Tag Archives: Illinois

How big do the financial incentives have to be to actually have affordable housing built in Illinois?

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A proposed Illinois bill suggests offering incentives for middle housing or affordable housing is a better way to go:

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While Pritzker’s plan would require municipalities statewide to allow denser housing, the municipal league’s bill, introduced by Homewood Democrat Rep. Will Davis, makes participation voluntary by dangling state money as an incentive rather than wielding state authority as a hammer. Local leaders have spent months objecting to Pritzker’s plan as an unprecedented state intrusion into their authority to shape their own communities….

Cole characterized his organization’s proposal not as a counter but as “an alternative proposal” built around a voluntary incentive program of state funds to support local participation in expanding housing supply, including locally chosen overlay districts where middle housing would be allowed by right. He pressed his case at a House subject-matter hearing on Wednesday with pointed rhetoric…

In addition, the new bill would allow municipalities to prioritize blighted properties for redevelopment, potentially with state assistance; exempt certain housing building materials from some taxes; and prevent private homeowners’ associations from restrictions that “unreasonably prohibit” ADUs. It would also cap upfront rental costs at one month’s rent. Whether to allow single-stairway buildings — a provision of the governor’s proposal for many buildings up to six stories — would remain up to individual municipalities…

Cole argued Monday that many of his members would embrace denser housing if the financial incentives were right and pushed back on the idea local leaders are inherently opposed to growth.

This is a familiar debate in a number of American states: people generally like the idea of constructing cheaper housing but do not necessarily want it near them as they fear for their property values and who might be their neighbors.

Here is what I want to know on the incentives side: what incentives are needed to get developers, builders, and communities to move? How much money would be available? How much money do those on the developing and constructing side want in order to change their focus from higher-end housing to cheaper housing? Will these incentives push communities to actually approve cheaper housing (say for any new residents more than 10-20% below the existing household median income for the community)? Incentives are often pitched as the answer but rarely are the numbers discussed publicly.

At the moment, the debate is pitched as state control or local control, mandates or incentives. Do we actually know what incentives will work or are Illinois communities committed to not giving up any local control (and this is a bedrock of suburban local government, if not all local governments)?

What other companies or organizations could benefit from an Illinois megaprojects bill intended to help the Chicago Bears

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Illinois state legislators continue to discuss a potential megaprojects bill. The bill is under debate because of what the Chicago Bears might do regarding their desire for a new stadium. But it could also affect other businesses, organizations, or sectors.

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The article cited above said the incentives in the bill could not be used for data centers. What about a major residential development? A new skyscraper? A planned community? A resort or casino? Intermodal facilities? An airport?

I understand that the Bears are the pressing question right now, particularly as Indiana has moved at the state level to attract the Bears, but the long-term questions are also ones worth asking. States and communities in the United States continue to offer tax breaks to companies and organizations to attract development. It is hard not to play this game if other places or governmental bodies are. Illinois legislators might not be discussing any help for the Bears if Indiana had not moved quickly.

Imagine it is not a sports looking for government help but a big corporation that wants to build a (non data center) facility in Illinois. They are motivated in part because of this bill. Does this standardize tax breaks in Illinois and either attract more businesses and development or limit what local governments can do in response?

State and local regulations about e-bikes and e-motos hinge on 28 mph limit

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As Illinois communities responded to the increased use of e-bikes and e-motos, the Illinois legislature now has plans. Many of these regulations depend on a particular speed: 28 mph. Here is how the Illinois regulations are described:

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If the bill passes, anyone who wants to ride an e-bike or e-moto capable of traveling over 28 mph would be required to have a driver’s license, title, registration and insurance. Those higher-speed devices would be treated more like motor vehicles, and riders would be barred from operating those higher-speed devices above 28 mph in bike lanes, paths and similar spaces. Most importantly, riders of most micromobility devices would need to be at least 16 years old. In short, this bill would set something Illinois has lacked for years: clear, statewide expectations for devices that have rapidly become part of everyday life.

What is special about 28 mph? It is not a common speed limit. Residential or local streets might have 20, 25, or 30 mph speed limits. Is it really safer to ride at 27 mph compared to 29 mph?

This particular speed limit is related to the three classes for e-bikes. Here is one description:

There are three designations of ebikes in America—Class 1, Class 2, and Class 3—that are defined by a small handful of characteristics. While most ebikes have a maximum power output of 750 watts, it’s a combination of a bike’s top speed and how that speed is achieved that puts each ebike into its correct class. The three classes also determine where you can ride your ebike…

With a top speed of 28 miles per hour, Class 3 bikes are the most powerful of all. However, given their speed, most states impose heavier restrictions on where you can ride a Class 3 ebike. Like any bicycle, riders can operate a Class 3 ebike on roads, in traffic lanes, and in road-adjacent bike lanes. However, Class 3 bikes are typically prohibited on greenways, paths, and in parks.

