sell their required affordable units. Developers shall use good faith and affirmative efforts to attract potential purchases or tenants from all minority communities and from households earning less than 120% (for-sale) of the AMI (or, if TIF assistance is received, marketed to households earning less than 100% and 80% of the AMI) through the marketing and advertising of the ARO units. To that end, DPD has set the following requirements and parameters for marketing all affordable for-sale units.

10.1 Marketing Intake Meeting Before marketing any unit for sale – and at least 90 days prior to the commencement of marketing for the units (all units, not just the affordable units) and 180 days prior to the anticipated closing for the affordable units – the developer must schedule a Marketing Intake Meeting with DPD Homeownership Center staff to review the process to market and sell the ARO units to income-qualified buyer(s). The meeting should be attended by the developer, and the marketing/sales agents that will be overseeing the process to sell the affordable units. 10.2 Marketing Plan At the Marketing Intake meeting, the applicant must submit their marketing plan for the project, following the format of the Marketing Plan template provided in Exhibit E.



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DPD staff will review the marketing and affordability requirements, and will review the process to approve and income-qualify eligible buyers/tenants with the applicant and marketing agents. No marketing or advertising material shall be distributed or published until DPD has signed off on the developer’s Marketing Plan for the project. Approval or disapproval of the marketing plan shall be made within ten (10) business days of receipt of a complete marketing plan. If the Marketing Plan is not approved, DPD will provide recommendations to remedy any deficiencies. DPD recommends that the applicant work with a marketing agent specializing in affordable units to ensure their affordable units are marketed effectively and sold quickly.

Article 11: Requirements for ARO Homebuyers Potential homebuyers must meet the following requirements:

11.1 Be Income Qualified Per Article 9.4

11.2 Complete Homeownership Training Potential homebuyers must receive certificates verifying that they have received the following pre-purchase education from a DPD-approved Delegate Housing Counseling Agency prior to submitting their application to purchase an affordable unit, unless otherwise indicated by DPD. All certifications must be provided to DPD at least 10 days before closing. Certifications are good for one year from date of issuance.

11.2.1 General Pre-Purchase Homebuyer Training

General Pre-Purchase Homebuyer certification requires 8 hours of training (including 6 hours of classroom training and 2 hours of one-on-one education)

on-line certification is not permitted

List of City-funded housing counseling agencies is online at http://www.cityofchicago.org/city/en/depts/dcd/supp_info/homeownership_housingcounselingcenters.html. Each Counseling agency maintains a calendar of scheduled classes on their websites.

11.2.2 Condo Training, if the unit is a condominium Condo training is provided by Rogers Park Community Development Corporation and Spanish Coalition for Housing, or other agencies as identified by DPD on their website. 11.2.3 Chicago Community Land Trust Training


http://www.cityofchicago.org/city/en/depts/dcd/supp_info/homeownership_housingcounselingcenters.html



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If the unit will be sold through the Chicago Community Land Trust (CCLT), CCLT-specific training is required, in order to ensure that buyers fully understand the ownership and resale restrictions and obligations inherent in purchasing a CCLT unit.

11.3 Mortgage Pre-approval If a buyer is purchasing a CCLT unit, each potential purchaser must obtain a mortgage pre-approval letter from a lender approved by the CCLT. The list of approved lenders is available at www.cityofchicago.org/CCLT. The letter should indicate the type of loan product, maximum loan amount, interest rate and term (only 30 year fixed rate loans are allowed).

CCLT Staff will ensure that homebuyers will not be spending more than 38% of their income on housing, and will verify that the mortgage they are receiving is not a predatory loan.

11.4 Completed Application The completed homebuyer application, attached here as Exhibit G and available online at [insert address], must be accompanied by the following documentation, and must be received at least ten days prior to signing a purchase contract:

Homebuyer Counseling certificates (including Condo + CCLT Training, as applicable), as detailed above in Article 11.2.1

Mortgage pre-approval from a participating lender, as detailed above in Article 11.3

Copy of driver’s license or State ID for each applicant over 18 years of age

Tax returns (signed) and W-2s for the prior two years

Paystubs from the prior three pay periods

Child Support Affidavit (attached as part of Exhibit G)

Completed Verification of Employment, signed by HR department of employer

Copy of Mortgage loan application

Copy of divorce decree or legal judgment of separate maintenance (if applicable)

Household Income affidavit

Additional documentation may be requested to verify income and eligibility. Prior to Clear to Close/Scheduling a closing for “For Sale” ARO units, the following documentation must be received at least ten days prior to the scheduled closing in order to prepare the restrictive covenant:

Signed Sales Contract/Purchase Agreement, with all upgrades and options listed

Appraisal

11.5 Exclusions Households where all of the members are full-time students are not eligible to purchase an ARO unit. A full-time student is defined by Section 151 (c) (4) of the Internal Revenue Code of 1986 as an individual who during at least five calendar months of the year is a full time student at a regular educational institution.



