Chicago City Wire

Mayor Brandon Johnson and the Chicago Department of Housing have introduced a new ordinance to the Chicago City Council aimed at establishing Green Social Housing (GSH) in the city. This initiative involves creating an independent nonprofit organization authorized to develop GSH projects.

The GSH model focuses on providing permanently affordable, mixed-income, and environmentally sustainable housing without relying on federal subsidies such as Low-Income Housing Tax Credits. The 2024 Housing and Economic Development Bond has already set up a $135 million revolving loan fund for low-cost construction loans for these projects.

Mayor Johnson stated, “I am proud to introduce the Green Social Housing Ordinance to City Council in an effort to increase the supply of affordable housing across our city and achieve environmental justice for our residents.” He emphasized that this financing model would ensure consistent funding for housing units meeting Green Building Standards, positioning Chicago as a leader in community investment.

While no funding approval is included in this ordinance, any GSH project utilizing $5 million or more will require City Council approval according to the HED Bond Ordinance.

Housing Commissioner Lissette Castañeda remarked, “In the midst of this long-standing housing crisis, it is imperative we take bold steps towards creating affordable, sustainable housing for all Chicagoans.” She described Green Social Housing as an innovative strategy maximizing resource impact on affordability.

Chicago faces a shortage of over 119,000 affordable housing units. Additionally, more than half of its residents are rent burdened, spending over 30 percent of their income on rent and utilities.

Under the GSH model, at least 30 percent of each development's units will be permanently affordable for households earning up to 80 percent of the area median income. The remaining units will be rented at market rates. This mixed-income approach allows rents to remain affordable without ongoing city subsidies.

The GSH Revolving Loan Fund aims to replace private equity needs by reducing construction costs. The Residential Investment Corporation will form joint ventures with private developers using this financing tool while retaining majority ownership during construction and after stabilization. This strategy combines private sector efficiency with lasting community benefits through affordable homes.

GSH developments are designed to meet Green Building Standards, which aim to reduce carbon emissions and utility bills while improving indoor air quality for residents.

The Mayor’s Office and Department of Housing expressed gratitude toward partners such as the Center for Public Enterprise, IL Green New Deal Coalition, and Impact for Equity for their support in developing this model.