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Winnetka Affordable Housing Documents
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WINNETKA AFFORDABLE HOUSING PLAN
This article focuses on the Winnetka Plan Commission’s recent recommendations for customizing Winnetka’s 2005 Affordable Housing Plan. These recommendations were made at the direction of the Village Council. Both the 2005 Affordable Housing Plan, and the Ordinance adopting it, directed the Plan Commission to conduct a study and make recommendations on topics ranging from the Village’s demographics to techniques to Code amendments.
The Plan Commission’s recommendations are contained in the Winnetka Affordable Housing Report (formally titled Reinvigorating a Tradition of Varied, Moderately Priced and Affordable Housing: A Report to the Village Council), and in the companion demographic and housing study titled Study of Housing Conditions and Needs.
The Winnetka Plan Commission has dedicated a large portion of the last five years to fulfilling the Village Council’s directive to update and customize the 2005 Affordable Housing Plan.
One of the primary objectives of this five-year process has been to communicate and engage Village residents in an open dialogue. The Plan Commission held focus groups in August 2007, followed by Workshops in January 2008, publicized with a Village-wide mailing. Workshops included a presentation of the results of the Plan Commission’s data collection, preliminary findings and possible alternative Village policies to address Winnetka housing diversity. Seven more public meetings were held since the 2008 workshops to consider findings and strategies and to finalize and approve the Study and the Report.
SUMMARY OF PLAN COMMISSION FINDINGS
The Plan Commission’s recent study revealed several findings, among them:
- Affordable housing has always existed in Winnetka, but it is shrinking.
Trends contributing to this loss include conversions of rental apartments to condominiums, a declining number of coach house units and, more recently, the occasional conversion of residential apartments above downtown storefronts into non-residential offices.
While condominium conversions provide an “entry point” into home ownership in Winnetka, the corresponding loss of rental units has an impact on the most affordable form of housing in the Village.
Conversion of downtown residential apartments to office space has had a similar impact on housing diversity. While office space is a valuable component of the downtown tenant mix, such conversions reduce the availability of rental housing. Downtown residents provide a loyal, dedicated market for local goods and services, and have an overall lower impact on downtown parking than office occupancies.
- Winnetka’s population is changing.
The rapid change in the Village’s housing stock from 1990 to 2000 brought a corresponding change in the Village’s population. Households became larger as seniors sold homes and left the Village altogether. Winnetka’s 2.8% increase in those aged 65 and older was dwarfed by other communities, which saw that age group grow at rates between 20% and 55%. The number of young adults dropped by 56%, while the number of school-age children went up by 26%, and single parent households with children increased 128%.
- Many Winnetkans are struggling, particularly seniors.
There is a large gap in the number of housing units available and affordable to lower income groups that live in Winnetka; 591 Winnetka households earned less than $50,000 (2000 census) but only 402 housing units were available in the Village at a cost affordable to their incomes. Households paying more than 30% of their income to housing expenses are considered “housing cost burdened.” In 2000, there were 943 housing cost burdened Winnetka households, 250 of which were seniors.
- Winnetka has become a fairly transient community.
Increasingly limited housing choices make it difficult for empty nesters and retirees to stay in the Village. While nationwide data show a trend toward people staying in their homes for shorter periods, Winnetka’s recent increase in mobility rates is noticeably higher than in surrounding North Shore suburbs. Demographics indicate that Winnetka may increasingly be viewed as a community to move to for the high quality schools, and to move from after school-age years.
- There are limited opportunities to develop new multiple family housing.
Developments such the Winnetka Mews (at Green Bay Road and Pine Street, constructed in 1971) took place on land formerly used for the Village’s Public Works operations. Today, such options for redevelopment are comparatively limited.
PRINCIPLES OF THE PLAN COMMISSION’S AFFORDABLE HOUSING REPORT
The Plan Commission Report focuses on creating a customized approach to Winnetka’s housing needs:
“Rather than simply following other affordable housing programs, which can rely overly on new construction and available developable land, we owe our residents a customized approach to housing needs in Winnetka. This customized approach must provide the flexibility to meet Winnetka’s goals, honor its character and traditions, empower property owners to provide a healthy and diverse housing stock, and recognize a growing national focus on rental housing and housing programs as important solutions to affordable housing needs.” (Report, p. 3)
This customized approach is made possible by the passage of the Home Rule Referendum in 2005, which gave Winnetka considerable flexibility on local matters, including housing. Without Home Rule authority, Winnetka would be obligated to adopt the regional affordability standards and development goals mandated by the State of Illinois that would be unsuitable for this high-value, built-out community.