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There are four exceptions to the full-time student restrictions; however only one must be met for the household to qualify for the tax credit program.

At least one member receiving assistance under Title IV of the Social Security Act (AFDC or its successor under welfare reform)

The household consists of single parents and their children and such parents and children are not dependents of another individual

All members of the household are married and file a joint tax return

At least one person of the household is a participant in a job-training program receiving assistance under the Job Training Partnership Act or similar federal, state or local laws.

11.6 Affordability Term For-Sale ARO units must be continue to be affordable – and sold only to qualified buyers – for a period of 30 years after the closing of the initial sale, unless the property is foreclosed upon or condemned. After the thirty year term expires, the owner at the time will have the option to: 1) Sell the unit for its market value to a buyer of their choosing, and pay the City an amount equal to

fifty percent (50%) of the difference between the affordable unit’s market value and its affordable price, as determined at the time of such sale, in which event the department will release the affordable housing agreement recorded against the unit; or

2) At DPD’s discretion, sell the unit to an eligible household at an affordable price, subject to an affordable housing agreement in the City’s then-current form.

If the owner of an affordable unit occupies the affordable unit as their principal residence for a continuous period of 30 years, the City shall release the affordable housing agreement without further obligation on the owner’s part.

Article 12: Process to Sell Affordable Units to Income-Qualified Homebuyers Unless otherwise indicated by DPD, Developers or their agents will be responsible for collecting completed homebuyer applications, see Article 11. Developers will designate a date on their Marketing Plan, after which completed applications will be accepted. Applications should not be accepted unless they are complete, including all required documentation. See Exhibit G for a sample application package. Unless otherwise determined by DPD Staff that a lottery or other application process is more appropriate, completed applications should be time and date-stamped, and submitted to DPD in the order of receipt. DPD staff will review completed applications, and will give potential purchasers up to ten business days to comply with submittal requirements before moving to the next applicant. Priority to select specific units will be based on order in which a completed application is submitted.



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Letters of conditional approval will be sent out to all potential buyers who are determined to be income-qualified to purchase an affordable unit. Qualified buyers will then sign a contract to purchase a unit and complete the steps needed to get a final commitment from their lender. When DPD financing is involved or the unit is being sold through the CCLT, the seller is responsible for sending a final request to close to DPD; DPD will issue a Clear to Close when the title commitment; final lender commitment letter; all required certifications; and a final appraisal are received by DPD. Where there is no DPD financing involved or the unit is not being sold through the CCLT, the seller is responsible for securing an agreement template from Law and recording the resale restriction at closing. Failure to record the 30-year resale restriction will deem the project non-compliant and will subject the developer to the Penalties for Non-compliance detailed in Article 17.

12.1 Lottery If DPD staff anticipate that demand for the unit may be high, the developer may be required to sell the unit via a lottery process, to ensure that opportunity to purchase the unit is made available to as many income-qualified homebuyers as possible. If this is the case, DPD will manage – or will work with a delegate agency – to coordinate the lottery process. The developer will be expected to participate in the planning process, and, potentially, will be required to hold open houses prior to the lottery; collect completed applications; and, potentially, host the lottery drawing – but will not be expected to coordinate or organize the lottery.

Article 13: Homeowner Restrictions on ARO Units 13.1 Resale or Transfer of ARO Units The resale or transfer of any affordable housing unit shall be restricted as follows:

13.1.1 During the thirty-year affordability period, owners of ARO units must sell their units at a price that renders the housing unit affordable, per the affordable housing agreement, to a household meeting the eligibility criteria as certified by DPD, or its agent.

13.1.2 ARO Homeowners must contact DPD at least 6 months prior to the anticipated time of sale. DPD will then calculate the maximum resale price. The homeowner will be required to pay for the price of an appraisal for the home, if a current (no more than 6 months old) appraisal is not available for the property. 13.1.3 Homeowners will not be required to complete a Marketing Plan for their home, but they will be responsible to sell the home. While the payment of a Realtor commission is not factored into the maximum resale price of a home, sellers are welcomed to work with a Realtor to sell their home. The Realtor’s Commission will need to be paid by the Seller, however.



