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Policy and governance » Affordable housing and smart growth

Multifamily Affordable Housing Policy

Arlington Heights, Cook County

Arlington Heights establishes high expectations for affordable units in new developments with a policy requiring developers to explain how their projects will address local affordable housing goals.

Goal

To promote affordable homeownership and rental opportunities, especially in Planned Unit Developments (PUDs).

Target

Low-and-moderate income families at or below 80 percent area median income (AMI) for the Chicago region, which was $57,900 for a family of four in 2014, for home ownership programs; and at or below 50 percent AMI for the Chicago region for rental programs.

Financing

No costs associated with this policy.

Success

Timber Court Condominiums was the first major application to this policy. Of the development’s three proposed buildings, the first two were completed in 2008 and contain eight one-bedroom and six two-bedroom affordable units. After the third building is built—for which the developer has planned four one-bedroom and three two-bedroom affordable units—Timber Court will have 21 affordable units (20 percent of the total development). Negotiations also have resulted in the planned inclusion of affordable rental units in the Arlington Downs development, and payment of a fee in lieu of providing affordable units in the Arbor Lane condominium project.

Lessons Learned

The affordable two-bedroom condominiums at Timber Court sold quickly; it was much more difficult to find interested eligible homebuyers for the affordable one-bedroom condominiums. In the future, the Village will ask that all affordable housing units have at least two bedrooms.

Since Arlington Heights established its Housing Commission in the 1970s, access to affordable housing has been one of the Village Board’s top goals. In 1998, to encourage affordable housing construction, the board enacted the Affordable Multifamily Housing Policy, which states:

It is the policy of the Village of Arlington Heights to promote adequate housing for all the community’s people; to create and/or maintain sound viable neighborhoods; to meet the needs for housing by increasing the number of housing units for low and moderate income families and individuals; and to expand housing opportunities for all members of the community.

To implement this policy, which is intended to promote both affordable homeownership and rental opportunities, the Village Board amended the application developers of multifamily residential housing must submit to the Arlington Heights Plan Commission, to include a description of how they intend to address the Village’s goal to promote affordable housing. As in many other parts of the Chicago region, since 2000 it has become considerably more expensive to live in Arlington Heights, as the Village has experienced an increase in both new construction and condominium conversions. Its policy elevates the importance of affordable housing in the decision-making process for Planned Unit Developments (PUDs), making the Village more directly involved. It also encourages developers to include affordable homes in their developments.

How it works

All Plan Commission applications for multifamily residential PUDs must include an assessment of the development’s affordability, details about the inclusion of affordable homes and an additional explanation of how the developer will respond to the Village’s policy. Developers are required to submit this information for both new PUDs and amendments to existing PUDs.

The Village created a MultiFamily Affordable Housing Toolkit and an Affordable Rental Program Policy that provide guidelines concerning the proportion of units in a development that are expected to meet the affordable housing criteria. These policies state that affordable homes must be dispersed among the market rate units, should have the same exterior and interior appearance and should not differ in terms of finishes or internal mechanical systems, unless otherwise approved.

While the policy is not a mandate, it does help the Village take affordable housing into consideration when reviewing a PUD. The number of affordable homes negotiated by the Village is dependent on zoning, site planning and other site-specific considerations.

The Village does provide guidelines for an acceptable percentage of affordable homes within different sized developments. Arlington Heights recommends that 12 percent of homes within developments of 11 to 50 units be affordable, 15 percent of developments with 51 to 100 units, and 20 percent in developments with more than 101 units. The developer may pay a per-unit fee of $100,00 in lieu of providing affordable units.

Buyers are eligible to purchase affordable homes in Arlington Heights if their annual household incomes are at or below 80 percent of area median income (AMI), which was $57,900 for a family of four in 2014; and are eligible to rent affordable units if their incomes are at or below 50 percent AMI.

Prices are set so buyers spend no more than 30 percent of their gross annual incomes on housing costs, which include principal and interest (on an adjusted average 30-year fixed rate mortgage), association dues, taxes and insurance. The appropriate number of occupants for a unit for the homeownership program for the purpose of setting the sale price is defined as one more than the number of bedrooms, and prices are set based on this standard. For instance, the price of a two-bedroom home is set to be affordable for a three-person household.

To support this policy and its overall affordable housing goals, the Village of Arlington Heights has put in place several tools to support developments that include an affordable component. The Village maintains a waiting list of ready and qualified buyers, and has developed several legal documents and measures to maintain affordability permanently, including provisions of the Declaration of Condominium, Development Agreement, and Buyer’s Occupancy and Resale Restriction Agreement signed by the homeowners.

Contact

Department of Planning and Community Development, Arlington Heights
847-368-5200, www.vah.com

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Suite 1400
Chicago, Ill. 60603
P 312 922 5616 F 312 922 5619 info@metroplanning.org
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