While the new affordable housing law was mentioned in the course of the home rule referendum discussions, it was not the focus of that referendum. The report of the Village Presidents that led to the referendum, as well as the educational materials circulated by the Village, focused on financial and local governance issues.
While the Affordable Housing and Planning Act and tax cap legislation were cited as examples of state laws that do not apply to home rule units, Village records indicate that, when affordable housing was discussed in conjunction with home rule, the discussions focused on the flexibility home rule status would provide the Village to develop standards that reflect the Village’s characteristics and needs, and on the additional development tools that would be available to the Village as a home rule unit.
The following principles establish the basis for the Report’s recommendations:
High land values and limited opportunities for new multiple family housing call for a highly customized approach to housing in
Winnetka.
No single community – especially one with Winnetka’s high land values and limited buildable land – can effectively take on the burden of addressing housing affordability for the region.
Winnetka’s Home Rule status allows for the adoption of a housing policy that takes Winnetka’s land values and income levels into consideration, and further, allows for a more customized approach which focuses on understanding and serving the housing needs of Winnetka residents and employees.
The Report therefore focuses on retaining and reusing existing multiple family units, a solution that the Report notes is “a faster and less expensive solution than new construction, has a substantially lower environmental impact, and helps preserve community character.”
In addition, the Report recommends establishment of “local preference” standards, which would ensure that any newly created affordable housing units be first made available to eligible long-time Winnetka residents, seniors, business owners and individuals employed in the Village.
Single family neighborhoods are NOT an appropriate location to focus housing affordability efforts.
The Village Council tasked the Plan Commission with updating the Village’s existing 2005 affordable housing plan with clear direction – recommendations for addressing housing diversity and affordability should be focused on the Village’s commercial areas and multiple family zoning areas.
High land values, together with little vacant land, make creation of affordable housing impractical and expensive in single-family areas.
Accordingly, the Report does not recommend policies that encourage new affordable single-family dwellings in single family neighborhoods – acquisition and development costs make these options an ineffective method of encouraging housing affordability.
Focus on maintaining and enhancing existing market rate housing units in downtown and multiple family areas.
Starting in the early 1900’s Winnetka’s development established much of the character of today’s Winnetka, with multiple smaller commercial areas which are more “hamlets” than “downtowns.” Each of these areas has developed over several decades, concentrated around each of the Village’s three rail stations.
These early development patterns provided Winnetka unrivaled access to rail stations, as well as a large number of residential apartments and condominium units, often located above first floor retail. A fundamental principle of the Report is to consider policies which focus on retention and enhancement of existing multiple family apartments and condominiums.
Approach housing diversity without reliance on new development
Maintaining Winnetka’s existing character is a fundamental value of the proposed Plan. The Report does not promote the redevelopment of the downtown Post Office site or any other Village-owned parcel exclusively for affordable housing.
Recommended tools such as an Inclusionary Zoning component, discussed in more detail on the following pages, are proposed not to encourage new development but rather to respond to it. As outlined in the Report, an inclusionary zoning ordinance would require 15% of newly created units to be sold at a rate affordable to Winnetka’s defined Standards of Affordability. Inclusionary Zoning would not apply to existing multiple family housing.
Inclusionary zoning programs do not require a financial contribution from the Village or taxpayers - rather, the units would be required as a condition of zoning approval.
For example, a bonus could be given by the Village to compensate for a required affordable unit, and to offset the developer’s cost of providing an affordable unit. Such bonuses may consist of allowing an additional market rate unit (density bonus), or a reduction in parking requirements.
Emphasize incentives versus mandates when possible.
Winnetka is a Village that is fiscally conservative and that values property rights. The Report therefore emphasizes housing solutions that have little to no financial impact on the average Winnetka resident or on Village government, and also give property owners more, not fewer, options.