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13.1.4 Include the following language in the listing under the Remarks section: Owner Occupants ONLY – Income restrictions and homebuyer education classes required before purchasing. Restrictions governing to whom and for how much you can sell the unit also apply.

13.1.5 An interested buyer must submit a complete program application to DPD to determine eligibility, to the attention of:

Homeownership Center City of Chicago, Department of Planning and Development 121 N LaSalle St – Room 1006 Chicago IL 60602

13.1.6 A homebuyer approval letter will be issued within ten (10) business days from the receipt of a completed application from the interested buyer. An approval letter is required in order to purchase an affordable unit.

13.2 Monitoring and Reporting Requirements Purchasers of ARO units are required to submit annual affidavits verifying:

that they maintain homeowner’s insurance on the property;

that they continue to reside in the property as their primary residence; and

providing current contact information

current income/occupation and other demographic information, as requested

13.3 Refinances Post-purchase education may be required prior to Refinancing of an affordable unit. Homeowners are required to contact DPD once a refinancing lender has been identified to request a SUBORDINATION AGREEMENT DPD Policy does not allow cash-out in Subordination transactions. The maximum new mortgage loan amount will be the amount of the pay-off letter(s) plus the closing costs shown on a signed Good Faith Estimate (GFE). The amount of the new mortgage loan must be consistent on the following documents. The following documents should be submitted to DPD by the lender to initiate processing of the Subordination Request:

13.3.1 A copy of the recorded City of Chicago junior mortgage related to your request. 13.3.2 A signed Subordination Request letter from the new lender, with all transaction details,

and the rationale for the refinance. 13.3.3 A copy of the signed Homeowner’s authorization to release information. 13.3.4 A copy of the signed Good Faith Estimate for the new mortgage. 13.3.5 A copy of the signed copy of the properly completed 1003. 13.3.6 A copy of the signed Truth-In-Lending Disclosure for the new mortgage. 13.3.7 A pay-off letter for a date at least fifteen (15) business days from the date documents

are delivered to DPD



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13.3.8 A copy of the signed Mortgage Approval/Commitment Letter with term, P&I and details for the new mortgage.

13.3.9 Copy of new Title Commitment for the amount of new mortgage. 13.3.10 Copy of the Appraisal or other Market Value Analysis used to process the new

mortgage. 13.3.11 Documents to show original loan amount, P&I, and loan type.

Upon receipt of all of these documents from the lender the DPD staff can initiate processing the Subordination Request. This can take 15 business days, or longer. If approved, the Subordination is mailed USPS, unless a prepaid overnight carrier envelope is provided. You as the lender should ensure that the amount of the new mortgage loan is consistent, even on the Title Commitment, and the rate is consistent on all documents.

Article 14: Marketing ARO Units: Rental Units It is the responsibility of the developer to market and lease their required affordable units. Applicants shall use good faith and affirmative efforts to attract potential tenants from all minority communities and from households earning less than 60% of the Area Median Income (or, if TIF assistance is received, marketed to households earning less than 60% and 50% of the AMI) through the marketing and advertising of the ARO units. To that end, DPD has set the following requirements and parameters for marketing all affordable rental units.

14.1 Marketing Intake Meeting Before marketing any unit for rent – and at least 30 days prior to the commencement of marketing for the units (all units, not just affordable units) – the developer must meet with DPD Compliance Staff for a marketing intake meeting to review the process to market and lease the unit to an income qualified tenant, as well as the process to income qualify tenants AND submit annual compliance documentation. The meeting should be attended by the Developer and Property managers, including those responsible for leasing the units and income-qualifying tenants AND for submitting annual compliance documentation. The meeting will cover the following:

14.1.1 Number and type of units which must remain affordable 14.1.2 Period of affordability 14.1.3 Unit requirements

Finishes

Square footage

Fees

“floating” units 14.1.4 How to calculate tenant income



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Tenant Information Certification (TIC) form and how to fill it out

What information are you required to collect and review?

What constitutes a “household member” 14.1.5 Maximum Affordable Rents 14.1.6 Initial Lease-Up Requirements 14.1.7 Annual Reporting Requirements The Compliance Division will send a letter to all participants following the meeting confirming participation.

14.2 Marketing the Affordable Units Developers must complete and submit the ARO Rental Unit Marketing Form (included as Exhibit F) to the DPD Project Manager before marketing their affordable units. Developers are responsible for providing current contact information to the City for the term of their affordability period. Submit contact information to Ted Dygus in the Communications and Outreach Division at [email protected]. The City will include the information provided through the ARO Rental Unit Marketing Form on the Affordable Housing Resource List. Developers are encouraged to reach out to their local housing counseling agencies to identify interested and income-qualified tenants. Marketing and Leasing of the affordable units must follow all provisions of the City’s Residential Landlord and Tenant’s Ordinance as well as all applicable sections of the Fair Housing Ordinance.