These are federal designations for this particular consumer product.

It would be interesting to see if such regulations change in the future to better match regular speed limits.

And how much will police or devices now track e-bike or e-moto speeds via radar to check on that 28 mph limit?

Funding local services via property taxes or state funds

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What should be the formula by which local governments and the state of Illinois contribute monies for local services? There might be change coming:

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The concern centers on the Local Government Distributive Fund, the long-standing revenue-sharing mechanism that sends a portion of state income tax collections to cities and towns across Illinois.

Illinois mayors are warning that Pritzker’s proposed fiscal year 2027 budget plan reduces the share of state income-tax revenue distributed to local governments, a shift that would force many municipalities to make tough choices.

The proposal would lower the municipal share of income tax revenue distributed through the fund from 6.47% to 6.23%, meaning cities and villages would receive about $60 million less than they would under the current formula. Lawmakers have reduced that share significantly over the years, starting with a substantial cut from the 10% level that persisted prior to 2011 when lawmakers significantly increased the income tax.

While the change would send more money to the state, it would squeeze local governments that rely heavily on property taxes to fund services. Pulling additional dollars from the LGDF risks shifting the burden onto Illinois homeowners, who already face some of the highest property tax bills in the country. Property taxes are set locally, but state decisions about revenue sharing inevitably shape how much local governments must rely on them. 

Several matters appear to be at play:

  1. Local residents and leaders tend to like more local oversight of government and funds. But they are not necessarily opposed to getting funds from elsewhere – like the state – to then spend locally.
  2. Who should be making “tough choices”? Let’s say the formula is reconfigured; what local services are at risk for Illinois communities? Or where is that extra money the state is keeping then being spent? Would that money be spent in ways that helps lot of people?
  3. Property taxes are a hot button issue in many places. People like their property values going up but they do not like their property taxes going up along with that. And property taxes pay for the local services that help support their property values (schools, local amenities, etc.). If people don’t want property taxes to keep going up, what would local communities actually cut or scale back?

Percentage-wise, the formula change seems small but this gets at a fundamental issue in the American political and social system: there are multiple layers of government that provide for residents. Americans tend to like local control but townships, counties, states, and the federal government also provide services. The optimal distribution of funding and services is up for negotiation and the debate grows stronger when there is less money to go around.

IL governor’s push to have statewide residential zoning

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In his State of the State address, Governor JB Pritzker said he supports statewide zoning changes to promote more housing:

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Gov. JB Pritzker will propose a statewide zoning law in his State of the State address on Wednesday, drastically limiting the authority local governments have to control what types of housing structures can be built on land that’s zoned residential…

A study published last year by the University of Illinois found that the state is about 142,000 units of housing short and would need to build 227,000 over the next five years to keep up with demand. That equals about 45,000 new homes a year — nearly double the five-year average of about 19,000 built annually between 2019 and 2024…

Pritzker’s office says the plan includes a tiered framework to permit multi-unit housing by right in all but the smallest lots zoned for residential use. Local zoning boards would no longer be allowed to prohibit property owners from building multi-unit housing on residential lots exceeding 2,500 square feet…06

More straightforward, accessory dwelling units — attached or detached secondary residences such as granny flats, backyard cottages and above-garage apartments — would be legalized on all properties zoned for residential use. The city of Chicago moved last year to relax its 60-year ban on granny flats. And legislation was filed in Springfield last year to ban local governments from prohibiting the units. But it has not moved.

Three thoughts in response to this proposal:

  1. One feature Americans tend to like about suburbs and local governments is that they have control over land use decisions, not people located elsewhere. This means residents have more direct say about who might be there neighbor or what might be located next door. In roughly the last one hundred years, zoning in suburbs is then used to protect single-family homes and their values. Messing with this established use is not easy; as the article briefly notes: “the effort is likely to be met with stiff pushback.”
  2. Illinois is not the first state to pursue this so there are other models to look at and see whether similar legislation has had positive effects. This has primarily occurred in blue states with more expensive housing markets than Illinois.
  3. It will be interesting to see how different parts or communities in Illinois respond to this. The Chicago area housing market is different than downstate. How will wealthier suburban communities react? Which communities are most eager to construct affordable or missing-middle housing? Where would developers and builders want to construct housing if these statewide guidelines are passed?