For example, a recommendation to eliminate zoning rules against renting existing vacant coach house units would increase the rights of property owners to rent or renovate their coach houses, and could add as many as two dozen additional rental units to the Village.
Because property owners would be free to set any rental rate they choose, these coach houses would not be mandated to be “affordable,” but would nonetheless increase housing choice at no cost to taxpayers.
In addition, incentives (versus mandates) are recommended to encourage the renovation of a handful of vacant downtown apartments (7 units) which are “long term vacancies.” Reintroduction of such units is seen as far more effective than creating the equivalent through a “new development” based strategy.
A TRADITION OF HOUSING DIVERSITY
Winnetka has a long established tradition of diverse housing. Iconic, early 1900’s-era downtown buildings provide both a rich character and a variety of convenient retail shopping. Importantly, these buildings also provide a surprisingly large number of rental apartments (262 units) as well as condominium units (67 units).
An additional 366 multi-family units located along Green Bay Road and on the periphery of the Village’s business districts (near the Winnetka Public Library for example) provide additional diversity for younger households as well as empty nesters. Unlike downtown apartments, these developments tend to be owner-occupied condominium and townhome units, built after the 1950’s.
As a predominantly single-family community, it is revealing to note that the previously described 695 multiple family units are home to approximately 16 % of all Winnetka households.
A smaller, but unique component of Winnetka’s housing diversity exists in the form of occupied coach house units located throughout the Village (31 units in 2006).
Coach house units were typically designed to serve as living quarters for household help. Today, they tend to be occupied by renters or by extended family as independent living quarters for aging parents.
The number of rental units has declined significantly in recent years: Winnetka lost 260 renter-occupied units between 1980 and 2000 - a 37.5% reduction - and losses have continued. Simultaneously, the cost of owned housing has skyrocketed as smaller homes have been replaced with larger more expensive ones. The Report concludes:
“Winnetka’s housing stock increasingly serves only one kind of resident – a family at the peak of its earning years and with school age children. This limited vision of a Winnetka resident excludes too many of our own residents, offers little flexibility for dealing with changes in the economy or in demographics, and does not do justice to the economically diverse history of Winnetka”
A long-standing policy of promoting housing diversity
Winnetka has a long history of Village policy in support of its housing diversity. The Village’s earliest policy statement on housing diversity arose in 1979 with the adoption of a Statement of Community Objectives as an element of the Village’s Comprehensive Plan. That document articulated the following goals:
- Facilitate housing for “those who contribute to the community’s well being, such as public employees, storekeepers and retirees;”
- Encourage and assist in the “provision of moderate cost residences in the Village, especially for those who already live or work in the Village;”
- Facilitate the provision of housing for “older, long-term residents of the Village who no longer wish to live in and maintain single family homes;”
- Facilitate the provision of housing for senior citizens who live in the Village but no longer need, or can no longer afford single-family residences.”
More recently, the Village adopted Winnetka’s 2020 Comprehensive Plan in November 1999. Our primary land use planning tool, the 2020 Plan enunciates the policies and priorities of the Village for a 20-year period. Among them are:
- A need for more housing options for senior citizens and young families;
- A recognition of the important role multiple family buildings play in providing homes for older residents as well as those with modest incomes;
- A recognition of the importance of rental units in housing diversity;
- The observation that multiple family housing options in the Village are limited, with older couples often finding few alternatives when seeking more simplified living arrangements.
THE WINNETKA AFFORDABLE HOUSING REPORT’S SPECIFIC RECOMMENDATIONS
The recommendations in the Plan Commission’s Report are not regulatory in nature – rather, the Report is a “roadmap” suggesting a course of future actions to achieve housing diversity and affordability goals. All of the recommendations that follow require further consideration of specific Code language to carry out specific policies. As such, the recommendations listed below will require additional discussion and hearings.
Creating Appropriate Affordability Standards
Affordability standards define the maximum income level under which a household may purchase or rent a housing unit under the Village’s affordable housing program. As a first step in creating a customized housing policy, the Plan Commission agreed that Winnetka must define “affordability” at a higher level than would be appropriate in other communities.
Illinois law requires that a sufficient amount of housing in a municipality be “affordable” based on the median income of the greater metropolitan area. However, the 2010 median home sale price in Winnetka was $1,172,000, or 540% of the metropolitan area’s $218,000 median home sales price. The median household income for a family of four in Winnetka was $192,947, or 250% of the metropolitan area’s median income of $75,100.