Article 15. Process to Income Qualify an ARO Tenant Management company takes a rental application from the tenant

Management company requests required income documentation for household income

Management company performs initial income verification for an ARO unit

Management company provides tenant income information to ARO Program staff

ARO staff has 5 business days to review tenant income information and issue emailed response to management company. If tenant is qualified, ARO staff issues tenant approval letter.

Once Tenant Approval Letter is signed, management company may sign lease with approved tenant. Management Company should furnish a signed copy of the lease to the City.

15.1 General Guidelines 15.1.1 Tenants applying to rent affordable units should not be charged any fees for applying for an affordable unit that are not evenly applied to all applicants.


mailto:[email protected]

http://www.cityofchicago.org/city/en/depts/dcd/supp_info/affordable_rentalhousingresourcelist.html


http://www.amlegal.com/nxt/gateway.dll/Illinois/chicago_il/title5housingandeconomicdevelopment/chapter5-12residentiallandlordsandtenant?f=templates$fn=default.htm$3.0$vid=amlegal:chicago_il

http://www.amlegal.com/nxt/gateway.dll/Illinois/chicago_il/title5housingandeconomicdevelopment/chapter5-12residentiallandlordsandtenant?f=templates$fn=default.htm$3.0$vid=amlegal:chicago_il

http://www.cityofchicago.org/content/dam/city/depts/cchr/AdjSupportingInfo/AdjFORMS/OrdinanceBooklet2012.pdf


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15.1.2 Project owners may evaluate prospective tenants based on the criteria they typically use to do so, and may not evaluate prospective tenants on any criteria they would not apply to all tenants. 15.1.3 Affordable rental units should be rented to qualified tenants on a first-come; first-served basis.

Article 16: Monitoring and Reporting Requirements for ARO Rental Units Owners or Authorized Agencies of rental properties must submit the Annual Owner Certification (AOC) documentation to the Department of Planning and Development’s Compliance Division by October 31 of each year, including:

The rent roll (which includes tenants name, current lease period and household composition data)

Annual Owner’s Certification (Compliance Certificate filed as Exhibit in Affordable Housing Agreement – including information on number of bedrooms and square footage of each affordable unit)

Completed TIC form with required documentation for every ARO unit (do not need to have new forms unless there is a new tenant, or someone has been added to the lease of the current tenant)

Copy of lease agreement for every ARO unit

Contact information for the management company

Copy of the original signed Affordable Housing Profile It is the responsibility of the Management Company to submit completed and notarized AOC documentation to the Compliance Division of the Department of Housing and Economic by October 31 of each year until the expiration of the Affordable Housing Agreement term.

16.1 Affordability Term Rental ARO units must be continue to be affordable – and leased only to income-qualified tenants – for a period of 30 years after the closing of the initial sale, unless the property is foreclosed upon or condemned.

Article 17: Penalties for Non-Compliance

17.1 Developer fails to pay the in-lieu fee or provide required affordable units

17.1.1 Fines and revocation of residential real estate developer license Developers who fail to pay the required in-lieu fee or provide the required on-site or off-site affordable units – or if they provide the units but fail to meet the requirements to sell or lease the units outlined in the Ordinance shall be in violation of the Ordinance, which is punishable by a fine equal to two times the required in-lieu fee owed by the project and, in the case of a residential real estate developer licensed pursuant to Chapter 4-40 of the Municipal Code or any successor chapter, the revocation of the developer’s residential real estate developer license.



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Note that developers that submit piecemeal applications to avoid meeting the ARO – and that are later determined by the City to be subject to the ARO – will be subject to these penalties. 17.1.2 Other Remedies In addition to fines or license revocation, the City may seek an injunction or other equitable relief in court to stop any violation of the ARO and to recover any funds improperly obtained from any sale or rental of an affordable unit in violation of the ARO, plus costs and interest at the rate prescribed by law from the date a violation occurred. The city may seek other remedies or use other enforcement powers, as allowed by law.

17.2 Developer creates units – but leases them to households that are not income-qualified Upon the rental of any affordable housing unit (1) at a price above the rental price limits established by DPD or (2) to a household that does not meet the income eligibility criteria of DPD, the property owner will be subject to a fee of $500 per housing unit per day for each day that the property owner is in noncompliance.