Local history and Illinois high school mascots

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With two bills proposed in the Illinois legislature regarding the names of high school mascots, one writer looks at the connections between local history and mascots:

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Nearly every high school nickname in Illinois, and across the country, is a product of a local history. Your nickname, blandly innocuous or a 300-year-old derogatory insult toward indigenous people, is not special. More than 30 schools in Illinois currently claim Native American-related nicknames. There are also 36 schools that are Eagles, 29 that are Bulldogs and 29 that are Tigers…

Heritage and lore are often behind nicknames: Outside Champaign, the Bunnies of Fisher Jr./Sr. High School took their name from a century-old tradition, when players carried rabbit-feet. The DeKalb Barbs nod to DeKalb as the origin of barbed wire. In Brighton, Southwestern High School — honoring the area’s Native background without making a whole group of people a caricature — are Piasa Birds, a reference to the mythical creatures found painted into cliffs on the nearby Mississippi River.

Some of the best Illinois nicknames play off a town’s industry: The Rochelle Hubs honor Rochelle’s history as a travel junction, where rail lines and several interstates converge. The Cornjerkers of Hoopeston — home of the National Sweetcorn Festival — is another example of a team turning an insult (here, against corn farmers) into a point of pride. There’s a similarly defiant streak about Farmington Farmers and Coal City Coalers.

Discussions of changing the mascot often invoke this history:

“My first death threat I ever got as a legislator was after I filed that first mascot bill,” West said. “You hear, ‘If I see you crossing the street, I promise to forget how to use my brakes.’ My goodness — over a mascot! You are coming for their traditions, they say. Tradition is always the main argument. Finances too — how much it will cost to get new uniforms and so on. But the energy, and anger, in these conversations is about history.”

Local history is important to many communities. But there are also plenty of moments in history where communities make decisions to go different directions. As they consider external pressures and internal pressures, communities come together and discuss how they would like to respond. My research considered decisions about development but this could also apply to mascots. Have the times changed? How do newer residents in a community feel? What is the broader purpose of schools? The discussion may be about the name of the high school names bu tit likely invokes broader questions about how communities think about themselves and the world around them.

Of the examples of high school mascots provided in the article, the names highlighting a local industry are intriguing. What might this look like in the twenty-first century? The Office Parks? The Hospitalists? The Data Centers or Warehousers? The Drivers? New traditions could begin with names fitting more recent work and industry patterns.

Who will lead the way to address the need for hundreds of thousands of housing units in Illinois?

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A new study suggests Illinois needs a lot of new housing:

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Illinois has a shortage of about 142,000 housing units and must build 227,000 in the next five years to keep pace with demand, a number that would require recent annual production rates to double, according to a new economic study.

The joint study published Tuesday by the Illinois Economic Policy Institute and the Project for Middle Class Renewal at the University of Illinois Urbana-Champaign found that although the rental and for-sale housing markets in Chicago and Illinois as a whole remain more affordable than many coastal cities, such as New York and Los Angeles, and some other states, Illinois still faces a severe housing shortage that is escalating affordability challenges.

National housing shortage estimates are wide-ranging, with Freddie Mac citing 3.7 million and the National Association of Realtors reporting 5.5 million.

And the recommendations for how to do this?

The authors suggest a variety of solutions, some of which Chicago officials and other state leaders are already working on, including easing zoning restrictions, quickening permitting processes, offering tax incentives to convert commercial buildings to residential units and increasing surtaxes on short-term rentals such as Airbnb. Aldermen recently took a step toward giving themselves the power to ban Airbnb and other short-term rentals from opening in their wards, a move that could potentially lead to an increase in housing supply.

This is not a new issue. And even drastic changes right now would not lead to 227,000 new units in five years. This is a long-term project that needs to be addressed.

One thought: this is an opportunity for Illinois to do something that could help lead the way in the United States. Here is why. It is a blue state and Chicago and its region dominates politics and perceptions. (This is not to ignore those living outside the Chicago area; there are just fewer of them.) It has more affordable costs compared to numerous other important cities. Chicago is still an important, world-class city. If Illinois could make a serious dent in providing affordable housing across the state, it could become a model for numerous other places. What works in Illinois might not work at all in New York City or Seattle or San Francisco or other super-heated housing markets. But it might work in Cleveland, Nashville, Denver, and other American metropolitan regions. Figure it out and Illinois and lots of areas could benefit.

For numerous reasons, it seems like politicians and business leaders in American cities and regions are hesitant to truly tackle affordable housing. But those who get out ahead of it can (1) help people living there and (2) provide models and tools for others to learn from and use.