Using the state definition of affordability in Winnetka would be unworkable: creating housing affordable to the metropolitan area median income would be too expensive, and such housing would not address the needs of Winnetka residents. The Winnetka Plan Commission therefore began by proposing a multi-pronged affordability standard that is substantially higher than would be established under state law.
As illustrated in the chart below, Winnetka’s proposed affordability standards would include households with an income level of up to $135,180.
Zoning & Related Village Code Amendments
Consider Village Code amendments to encourage and preserve existing downtown residential units. Promote building owner investment in the residential component of downtown mixed-use buildings.
Downtown / commercial areas:
- Discourage conversion of existing apartments to non-residential uses;
- Relax parking requirements for downtown residential units as an incentive to convert downtown upper floor office space to residential use;
- Adopt a property maintenance code to assure that downtown residential buildings are adequately maintained and comply with sanitation and life safety codes;
- Explore building and zoning code amendments which allow creation of “work/live” in downtown areas.
Residential areas:
- Current zoning rules prohibit renting out a coach house if it sits vacant for six months, and make improvements and upgrades difficult. Eliminating these rules could return approximately 25 existing vacant coach house units to residential use, and would provide additional flexibility to the owners of existing occupied units to invest in upgrades.
- Establish a special use process and standards for evaluation of new accessory housing units such as coach houses or “in-law” apartments.
Inclusionary Zoning
While there are limited options for new multiple-family development, an Inclusionary Zoning amendment is nonetheless recommended to provide affordable units within such developments when they occur.
Inclusionary Zoning standards would require that a developer proposing new multiple family units provide a portion of those units (15%) at a reduced “affordable” level. A hypothetical 20-unit building would be required under such a program to set aside 3 of the units as affordable units. Required units would be subject to a maximum sale or rental price based on Winnetka’s affordability standards.
Units built under an Inclusionary Zoning requirement would be built at the developer’s expense, and would require no financial support from the Village. Inclusionary zoning as conceived by the Plan Commission would incorporate some or all of the following features:
- Local Preference for affordable units, where priority for such units is provided to eligible long-time Winnetka residents, seniors, employees and business owners.
- Continued long-term affordability of such units through deed restrictions and resale limitations;
- Similarity of design requirements, to assure that affordable units maintain basic qualities of market units.
Community Land Trust
The proposed Community Land Trust would be a non-profit organization that acts as an ownership mechanism for any affordable units, such as those created under an Inclusionary Zoning program. Purchasers of such units own the residence they occupy, with the Community Land Trust holding in trust an easement or covenant assuring the continued affordability and compliance with program objectives.
The Community Land Trust plays an important role in completing the affordable housing plan by assuring program goals, such as a “Local Preference” provision to assure that Village residents receive preferential access to units. A Community Land Trust is typically established by and reports to the Village Council.
Housing Trust Fund
The proposed Housing Trust Fund would work in tandem with the Community Land Trust, and serves as the source of funding for programs. The Trust Fund would provide financial support to projects that further the Village’s Affordable Housing goals. The Trust Fund may acquire land or existing housing in furtherance of affordability goals, but its primary strength is the flexibility to fund smaller projects, including those which are not “construction based” efforts, in exchange for the creation of affordable housing units.
The Report describes the use of Housing Trust Fund resources as a source of small loans or gap financing for improvements to older downtown buildings for general rehabilitation, or targeted to accessibility (elevator) improvements, life safety (alarm / sprinkler) improvements, or weatherization work. This investment would not only yield affordable units, it would improve the condition and attractiveness of the entire building.
NORTH SHORE AFFORDABLE HOUSING EFFORTS
Neighboring home rule villages along the North Shore such as Lake Forest, Wilmette and Highland Park have instituted affordable housing programs in their communities.
Towns throughout the country have funded their Housing Trust Funds through a variety of sources, including teardown fees, building permit fees, real estate transfer taxes, as well as donations and grants.
The Plan Commission thoroughly evaluated many tools during the course of their affordable housing study. The recommendations above are considered by the Plan Commission to be the instruments most appropriate for the Village of Winnetka.
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