Article 18: Changes to the Rules & Regulations The Rules and Regulations may be updated at any time at the discretion of the Commissioner.

Article 19: Changes to the Project 19.1 Project does not move forward If the project receives a zoning change and does not move forward, the hold will remain on the address range. If a different project submits a permit to construct a residential housing project on the site (ie a project with 10+ residential units), that project will be subject to the ARO, regardless of the ownership of the lots or development. 19.2 Changes to the project Any change to the project following approval by Plan Commission, City Council, or DPD that increases allowable FAR or number of residential units would require a recalculation of the affordable housing requirement.

Changes to the overall unit mix in the project may result in changes to the affordable unit mix – but would require the ARO PM’s signature prior to the issuance of the building permit. Approval would be based on the criteria outlined in Section 9. 19.3 Sale of the Property If the project or land is sold, the affordability obligation remains with the property: the owner is responsible for communicating the ARO obligation to the buyer. 19.4 Project converts from Rental to For-Sale



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Projects that convert from rental to for-sale prior to the expiration of the 30-year affordability term will be required to sell the affordable rental units to income-qualified for-sale buyers, under the terms of the ARO. The 30-year affordability term will restart on the date of the initial sale of the condominium unit. 19.5 No changes permitted after the building permit has been issued The Ordinance requires that, prior to the issuance of a building permit, all ARO-subject projects must pay an amount equal to the required fee in lieu or file the affordable housing agreement securing the construction of the affordable units. If the developer fails to comply and build the on-site units, the penalties described in Article 17 become effective.

Article 20: Affordable Housing Opportunity Fund The in-lieu fees and other fees collected through the ARO and Density Bonus shall be deposited into the affordable housing Opportunity Fund, unless required to be deposited into another fund pursuant to federal or state law.

20.1 Administration of Funds The Department of Planning and Development is responsible for administration of the Affordable Housing Opportunity Fund, as set forth in Chapter 2-45-110 of the Municipal Code of Chicago. 20.2 Collection of Funds Developers who are making a payment in lieu must submit a check payable to the “City of Chicago” to the Department of Planning and Development. The Department of Planning and Development will deposit the funds into an established account, and issue the developer a receipt for the deposit. 20.3 Distribution of Funds The Department of Planning and Development will be responsible for administration of the Affordable Housing Opportunity Fund, according to the following criteria:

20.3.1 Administrative and monitoring costs AHOF funds will pay administrative and monitoring costs related to the ARO. 20.3.2 Construction, Rehabilitation or Preservation of Affordable Units Fifty percent of remaining funds will be directed to the Department of Planning and Development and shall be used for the construction or rehabilitation of affordable units. 20.3.3 Chicago Low Income Housing Trust Fund Fifty percent of remaining funds will be directed to the Chicago Low Income Housing Trust Fund, which provides rental subsidies for households earning 30 percent or less of the area median income.



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Article 21: Hardship Waivers Because of their widely varying land use and operational characteristics, hardship waiver requests require case-by-case review. Hardship requests should be made to the ARO Project Manager, who will forward the request for consideration to the Commissioner. At minimum, in order to be considered for a hardship waiver, the applicant would need to provide evidence and/or written description of evidence that the particular hardship exists, specifically that the ARO creates a hardship for which:

the practical difficulties or particular hardships are due to unique circumstances and are not generally applicable to other similarly situated property;

the particular physical surroundings, shape or topographical condition of the specific property involved would result in a particular hardship upon the property owner as distinguished from a mere inconvenience, if the strict letter of the regulations were carried out;

the conditions upon which the petition for a hardship is based would not be applicable, generally, to other property within the same zoning classification;

the purpose of the hardship is not based exclusively upon a desire to make more money out of the property;

the alleged practical difficulty or particular hardship has not been created by any person presently having an interest in the property;

the granting of the hardship will not be detrimental to the public welfare or injurious to other property or improvements in the neighborhood in which the property is located; and

the waiver, if granted, will not set a precedent that reduces the impact or is counter to the intent of the ordinance.