Almost 80% of Illinois farmland devoted to two crops

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Illinois farmland has two primary crops: corn (39.9%) and soybeans (38.9%).

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These figures were part of a story about AI farming technologies:

In general, technology is further along for row crops because hundreds of acres of corn and soybeans are relatively simple to tend to en masse. Ag-tech conglomerates such as John Deere and CNH Industrial have also historically catered to the needs of row crop operations since they’re such a large share of the nation’s agricultural sector, accounting for $21 billion of agricultural production in Illinois alone. Specialty crops haven’t received as much attention from corporate America. 

When you drive out of the Chicago area, you can see what appear to be endless fields of these two crops. Illinois may lead the country in pumpkin production but the amount of corn and soybeans grown is much higher. These may not be “exciting” crops but they are used in many ways.

Put it another way: what would Chicago area residents think if “Land of Lincoln” was changed “Land of Corn and Soybeans”? Would they associate those crops with other places (like corn with Iowa)?

And would being a state that leads in corn and soybean AI be an advantage? If so, how much so and where would the benefits go?

Illinois drops state’s 1% grocery tax, over 150 communities have adopted one

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Local governments need revenue for local services. So when the state of Illinois dropped its 1% grocery tax, many municipalities have adopted their own 1% tax:

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Even though the measure failed in Bensenville, at least 163 communities around the state have recently enacted local grocery taxes.

Gov. JB Pritzker signed a bill last year repealing the state’s 1% grocery tax, saying it hit poorer families harder. But the bill also allowed municipalities, which depend on the revenue, to implement their own tax. Bensenville put the proposal on the ballot to get voters’ input, but local officials are not required to do so. In many municipalities, local governing bodies are casting the deciding vote…

The state suspended the grocery tax for fiscal year 2022 to help fight rising inflation, but municipal leaders say losing the stream of revenue permanently forces them to consider cutting services, raising sales or property taxes, or implementing a local grocery tax. If they approve a local grocery tax by Oct. 1, it would take effect on Jan. 1, 2026, when the state tax expires…

Illinois residents already pay the highest combined state and local taxes in the nation, at more than $13,000 annually, according to a recent report by WalletHub. Food prices rose 3% in the past year as of March, and the federal government forecasts them to rise another 3.5% this year…

“If local governments believe it is necessary to tax milk, bread, eggs, etc. to fund local services/local government, then they should be responsible and accountable for that decision to local taxpayers,” Illinois Department of Revenue spokeswoman Maura Kownacki told the Tribune. “The state should not be imposing a regressive, statewide sales tax on groceries especially during a time when inflation is hitting the pocketbooks of Illinois families.”

The cynical take would be that in a state with high taxes the Illinois governor wanted to paint the state in a good light by dropping the tax. Municipalities have limited options for filling the budget hole so they quickly move to adopt a local tax. The grocery shopper notices no change in taxes while the politicians debate who was more responsible.

I get the reaction from communities. They want a balanced budget each year and don’t want to have to cut services or acquire debt. Getting money from groceries is dependable money as people need to buy food.

At the same time, adding local taxes and fees can make residents angry. They already see the amount the federal and state governments take in each paycheck. Why do local governments charge for car registration and ask for more money for schools and keep coming up with new revenue ideas?

I wonder if this is also part of the larger issue of limited growth in Illinois. If communities were growing – adding residents, businesses, energy, status – this can cover up revenue issues. New growth leads to growing budgets with new tax money coming in. But if many communities in Illinois are growing slowly or not growing at all, this means stagnant budgets. Or worse, communities have to spend more to maintain older infrastructure that supported growth decades ago.

It may just be a grocery tax but the issues could be much larger.

Education the biggest recipient of local property and IL state taxes

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I recently received the breakdowns of where tax dollars for the State of Illinois and DuPage County went in 2024:

In both cases, education leads the way. For state expenditures, education accounts for 24.8% of spending. At the local level, education accounts for 69.4% of the total rate.

The large portions going to education are supported by multiple interests of residents:

  1. Education is often pitched as for children, the next generation, and the future. If we do not spend on education today, how will the children succeed and/or do better than the previous generation?
  2. The quality of local schools is often tied to housing prices and the status of communities. To not spend locally on schools might provide short-term savings but reduce the desirability of properties and communities in the long-term.
  3. The bulk of education costs is in salaries for teachers and staff. Without quality educators, how can schools be successful?

Some might complain about the tax burden – and Illinois does have high property taxes – but it is hard to argue against spending on education. It could be more effective to reign in spending by targeting other areas where there is duplication of local services (such as townships).