Article 22: Contacts Questions about the Affordable Requirements Ordinance can be directed to the following individuals. Department of Planning and Development (Bureau of Housing) ARO Project Manager 121 N LaSalle Chicago, IL 60602 Phone: 312-744-6746 Department of Planning and Development (Bureau of Zoning) Assistant Commissioner 121 N. LaSalle, Room 905 Chicago, IL 60602 Phone:



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Department of Planning and Development (Compliance & Monitoring Division) Program Auditor III for NSP/ARO/TIF Phone: 312.742.0345



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Exhibit A: Affordable Housing Profile Form to be provided Exhibit B: Affordable Housing Agreement: Rental to be provided Exhibit C: Affordable Housing Agreement: For Sale to be provided Exhibit D: ARO PD Statements to be provided



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Exhibit E: For Sale Marketing Form

City of Chicago Affordable Requirements Ordinance (ARO): For-Sale Units

Marketing Plan for: _____________________________________ Insert development name

Submitted: _____________________________________________ _________________________ Name Date

Approved: _____________________________________________ _________________________ Name Date

Section I: Introduction It is in the best interest of all involved that the affordable units we have all worked so hard to create are sold or leased quickly, and that information on these units is shared as widely as possible. To that end, the City of Chicago requires that each project that will include ARO units creates and carries out a marketing plan to attract prospective tenants within the City of Chicago, regardless of race, color, religion, sex, disability, familial status or national origin. The City of Chicago will work with the developer to review and approve the following Marketing Plan. The City will have ten business days following the Marketing Meeting to review and approve the marketing plan. Please set all advertising dates in this plan so that no date commences sooner than 30 working days before the date of your plan submission. While the developer will be responsible for marketing and selling the affordable units, the City will do the following, beginning no sooner than 90 days before the units are scheduled to close.

1) Publish information on these units on the City’s website, under the page titled “City-Funded Home to Purchase, Affordable Properties List.” Rental properties will be included in the City’s “Affordable Rental Housing Resource List.”

2) Share information with the Housing Counseling agencies funded by the City; 3) Create and share an “e-blast” with all individuals who have expressed interest in purchasing or leasing a City-

owned unit.

Section II: Owner and Development Information 1. Owner Company Name: ________________________________________ Contact Person: ________________________________________

Address: ________________________________________ City/State/Zip: ________________________________________ Telephone #: ________________________________________ Email Address: ________________________________________



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Website: ________________________________________ 2. Property Management Company Firm Name: ________________________________________ Contact Person: ________________________________________

Address: ________________________________________ City/State/Zip: ________________________________________ Telephone #: ________________________________________ Email Address: ________________________________________ Website: ________________________________________

3. Entity Responsible for Marketing

□ Owner □ Agent □ Other – Specify ________________________________________

Firm/Agency Name: ________________________________________

Contact Person: ________________________________________ Address: ________________________________________ City/State/Zip: ________________________________________ Telephone #: ________________________________________ Email Address: ________________________________________ Website: ________________________________________

4. Date of Initial Occupancy: _____________________________ 5. Development Information

□ Attach signed Affordable Housing Profile with affordable unit details

Development includes:

□ Accessible/Adaptable units Please describe: _____________________________________________

□ Other describe: ________________________________

Approximate Starting Dates for: General Advertising: __________________________ Occupancy: _______________________________ Describe the Market Area: ______________________________________________________________ ____________________________________________________________________________________ 6. Application Information Where will applications to purchase the unit be available to pick up/download (you must have locations for both): Contact Name: ________________________________________________________________ Telephone #: ________________________________________________________________ Email address: ________________________________________________________________ Online: ________________________________________________________________



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In person: ________________________________________________________________ When is the first date the applications will be accepted? ____________________________________ Note: set the application date at least 30 days after the date the units are posted on the DPD website, which will be ________________________. When is the deadline to apply to purchase an affordable unit? ______________________________ Note: Set the application deadline at least 45 days after the date the units are posted on the DPD Website, which will be ________________________. Where should applications be delivered? Include: Office/Location: Contact Name Address City/State/Zip code

Section III: Affirmative Fair Housing Indicate below how you will reach out to the following racial or ethnic or special outreach group(s):

□ People who live or work in the Neighborhood:

□ Persons with Physical Disabilities

□ African Americans

□ Hispanic/Latino

□ Asian

□ Other ethnic group, religion, etc (specify): _____________________________________

Section IV: Marketing Plan Indicate the means to be used in advertising the general availability of this housing as well as special outreach efforts. A. Commercial Media Your commercial media plan should target the following groups:

□ Income-qualified people who live in the Neighborhood

□ Income-qualified people who work in the Neighborhood

□ Persons with Physical Disabilities

□ African American families/individuals

□ Hispanic/Latino families/individuals

□ Asian families/individuals

□ Other ethnic group, religion, etc (specify): _____________________________________



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Your commercial media plan should include at least one of the following markets, and, for each market, should include at least one outlet.

□ Newspaper/Publications

□ Radio

□ TV

□ Billboards

□ Internet/Social Media

□ Other

Names of Newspapers, Targeted Audience Size & Duration of advertising Radio, TV Stations, etc and expected impact __________________________ __________________________ __________________________ __________________________ __________________________ __________________________ __________________________ __________________________ __________________________ __________________________ __________________________ __________________________ __________________________ __________________________ __________________________ Add more lines as necessary B. Community Contacts If a community group/organization is to be used as part of the general or special outreach marketing efforts, it is expected that contact with the group/organization listed below will be established and maintained throughout the initial marketing campaign and subsequent marketing efforts. Provide the following information for each contact, if more space is needed, attach an additional sheet. Note that the first name/Organization listed should be the local Alderman’s office. Name of Group/Organization: ________________________________________________________ Street Address: ________________________________________________________ City/State/Zip: ________________________________________________________ Identification of Audience to be reached: __________________________________________________ Approximate date of contact or proposed contact: ___________________________________________ Name of Group/Organization: ________________________________________________________ Street Address: ________________________________________________________ City/State/Zip: ________________________________________________________ Identification of Audience to be reached: __________________________________________________ Approximate date of contact or proposed contact: ___________________________________________



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C. Marketing Accessible and Adaptable Apartments Those developments with accessible or adaptable apartments are to indicate below what specific outreach efforts will be employed to attract persons with physical disabilities, to the accessible or adaptable apartments. Specify: _____________________________________________________________________________ ____________________________________________________________________________________ ____________________________________________________________________________________ D. Open Houses You must hold at least 3 open houses, 1 on a weekday evening, 1 on a weekend day and another date/time of your choice. Open House Location: ___________________________________________ Open House Dates/Times: __________________________ ____________________________ ____________________________ Open House #1 Date/Time Open House #2 Date/Time Open House #3 Date/Time D. Additional Marketing Activities 1. Brochures and Signs Will brochures, leaflets or handouts be used to advertise?

□ Yes □ No If yes, Please attach a copy of all printed materials to be used as part of marketing program or submit when available (the Fair housing and Wheelchair Logo must be present in all printed materials). All flyers must be approved by DPD before you may publish or distribute them. At minimum, the flyers must include:

Reference to DPD ARO program

Maximum Qualifying Incomes

Sales Price(s)

Description of Units

Exterior and Interior (if available) Photo of the Development

Information on how to obtain an application

Open house dates

Fair housing logo

Equal Opportunity Logo

Application deadline

Sales/Marketing Team contact information (Ads may refer applicants to the DPD website at www.cityofchicago.org but will not list DPD telephone numbers or email addresses)

All postings will display an “Equal Housing Opportunity” symbol on all marketing materials, advertisements and notices at the sales office:



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Sample Ad Language

2 one-bedroom ARO ownership units available at 333 Birch Street. $lowest price– $highest price with parking and $lowest price– $highest price without parking. Buyers must not exceed the following income: 100% of Median Income One person - $XX,XXX; 2 persons - $XX,XXX; 3 persons - $XX,XXX; 4 persons - $XX,XXX etc. Applications due by 5pm on DATE. Please contact the Green Company for an application and more information. (415) xxx-xxxx, [email protected] download at www.green.com. Units available through the City of Chicago’s Department of Planning and Development are subject to

monitoring and other resale restrictions. Visit www.cityiofchicago.org/dpd for program information.

2. On-Site Marketing: Will the project have any of the following:

□ Rental Office □ Model □ Real Estate Office

If so, how will staff at these sites be trained on how to market the affordable units? Please specify: _________________________________________________________________________ _____________________________________________________________________________________

3. Other Activities: Please specify: _________________________________________________________________________ _____________________________________________________________________________________


http://www.green.com/


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Exhibit F: Rental Unit Marketing Form

Affordable Requirements Ordinance (ARO)

Rental Unit Marketing Form

Submit this completed form to the Department of Planning & Development (DPD) prior to marketing your rental units. Your units will be included in the Department of Planning and Development’s Rental Housing Resource List and listed on the DPD website

Project Name: ______________________________________________________________ Project Address(es): _________________________________________________________ Total Number of Affordable Units: ___________ Total Number of Affordable and Accessible Units: ___________ Please check all appropriate boxes: □ Tenant pays no utilities – landlord pays all utilities □ Tenant pays for cooking gas and other electric (not heat) □ Tenant pays for electric heat, cooking gas, and other electric □ Tenant pays for gas heat, cooking gas, and other electric □ Tenant pays for electric cooking and other electric (not heat) □ Tenant pays only for other electric Using the City of Chicago Maximum Affordable Monthly Rents effective as of the current calendar year, please provide the following information for the affordable units included in your

project.

Studios One-bedrooms Two-bedrooms Three-bedrooms

Number of units

Square footage

Rent





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Marketing Details Marketing Contact: ___________________________________________________________

Name Phone Number

___________________________________________________________ email development website

Developer contact: ___________________________________________________________

Name Phone Number email address Owner contact, if different than above: ___________________________________________________________

Name Phone Number email address Property Manager contact, if different than above: ___________________________________________________________

Name Phone Number email address When do you expect to begin marketing the units? ________/________/_________ Month/ day Year ______________________________________________________________________ Name (printed) Signature date Note that:

You must market the affordable units at the same time as the market units

If the marketing agent changes, you are responsible for providing us with updated information for the City’s website/Rental unit listing. Please contact the Communications and Outreach Division at 312-744-2976 to provide updated contact information.

Return this completed form to Marcia Baxter, Department of Planning & Development, 121 N. LaSalle, 10th Floor, Chicago, IL 60602, or via email: [email protected]. For any questions, please call (312) 744-0696.


mailto:[email protected]


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Exhibit G: Homebuyer Application, including all required documentation/affidavits to be provided Exhibit H: 2015 Income Limits

Household

Size

50% Area

Median

Income

(HOME Very

Low Income

Limit)

60% Area

Median

Income

80% Area Median

Income (HOME

Low Income

Limit)

100% Area

Median

Income

120% Area

Median Income

140% Area

Median

Income

1 person $26,600 $31,920 $42,600 $53,200 $63,840 $74,480

2 persons $30,400 $36,480 $48,650 $60,800 $72,960 $85,120

3 persons $34,200 $41,040 $54,750 $68,400 $82,080 $95,760

4 persons $38,000 $45,600 $60,800 $76,000 $91,200 $106,400

5 persons $41,050 $49,260 $65,700 $82,100 $98,520 $114,940

6 persons $44,100 $52,920 $70,550 $88,200 $105,840 $123,480

7 persons $47,150 $56,580 $75,400 $94,300 $113,160 $132,020

8 persons $50,200 $60,240 $80,300 $100,400 $120,480 $140,560

9 persons $53,200 $63,840 $85,120 $106,400 $127,680 $148,960

10 persons $56,240 $67,488 $89,984 $112,480 $134,976 $157,472

Income limits based on Chicago PMSA median income, as adjusted by HUD. As of March 6, 2015

Exhibit I: ARO Zone Map to be provided Exhibit J: Frequently Asked Questions to be provided Exhibit K: Chicago Community Land Trust to be provided



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Exhibit K: Chicago Community Land Trust The Chicago Community Land Trust was created in 2006 to provide and sustain quality and affordable homeownership opportunities and to create a community of support for working families and individuals in Chicago. Chicago is the largest city in the country to host a land trust. The CCLT ensures that the initial investment required to create each affordable unit is preserved for multiple generations of homeowners. Most units in the CCLT are created in market-rate developments through the City’s Inclusionary Housing programs, ensuring the preservation of affordable homes in neighborhoods across the entire City. While CCLT homebuyers agree to sell their units to affordable buyers at affordable prices, they benefit from the wealth-building potential of homeownership. CCLT homeowners access the income tax benefits reserved for homeowners, and, at resale, they keep a percentage (typically 20%) of any increase in value their home realized at sale. Finally, CCLT homeowners are supported throughout the entire homebuying/homeownership process. CCLT staff work to ensure that buyers receive pre-purchase education, fixed-rate loans with responsible lenders, reduced property taxes, post purchase monitoring and support, and assistance to market their homes at resale. In our first nine years, the Chicago Community Land Trust has . . .

Lost NO units to foreclosure

Enabled 70 families to achieve the American Dream of homeownership, with an average per unit savings of $69,852

Preserved over $4.8 million in affordable housing subsidies

Worked to secure a 44% reduction in property taxes for CCLT properties

Educated over 1,000 prospective homebuyers since 2007

Partnered with participating lenders (Charter One, Neighborhood Housing Services, Standard Bank & Trust, Wintrust Mortgage) to secure fixed-rate mortgages

Received funding and support from a variety of partners, including the City of Chicago, John D. and Catherine T. MacArthur Foundation, US Bank, Bank of America, and Mayer Brown LLP

Continued to expand opportunities for affordable ownership, with 300 units in the City’s pipeline that will eventually be sold through the CCLT



of 53


Exhibit L: Affordable Rents
